Japan’s cloud communication platform for small businesses ChatWork, a direct rival to market leader Slack, has raised US$2.5 million from GMO VenturePartners to “build brand awareness and acquire enterprise customers in Asia”.
The money will also be used for product development, hiring, and to fuel continued growth in North America and Europe. ChatWork is going up against the likes of HipChat, Asana, Basecamp, as well as Slack, which most recently raised US$160 million in a Series E round in April.
While playing in the same space as the above mentioned, ChatWork is trying differentiate its offering by what it sees as a focus on ‘non-technical, small businesses’, and gives law firms as an example of the type of businesses particularly drawn to its platform.
Turning to the numbers, the four-year-old startup doubled its year-over-year revenue in 2014, with over 66,000 companies across 183 countries now using its platform. The rate of 30,000 new users per month means it expects to hit one million users by the end of 2015. As of now, it claims 10,000 paying customers.
Notably, ChatWork says that 15 per cent of users convert to paying customers (plans start at US$2/month), which it points out is three times higher than conversions enjoyed by services like Evernote and Dropbox. Of those paying customers, it claims retention rates as high as 99 per cent.
Back in 2013 we reported that ChatWork had officially launched in the US as it continued expanding in Southeast Asia. Today, seems to mark its next major milestone in its quest for growth both at home in Asia and more broadly in the global market where it will battle established unicorns like Slack, most recently valued at US$2.8 billion.
It won’t be an easy fight, but everyone loves an underdog.