Bevy Raises $40M Series C Funding - Diversity in Tech

Bevy Secures $40 Million Series C Funding Amidst Community Building Demand

It might be anticipated that a company specializing in community building software would experience growth during times when in-person gatherings are challenging. Bevy, the platform behind online communities for organizations such as Salesforce Trailblazers and Google Developers, recently announced a $40 million Series C funding round. This growth is, in part, attributable to the increased need for virtual community spaces.

Investment Details and a Focus on Diversity

Accel spearheaded the funding round, with contributions from Upfront Ventures, Ryan Smith – co-founder of Qualtrics – and LinkedIn. Notably, this investment is distinguished by the inclusion of 25 Black investors, constituting 20% of the total investment capital.

James Lowery, a management consultant, entrepreneur, and a pioneer as the first Black employee at McKinsey in 1968, believes this investment strategy can serve as a template for attracting capital from other underrepresented demographics.

“My experience and network demonstrate a significant willingness among individuals to invest in opportunities like these, should they be presented. I believe we can establish a national model for inclusive investment,” Lowery stated.

Addressing the Lack of Black Representation in Venture Capital

Unfortunately, Black representation within venture capital remains limited. Currently, only approximately 3% of venture capitalists are Black, and a substantial 81% of VC firms lack even a single Black investor.

Kobie Fuller, a general partner at Upfront Ventures, a member of the Bevy board, and founder of the Valence community, suggests that investments like this can initiate a positive cycle, encouraging greater Black participation in startup funding.

“My focus is on increasing Black investor presence on company cap tables at an early stage, before companies become publicly traded, enabling wealth creation. This includes securing positions for Black executives within leadership teams, granting them opportunities to build wealth through stock options and equity, and ensuring diverse representation on company boards to hold leadership accountable for diversity objectives,” Fuller explained.

Bevy as a Platform for Inclusive Growth

Fuller views Bevy’s community-focused software platform as an ideal starting point for this initiative, emphasizing the importance of the company reflecting the diversity of the communities it serves. “A diverse workforce, board, and investor base is simply sound business practice,” he asserted.

Bevy’s CEO and co-founder, Derek Anderson, echoes this sentiment. Following the death of George Floyd last May, his company lacked diversity, with no people of color among its 27 employees and no Black investors. He resolved to rectify this, discovering that increased diversity not only aligned with ethical principles but also benefited the business.

“We found that incorporating individuals from Black and brown communities into Bevy elevated the overall talent pool. Expanding our candidate search led to a stronger culture, increased customer satisfaction, and a positive trajectory for our profits and revenues – all demonstrably correlated,” Anderson said.

Progress Towards Diversity Goals

Last summer, Bevy established a two-year goal to achieve 20% Black employee representation. Starting from zero, the company reached 5% in June and 10% by September. Currently, Black employees comprise just under 15% of the workforce, with the company anticipating reaching the 20% target by this summer, a year ahead of schedule.

Company Origins and Growth

Bevy originated from Startup Grind, a community Anderson founded several years prior. Unable to find suitable software to manage the community, he developed his own solution. In 2017, this product was spun off as a separate company, becoming Bevy, and has since secured $60 million in funding.

Bevy’s platform is utilized by numerous large enterprises to power their communities and events, including Adobe, Atlassian, Twilio, Slack, and Zendesk, in addition to Salesforce and Google.

The startup is currently valued at $325 million, a fourfold increase from its $15 million Series B valuation in May 2019. Bevy projects reaching $30 million in Annual Recurring Revenue (ARR) by the end of the current year.