The creation of digital products – the development of websites and applications designed to function flawlessly and according to specifications – has become increasingly critical in recent times. As more consumers engage with businesses through digital channels, a malfunctioning or subpar online experience can lead to customer loss more readily than in traditional physical settings, where assistance from staff or distractions from other products might retain a customer’s attention.

A startup focused on providing tools for digital product design is today announcing a substantial funding injection, highlighting the growing importance of this field.

Quantum Metric, a provider of a cloud-based platform for both the construction of digital products and their subsequent real-time testing and refinement to enhance performance – marketed by the company as Continuous Digital Product Design – has secured $200 million in funding. This Series B round establishes the company’s valuation at over $1 billion. According to founder and CEO Mario Ciabarra, this represents a significant increase in valuation, a 9.2-fold rise since 2018.

This funding round is also noteworthy considering the company’s prior fundraising efforts, which previously totaled $50 million from three investors: Bain, Hangar 51, and Insight.

The current Series B round is spearheaded by Insight Partners, with additional investors remaining unnamed. Insight Partners is emerging as a prominent investor in companies dedicated to improving customer service experiences within the current, digitally-driven and socially distanced economy. Earlier today, the same partner leading the Quantum Metric round, managing director Lonne Jaffe, also led a $78 million investment in Glia, a platform designed to streamline workflows for customer service representatives.

Ciabarra established his company in Colorado, and the company’s remote-first approach appears to have influenced the development of its product. The core concept is that identifying customer dissatisfaction doesn’t require physical proximity. In fact, operating remotely is considered a benefit.

Through its enterprise customer base, the company gathers data from interactions encompassing approximately 1 billion internet users and around 20% of all internet activity. Ciabarra stated this allows “capturing experiences to pinpoint areas of user frustration on websites and within native applications. Our primary focus is on identifying and addressing friction and frustration.”

Quantum Metric blends elements of both DevOps and martech. When implemented, it enables customers to monitor instances where users are excessively clicking to complete tasks or abandoning their efforts. These actions are recorded, and the platform then proposes solutions for improvement.

This dedication to identifying negative online experiences appears to be a consistent theme for Ciabarra. He began our conversation by recounting a frustrating experience his 12-year-old daughter had “while attempting to purchase a bed online for her birthday,” when her desired bed didn’t immediately appear in her shopping cart. (Apparently, some 12-year-olds independently purchase furniture online, a fact I intend to keep from my own children.)

“Economic challenges tend to highlight high-growth companies that offer significant value to customers,” stated Jaffe. “This year, the exceptional customer demand for Quantum Metric’s product, particularly from businesses impacted by the pandemic, has been remarkable. Quantum Metric empowers enterprises to leverage real-time qualitative and quantitative data, eliminating uncertainty in the process of enhancing their digital features and products. We are pleased to strengthen our partnership with the Quantum Metric team as they extend their powerful analytics capabilities to customers globally.”

The company currently serves a diverse range of prominent online and offline brands, including Alaska Airlines, Crate and Barrel, Lenovo, Western Union, Lulu Lemon, and FanDuel. Ciabarra reports a 98% gross retention rate among this customer base, despite competition from companies like Log Rocket and Decibel, which directly position themselves as alternatives. However, substantial opportunities remain as the market continues to evolve and the shift to online interactions appears to be permanent.

Prior to the COVID-19 pandemic, Ciabarra noted that “only 10-15% of transactions occurred online. That has now reversed, with only 10% taking place in person.” He added that the company’s success isn’t solely attributable to changing customer behaviors, “but also to evolving company cultures.”