There are 38.2 million American solopreneurs, according to MBO Partners. Nearly a quarter of the total U.S. workforce are independent, self-employed workers.
As the chief cook and bottle washer of their small businesses, they do everything from scheduling and managing projects to organizing and storing files to billing. Typically, solopreneurs rely on a hodgepodge of software or paper processes that don’t work well together. Yet, time is money to them and it is their most precious resource.
More than eight years ago, HoneyBook was launched to provide solopreneurs—service providers such as graphic designers, marketing consultants, photographers, doulas, and dog walkers—with the technology to make them more efficient. As a San Francisco-based tech company, it has a philosophy of failing fast, which means it takes an iterative, hypothesis-driven approach to developing and launching new ideas. However, making decisions related to the company’s direction at the onset of Covid-19 required placing a big bet during an economic upheaval.
The company’s values provided the North Star that HoneyBook needed to guide its decision. Their value was connecting members, enabling them to create solutions, share those resources, and support each other, commented Naama Alon, co-founder and Chief of Product at HoneyBook. When the team thought about solutions, they focused not on putting the company first. Instead, they focused on how to be of service to members, she continued.
Providing a community of support to Honeybook members during a difficult time was the right thing to do, even if it wasn’t going to be a moneymaker, Alon said. As it turned out, sticking to values was also profitable. In the past year, its focus on its members led to a tripling in annual recurring revenue and more than doubling of new subscribers in the U.S. and Canada. At the same time, members have booked more than $1 billion in business on the platform in the past nine months.
The company recently raised $155 million in Series D funding to continue developing its client experience and financial management platform for service-based small businesses and freelancers. Durable Capital Partners led the round. Joining the round were Tiger Global Management, Battery Ventures, Zeev Ventures, 01 Advisors, and existing investors Norwest Venture Partners and Citi Ventures.HoneyBook has raised a total of $248 million in venture capital since its founding in 2013. HoneyBook will invest in product development, including adding financial tools to enable members to accept payments, access to capital, and monitor and control expenses.
“Reaching a $1 billion valuation is a testament to how investors are looking at the community and the potential of our business,” Alon said. “Investors saw these businesses through the past year and how resilient they were. We are amazed by the growth in the past year. We are still seeing trends going on and believe we will double again next year.”
How did you meet your customers’ needs during the Covid-19 crisis?