Honesty is the best policy: Brand review service Trustpilot wins $73.5m investment
3 min read
28 May 2015
Online review channel Trustpilot, which was built to give consumers a voice and businesses the opportunity to be transparent about their services, has proved honesty is the best policy by securing a $73.5m Series D round.
The Danish firm claims it is one of the highest investments in the country’s history and brings total funding to $118m. Private equity firm Vitruvian Partners led the round alongside existing investors DFJ Esprit, Index Ventures, Northzone and Seed Capital Denmark.
The cash injection follows a revenue growth of 80 per cent in 2014, during which Trustpilot users posted one review every five seconds. Indeed, the platform has seen more than 13m reviews of over 100,000 brands.
The company’s business model revolves around eCommerce and works by integrating a reviews channel into brands’ websites, which consumers can rate based on the service they receive. The idea is that outstanding firms will have their achievements rewarded with good reviews, while under-performing companies can find out exactly where they can improve.
This latest round of $73.5m will be used to enhance global growth, which will be achieved by investing in new members of staff and technology enhancements. The aim is to become “the online standard for brands that want to increase trust”, according to the firm.
Peter Holten Mühlmann, CEO and founder, said: “Every day more than 10,000 consumers sign up for a Trustpilot account, demonstrating the growing influence of customer experience on brand perception.
“A brand is no longer just defined by the company, it’s defined by what customers are saying about that company; this is a global trend that businesses cannot ignore. Trustpilot is at the forefront of this trend.”
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Nando’s, Boohoo.com, ebookers, Mazuma Mobile and meal box service Gousto are just some of the companies collecting reviews with Trustpilot to improve customer retention and experiences. In turn, marketing teams are able to make informed decisions about campaigns and products.
And with customer retention in mind, Trustpilot itself boasts a customer retention rate of 95 per cent. It attributes this to a dedicated team of 30 staff that work around the clock, while overall staff numbers now top 400 people from 40 nationalities across New York, London, Copenhagen and Melbourne.
Ben Johnson, partner at Vitruvian, who has joined the Trustpilot board, said: “Consumers increasingly recognise that peer-to-peer reviews have become an essential resource. There is a huge global market opportunity for online reviews based on the desire of customers around the world to find trusted recommendations in every category.
“Trustpilot is a technology leader and pioneer in this area, and its opportunity is to reach customers in new markets and to continue extending the benefits of online reviews to new global brands.”