How Berlin Startup Contentful Gained Strong Global Traction
Gone are the days of using a content management system to build just another boring website. We have entered a new era where everything is connected to build next-generation digital experiences. The introduction of the iPhone in 2007 marked the mobile revolution which has entirely changed users’ expectations of the web and the digital experiences it generates. This situation started a ripple effect and we shifted away from installed software on our desktops to mobile apps at our fingertips. The explosion of mobile apps reached a tipping point in 2008. While all this craziness was happening, users who relied on content management systems were left behind for these use cases.
This gap was noticed by a handful of forward-thinking vendors, and one of those was Berlin-based startup Contentful, an API-driven content management developer platform provider. What drove Sascha Konietzke, Founder and CEO of Contentful, to launch this platform was an abundance of challenges developers were facing when they were working to create new content experiences for other devices and platforms than only desktop websites. He believed, traditional CMSs like Wordpress or Drupal are not architected for creating such experiences.
Early this week, Contentful announced it secured $28 million in series C financing. The round was led by General Catalyst Partners, with participation from existing investors Benchmark Capital, Balderton Capital, and Point Nine Capital. With the $13 million the vendor raised in Series B financing in May 2016, the latest investment received puts the total funding raised to date to $45 million.
Launched with 12 people in May 2014, Contentful has generated the most buzz among the vendors offering headless principles and garnered so much attention from not only investors but also developers in such a short period of time. In fact, in two years, its team grew rapidly and reached 60 employees while the vendor was enjoying watching monthly revenues rise to double-digit rates. As a result of this unprecedented growth, as mentioned, the funding from Series B equaled total financing raised of $16.8 million in May 2016. The vendor used the investment to fuel its global reach. To that end, Contentful made an entrance to the North America market by opening a new office in San Francisco with a focus on evolving the platform to meet the changing needs of the developer community and enterprises alike. Following this announcement, Scott Liewehr told us what impact Contentful will have on the US marketplace.
All of the funding and great efforts behind the scenes today are paying off to grow the team to over 140 employees worldwide as well as to attract more and more investors to come on board. As Scott pointed out during the interview, the primary reason behind this great attention is its offerings that go beyond the traditional monolith solutions, thanks to its API-first approach to authoring and delivery.
To me, another reason why Contentful has become so popular in the space is that the platform is a highly affordable and well-integrated content management solution. As it is designed to make all created content accessible via APIs, the platform enables users to bring their content anywhere and showcase it for any purpose. As a result, the developer community jumped on the Contentful bandwagon as the platform fits in a variety of use cases, from in-store touch screens to a mobile lifestyle app.
Now I don’t want to go off-topic, however, Scott made a great point about the potential challenge that Contentful and other vendors, which provide a similar solution with an API-first, headless approach, may face. He said that developers might like a platform but they won’t be in the room where the decision on technology purchasing is being made. I thought it is a valid point and it is easy to understand where he is coming from. Given one of the drawbacks of a headless CMS approach is that the preview feature is taken away due to the separation of content and delivery, marketers may not be impressed by the technology as much as developers are. At the end of the day, they might need to do a lot of upfront anticipation work to make the page look good in the end.
Since the platform is being purchased for content creators like marketers, some organizations might diminish the importance of opinions of the technical folks. Fortunately, industry analysts like Forrester have been warning organization on the inclusion of developers: “Marketing executives who think they should make technology decisions without the CIO are gambling that nothing will go wrong.”
Why Is Microservices Architecture So Important?
Paddle back to Contentful, just because the vendor is providing an API-driven content management developer platform, doesn’t mean it has no value for marketers. Conversely, the premise of an API-first and headless CMS approach is making content creators and marketers more productive while driving an omnichannel success. Here’s a data point I cited in one of my most recent articles that bears repeating: “Only 9% of brands describe their marketing strategy as omnichannel, and 30% say they have no plans to implement omnichannel, or that they have abandoned the idea entirely.” To be honest, I am still appalled by this finding, however, there are so many reports that unveiled similar findings on the matter. The National Retail Federation (NRT), for instance, declared in early 2017, it’s still a “long road to omnichannel success".
Today, whether the content is as simple as a product slideshow or as interactive as a game, marketers should be able to deploy it simultaneously across multiple channels, devices, and apps. While doing so, customers shouldn't feel their transition between touchpoints, snapping them out of the customer experience. With the traditional approach, they need to go back to all the channels and change it separately, but with the microservices, any update is automatically pushed across all the digital channels utilized. Leading organizations have long recognized the importance of creating a consistent experience across all digital touchpoints. The Washington Post, for instance, analyzes tens of millions of events every night to improve content and ad relevance. However, providing such experiences is easier said than done so vendors like Contentful are mitigating the hurdles arising from the limitation of traditional CMSs to make life easier for developers and more productive for companies.
Dr. Robert Zores, CTO at REWE Digital, said in an interview with Forrester that his team is using headless components like commercetools and Contentful to build an architecture of microservices to serve a scalable digital commerce platform.
“At General Catalyst, we focus on user-centric products that have the potential to become hugely useful in enterprises. Contentful is among this new ecosystem of platform services, which provide a fundamentally new infrastructure for building modern applications,” said Trevor Oelschig, Managing Director at General Catalyst.
Just like every other technology, Contentful’s platform is not for everyone. As the shift to a headless CMS approach involves heavy reliance on the IT teams, the mid-market for instance, is less likely to want to embrace it. That being said, if you have a multi-national audience, or if your website heavily relies on mobile apps and even displays content on very specific connected devices, then having a headless CMS provides you with the flexibility of content deployment you need where the coupled CMS template system seems to be too limiting. In the advent of technology, the possibilities in the content creation process are becoming endless so it really boils down to your priorities and what you could compromise on to get those priorities done in a timely fashion.
Given the vendor has 130,000 developers using its platform, with thousands of paying customers like Uber, Lyft, Samsung and Spotify, Urban Outfitters, Red Bull, Jack in the Box, Nike, Trunk Club, Xoom, and Tastemade besides many more free users, Contentful’s success story is not something many tech startups could achieve. It feels like even bigger things are on the horizon for the company so stay tuned! We will share more insights on the next occurrences within the organization in the upcoming months as the events unfold.