1Mby1M Deal Radar 2019: SourceScrub, San Francisco, CA

SourceScrub at its core is a business intelligence database surrounded by a platform that allows the user to find companies or investment opportunities that meet a given criteria. Its main value proposition is that its platform can help uncover founder-owned businesses that either aren’t very active in marketing or have yet to transact.

SourceScrub was founded in 2014 by Tyler Fair and Prescott Nasser who were childhood friends and Bay Area natives. Tyler graduated from University of Arizona in 2007 and comes from an entrepreneurial family. He started off his career as an associate at Harvey & Company, a top-performing buyside advisory firm based in Newport Beach, where he sourced thematic investment opportunities for private equity clients. After 3.5 years, he received an offer to build out the proprietary business development strategy as a director at Serent Capital, a San Francisco-based private equity firm with over $600MM AUM. It was at Serent that the concept behind SourceScrub was born. Prescott also recognized the necessity and growth potential of building a data solution catering to this specific problem, and so he joined forces with Tyler and architected the SourceScrub platform.

Tyler approached the partners at Serent about his entrepreneurial venture, and they signed up as the first customer for SourceScrub. Today, their customers span across PE, VC, IBD, Lending, and Corporate Development. They leverage the platform to uncover founder-owned businesses, perform TAM analyses, prepare and market for conferences or other events, optimize travel schedules around areas concentrated with prospective targets or purely to enrich data. Its platform finds lists of companies and then profiles them out including investor-centric information and other company details.

When they started out, most of the software platforms available to investors at the time such as Pitchbook, CapiIQ, Mattermark, Sutton Place Strategies, D&B, and LinkedIn, provided a fair amount of information on businesses that have transacted or gone through some liquidity event. However, their coverage and data fidelity were not as extensive as SourceScrub provided, especially for private businesses that weren’t actively marketing themselves. Its competitors include CapIQ, Pitchbook, Mattermark, Datafox, and Axial.

SourceScrub’s top market segments are growth equity or private equity firms, specifically mid-market firms that focus on injecting growth capital into mature, profitable, founder-owned businesses, venture capital firms, investment banks, and direct lending firms.

Currently, SourceScrub has about 250 PE, VC, IBD, Lending, & Corporate Development customers and several thousand monthly active users. It has no advertisers. Its pricing depends on the AUM or transaction volume of the organization, number of users accessing the data, and other factors such as export capabilities, CRM integration, and custom research. It also offers introductory packages for individual users with platform access and no downloads or CRM connection. These are priced at the lower end, and pricing scales up as capabilities increase or as the respective firm grows.

SourceScrub is headquartered in San Francisco, CA with additional offices in New York and Washington, D.C. In 2018, the company’s revenue level was about $4 million. With the strategic growth of employees, SourceScrub moved into a larger office space in San Francisco. Its workspace is reflective of the company’s belief in the importance of creating a high-efficiency workspace that allows for collaboration across teams, while also attracting and retaining the best talent.

SourceScrub recently announced the receipt of a growth equity investment from Mainsail Partners, a San Francisco-based growth equity firm. The company will use capital to accelerate product innovation and expand its customer success resources, with the goal of driving even greater value and support for the company’s growing base of customers.

SourceScrub has grown organically over the last few years as a result of the product expansion strategies, customer base and personnel. It has doubled consistently over the past three years and plans a similar trajectory for the coming years as well.

This segment is a part in the series : 1Mby1M Deal Radar 2019