Cognism: The UK B2B Sales Startup doing $71M ARR

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Hi 👋, this is the Today in AI Newsletter: The weekly newsletter bringing you one step closer to building your own startup.

We analyze a cool, industry-shaping AI startup every week, with a full breakdown of what they do, how they make money, how much they’ve raised, and the opportunity ahead. 

Let’s get to the good stuff in this email: 

• This UK startup is helping 3,000+ customers with B2B Sales using AI

• They’re doing $71M in ARR, and are on track to doing $100M ARR very soon

• They’ve raised an $87.5 Million Series C at a $450M valuation in 2022

So what’s the startup and who are the founders behind it? Here’s the story of Cognism 📈

Cognism was founded in 2015 by James Isilay and Stjepan Buljat in 2015 with the mission to optimize companies sales pipelines and increase win rate. 🏆

Cognism is a B2B Sales intelligence company that helps other firms with contact data filling in the sales pipeline, enriching lead gen opportunities. 

Most reps spend 20% of their time researching prospects and an additional 30% of their time is wasted because of bad data. 😤

Cognism solves this… 💡

Cognism helps you get accurate, verified phone numbers and B2B emails and integrate these with your CRM.

This way it really helps you build and execute on your sales pipeline. 🧱

Backstory 👀

Before Cognism, James went to study Info Systems Engineering at Imperial College London for his Bachelors.  🎓

He then went on to work as a Quant Trader and Analyst at UBS. This had been his dream job at the time, but soon he realized that this dream was his worst nightmare… 😧

James realised that he loved communicating with people and was good at it, but trading at a bank didn’t allow him to do that.

When you’re a trader, you sit at a desk on your own, looking at a computer screen most of the day.  💻

You’d be super stressed out because one programming error could cost you tens of thousands, if not millions of dollars.  💸

The job was super high pressure but James was getting really successful with it and climbing up the corporate ladder pretty fast.

This is when he went to visit a friend of his from University who started a company called Alchemy - One of the Top Up & Coming Unicorns in the UK at the time. 🦄

The energy in their office after just raising was overwhelming. It just hit him, everyone was bouncing off the walls, it’d been like nothing he’d ever seen before… 🤯

This was James’ inflection point - he wanted to build something like this.

The Hustle 🤑

He started to look into starting something, when The Financial Times approached him to help use their EPI for trading.

James started experimenting with a bunch of startup ideas, mainly in fintech because it's what he’d done all his life. 💎

He then left his job completely and joined a few incubators including Fintech Sandbox based in Boston and Winston Labs in London. 🥸

James entered these incubators with the idea to build a system for hedge funds to source new money. Soon he found out this was a terrible market to be in…

At the end of the Winston Labs program, James found out that even if they managed to sell to hedge funds, they didn’t have IT teams. 

This meant they couldn’t integrate the tech they’d proposed, so they were stuck on a 6 month waitlist - an incredibly slow sales cycle. 🐌

This is when James pivoted to optimizing sales and marketing - so started to collect contacts from the project he built with the Financial Times. 📰

He didn’t know the first thing about sales and marketing so explored the space and learned from scratch. 🤷

This fresh lens helped him start Cognism in 2015 at the age of 35. 🧓 It’s never too late guys.

They started in a small office with 4 people in the heart of London and started to hustle. 🤑

They’d been getting contracts but it was inconsistent, unstable revenue.

There was one point in 2016 where their first round of funding had fallen through and they weren’t getting any more contracts and were running out of money. 😓

His co-founder went salary-free for 4 months and James got some consulting work to keep the business alive. He worked every morning, lunch and evening to keep this dream alive.

He was thinking of giving up when one day one of his developers in Macedonia was out for a networking event and met an investor. 🧑‍🤝‍🧑

He told the investor about Cognism’s vision and he loved the idea. The investor flew out to Zurich to meet James the next day and ended up becoming their first lead investor. 💰

From then on it was easy to onboard more investors, and James went all in…

Stats 📊

👥 Today, Cognism has over 500 employees, a London office on the 11th floor of The Shard (Tallest building in the UK), and an office in Boston.

🚀James to this day, meets every single employee before they’re hired.

🏢The startup now has over 3,000 corporate customers including Drift, Aircall and Bright Network.

📈Last year they did $56 million in revenue with 79% gross margins and 71% growth year over year.

❗Net losses before tax grew by 47% to $39M in 2023, but revenue is outpacing this.

💸 Cognism announced earlier this year that they’ve hit $76M in ARR and are on track to doing $100M ARR very soon.

💰On January 13th 2022, Cognism raised an $87.5M Series C at a $450M valuation led by Viking Global Investors with participation from Blue Cloud Ventures, AXA Venture Partners and more bringing their total raised to $123.5M

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