About 20 miles west of Boston lays a fast growing tech company representing some of the world’s most recognizable brands – Google, Microsoft, Fox, Netlfix, Amazon… the list goes on.
This seven-year old company, whose first office was a small room inside the Ashland, MA train station, now has an employee count over 200 and is still flying, relatively, under the radar here in Boston – despite having a significant global presence.
This company is Applause (formerly uTest), an app quality company founded in 2007 by two Israeli natives who met by chance some 8 years ago. By combining “in-the-wild” testing services, software tools and analytics, Applause helps companies achieve 360° app quality.
To put it simply, Applause contracts more than 150,000 testers (actual human beings) around the world to test, debug and report on the apps we all love and use everyday. These apps, like Boston-based RunKeeper and ParkBoston (two favorites of Applause’s CEO), perform as well as they do in large part because of Applause.
Last week I sat down with Applause Co-Founder and CEO, Doron Reuveni, an Ironman competitor and 11-time Boston Marathoner, to learn about his journey from the Israeli Military to the United States to the head of a burgeoning tech company potentially on the verge of an IPO.
Reuveni talked of his five-year stint in the military as a “special path.” A combination of learning and serving, he earned a degree in computer science while serving with the intelligence force.
His background in engineering would lead him to a technology startup, Enigma, who, in 1996 offered Reuveni the opportunity to open an office in the U.S. Reuveni jumped at the opportunity, set up shop in Boston and helped scale the company, which was eventually acquired by PTC, to a few hundred employees.
It was in early 2007 when Reuveni took a leave from Enigma for a trip home to Israel where he’d meet his eventual co-founder, Roy Solomon, at a mutual friend’s holiday party.
Solomon had an idea. “A very forward thinking idea,” as Reuveni put it to me, explaining how mobile was in its infancy and “the iPhone wasn’t even a thing yet.” Solomon envisioned crowdsourcing software testing.
Reuveni, with his business building experience, went right to work testing the idea on the sales side, talking to prospective customers – “if this existed, would you use it?” Not only was the response positive, but Reuveni had companies signing Letters of Intent before he and Solomon had anything built.
By the end of the year, the two raised $2.2 million from angel investors and MassVentures, built out an initial platform and Solomon moved to the States to join Reuveni. The duo’s first stop from Logan was the small office Reuveni had established in Ashland, MA – one room inside the train station.
The two, who share many lifestyle interests away from the office, like cycling (which helps makes the co-founder marriage work), did debate east versus west coast. Reuveni said there were two main reasons that Boston ultimately won out – “Access to talent and, knowing we were building a global company, accessibility to Europe.” How’s that for confidence and vision?
As they started to improve their platform and build a community of testers in order to accelerate the company, that community was actually responsible for testing the initial version of uTest.
2008 Economic Downturn
By August of 2008, uTest had come out of beta with early adopters such as Second Rotation (now Gazelle) and European gaming company, 888. With the economic downturn upon them and private funding all but shut off in the States, they were able to land competing term sheets - ultimately closing a $5.2 million Series B with Longworth Venture Partners. In December of that year, Matt Johnston joined the team and now serves as the company’s Chief Marketing and Strategy Officer (i.e. Reuveni’s right-hand man).
While the company achieved roughly $100,000 in revenue in 2008 and the economy was negatively affecting businesses everywhere, this recession would ultimately be a key driver for the growth of uTest and a key reason Applause is what it is today.
As Johnston and Reuveni spoke to me about the recession, they quickly realized, at the time, companies needed help continuing to innovate, but in a faster and less expensive way. “These large companies became more open-minded than ever before,” Johnston said.
One of these large companies was Google. Having heard about uTest through word of mouth, Google came calling with a project and uTest “crushed it,” a proud Reuveni told me. Admitting it wasn’t easy, but it made them realize they could do the job and handle these larger companies.
“Without the recession we probably would have continued working with startups and playing things slowly,” he added.
On the heels of Google and others, like J.Crew, uTest jumped to $1.25 million in revenue in 2009.
Having broken through the struggling economic times with major clients and newfound confidence, 2010 achieved growth to $4 million, strategic west coast funding from Scale Venture Partners and a new San Francisco office.
Scaling & Rebranding
At this point for uTest, it was all about scaling. 2011 brought another round of funding, this time led by QuestMark, and the actual coining of their, now, go-to term, “In the Wild.” While this was always how they viewed their work, it wasn’t until a client illustrated the fact that “you test where our users live,” that they actually coined the term.
A 2012 acquisition of Poland-based Apphance, got the team internally discussing a rebrand as they entered 2013. Gaining new assets,- and adding analytics and other features beyond functional, usability and load testing - expaned the companies’ capabilities. All of a sudden, the name “uTest” wasn’t covering all the bases.
As uTest got set to move into a new office in Framingham (their current headquarters) in September of 2013, the wheels were put in motion for a complete public rebrand in 2014.
Further setting the stage for a massive 2014 was the unsolicited interest Reuveni was receiving from investors.
Sitting on a beanbag chair in his new office the day after Labor Day 2013, Reuveni took a call from a Partner at Goldman Sachs who “happened to be in the area.” Since the new space didn’t yet have Internet access, Reuveni invited him by to check out the new space and hear him out. The two hit it off and in January of ’14 Goldman Sachs led a $43 million E Round of funding ($80M total raised to date).
The official announcement of the name change to Applause came in May in conjunction with the acquisition of top German crowdtesting company, Testhub, which also became the European headquarters for Applause.
With the rebrand to Applause, the move to help companies focus more holistically on app quality was realized. At the time of the acquisition and re-launch Reuveni had this to say:
“Modern app quality is no longer just a developer or QA problem; it's a CIO problem, a marketing problem, a sales problem and a CEO problem. At Applause, we bring together a range for testing services and app quality tools to enable companies to achieve this."
The re-launch also gave way to a new uTest, which moved from the customer-facing brand to a community hub for all things related to professional testers and software testing. Testers on the hub have personal profiles, free training, and can be hand-selected by Applause clients for specific projects.
At the time of the initial launch of uTest in 2008, there were 8,000 testers under their umbrella. Today, Applause utilizes more than 150,000 testers (all of whom go through a multi-phased vetting process) across over 200 countries and has profiled 500,000+ connected devices.
If Applause’s growth and statics weren’t evidence enough of the market, Reuveni pointed out a simple observation to me:
“When we started it was really only software companies making software. Now, it’s every business - McDonald’s has apps. Six years ago, this wasn’t mission-critical – now it is.”
The growth at this hidden gem in Framingham (who is hiring aggressively) is fascinating, and for anyone passionate about the success of the Boston tech community, it’s exciting.
After seeing their revenues grow 4,000% over the previous four years, what more can we expect from Reuveni and Applause going forward?
“Apps have become a vital gateway to a company’s brand and business. As the apps economy continues to expand, it’s vital that a brand’s digital experiences delight their users. With our customer base - and with our portfolio of testing services and app quality tools all continuing to grow - we are well-positioned for the future of mobile, web and IoT. In fact, we’re just getting started.”