Funding round announcements are regular occurrences in the news cycle but some are more symbolically significant than others. Such is the case with task management startup Asana's announcement of a Series C financing round worth $50 million. Asana described what the capital infusion means for the company in a blog post:
It’s a sign of how far Asana has come in empowering teams to be more effective. It’s also fuel for the next two years of the company, helping us make work tracking more pervasive across the world, make Asana easier and more powerful for both small teams and giant companies, and continue striving to build the best team and culture for the work at hand.
We started Asana with the hypothesis that every team in the world is capable of accomplishing bigger goals—and that software could help empower them to drive work forward with more ease, clarity, and accountability.
The product was born out of our own need to coordinate better: Even when we worked at great companies like Google and Facebook, there were constant challenges keeping everyone on the same page, and a huge amount of time spent on “work about work.” It turns out that these difficulties tracking work are universal across organizations: the bigger your team, and the bigger your mission, the bigger your coordination problem.
Asana: Growing Fast In A Crowded Market
Like other task management vendors, Asana uses a freemium model, with a basic version of the software available at no charge for teams of up to 15, while charging for a premium edition that contains the features most enterprises require, such as admin controls and priority support.
It now has 13,000 paying customers, marking a 30 percent increase over September, when it had 10,000. Marquee customers include CBS Interactive, Uber, Harvard University and Major League Baseball.
The Series C round was led by Sam Altman of Y Combinator. In a blog post that to some may verge on hyperbolic, he explained his rational for the investment:
Asana has the level of product love that all great companies have in common. As a small example, their recurring revenue has been incredibly sticky and more than doubled every year.
Asana is the kind of lever that could someday massively increase the productivity of hundreds of millions of people around the world. There’s not only an opportunity for Asana to be a huge company, but also for Asana to materially increase the output for the planet—somewhat amazingly, software has not yet eaten this important part of the world.
Task Management: The Lifeblood of Collaboration
Asana is the darling of the task management software market and one of its earliest players, says Constellation Research VP and principal analyst Alan Lepofsky. But it's not the only one, with competition from startups such as Wrike as well as large players like Microsoft, which actually includes its Planner software with Office 365 subscriptions.
Asana has built out integrations with many collaboration tools, including Outlook, Slack, HipChat and Github, allowing companies to tie activities in those tools to related tasks in Asana.
Task management software augment those collaboration tools in a crucial way. "In a nutshell, collaboration doesn't work, because it's just a free-for-all," Lepofsky says. "Collaboration needs structure. It doesn't need to be complicated, but it needs something," including the concepts of accountability and milestones, he adds.
In addition, the idea of social task management tools is that you do your work in them," Lepofsky says. "They replace social networks. If not replace, they absolutely integrate."
Asana plans to use the $50 million to expand its global support operations, refine the software and build out more integrations to other tools.
CIOs should make funding task management software a budget priority, Lepofsky says. Adding such a tool to the mix can improve ROI for previous investments in collaboration software while boosting worker productivity. "People need structure to get work done," he says. "Collaboration is much more challenging without coordination."
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