Israeli startup monday.com knows that despite the 35,000 teams that pay for its work software, the average person still hears “Monday” and just thinks of the first day of the workweek. With a new $50 million funding round that values it at half a billion dollars, Monday thinks it can change that.
Announced on Wednesday, Monday’s $50 million Series C funding round brings the six-year-old startup once known as dapulse to more than $84 million in total funding. The round values Monday at a pre-money valuation of $500 million, five times more than its previous worth a year ago, a source with knowledge of the raise says. And it comes with a credit line of tens of millions more from tech banker Leumitech to tap into without further diluting founders Roy Mann and Eran Zinman or their employees.
“We have a very ambitious plan to build an operating system for every business, so that for customers, it’s the first thing they use in the morning,” says Mann. “We’ve been growing super-fast and see many opportunities for scaling and new products.”
Based in Tel Aviv, where most of its 130 people work, monday.com took off at first without users having a clue who it was or where it was based. Mann, a onetime gaming entrepreneur, was an executive at Wix looking for a better way to track employees and their projects. He synced up with Zinman, head of research and development at a mobile company called Conduit Mobile, and the two launched what was then dapulse as its own startup in February 2014. Offering a two-week trial and then tiers of pricing that started with $25 per month for five users up to an enterprise-level product that costs $118 for the same amount (companies with more seats could get a slightly lower rate), dapulse took off through word of mouth for its team boards, which made it easy to assign tasks, mark work done and send updates by email for app-averse employees.
The name, however, was a problem, mocked by employees and strangers who didn’t appreciate Mann’s pulse concept. Last November, the company rebranded as monday.com, but the dapulse name lives on in some conference rooms and marketing materials connecting the two brands. The renaming was part of what Monday’s CEO says was a bigger effort to grow up the business. “Changing the name was a big part of a maturity phase,” Mann says. “We chose Monday as the first day of the week, not Sunday (the first day of the workweek in Israel), because we understand who our audience is. It goes alongside having a big goal of now getting our software to everyone.”
The new lead investor in monday.com is Stripes Group, a New York firm known for consumer and internet investments like Blue Apron, GrubHub, Refinery29 and Flatiron Health (as well as brands like Califia Farms, the almond-milk maker, and Levain Bakery). Managing partner Ken Fox says Stripes had been tracking the workflow automation space for months before making its first bet in the category with Monday. Monday’s numbers—tripling revenue growth in the tens of millions, low churn among paid users and 200 business verticals—stood out, as did the behaviors Fox says his team heard from customers. “The application of communication and transparency around team projects is a powerful idea across industries,” says Fox. “If you’re on Monday, your meetings are shorter and you can meet less frequently. It makes everybody’s job more enjoyable.”