Pivot Patrol: YC Alum SwipeGood Is Now Elastic, A Sales-As-A-Service Platform For Tech Startups

The team behind SwipeGood first stepped on the tech scene back in November 2010, when they launched their software platform for enabling people to donate small amounts of money to charity with each purchase they made.

For a while, things after that went pretty well. In early 2011 SwipeGood graduated from the winter class of top-tier startup incubator program Y Combinator, and it went on to land $500,000 in seed funding from a reputable group of angel investors. But in the months following, the company ran into a problem — it found that it couldn’t truly compete and grow the business, largely because it lacked the kind of sales force it would need to play in the big leagues. And that led co-founder and CEO Steli Efti and his co-founders Thomas Steinacher and Anthony Nemitz to an “a-ha” moment of sorts.

“The more big customers came on board, the worse the conversion numbers worked out at the rate we were going. To have it really make sense and be sustainable, we would have to build an internal sales force, which was beyond our means. We said, wait a minute: If this is a challenge that we’ve had, and other small companies we know that are enterprise business startups are having it too, maybe we should be working on tackling this.”

So nine months ago, SwipeGood quietly pivoted its focus to start working on just that, and Elastic was born. Elastic is a “sales-as-a-service” platform that provides both software and manpower that lets startups outsource their sales functions on demand. Efti sums it up thusly:

“We have a tech component and a sales component. We’ve built a sales communication platform that’s sort of our secret sauce, and that’s what our sales people use. The next part is the services business, where we let startups to essentially rent sales people in the cloud.”

Elastic has been received pretty well. “We’ve closed more than 300 deals for 10 different startups,” Efti said, noting that this has meant “millions” in dollars in top-line new sales for its clients. The team has grown from its 3 co-founders to a staff of 15, equally divided between “hackers” who build the company’s software platform and “hustlers” who help with the human-powered sales aspect. The headcount growth has been purely from Elastic’s own reinvested revenues (it takes a commission on the sales it helps companies generate) and Efti is looking to double the staff over the coming months. Elastic has started to field interest from venture capital firms looking to provide funding, Efti says, but for now the company is focusing on the business.

Elastic’s vision is ambitious but certainly worthwhile. Essentially, it aims to be the sales version of LiveOps, which provides a platform for businesses to outsource their customer service operations. “A startup should never again fail because of a lack of sales expertise. We work with startups that have great technology and cutting edge products but don’t have the know-how or capabilities to put a big sales force out on the streets to sell it.” That’s something that it seems many Silicon Valley firms could find a use for — so it’ll be interesting to see if Elastic will be the one to really deliver on the challenge.