BugHerd targets local VC, pulls in $500K
Local bug-management start-up BugHerd has scored $500,000 from Melbourne-based venture-capital (VC) firm Starfish Ventures, providing the means for it to fulfil its growth plans.
Matt Milosavljevic at Tech23 last year.
(@mmilo just got a #woo demoing @Bugherd at #tech23 image by bigyahu, CC BY 2.0)
BugHerd founders Alan Downie and Matt Milosavljevic created BugHerd after recognising the lack of bug-tracking products in the market for visual website issues. Their idea of creating bug-tracking software that is simple and fun to use was well received after the duo pitched it to local start-up incubator Startmate last year.
At the time, BugHerd received $25,000 in seed funding and mentoring advice. They were also selected as one of the 23 companies to compete for Tech23's $150,000 prize, and won the People's Choice award.
BugHerd met with Starfish during the Startmate program, and felt that, being a local venture-capital firm, they would be the right fit for the business in the future.
"From very early on, we were keen to work with Starfish Ventures. Not just because they've recently backed some pretty high-profile tech companies like Design Crowd and iSelect, but because it enables us to stay here in Australia," Downie said.
BugHerd also caught the interest of those abroad in Silicon Valley, being the first Australian company to participate in the 500 Startups accelerator program.
"We received a lot of exposure in a fairly short time, and it meant we were in the enviable position of being able to choose an investment partner that suited us," Downie said.
Even with its options open, BugHerd didn't want to have to rely on the US, and wanted to show that other start-ups don't have to, either.
"A lot of start-ups are in a rush to get over to the US these days, but we're keen to show that with the right support, you can do it all from here without compromising the business. And with Starfish, we still have the option of moving to the States if we ever choose."
BugHerd will use the funding to hire more talent into its team and scale its product to a larger audience.
"We have a really good product at the moment, but it is squarely focused on smaller agencies. We're now looking to expand that vision," the company wrote.
At its inception, it only expected to price its product in the $10-per-month range. Today, its lowest-tier service is priced at just under $9 per month, but the company has expanded its target market, rolling out packages for $29 per month and $99 per month for larger teams and agencies, respectively.
To help support further growth, it has already poached Pollenizer's former marketing consultant James MacGregor as its new marketing manager, and is currently seeking additional front-end developers to help build its product.
Starfish thinks that BugHerd will be relatively unchallenged in its market niche.
"We are strong believers in what the BugHerd team is aiming to achieve. We could see how the products available on the market really weren't usable by non-technical users, leaving a huge gap in the market for a solution like BugHerd. The guys have really identified a strong customer pain point, and developed a remarkable product to meet it," said Starfish investment director Tony Glenning.