HubSpot CEO: Boston Must Battle Silicon Valley for Marketing Tech DominanceOctober 23, 2012
Boston Business Journal
by Kyle Alspach
A fired-up Brian Halligan told the FutureM conference Tuesday that the Boston tech sector has largely missed its chance to be part of revolutions around hardware, networking and enterprise software. But the region now must solidify its place as No. 1 in marketing technology, the HubSpot CEO and co-founder said, which would make Boston a "next-generation Madison Avenue."
"I feel like we lost the tech war against the Valley," Halligan told an audience at the marketing conference in Boston, saying he expects that hardware, networking and enterprise software will continue to be dominated by Silicon Valley in coming years.
But still being fought is a "major, major battle for marketing, and I think we have a shot at winning it," Halligan said.
Founded in 2006, Cambridge-based HubSpot provides inbound-marketing software-as-a-service, mostly for small and medium-sized businesses. The company expects more than $50 million in revenue this year, Halligan said recently, making it one of the larger emerging marketing technology firms in the U.S.
Halligan told the FutureM audience he's convinced that "Madison Avenue will crash" and that "Silicon Valley is going to compete with us for the future of the marketing industry."
"What I don't want is to lose to the (expletives) out in Silicon Valley," he said.
Halligan said Boston is currently the "center of the universe for emerging marketing platforms," citing his company along with Constant Contact (Nasdaq: CTCT) for e-mail, Unica/IBM for marketing management, Demandware (Nasdaq: DWRE) for e-commerce and Brightcove (Nasdaq: BCOV) for video.
The region also has a number of earlier-stage companies with marketing-related technologies that are seeing rapid growth, such as Visible Measures, Acquia, DataXu and Jumptap, Halligan said.
Boston is thus poised to benefit from the shift away from Madison Avenue-style marketing, where the focal point is television advertising, he said. Revenue from TV ads was down 17 percent from 2010 to 2011, and "I don't foresee this thing turning itself around," Halligan said — due to factors including increased use of DVR and subscription services such as Netflix and Apple TV.
Halligan said he's "nervous" that Silicon Valley companies might end up dominating next-generation marketing if Boston fails to take the lead. He urged the audience to help the cause by starting, joining or investing in marketing companies in Boston, and by hiring local marketing interns and students.
Halligan has repeatedly stated that HubSpot intends to stay an independent company in the Boston area over the long term. He said in September that the firm, which employs about 400 in Cambridge and recently expanded to Ireland, is "maybe a year away" from filing intentions for an IPO with the SEC.
In August, HubSpot debuted of a new version of its software, which aims to offer companies more ability to customize the web, mobile and email experience of visitors, using information stored about each visitor in a contacts database. The personalization tools were part of a full revamp of the HubSpot software, which is focused on attracting leads with tools for content creation, social media and search-engine optimization.
The company aims to differentiate from other marketing software firms by offering a full suite of web marketing tools in one place.