How Clickdimensions Achieved $40 Million in Revenue by Dominating the Microsoft Dynamics Channel

In the competitive world of SaaS and marketing automation, standing out requires not only innovation but also strategic moves that set a company apart from the crowd. For Clickdimensions, a company founded in 2010, the journey to hitting $40 million in revenue was fueled by a unique focus on the Microsoft Dynamics ecosystem. This blog post unravels how Mike Dickerson, CEO of Clickdimensions, harnessed specific growth tactics and metrics to propel the company to new heights.

2010: The Birth of Clickdimensions in a Crowded Market

Clickdimensions was launched in 2010, amidst a rapidly expanding landscape of marketing technology firms. The company was born out of a collaboration between a small business owner working from his basement and a code-savvy developer based in Tel Aviv, Israel. Despite the geographical distance, the founders shared a vision: to create a marketing automation solution that integrated seamlessly with Microsoft Dynamics 365. By focusing on this niche segment, they effectively shielded themselves from intense competition in the broader martech industry.

2017: Mike Dickerson Joins as CEO and Sets Revenue Goals

In January 2017, Mike Dickerson stepped in as CEO. By then, Clickdimensions had 2,800 customers and was generating nearly $20 million in run rate revenue. With a strong foundation already in place, Dickerson aimed to double down on the company’s strengths and drive revenue growth. His previous experience in growing PGi’s revenue from $86 million to $240 million made him well-suited to lead Clickdimensions’ next phase of growth.

2018: Reaching $31 Million Revenue through New Customer Acquisition

In 2018, Clickdimensions achieved $31 million in revenue, marking a 36% growth year-over-year. This progress was largely driven by acquiring new customers. The company’s effective customer acquisition strategy capitalized on the Microsoft Dynamics channel, which became a powerful distribution system. The founders’ deep understanding of the Microsoft ecosystem allowed them to connect with Dynamics partners and leverage their networks for customer acquisition.

How Clickdimensions Hit $40 Million Revenue Using Microsoft Dynamics

By 2019, Clickdimensions was on track to hit $40 million in annual recurring revenue (ARR). Here are some of the key tactics that enabled this growth:

• Channel Partnership Strategy: Clickdimensions built a network of over 650 active partners within the Microsoft Dynamics community. These partners, ranging from small firms with 10 consultants or less to larger entities, acted as the company’s extended sales force. This long-tail phenomenon was a crucial component of their growth strategy, allowing them to scale efficiently without a massive internal sales team.
• Efficient Customer Acquisition: Clickdimensions maintained a low customer acquisition cost (CAC) with a lifetime value (LTV) to CAC ratio of 7x. This efficiency was achieved by leveraging the Dynamics channel for lead generation, focusing on new Dynamics implementations where Clickdimensions could be bundled as part of larger deals.
• Recurring Revenue Model: By structuring deals as recurring revenue rather than one-time sales, Clickdimensions ensured a steady income stream. Partners received a 21% margin on Clickdimensions software, incentivizing them to promote the product as part of their Dynamics solutions.

Expansion and Scaling: From 2,800 to 3,700 Customers

Under Dickerson’s leadership, Clickdimensions expanded its customer base from 2,800 to between 3,600 and 3,700 customers. This growth was not only a testament to the effectiveness of their partner strategy but also their ability to cross-sell and upsell additional products to existing customers. By focusing on the Dynamics ecosystem, Clickdimensions could offer a comprehensive digital marketing portfolio tailored to B2B customers.

Managing Churn and Ensuring Customer Retention

While Clickdimensions experienced a 15% logo churn rate, the company worked to mitigate this by providing value to both large enterprises and SMEs. Their churn was significantly lower among larger customers, highlighting the importance of focusing on high-value accounts. Additionally, Clickdimensions aimed to enhance their offerings and support to increase customer stickiness.

Financial Strategy: Bank Debt and Private Equity Support

In 2016, Clickdimensions was acquired by private equity firm Accel-KKR. Unlike venture capital, which focuses on growth at all costs, Accel-KKR supported Clickdimensions with a focus on sustainable, profitable growth. The company utilized bank debt, rather than equity financing, to fuel its growth. This approach allowed Clickdimensions to remain cash flow positive and leverage its recurring revenue model to secure favorable financing terms.

The Future of Clickdimensions: Continuing to Dominate the Dynamics Ecosystem

Looking ahead, Clickdimensions plans to continue dominating the Microsoft Dynamics channel. With a team of nearly 200 employees spread across the US, The Hague, Tel Aviv, and Christchurch, the company is well-positioned to scale internationally. Their presence in 61 countries signifies a robust global footprint that the company aims to expand further.

In conclusion, Clickdimensions’ success story is a testament to the power of strategic channel partnerships and leveraging niche markets. By focusing on the Microsoft Dynamics ecosystem, the company carved out a unique position in the SaaS landscape, allowing it to achieve substantial revenue growth. As Clickdimensions continues to innovate and expand, it remains a compelling example of how targeted strategies can lead to significant business success in a crowded market.

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