Last year, the top-grossing scheduling startup made a name for itself, raising more than $3 billion in valuation last year as the largest startup in the space. And plan any event where two or more people spend time with each other. Standing in the long shadow of giants like Google, Microsoft and others of Go to the platform for work and leisure life planning, now Calendly is making moves to increase its own momentum. The company has acquired Prelude, a specialist in automating the scheduling and organizing the work environment. Calendly is profitable, and this is the first purchase.
Prior to the deal, Prelude — originally launched under the obscure name “The Interview Program” — had raised just $2.4 million from investors that included Sam and Jack Altman, Fuel Capital, Elad Gil and others. Financial terms of the deal are not being disclosed, but Prelude says it has “hundreds” of customers, including One Media, Duolingo, Cloudflare and Samsara.
The acquisition highlights some interesting trends and developments.
For Calendly, this is a sign that the company is refocusing its vision and strategy as a business, starting with HR and building more unique products for the vertical. It’s a departure for the company, which has quietly grown into a scheduler on the back of a different approach: building a general-purpose tool that can be used by anyone and everyone. Especially during the pandemic, scheduled meetings are not only their own, but also many interactions that may have been boring in the past.
In the past two years, Calindly founder and CEO Tope Awotona said the company focused less on individual users and focused on enterprise users, with its typical deals covering organizations with hundreds of thousands of users, which is another reason the company has evolved. It is now in product expansion mode.
Avotona says this may be his first purchase, and his first effort to design features for a specific use case, but it won’t be his last.
While those moves will help Calendly better serve the enterprise sector, it’s also a way for the company to differentiate itself from competition from other scheduling services. The likes of Google have built amazingly on their own calendar platform to improve scheduling and developed additional tools that are tightly integrated with those in their own calendar apps and with other productivity and organizational tools like email, making Calendly even more useful. Exceptions will be one way to hold on to users and bring in more.
This isn’t a sign that Calendly is starting a shopping spree: some features will be built in, Awotona said. In the case of Prelude, it would have been more challenging and time-consuming to replicate the automation software developed by the company and the team behind it as a complete package, so pick it up and eventually integrate it into Calendly itself.
Pre-selling is part of a larger consolidation trend we’re seeing in enterprise software. The line that tends to be drawn in software is often between features and platforms, where features may be important or nice to have, but eventually their positions can be jeopardized or at least weakened if there are competing services that offer those features. , or if you are very dependent on many other services and to perform as needed.
On top of this, there is a huge financial crisis, and thus it is becoming very difficult for all startups to raise funds. While in the past a startup could spend more time, raise more, and spend more time growing their business (and valuations), these days they may be backing exits when calculations are presented. Combine this with a business perspective for small startups with strong character sets or those that have had time to build themselves into larger platforms and you can see how a lot of M&A is cropping up these days.
But to be completely clear, Avotona says that Prelude is not buying locally.
“They weren’t looking for a purchase,” he said. “I reached them.” In fact, he says he did it on the back of Calendar by asking his own customers what they wanted from the product. Across industries, and despite economic trends, a significant number of them seem to want better tools to manage recruiting, so that’s how Calendly is trained on the spot.
The HR category in general has been very interesting to watch over the past several years and especially now. If you consider that job listing boards were some of the oldest content pieces on the World Wide Web all those years ago, you could argue that recruiting and the broader field of HR is one of the oldest categories in the B2B2C Internet. This allows new players to enter the category and improve upon those that were originally created years ago. At the same time, there are some very unique tools used in HR and recruiting, such as applicant tracking systems. Even new software developed for HR teams must still work with existing ones.
Recruiting, especially in some areas like technology, has been in chronic undersupply for years. On the one hand, there seems to be a constant lack of talent to feed the tech industry machine, which means that people who are hiring want the process to be as quick (but thorough) as possible. On the other hand, it’s especially difficult to recruit for technical jobs, because of the double challenge of not only evaluating candidates’ skills, but also interviewing them, often through meetings, to further screen people and see if they’ll fit. Good fit. And that’s something that remains consistent even when hiring shrinks, as has been the case for many companies in tech, which are currently shedding more jobs.
This last piece of the puzzle is where a tool like Prelude fits in. For organizations that need to schedule a large number of meetings for recruiting purposes, along with the various interviews the process can bring, the idea is that HR management can. Create a complete itinerary that captures it all in one place. Interviewers can be trained and organized, and candidates can sign up for interviews and be given a single interface to view their schedule without going back and forth, all of which integrates with other productivity tools. Application tracking systems. The idea is that this can reduce the time needed to figure out all the logistics by streamlining a lot of the process for recruitment interviews, unlike Calendly, for a specific use case.
Calendly, which has now raised about $350 million (mostly from a single round in 2021), isn’t currently in the market to raise more money, Awotona said, but this early deal could be a good template for how a startup can turn out. Looking to expand the product in the coming months and years.
“This acquisition provides a significant market opportunity with the depth of relationships and experience that modern companies have with the people they hire,” said Will Laufer, Prelude’s founder and CEO, in a statement. There is a natural alignment here as our shared vision is to provide a comprehensive solution for recruiting teams with one integrated platform. Scheduling automation is critical to the success of any business team—and together, Calendly and Prelude become the obvious choice.
