The archive · Developer & Business Tools · Financial decision · 2012
Mixpanel's $10.25M Series A bet: engagement events, not pageviews
Backed by Andreessen Horowitz in May 2012, Mixpanel tracked seven billion actions a month on its bet that event analytics would beat pageviews.
Mixpanel
What the business is
Mixpanel was an analytics service for web and mobile apps that tracked individual user actions and offered segmentation, funnel, and cohort/retention analysis, charging by data volume.
Starting capital：$1.75 million seed from Max Levchin, Michael Birch and Sequoia Capital before the 2012 Series A.
How it started
Suhail Doshi had interned on the metrics team at social-app maker Slide; Slide CEO Max Levchin was so impressed he tried to get Doshi to drop out of college. It did not work, but when Mixpanel started, Levchin was there to fund it and stayed actively involved.
What happened
By May 2012 customers included Path, Viddy, Socialcam, Jawbone and Airbnb, and Mixpanel was tracking seven billion actions a month, up from four billion in February, as existing customers grew and new customers joined. On 2012-05-10 AllThingsD reported the $10.25M Series A led by Andreessen Horowitz, with Salesforce CEO Marc Benioff and Yammer CEO David Sacks also joining; Doshi said the money would let him pay his first 100 employees 'way above market'.
No ending yet — it is still running.
Background
Mixpanel was Suhail Doshi's answer to a gap he saw from inside the metrics team of social-app maker Slide: products lived on engagement, yet the analytics incumbents still counted page views. He aimed for something richer than Google Analytics and easier to grasp than Omniture, measuring modern things like engagement. Max Levchin, Slide's CEO, had tried to convince Doshi to drop out of college; when Mixpanel started, Levchin funded it and remained actively involved.
By May 2012 Mixpanel was used by Path, Viddy, Socialcam, Jawbone and Airbnb, and was on track to measure seven billion actions a month — up from four billion in February — through growth in existing customers plus new joiners. Its three product areas were segmentation, funnel analysis, and cohort/retention analysis, built on a data store designed to make queries easy, and it charged by data volume: 500,000 data points cost $150.
On 2012-05-10 AllThingsD reported a $10.25M Series A led by Andreessen Horowitz, with Salesforce CEO Marc Benioff and Yammer CEO David Sacks joining the round. Levchin framed the opportunity as data mining rather than traffic analysis — a product letting humans use algorithms and visualization to grasp customer behavior — while Doshi kept the boundary clear: analytics gives hypotheses, but someone still has to have ideas.
What has to be true
- Its customers were the social and mobile wave whose products lived on engagement, so the events-based model was validated by the fastest-growing apps of the moment.
- Andreessen Horowitz backed it because every startup its partners talked to was already using Mixpanel — demand visible before the pitch.
- Pricing by data volume tied revenue to customer growth, and Levchin's Slide history supplied a cautionary line: Mixpanel only provides numbers, it does not pick products.
- The jump from four billion to seven billion actions in three months showed usage spreading inside existing customers as well as new ones.
What can be applied
Sell the instrument, not the dashboard: Mixpanel measured engagement events on web and mobile while incumbents counted pageviews, so the market shift did the selling.
Aftermath
As of 2012-05-10 Mixpanel had just announced the $10.25M Series A led by Andreessen Horowitz, was on track to measure seven billion actions a month, and planned to hire and pay its first 100 employees well above market. Nothing in this batch documents what happened after that date.
Sources
- Hot Analytics Start-Up Mixpanel Raises $10.25M Led by Andreessen Horowitz
- HN discussion: Mixpanel Raises $10.25M
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