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Estonia-based startup Modash has raised a $12 million Series A led by henQ, a Dutch VC firm that prides itself in “funding the odd ones.” And what’s odd about Modash, according to CEO Avery Schrader, is that its team “has a really strong opinion in a space that nobody really has much faith in anymore.”
The space in question is influencer marketing. Like competitors CreatorIQ and Upfluence, Modash helps brands like Farfetch discover people who can promote their message. But instead of focusing on content creators with big followings, Modash scrapes open data to let its clients find matches among the long tail of the 250 million creators it says it lists (unless they opt out.)
This means brands are being connected with relatively niche content creators through Modash’s platform. But — the founders’ theory is — these are individuals who can pack a marketing punch as their smaller follower bases may be more engaged with, and put a higher store on, what they’re saying.
Essentially, it’s a flipping of the usual influencer marketing script which could help circumvent some of the cynicism that’s sprung up around highly paid influencers shilling products. Not having creators sign in also makes it easier to scale, in a space where pure marketplaces have struggled.
This is why Modash remains bullish on the creator economy — even as Schrader understands why others might not be. “The whole VC class has already placed one or two bets that have already gone down the drain in the space,” he told TechCrunch.
“[But] people miss the point that the creator is the atomic unit of the internet, and [creators] will just keep making stuff,” he went on, explaining why he and his team believe in the marketing power of content creators and in the market opportunity of helping them monetize.
“Whatever you immediately think of when you think ‘influencer’… I think it really has a negative connotation… Whatever you don’t consume is what you think of an influencer as, and then whatever you consume, whatever is in your own YouTube search history, that’s who we support,” he added. “It’s like the small creators doing the weirdest stuff, talking about the things they really love.”
The 26-year-old Canadian fits the bill himself; originally from Nova Scotia where he tinkered with videos and forums, he made his way to Estonia after reading that it was becoming “the Silicon Valley of Europe.” There, he soon found himself recording podcast episodes with the Baltics technorati, while trying his hand at influencer marketing for clients like Estonian scale-up Bolt.
The client side of the problem is key to Modash. The startup’s vision is that brands want an end-to-end platform that lets them source creators, but also analyze campaigns, manage payments, and more. That’s what it monetizes, with plans starting from $199 a month up to a custom enterprise tier.
With Bolt and an Estonian agency among its first clients, Tallinn proved to be a great launchpad for Modash. Whether or not the comparison with Silicon Valley stands, network effects were clearly at play and several Estonian founders became Modash’s first mentors and angels, some of whom have returned to join its latest round too.
The capital city is also where Schrader met his co-founder and CTO, Estonian software engineer Hendry Sadrak (on the right in the picture above) and the rest of their founding team. “Even today, 40% or 50% of the company is in Estonia,” said Schrader. “Lots of them from Bolt, Pipedrive, Transferwise… — the Estonian mafia.”
If Schrader sounded unsure about the exact percentage of local staffers it’s a reflection of how much the team has grown over the last few months. “We were like 25 [people] in the beginning of the year, we’re now 60, and we’ve set a cap for next year that we won’t go beyond 99, because it’s really important to keep the team as small as we can.”
Many of Modash’s new hires will focus on data engineering, as AI-enabled discovery features are a big part of its product roadmap.
In addition, the startup plans to recruit people for customer-facing roles in North America to be closer to its clients there.
Schrader himself was back in Canada when he talked to TechCrunch, and he told us he plans to spend at least half his time in the country going forward. International expansion and an increased focus on e-commerce will be the startup’s priorities leading up to its Series B round, he said.
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