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AB Tasty raises a delicious $40m and doubles down on US expansion

The Paris marketing startup is raising money and accelerating its US push. Its founder moving to New York has been instrumental.

By Marie Mawad in Paris

Two years ago, French entrepreneur Alix de Sagazan moved from Paris to New York to develop the US portion of her business. She never regretted that decision.

No matter how fashionable remote work becomes in the wake of the coronavirus crisis, Sagazan says being on site has been a tremendous advantage for AB Tasty, the digital marketing company she cofounded 10 years ago.

Like rivals Kameleoon in France and Optimizely in the US, AB Tasty builds technology for so-called A/B testing. In short, it’s a marketing tactic aimed at testing two designs for, say, an e-commerce website, and measuring performance specifics to help pick which one to launch.

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As it unveils a $40m funding round on Wednesday, the French startup boasts a ratio of 60% of its revenue generated away from home. It plans to use some of the fundraising money to intensify its sales push in the US, where it has offices in New York and San Francisco.

More than money, it’s presence that has made a difference in AB Tasty’s American trajectory, says founder Sagazan. It has wooed customers including media USA Today, and globally luxury group LVMH, carmaker Jaguar and cosmetics company L’Oréal.

“We opened our first US office at the end of 2016, and being on-site has been a real advantage,” says Sagazan, who moved there herself in 2018. “We increased revenue in the United States 480% in two years.”

The company doesn’t disclose sales figures.

Covid barriers

This year, Covid-19 has raised barriers to travel and makes it more difficult for business to expand into new regions. Some companies as a result are favouring all-remote and no physical presence.

“It’s clear that if we had decided to open our offices in the US this year, pre- or post-Covid, it would have been incredibly difficult,” says Sagazan. “It would have thrown off our schedule for the US expansion, despite the $40m fundraise.”

But travel and physical presence isn’t the only aspect of business that’s been affected by the coronavirus in AB Tasty’s field.

The underlying trend in A/B testing has been forecast as positive for the coming years, but Covid-19 has had adverse effects in the short run for some players. Marketing budgets are often the first to get cut at companies in an economic downturn.

Earlier this month, competitor Optimizely said it was laying off 15% of its staff because of the impact of Covid on its activities.

AB Tasty has seen a different, more positive trend recently.

“Two weeks after the public health crisis, we noticed a 50% increase in the use of our platform,” says Sagazan. The accelerated shift to online boosted demand from some customers, while the need to measure exactly how efficiently marketing money is spent became more pressing for others.

“Unfortunately, some clients from specific sectors like travel were highly impacted, and experienced losses,” the AB Tasty founder says. “On the other hand, our platform became a real partner in generating return on investment during this period, especially for clients in the retail sector.”

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