Segment raises $64 million because marketing analytics is a truly massive space

Segment.io announced a $64 million Series C investment round on Thursday, and has now raised nearly $
ARCHITECHT
Segment raises $64 million because marketing analytics is a truly massive space
By ARCHITECHT • Issue #112 • View online
Segment.io announced a $64 million Series C investment round on Thursday, and has now raised nearly $110 million since it was founded in 2012. If you haven’t heard of Segment, it’s a platform for collecting digital customer data from sources like websites, chat, email, SaaS services, etc., and feeding it into any number of marketing analytics tools or data warehouse products. You can get more info in the blog post linked to above, or by listening to Segment co-founder and CTO Calvin French-Owen on the ARCHITECHT Show podcast in April. 
I’ll be honest: customer marketing analytics is not a space about which I care too deeply, but it’s a space that has become hugely important over the past few years. You could chalk that up to many things, but I think it boils down to the fact that the messages around big data and SaaS sunk in. And thus sprung thousands of companies and services collecting everything they can about customers, and thousands of companies willing to pay for them.
I spoke with Segment co-founder and CEO Peter Reinhardt earlier this week, and he pointed out that there currently are more than 5,000 companies listed in the MarTech Industry Index. Mature Segment customers might connect their data to dozens of different destinations (services or databases), and Segment itself connects to 20 or 30.
The result, Reinhardt explained, is that the amount of data Segment handles for customers has been doubling every six months, and the company is presently processing 50,000 data points per second. Every one of those data points is attached to somebody clicking, typing, or otherwise interacting with a customer data source.
In fact, one of the main reasons French-Owen was on podcast in April was to discuss a Segment blog detailing how it cut more than $1 million a year off its Amazon Web Services bill. It’s a really good case study in how fast a company, its customer base and its AWS bill can grow—the latter of which can be full of opportunities for optimization that require a focused effort on watching it, troubleshooting it and getting clever about how you manage resources.
Segment is also an omen for what’s about to hit (or is already hitting) companies trying to offer any sort of meaningful analytics around data derived from sensors or other previously non-digitizable interactions. I would put various AI applications—digital assistants, facial-recognition apps, chatbots, etc.—in this bucket, as well. Helping customers take advantage of these new types of interactions and integrate them with existing data is going to take even more investment in architectures, data storage and processing.
For more on this general topic, I would suggest listening to a handful of ARCHITECHT Show episodes from earlier this year. Aside from French-Owen, interviews with IBM’s Adam Kocoloski, Cloudera’s Mike Olson, Confluent’s Jay Kreps and Honeycomb’s Charity Majors come to mind off the top of my head.
In other news, Google and Alibaba are doing so much in applied artificial intelligence …
Here are links to some good blog posts and news articles from this week about what they’re building and how they’re applying AI in some really interesting ways:
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ARCHITECHT delivers the most interesting news and information about the business impacts of cloud computing, artificial intelligence, and other trends reshaping enterprise IT. Curated by Derrick Harris.

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