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Originally published Thursday, February 13, 2014 at 8:00 AM

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Front Desk announces $4 million investment round

Seattle-based startup Front Desk secured $4 million from investors in its first round financing, allowing the company to accelerate product development and invest in marketing and hiring for its cloud-based business management software.


Seattle Times business reporter

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Seattle-based startup Front Desk secured $4 million from investors in its first round financing, allowing the company to accelerate product development and invest in marketing and hiring for its cloud-based business management software.

The Front Desk software works on smartphone’s, tablets and desktops, giving personal service businesses, such as yoga studios, tour operators and music teachers, the ability to run their businesses from anywhere at any time. Businesses can manage client relationships, automate billing, schedule classes and appointments and track attendance all in one place, co-founder and CEO Jon Zimmerman said.

“We were finding that 80 percent of businesses were using paper and pencil and generally a combo of Google calendar, Excel and some stand-alone payment processing solutions,” Zimmerman said. “By integrating all those together in one software, businesses are going to be able to capture a lot of revenue that they may have been missing.”

Zimmerman started Front Desk in March 2013. As an investor in a CrossFit gym, he said he saw the chain was in need of a way to manage business efficiently. So, he joined forces with small business and tech savvy individuals, some of whom were former colleagues from Expedia, and created Front Desk.

Initial seed funding for the software was $3.2 million and was led by Seattle-based Second Avenue Partners. This financing round brings the total capital to date to $7.2 million and was led by California-based FLOODGATE. Existing investors Second Avenue partners, Version One Ventures and Rich Barton, founder of Expedia and co-founder of Zillow, also contributed. Located in Capitol Hill, Front Desk has 17 employees with plans to grow to 40 by the end of the year.

“When I look for startups to invest in, I look for a big pond and great fisherman, and this one nails both of those,” said Barton, who has worked with Zimmerman for more than 20 years, starting at Expedia and going on to work together on other startups.

“There are so many small business out there who need software for their small business and this is the A-team of fisherman to provide it.”

More than 1,000 businesses in 20 countries use Front Desk. Many are mom-and-pop operations, which Zimmerman expected when he started the company. But, he said, others are larger operations, such as Denver Broncos quarterback Peyton Manning’s chain of D1 gyms in the Midwest.

Front Desk offers tiered pricing for businesses based on the company’s size and transaction volume, starting at $45 per month and scales up with the size of the business. It charges 1 percent for the first $10,000 of transactions processed through Front Desk, and then $2 dollars per $1,000 after that.

“We are basically aligning our pricing with a company’s ability to grow their business,” Zimmerman said.

He said Front Desk is on track to process more than $100 million in payments between businesses and their clients in 2014. With an estimated $350 billion processed in personal service businesses each year, Zimmerman said, he knows there is a lot of room for Front Desk to grow.

He said he knows it is a long ways off, but Zimmerman hopes the company can become the next Zillow or Expedia for small- to mid-sized businesses.

Coral Garnick: 206-464-2422 or cgarnick@seattletimes.com. On Twitter @coralgarnick



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