Evernote is unstoppable: Just last week, the productivity and memory platform closed a huge round of fundraising — $70 million to be exact — and found itself at a $1 billion valuation. But the numbers themselves don’t matter so much to CEO Phil Libin; it’s what he can do with them that means something.
And Evernote isn’t wasting much time, scooping up iPad handwriting app Penultimate. Libin and Penultimate CEO Ben Zotto tell me the acquisition is as mutually beneficial as they come and the app will remain independent while simultaneously being natively integrated into Evernote. “Digital handwriting has been around for awhile,” says Libin. “There was all this technology for it but we never had it expressed as a consumer-ready app. Then Penultimate launched and sort of changed all that.”
Libin and co. have been eyeing Penultimate since it debuted two years ago, and Evernote tried to get the team to come over at their launch. While the partnership wasn’t immediate, it has now come to fruition. “Evernote’s a really natural fit,” says Zotto. “[Penultimate] will remain a clean and elegant separate app, but it will be a gateway into all this powerful stuff. So in many ways it was a no-brainer.”
The acquisition is part of the creative period Libin talked so much about last week. “This is the most exciting time at this stage of the company,” he tells me. “We can take the most risks, experiment, and do what we love. When you’re a startup in the early days, you can’t take many risks — everything is really by the book because you can’t afford to do very much. And then when you’re a large public company you have people watching you every quarter and you can be punished for not meeting your goals. So right now is the most exciting time and we can really innovate and try new things. This fundraising is about extending that sweet spot.”
So what else can we expect for this sweet spot? Plenty, says Libin. While Evernote has no M&A shopping list, areas of focus include improving collaboration, sharing, and group productivity, as well as updating how Evernote fits into users’ business environments (something the Penultimate acquisition will play into). International expansion is also on Evernote’s to-do list, as is platform extension.
Libin took a minute to talk to me about an Evernote IPO and the bubble-fear mongering that has trailed his company’s recent valuation. “Our goal is to build Evernote to be around for 100 years and have people in love with it 100 years from now,” he says. “We want that startup spark and culture… an IPO is a step in that process, and in order to stay great and durable and meaningful for 100 years we have to be public at some point.”
He clarifies that Evernote’s IPO is not about an exit though — the company will not sell and it will remain independent. “So we’re planning it, the funding is about it, but we don’t want to be rushed into it,” he says. “Not for the next several years. We want it to happen on our time.”
And about all the unstoppable bubble talk, Libin chalks much of it up to ignorance. “I’m a little surprised about how little understanding there is. People talk about it and you can tell they don’t understand what a valuation is. Whenever everything is going well, it’s because we’re in a bubble, and when they aren’t going well, it’s a depression.”
“I don’t know what the economic conditions will be like in the next couple years, and we don’t want to put Evernote at risk — and that’s part of the fundraising. We want to shield ourselves from market fluctuations so we fundraise even when we don’t need money,” Libin explains.
Economy aside, Evernote addicts should have the peace of mind that the platform has thought long and hard about the road ahead. The company has bought the insurance to make sure it can innovate, create, and stick around — no matter what. “If we’re in a bubble and it busts, well okay… we have the resources to go on indefinitely.”
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