Serving small businesses is quickly turning ActiveCampaign into a big one, and it’s adding a chunk of new office space to accommodate its growth.
After doubling its total workforce since early last year to around 500 employees, the 16-year-old marketing software company is nearly doubling the size of its office at 1 N. Dearborn St. to about 115,000 square feet, CEO Jason VandeBoom said.
Its new lease for roughly 50,000 square feet on the Loop building’s fourth floor expands its footprint from the fifth-floor office it opened less than two years ago. The original space quickly proved to be not enough for the fast-growing company, which sells a subscription platform to small and midsize businesses to help them make more targeted decisions about how they connect with customers.
Ramping up its team with about 180 new hires last year, ActiveCampaign subleased about 15,000 square feet on the building’s eighth floor from logistics software company FourKites to give its employees a little more room to work with. Now it is hoping another floor will help its capacity issue, though VandeBoom said it will be hard to keep pace with the company’s growth.
“We are a quiet company that is scaling up under the radar in Chicago,” he said. “We’re an example of having hyper growth, but sustaining it from a customer base that’s demanding it.”
Tech companies expanding here and gobbling up office space downtown has become a common tale in recent years. Locally grown tech firms and giants from the coasts have tapped into the city’s deep and relatively affordable Midwest engineering talent pool during the decadelong economic growth cycle and, in turn, made a lot of downtown office landlords happy with their space needs.
ActiveCampaign has been an especially fast-growing example, having boosted its customer base about 50 percent since early 2018 to around 75,000 clients today, according to VandeBoom. With those companies paying anywhere from $9 a month to tens of thousands of dollars, depending on the services they need, ActiveCampaign is on track to reach $100 million of recurring revenue by the end of this year—twice the amount it had just more than a year ago, VandeBoom said.
ActiveCampaign now has about 450 employees in its Chicago office. It also has a small office in Indianapolis and another one in Sydney, as more than half its revenue comes from foreign companies. VandeBoom said the company is also preparing to open an office in Europe in the next few months.
VandeBoom said the firm’s recent revenue boom has come from creating more connective tissue between customer datasets to help users make better marketing decisions. The company is honing the way its software automates timely messaging that small businesses send to customers and predicts the best times for sales reps to follow up based on information about optimal buying times.
“There’s a fallacy of this idea of siloed data being (only) a (large company) problem. The maturity of small businesses is far further along than people give credit,” said VandeBoom, who originally bootstrapped ActiveCampaign out of his apartment in 2003.
ActiveCampaign looked at other options around the city to expand its office, but VandeBoom preferred to build off of its current home and stay in the Central Loop, where many companies have been departing for hot submarkets like the West Loop, the Fulton Market District and River North.
It is now the second-largest tenant at 1 N. Dearborn St., behind only the headquarters of Chicago Public Schools, according to real estate information company CoStar Group.
The building, owned by Beacon Capital Partners and a joint venture of MetLife and the New York State Common Retirement Fund, has lured a handful of tech firms to its tenant roster. In addition to ActiveCampaign and FourKites, the building has inked deals over the past two years with artificial intelligence company Narrative Science and software provider Snapsheet.