SurveyMonkey.com LLC, an online survey provider, raised $100 million in debt financing from banks including Bank of America Corp.?s Merrill Lynch to help the company retire existing debt and make acquisitions.
The financing, completed Oct. 29, reduces SurveyMonkey?s cost of capital and will be used for general corporate purposes, Palo Alto, California-based SurveyMonkey said in an e-mailed statement.
Founded in 1999 by Ryan Finley, SurveyMonkey says it handles more than 25 million online survey responses a month and that it works with all the Fortune 100 companies. Startups with hard-to-predict sales typically shun debt financing. SurveyMonkey made an exception to take advantage of lower borrowing costs and because it has a steady revenue stream, Chief Executive Officer Dave Goldberg said in an interview.
?We?ve been around for 11 years and have a predictable and growing business,? said Goldberg, who said the company is profitable and declined to disclose revenue. ?It?s a pretty easy business to put debt on without having any concerns about it.?
SurveyMonkey last raised debt in January 2009, when the company bought majority control from the founder. By refinancing, it cut its interest rate by more than half, said Goldberg, who joined the company last year.
Yields on investment-grade company bonds tracked by Bank of America Merrill Lynch?s U.S. Corporate Master index are hovering near the 3.55 percent level reached on Oct. 11, the lowest since the daily measure started in October 1986.
SurveyMonkey Expands
Clients use SurveyMonkey software to gauge customer satisfaction, schedule events and conduct employee performance reviews. Earlier this year, SurveyMonkey acquired Precision Polling to expand into telephone surveys.
SurveyMonkey?s most popular product costs $200 a year and lets customers create branded surveys with unlimited questions and responses. The company also has a free product that allows 10 questions and 100 responses per survey.
The company has expanded its workforce more than fivefold in the past 18 months to 75 employees, Goldberg said. The funds will be used in part to make acquisitions, he said.
Merrill Lynch led the funding with SunTrust Robinson Humphrey Inc. They were joined by JPMorgan Chase & Co., Royal Bank of Canada, Webster Bank and Zions First National Bank.
SurveyMonkey?s backers include Spectrum Equity Investors and Bain Capital Ventures. The company has offices in Portland, Oregon, and Funchal, Portugal.
To contact the reporter on this story: Ari Levy in San Francisco at alevy5@bloomberg.net
To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net
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