Evernote has raised yet another funding round, $70 million on top of the $96 million it previously raised in several rounds. CEO Phil Libin confirms that the funding puts Evernote at a $1 billion valuation and prepares the company for IPO.
In a blog post announcing the funding, Libin reiterates his goal to build a "hundred year startup that can be everyone's second brain." He says the funding will be used for expansion, acquisitions, increasing the pace of product improvements, and international expansion. It's "not because we need the money to fund operations," he writes. Here's the official news release.
Lead investors in this new round are Meritech Capital and CBC Capital. The CBC relationship is particularly important for Evernote's international ambition, as that firm typically invests in Chinese companies.
Evernote is one of the rare startups that has found success with the freemium model. The note-taking, Web-clipping, and image-storing service (and apps) are free to use and provide a lot of utility. Evernote's upsell to the paid service, which gets you more bandwidth and improved features on the apps, is relatively subtle. Evernote does keep its users for years, and over time they convert to paid at increasing rates. Even so, of Evernote's 25 million users, only 1 million pay.
Thus the company's drive to build or buy new products that funnel users into the Evernote ecosystem. Recently, the company has acquired the graphics utility Skitch, and rolled out Food, Hello, and Clearly, all specialized applications the feed data into users' Evernote accounts.