Founded in 2006, by Brian Halligan and Dharmesh Shah, HubSpot is much more than just a marketing tool. It is in fact a one-stop shop and a complete CRM platform with all the tools and integrations that your business is ever going to need. Whether it is that you want to accelerate your sales, increase your marketing efforts, streamline your customer service or just build a power website, HubSpot does it all. The CRM platform is made up of four major hubs named;
Service Hub
Sales Hub
CMS Hub
Marketing Hub
The service hub is a customer service software that helps business owners connect with their customers, helps build brand loyalty turning those customers into promoters who help grow your business. Similarly, the sales hub is primarily a CRM software, which helps you automate all the boring tasks, gives you deeper insight into your potential clients and helps you close deals faster. It comes equipped with features like advanced CRM, quotes and meeting scheduling options. The third one is a content management software, which helps you create a website that leaves a lasting impression. With tools like drag-and-drop editor, SEO recommendations and a multitude of themes, you are bound to give your customers a personalized and safe experience. Finally the one most relevant to our cause is the marketing hub, which entails a marketing software which helps you do a ton of things to promote your brand online. Since today we are only talking about digital marketing, we will go into the details of tools and features that the marketing hub of HubSpot is equipped with.
The HubSpot Marketing Hub is actually a marketing automation software designed to help you reach out to the right audience, convert your website traffic into sales and run effective and inbound marketing campaigns at a scale. All of this is done under a single roof using the powerful yet easy-to-use platform. The major functionalities of the marketing hub are divided into three parts and each part comes loaded with features;
The first and foremost focus of the HubSpot marketing hub is at creating content that your potential customers are looking forward to, and is impossible to miss. Marketing hub helps you publish content that helps your site get discovered in search engines, social media platforms and beyond. By adding calls to action, it converts readers into customers. Similarly, the SEO tool helps your website build its search authority to outrank competitors. The SEO tools integrated into the platform not only help you plan your content strategy but also optimize your content as you type.
The Ad tracking and management feature helps you cut down on your ad spend. You no longer have to struggle between Facebook, Instagram, LinkedIn and Google ads, instead you can run ad campaigns, manage and track them right inside HubSpot. It also lets you see which ads are turning prospects into actual sales. The integrated social media managementplatform lets you do everything else as well such as publishing on social media platforms, the same ad campaigns you created using HubSpot. It also helps you monitor each and every interaction with a customer on any of your platforms. HubSpot also supports video files by storing them right inside HubSpot and embedding them on your website or social media platforms when needed and as needed. Finally, it lets you connect with your customers in live chat and uses bots to qualify leads and save you some precious human hours.
Figure 6: HubSpot – Creating Content that your prospects crave
Converting More Leads
The second major functionality that HubSpot focuses on is converting leads into actual customers with personalized strategy. HubSpot carries out a number of carefully curated actions to convert those leads into prospects. The first one is the design and launch of an appealing landing page. It lets you choose from pre-configured templates, which you can customize to the exact needs of your business, or you can always start from scratch. An appealing landing page is the key to retaining customers. The tool also helps you build easily customizable forms, which you can add to your website to convert your anonymous visitors into leads.
Figure 7: HubSpot: Lead Conversion
The best part of all is that it completely automates all these processes not only saving you time but also helping you scale up your efforts on things that matter the most. When cross-functional operations are automated and bulk data is being managed, you can work on nurturing leads and personalizing emails. Email marketing is an important aspect of digital marketing. HubSpot lets you create mobile-optimized email campaigns that look the same as a professionally designed email and gives you the window to personalize the message as per each recipient. This helps you build deeper relationships with your customers and utilize collaborative and intuitive account based marketing tools for your highest value targets.
Finally, with lead tracking and management, you are always on top of your lead game, getting a full picture on the status of every lead in an integrated database. Then you can proceed to segment leads based on the data available and nurture each one of them at a different pace.
Report & Customize
Finally, the focus is on customizing your platform in order to give marketing the credit it deserves. HubSpot is equipped with built-in marketing analytics, reports and dashboards, which help you make smarter, data-backed decisions. Based on these decisions, you can then customize your platform in a way that it is in coherence with what data indicates and indirectly what the customer wants.
Figure 8: HubSpot – Marketing Analytics
Lastly, given that HubSpot is a comprehensive CRM platform, it allows the integration of Salesforce for bi-directional yet faster sync, thus allowing you to send all this lead intelligence to your sales team so they not only have the information about who is your prospect customer but also the complete context on how to approach them.
Hubspot’s main individual shareholders are its founders, Brian Halligan (1.7% ownership) and Dharmesh Shah (3.5% ownership). At the same time, the majority stake is in the hands of institutional shareholders, who have a more passive role. These institutional investors comprise T.Rowe Price Associated (10.4% ownership), The Vanguard Group (8.64% ownership), BlackRock (7.2% ownership), and FMR-Fidelity Investments (5.49% ownership).
HubSpot is a CRM (customer relationshipmanagement) solution providing various levels of its B2B and Enterprise subscription plans. Beyond subscriptions, the company monetizes via professional services. However, these carry a negative marginality as the company uses professional services (in onboarding and implementation) to increase its tools, which help companies leverage digital marketing channels to generate leads.
Hubspot generated $2.17 billion in revenue in 2023, compared to 1.73 billion in 2022, $1.3 billion in 2021, and $883 million in 2020. In 2022, about 98% of Hubspot’s revenue came from subscriptions, which generated $1.69 billion in revenue.
Hubspot reported $176 million in net losses for 2023, compared to a reported net loss of $112 million in 2022, a net loss of $77 million in 2021, and a net loss of $85 million in 2020.
Hubspot generates most of its revenue from subscriptions. Indeed, in 2023, about 98% of its revenue came from subscriptions. In 2023, Hubspot generated $2.12 billion in revenue from subscriptions vs. $46.7 million from professional services.
The subscription revenue cost structure is quite effective. In 2023, on a $1.83 billion in subscription revenue, the company reported $290 million in cost of revenue (expenses related to delivering the service and providing support, including the costs of data center capacity), thus generating a $1.83 billion in gross profits, compared to $1.43 billion in gross profits from the subscriptionbusiness, in 2022.
The professional service business is run to sustain the subscriptionbusiness. Indeed, in 2023, on $47 million in professional services revenue, the company reported over $54 million in cost of revenue (expenses related to delivering the service and providing support, including the costs of data center capacity), thus generating a gross loss of over nearly $8 million.
Hubspot had 7,663 in 2023, 7,433 employees in 2022, 5,895 in 2021, and 4,225 in 2020. The company has grown from 2,638 employees in 2018 to 7,433 in 2022.
Hubspot generated $283,209 in revenue in 2023, compared to over $232K per employee in 2022, over $220K in 2021, and $209K in 2020. Hubspot’s revenue per employee grew from over $194K in 2018 to $283K by 2023.
Hubspot had over 205K customers in 2023 and 167K in 2022, compared to over 135K in 2021 and nearly 104K in 2020. The company grew from over 56K customers in 2018 to over 205K customers by 2023.
In 2023, Hubspot spent 49% of its revenues on sales and marketing efforts and 28% on R&D efforts, compared to 51% in sales and marketing efforts and 26% in R&D efforts in 2022.
Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
