Vancouver-based Spruik, an online software-as-a-service referral platform, this week raised “more than $200,000” in private investment.
The funding was secured from the owner of SplitMango Media, a web development firm also based in Vancouver, who will partner with the startup.
Research conducted by the Harvard Business Review reveals that although 68% of customers intend to refer a business, only 33% followed through with it. And of the referrals that are followed through, less than 40% are actually acted upon.
There are two main reasons for this, according to Spruik. First, a referral requires effort on the part of the satisfied customer. Second, orgotten details or inaccurate recollection of the referred business’s name are a common occurrence.
Spruik’s SaaS business model aims to solve these issues. The Canadian startup says its model is centered on the concept of word-of-mouth being the most trusted and credible form of advertising: when a Spruik referral is acted upon, three parties get rewarded—the business receives a new customer, the new customer receives a generous discount, and the referrer receives a cash reward.
“This partnership with SplitMango will strengthen Spruik’s overall development capacity and allow Spruik to stay agile and ahead of the market,” says Susan Perry, CEO of Spruik. “Having only just launched our beta version, we already received such a great response. This investment will accelerate our mobile optimisation and fast-track new feature launches to provide more value to both users and businesses.”
Spruik’s was founded by Susan Perry, Brendan Jones, and David Crane.