Cloud-based software provider AppFolio is gradually growing into its Goleta home after another stellar year, which included the milestone of going public.
President and CEO Brian Donahoo said unveiling an initial public offering (IPO) in June was just the latest advancement toward the 8-year-old company’s goal of steady financial expansion.
It’s a marathon, he said, not a sprint.
AppFolio, which provides web-based software for small- to midsized residential property management companies and law firms, is expected to earn nearly $75 million in revenue this year.
According to the company’s third-quarter earnings report, AppFolio brought in $20.3 million — an increase of 56 percent period-over-period — growing its property manager customers to 7,561 and law firm customers to 5,566.
“We said we want to be a billion-dollar sized company serving smaller companies,” Donahoo told Noozhawk. “We have a long way to go. I think what I’m proud of is, through the last eight years, we’ve had impressive sustained growth.”
AppFolio has 550 employees, with 400 working out of its engineering-focused headquarters at 50 Castilian Drive. The rest are in offices in San Diego and Texas, Donahoo said.
With its Goleta facility bursting at the seams, he said AppFolio plans to take over all of the building next door at 90 Castilian Drive by the end of 2016, after all renovations are complete.
Donahoo estimated the company occupies 20 percent of that building now, temporarily leasing up surrounding office space in the meantime.
“Probably in a year’s time, we’ve grown by 150 employees,” he said. “We’re a software company and that means we’ve got to be hiring great engineers to build great software.
“For us, Goleta has been the spot to grow the business. There is proximity to the university (UC Santa Barbara) where our target (hiring) market is. In general, we’re big fans of the local technology community and the lifestyle here.”
Part of AppFolio’s growth came from acquiring two companies within the last few years.
In April, it bought RentLinx with the goal of using its fast-growing apartment search site Show Me The Rent to allow AppFolio customers to leverage advanced vacancy marketing features.
Before that, AppFolio picked up MyCase, a web-based legal practice management software.
Both companies were small — three to eight employees — and based in San Diego, where AppFolio plans to combine offices in early 2016, Donahoo said.
“The teams of people that joined the company from those acquisitions were really just stellar,” Donahoo said. “They were both great successful technology companies at the time we bought them. Both had intense focus on customers and delivering services.
“It made sense for us to join forces.”
Donahoo thinks AppFolio has built a great foundation, one that emphasizes company culture as well as customer satisfaction.
“All of our customers usually have two stories for me,” he said. “One is how our software solution has improved their business and how they’ve been able to grow.”
The second involves being impressed with an AppFolio team member.
“It’s indicative of our culture,” he said. “We focus on really building great teams who understand who are customers are and how to help them.”
— Noozhawk staff writer Gina Potthoff can be reached at gpotthoff@noozhawk.com. Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.