New York’s Sailthru Finds New CEO Neil Lustig Close to Home

New York startup Sailthru Inc. named Neil Lustig, an International Business Machines Corp. veteran, as chief executive, adding to a string of big hires by enterprise software startups in the city.

“We were super excited to find a veteran, proven, tried-and-true enterprise software CEO right in Manhattan,” said Bill Gurley, a general partner at Benchmark, one of the investors in Sailthru.

Mr. Gurley has in the past been critical of New York-based startups, saying that too few build out into big companies and go public.

“I think it’s more difficult in the outer markets to build long-term independent public companies,” Mr. Gurley said, referring to smaller venture markets than the one in Silicon Valley. He said there hasn’t been much of a record of big IPOs in New York, especially with enterprise software companies, an underrepresented sector in the startup community in the city.

“One of the things need to be able to get to that level is to put together an experienced team,” Mr. Gurley said. He said that it is the executive-level talent that is sometimes hardest for startups in New York, as well as in other cities outside Silicon Valley, to find that limits how far they can go.

Mr. Lustig is taking over from Sailthru’s founder, Neil Capel, who will remain at the company as chairman.

Most recently, Mr. Lustig ran privately held Vendavo, an enterprise software company offering price-optimization services to businesses. Francisco Partners took controlling interest in the venture-backed Vendavo last year. Earlier in his career Mr. Lustig spent 16 years at IBM.

Other recent hires by New York enterprise software startups include Carlos Dominguez joining Sprinklr Inc., as president and chief operating officer, from his senior executive role at Cisco Systems Inc., and Stephen DeWitt, a former Hewlett-Packard Co. executive becoming CEO of Work Market Inc.

Sailthru is a marketing-automation company that helps personalize messages sent by brands to their customers. It counts about 400 clients, including publishers such as Huffington Post and Business Insider, as well as e-commerce sites such as Thrillist, Everlane and Rent the Runway.

The biggest reason businesses are collecting and processing reams of data in what’s called big data is to accomplish what Sailthru helps do: “service people in an individual way,” Mr. Gurley said.

Sailthru said that it increased its annual contract value by 125% over the past 24 months, and added 32 new corporate customers in the fourth quarter of 2014 alone. Sailthru also increased its employee count from 129 at the end of 2013 to 177 now.

The startup, founded in 2008, raised about $48 million from venture investors including AOL Ventures, DFJ Gotham, RRE Ventures, Scale Venture Partners, and Occam Partners. Its competitors include ExactTarget, acquired by Inc., in 2013.

Benchmark has just three New York-based startups–Sailthru, office-space provider WeWork Companies Inc. and luxury-sales site Inc.–out of hundreds in its portfolio.

“I can help prove myself wrong on my previous comments,” Mr. Gurley said about his New York companies.