The origin of constants in mel-scale formula
The different mel scale formulas are supposed to approximate the human ear's critical bandwidths. Usually the formulas have this form:

$$m=C\log\left(1+\frac{f}{f_0}\right)\tag{1}$$

Below the frequency $f_0$ the mel scale changes approximately linearly with frequency, whereas above $f_0$ it changes logarithmically. This is the result of measurements. The difference between most formulas is the choice of the corner frequency $f_0$, which is usually chosen somewhere between $600\,\text{Hz}$ and $1000\,\text{Hz}$. So the number $700$ in your formula is the corner frequency $f_0$ where the scale changes from linear to logarithmic. The constant $C$ in $(1)$ is normally chosen such that $1000\,\text{Hz}$ correspond to $1000$ mel:

$$C=\frac{1000}{\log(1+1000/f_0)}\tag{2}$$

If we take the natural logarithm and with $f_0=700$ we get from $(2)$ $C=1127$. If instead we use the logarithm with base $10$, we obtain the other well-known constant $C=2595$.