Making sense of endless data is what Business Events does quickly and accurately, enabling companies to monitor their business and reveal opportunities and changes weeks, months, or even years before they might otherwise have been identified.Amir Ashiri was a specialist in developing business intelligence and data mining tools. But he eventually became frustrated because although he spent years of his life building massive data warehouses for his customers, the users of these warehouses barely scratched the surface of the information available. Instead they would use the database like a summary report, asking specific questions, and receiving the same information week in and week out, leaving most of the data untouched.
“Initially he blamed the users,” says Chen Amit, the president, CEO and co-founder of US-Israeli start-up Business Events, the company he and Ashiri co-founded. “But after awhile he realized that they only have a fixed amount of time to look at this information and cannot spend the time looking for deeper meanings.”
Business Events, the world’s first business opportunity discovery company, searches through the huge amounts of data generated by companies to monitor their business and reveal opportunities and changes weeks, months, or even years before they might otherwise have been identified – a kind of early warning system, or well-informed crystal ball for the business world. The tool is aimed specifically at the consumer market, where companies deal with large amounts of customers, a highly competitive landscape, and huge amounts of customer and retail data.
Interest in Business Events is running high. Earlier this year US analyst firm Gartner included the company on its list of ‘Cool Vendors’ in the CRM Marketing and Analytics, March 2006 report. Gartner announced that Business Events had created the category which it was defining as “business opportunity discovery”, and recommended that companies currently inundated with data or unaware of critical business information should use the tool. In September, Globes – Israel’s financial daily – also named Business Events as one of 10 most promising start-ups of 2006.
Essentially Business Events uses its patented Verix technology to crunch a company’s data – a job that would normally take hundreds of thousands of man hours – to identify any hidden changes that are taking place in the business. Changes could mean anything from key business opportunities to revenue leakages, hidden or poor sales performance, competitive activities that are stealing sales, fluctuations in customer behavior, or identifying populations of retailers with common characteristics.
The tool is hosted by Business Events itself, making it simple and easy to use. Alerts are sent out to relevant management personnel once a week, or month, via e-mail, drawing attention to anything abnormal or out of the usual.
“It’s like an iceberg,” Amit told ISRAEL21c. “In most cases today a company will only notice a change when it is obvious and big like an iceberg crossing your path. We notice the changes occurring when they are still only the size of an ice cube.”
By doing so, Amit asserts that companies can rectify problems much earlier than before, prevent revenue leaks, enhance sales performance, and increase market share by capitalizing quickly on new opportunities. The bottom line: substantial revenue and profitability gains, says Amit, giving some examples.
When Business Events crunched the numbers for a large pharmaceutical company in the US that manufactures and sells blood glucose monitors for diabetics, it discovered that in one specific region, sales of the monitors were dropping in the pediatric sector. They evaluated this drop and found that one of the pharma’s competitors was trying out a new sales message specifically aimed at the pediatrics market in this region. Their rival was selling the same needle as before, but was now marketing it as a needle specially designed for children. The pharmaceutical company acted quickly to alter its own sales message and reversed the downward trend.
“We picked up the change quickly – without Business Events it would have taken the pharma nine months to pick up the specific problem and in this time they would have lost a lot of revenues,” says Amit.
When a large food manufacturer tried out Business Events it discovered that while sales of a new dairy product were growing well across the board, in certain locations across the country sales were not picking up. A closer examination revealed that one of the company’s significant target markets did not like the company’s advertising.
“We spotted it early enough for the company to reverse the trend before they lost a lot of money,” says Amit.
In another case a telecom operator who used Business Events discovered that one of its resellers was exploiting a tariff mistake to sell long-distance calls too cheaply, drawing traffic away from other sites. This quick diagnosis of a problem, saved the company a great deal of money.
“We are enabling something that was not possible before,” says Amit. “Before Business Events, companies in the consumer industry had to live with the fact that there were some things that they could not know until they hit you hard. Now we are offering our customers a very different, informed way of doing business, that allows them to find the needle in the haystack.”
Ashiri and Chen officially founded Business Events in 2004. Gemini Israel Funds, an Israeli seed-stage investment fund, invested $2.75m. in the seed round. The company spent the next two years developing the technology, carrying out pilot schemes with food manufacturer, Tnuva and Israeli telecom operator Barak. In late 2005, the company moved its headquarters to Mountain View, California, leaving R&D at Glil Yam in Israel.
In February this year, the company held another investment round, raising $12.75m. in funding from Israeli VC Carmel Ventures, Gemini, and a group of private investors led by Bobby Lent, formerly a co-founder of leading enterprise software company Ariba Inc. At the time, Lent, who now serves as an active chairman of the board at Business Events, said he was excited about working with the company and looking forward to building ‘the next great software company of the 21st century’. “Business Events provides a unique, huge competitive advantage to customers, which I believe will become a ‘must-have’ for any enterprise,” he observed.
Today Business Events, which employs 45 people, has 10 customers, most of which are from the pharmaceutical industry. Companies range in size from smaller $100m. firms, to large multinational giants. It was not initially the company’s intention to focus on the pharmaceutical industry, but interest from this sector is high, and Business Events was soon drawn in. It is also a good match, says Amit.
“The pharma industry is very data savvy and analytical,” he explains. “Companies provide and deliver very clean data and they are not too secretive about it.”
Business Events now plans to move into new areas of business. It has already identified several key markets including credit card companies, insurance operators, and banks.
As a pioneer of an entirely new market, Business Events has certain obvious advantages, but also certain disadvantages. “It’s up to us to educate the market that a new class of software is available,” admits Amit. “We would actually welcome competition to help us build this market. There is room for a handful of companies in this sector.”
Room there may be, but Amit believes that it will actually be pretty tough for rivals to catch up with Business Events. “I’ve been involved in many companies and this is the most technologically challenging effort I have ever experienced,” he says. “The technology is very complex and unless a company has been working on something similar behind the scenes for the last two to three years, it will take a very significant amount of time for them to catch up. It’s doable but they will come late to the market. I believe the opportunity for other companies will be in penetrating the market with us, rather than trying to build the technology themselves. There will be many partnership opportunities.”
The other main problem Business Events experiences, is in convincing companies that they need this technology. “Companies don’t know what we will discover before they try our technology. That’s daunting,” says Amit.
But could it ever happen that Business Events will go through the data and find nothing significant?
“It hasn’t happened so far,” says Amit. “We look at things through a very large and wide aperture. Something will happen at that organization. Maybe it happened last week, or the week before, but we will pick it up.
“People don’t normally use data in this way,” he adds. “We are up to something very significant here.”
So what’s next?
“It is still very early days,” says Amit. “Ten customers are nice, but we are looking at a market with 20,000 potential customers. For us the next stage is to move from 10 to 25, to 100 customers and to expand globally.”
He is confident that this growth will occur. “In consumer related companies there is currently too much complexity,” he explains. “There are too many competitors, too many products, too many flavors, and too many sources of surprise. No individual in a company can know everything.”