An Atlanta-based e-commerce startup wants to use big data analytics to give small online merchants Amazon-type business intelligence on their shoppers.
Springbot helps small and medium sized businesses get better insights into their online customers — information they can then use to more effectively market to those shoppers.
Springbot has raised $1 million from several investors, including John Shlesinger, vice chair of real estate powerhouse CBRE Inc.; Tom Cousins-backed Nonami Investments; entrepreneur Allen Nance; and former executive vice president of Turner Home Entertainment, Steve Chamberlain.
Springbot co-founder Brooks Robinson is familiar with the small- and medium-sized market. Robinson co-founded Cbeyond, an Atlanta based telecom that serves businesses with five to 250 employees.
Shlesinger was introduced to Springbot by Nance. Shlesinger said the investment is not just a bet on the startup’s technology, but on the management.
“At the end of the day, the people make any company,” Shlesinger said. “We’re really looking [to invest in] people [who] have great ideas.”
Springbot is growing its development team and is a recent graduate of the accelerator program Flashpoint at Georgia Tech. Robinson recently returned from New York and San Francisco, where he and other Flashpoint graduates pitched to angel investors and venture capitalists.
The startup plans to raise a $5 million Series A round early next year to build out its sales and marketing team.
The e-commerce market for small-and-medium-sized business is ripe for innovation, said Nance, CEO of WhatCounts, an Atlanta e-mail marketing firm.
“They are bringing a knife to the e-commerce gunfight, and Amazon’s got the gun,” Nance said.
Amazon is setting consumer expectations. “As a shopper on the Internet, I just expect you to know everything about me; I just expect you to recommend other products; I just expect you to create a personalized experience,”
Nance said. “Springbot provides small and medium-size businesses with the data analytics and marketing systems to create a user experience that is very similar and competitive to what somebody would experience with Amazon.com.”
How it works
Springbot collects demographic, social and other information on clients’ online customers from data mining companies such as Rapleaf, Equifax and Acxiom.
“Today, small businesses typically have only the e-mail and physical address of their customers,” Robinson said. “We can gather additional information such as age, gender and social profiles, so now the small business is smarter about their customers.”
Springbot then uses the data to recommend and prioritize the most effective marketing tools — whether it is e-mail, online, mobile, or social media.
“A small business is completely overwhelmed with all the marketing choices they have,” Robinson said. “Do they use Facebook and email marketing, do they use Pinterest or Retargeting?”
Springbot automates the marketing campaigns and measures their effectiveness by tracking how many customers responded, and how much in sales it generated.
“Our platform makes sure [small businesses are] focused on the actions that will provide the best return on their investment of time and money,” Robinson said.
Springbot, which does not have revenue yet, plans to offers service packages on a subscription basis. The company is proving out its technology with several companies and expects to begin generating revenue next year.
Springbot plans to sell through channel partners — consultants and system integrators who help small and medium sized businesses set up online shopping carts — as well as a direct sales force.
The e-commerce market is a $200 billion industry, with the small and medium business segment accounting for about half that revenue.
Springbot’s customer base is fragmented. In the U.S., the top 10 e-commerce providers such as Amazon, Staples and Apple, account for 50 percent of all online sales. The rest of the market is scattered among 500,000 small and medium-sized businesses.
While that suggests market potential, selling into a fragmented market is a challenge and can be expensive.
Nance is confident in Springbot’s management.
“Brooks has a decade’s worth of experience in serving the small-to-medium-sized business market at Cbeyond,” he said.
Springbot has to develop products that have a “zero learning curve,” Nance said, because small merchants can’t afford to spend hours learning and maintaining new software.
Urvaksh Karkaria covers Technology and Health Care