Of the many ways that big data analytics is impacting how enterprises do business, one of the most interesting has been in the area of predictive intelligence — the idea that by looking at all of the data being created in and around your organisation, you can help figure out what to do in the future.
In the latest development in this space, 6Sense – a startup that was created out of a consulting project at Cisco — which is now a customer – is emerging from stealth, with $12 million in backing and a host of large IT businesses beyond Cisco already signed on as customers. 6Sense claims its platform can identify potential business customers with 80% accuracy.
The Series A was led by Battery Ventures and Venrock, with participation also from Silicon Valley Bank. As part of the round, Battery Ventures’ general partner Roger Lee and Venrock’s Brian Ascher are joining 6Sense’s board.
There are a number of startups in the market right now that are focusing on predictive intelligence, specifically honing in on sales, which is a natural area to apply the technology. They include mobile-first startups like Clari and on a larger scale InsideSales, which recently raised $100 million at a $1 billion valuation. Like 6Sense, other predictive intelligence companies use machine learning algorithms and behavioral data among their sources.
But Amanda Kahlow, the CEO and founder of 6Sense, tells me that her company’s approach is different in a few key ways.
The first is that while a lot of services today help find targets at the “bottom” of the sales cycle, this is only about 10% of the opportunity in her estimation. The idea here is that you can find customers who are not just making initial enquiries for a service; but also those who may have already figured out what it is that they want to buy or have more targeted interests. “We find net-new customers ready to buy and prioritize known prospects,” she says.
“There are many B2B companies today using predictive analytics for lead scoring (scoring the known contacts at the bottom of your sales cycle),” she continues. By 6Sense’s estimates, between 60% and 90% of B2B purchasing decisions happen before a customer makes into into a company’s sales and marketing systems. “That is, before that customer raises their hand and asks to be called. The challenge for B2B marketers is to find those buyers early in the sales cycle instead of waiting for those buyers to be scored at the bottom of the funnel.”
The other aspect worth noting is the kind of data that 6Sense produces for its customers: not just “scores” on how customers rank but more detailed information about what they want and where they are in their particular buying cycle. “We see activity on thousands of B2B publisher sites, directories, communities and more. We combine this data with our customers’ activity data and descriptive attribute data to make our predictions,” she says. “Other predictive lead scoring tools simply tell you if the lead is your ‘right’ profile buyer.”
While that is important, she says, “alone, it’s not enough. Descriptive data alone doesn’t tell you if that buyer is in market to buy now. For example, if you are going to buy routers today (because you are moving offices), you are not going to be ready to buy in 6 months from now.”
Interestingly, the company and its mandate were born out of a consulting project she was doing for Cisco when she was running a previous business. Called in to help revamp Cisco’s sales process for some of its networking products, and describing the process above, suddenly a marketing executive interruped her. In her words,
“Suddenly one of them dramatically stopped the conversation, looked at me and said, ‘Amanda do you know what you are doing here?’ I responded, ‘No, what?’ And he said, ‘You know [what] our customers are going to buy before they even know they are going to buy.’ The room moved to discussion about sending customers a PO before the rep calls the customer. This was the moment I knew we had something game-changing. I knew I no longer could be a modest services business and that I needed to build a scaleable repeatable product. I knew there was a door open in front of me and I was going to walk through it.”
Customers today include, in addition to Cisco (who is not an investor, Kahlow says), NetApp, Xactly, Pure Storage, Blue Jeans and CBS Interactive. One customer, the company says, has reported $300 million in new business closed as a result of 6Sense’s predictions.
While that sounds like a very IT-heavy list, Kahlow says that the platform can be used across a number of other verticals, which is one area where we might see some of this Series A deployed.
“We see ourselves as a premier, premium product in the space of predictive sales and marketing, but we are not industry specific,” she says. “For 6Sense, the threshold for what we consider a customer where we can effect strong results is that they have a high considered purchase.” She says that the company is currently in conversations with businesses in hospitality, manufacturing, healthcare, and financial services for future deals.