Recordant Closes on $9M
Sales talk analyzer software aims to close the deal
February 06, 2007
Pequot Ventures of New York led the Atlanta-based firm's second round of financing and was joined by Boston-based Kodiak Venture Partners, which led Recordant's first round in 2005, and Aurora Funds, based in Durham, North Carolina. Recordant applies technology to an age-old problem: how to turn a shopper from a tire-kicker into a buyer.
Its system lets companies record a sales associate's pitch and later listen to the interaction and analyze it to find key words or interactions. The software can allow a sales force to hear top producers close deals, make sure sales associates are offering the complete product line, and find out what pitches are working during a given period.
Deborah Bernstein, a principal with Pequot Ventures, said her venture capital firm made the first approach. "We're an active investor in the retail space," Ms. Bernstein, who now sits on Recordant's board, said in an interview. "We do proactive research. We reached out to Recordant and found them."
Ms. Bernstein noted that Recordant's Moment of Truth Intelligence software takes advantage of digital signal processing and audio analysis technology.
Sales associates wear the unobtrusive recording device, typically around their neck. When they have finished talking to customers, they put the device into a docking station that uploads the voice file into Recordant's servers, where it is analyzed. That software streamlines the analysis, meaning that managers don't have to spend hours listening to the recording to find points of interest.
A retail employee might be on the floor seven or eight hours, noted Recordant Chief Executive Jeff Neppl, but the company's software can bookmark crucial points in conversations, allowing for rapid retraining or the sharing of top producers' methods. "What bosses like is they find guys knocking it out of the park," Mr. Neppl said in an interview. "You can employ best practices."
Those points of interest in the audio files vary across industries and corporate cultures. Some companies may have a strict 14-step selling process, Ms. Bernstein said, while others want to ensure their sales force is cross-selling at every opportunity. Pequot Ventures is the venture capital unit of Pequot Capital Management, which had more than $7.6 billion under management at the end of 2006.
Closely held Recordant, based in Alpharetta, Georgia, was founded by Chief Technology Officer John May, the former chief executive of a subsidiary of supercomputer maker Cray.
Though point-of-sales data provides the results of a customer visit, two-year-old Recordant calls the in-person sales process the "black box" of retail.
"The holy grail, where 90 percent of business is done, is the face-to-face environment," Mr. Neppl said in an interview. Mr. Neppl estimated the company's market opportunity at $8 billion in the United States alone. Though the company knows of no direct competitors, he said rivals are expected.
"We know people will come into this space," Mr. Neppl said. "There's nobody visible right now."
Recordant plans to use the proceeds from the latest venture round to expand into new markets, including those abroad.