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Verix Private Vendor Watchlist Profile

IDC Opinion

Verix was founded to address a common challenge in the business analytics space — the difficulty of analyzing and making sense out of increasing amounts of data to obtain meaningful business inputs, let alone in real time. As existing analysis tools rely highly on business managers to define hypotheses and drill down into hierarchically organized data, the analysis process is typically iterative and may often result in misleading or shallow findings. Verix Automated Analytics Suite tackles this problem by proactively alerting managers to emerging trends that will allow them to take earlier and more precise actions in the marketplace. We believe Verix is a company to watch because:

  • Verix can be appealing to large organizations in specific vertical industries in which rapidly and accurately responding to evolving trends and changes in customer behavior can be critical
  • With IT budget constraints in mind, as companies often address the need to identify trends from increasing volumes of data by using internal or outsourced analytics centers, Verix’s SaaS solutions can be considered cost effective

In this Vendor Profile

This IDC Vendor Profile analyzes Verix, a company playing in the business analytics market, and reviews key success factors: market potential, technology/solution, corporate strategy, force multipliers, and customers. Leveraging IDC’s expert understanding of the competitive landscape and future outlook, this document highlights company and market information tailored to the investment professional’s needs.

Situation Overview

Company Overview

Verix, based in Mountain View, California, plays in the business analytics market. Company details are provided in Table 1.

 

Figure 1 shows the cumulative Watch Factor score for Verix versus the Watch Factor average score for all companies ranked by the Private Vendor Watch Service at the time of publication.

Figure 2 shows the breakdown scores for Verix. The sections that follow detail the reasons for those scores.

IDC Watch Factor Scores

IDC Watch Factor scores measure private companies based on a set of defined success factors:

  • Market potential: Strength of the market, and the potential for the company to grow within the market
  • Technology/solution: Strength and differentiators of product/solution
  • Corporate strategy: Potential exit strategy and company leadership, vision, and funding
  • Force multipliers: Number of valuable partnerships and opportunities, as well as channel strategy
  • Customers: Existing and potential customers and vertical audiences

Market Potential

Market

Verix’s solutions fall into the CRM analytics and business intelligence (BI) tools segments of the business analytics market. The worldwide CRM analytics market is estimated at $1.6 billion in 2008, and it is expected to grow to $2.3 billion in 2011. The worldwide BI tools market is estimated at $7.8 billion, and it is expected to grow to $11.8 billion in 2012.

Verix’s revenue is estimated to be in the range of $1 million to $10 million.

Market Disruption

Verix is currently focused on two major vertical markets — consumer packaged goods and pharmaceuticals. By offering its solutions as SaaS, the company is aiming at addressing common barriers to the adoption of on-premise business analytics solutions.

Competitive Landscape

Functionality-wise, established business analytics players, such as Business Objects (SAP), Cognos (IBM), SAS, SPSS, and others, are offering at least some of the functionalities provided by Verix, especially around anomaly detection. However, the company believes that its predictive exception monitoring capabilities, the timely detection of trends and changes in customer behavior, and its focus on specific verticals are strong differentiators, which make its solutions more complementary than competitive.

In addition, established vendors (including some of the abovementioned) and a slew of start-ups, such as PivotLink (FKA SeaTab), LucidEra, Oco, QL2 Software, OnDemandIQ, Blink Logic, and others, are offering different business analytics SaaS solutions. However, most of these players have a different focus than Verix.

Technology / Solution

Verix Automated Analytics Suite

Verix Automated Analytics Suite is a SaaS-based solution that automatically scans all intersections of multidimensional data, discovers granular changes in trends, clusters changes with similar patterns, analyzes underlying drivers associated with change, and generates alerts at actionable levels.

While traditional analytics solutions rely on individual interpretation of data, Verix provides organizations with automated, exhaustive analysis of all the available data with no predefined hypotheses necessary. Furthermore, the product allows to analyze data over a period of time, rather than static data snapshots. Thus, it enables the identification of true behavioral patterns of businesses and provides executives with early visibility into changes and trends.

Based on this technology, Verix has developed two solutions to address the needs of specific vertical markets — Verix Automated Analytics Suite for Consumer Packaged Goods and Verix Automated Analytics Suite for Biopharmaceuticals. In addition to the general sales and marketing performance functionality, each solution includes several modules that are aimed at addressing vertical-specific needs.

Corporate Strategy

Leadership

Doron Aspitz, CEO, was cofounder, chairman, and CEO of Blue Pumpkin Software, a workforce management solutions company that was acquired by Witness Systems in 2005 for about $90 million. Prior to founding Blue Pumpkin, Aspitz held global business and technical management positions, including manager of product strategy development at Tandem and product line manager at IBM.

Aspitz joined Verix in 2006 as part of a repositioning move, in which the company changed its name (formerly Business Events) and shifted focus toward industryspecific solutions.

Go-to-Market Strategy

  •  SaaS

Exit Strategy

The business analytics market has been rapidly consolidating over the past years as major players, such as Hyperion, Business Objects, and Cognos, have been acquired (by Oracle, SAP, and IBM, respectively). As Verix can provide complementary capabilities to business analytics, it could become a target for leading vendors that are constantly looking to gain competitive edge through acquisitions in this space. Verix’s partner Nielsen, as well as other data service providers, are also potential acquirers.

Another acquisition driver may be Verix’s SaaS-based offering. As seen in Table 2, over the past two years there were several acquisitions of business analytics SaaS providers. Looking ahead, as demand for SaaS is expected to grow, business analytics vendors are likely to expand and enrich their SaaS offerings.

Key Acquisitions

  • None

Current Investors

Verix raised close to $20 million in two financing rounds from Gemini, Carmel Ventures, and Hillsven for product development, market penetration, and building market positioning and awareness.

Force Multipliers

Partners

  • Nielsen

Partnership Opportunities

  • Verix is looking for OEM partnerships with major business analytics vendors to provide its solutions on top of their infrastructure

Channel/Sales Strategy

  • Both direct and indirect SaaS channels

Customers

Key Customers 

  • Nielsen, TherRX, Tnuva, and Kraft

Key Audiences

  • Large enterprises in the biopharmaceutical and consumer packaged goods industries

Geographic Reach

  • North America

Future Outlook

Challenges and Opportunities

Challenges

Business analytics SaaS solutions, such as Verix’s, can be appealing to organizations by addressing common issues surrounding on-premise solutions that involve high costs, long implementation time, and substantial IT department resources required for testing, deployment, and continuous maintenance. However, these factors trade-off with limited customization capabilities. Although a SaaS delivery model typically means that the vendor is continuously developing and adding new functionality at no additional cost, the customization requirements at each individual client site may be difficult to meet.

Another challenge for Verix is to keep expanding into additional vertical markets. The company is planning to move into the Web analytics space as well as other fields in the longer term. This growth would require significant financial resources, for which the company may need to raise additional funding.

Opportunities

Companies often address the need for analytic insights through outsourced analytics centers. However, the option of using an external team to analyze ever-increasing amounts of data has several weaknesses, such as high costs and limited relevancy of the insights discovered, which tend to be out of date by the time they reach the business users. Verix’s solutions can address these common drawbacks, offering organizations a cost-effective alternative and improved response times.

In addition, Verix can benefit from the move toward business analytics SaaS. Today, the business analytics market is expanding in two ways. One involves organizations new to business analytics solutions that don’t have the necessary internal IT or analytics expertise. The other involves expansion of business analytics solutions within organizations that have expert staff but lack enough resources due to rapid growth in end-user demands for new analytic functionality and content. The shortage of appropriately skilled, internal resources is expected to continue and even become more pronounced. SaaS offerings will play an important part in addressing the end users’ demand. In addition, budgetary constraints may prevent large acquisitions of traditional business analytics software. Business analytics SaaS offerings will enable companies to spread costs over a greater time period to reduce impact on profits.

Essential Guidance

Reason to Watch

Verix can be appealing to large organizations in specific vertical industries in which rapidly and accurately responding to evolving trends and changes in customer behavior can be critical.

Differentiators

Verix Automated Analytics Suite proactively alerts managers to emerging trends and customer behavioral changes, allowing them to take earlier and more precise actions in the marketplace. The company’s solutions reduce the need to rely on individual interpretation of data, build a hypothesis, or base analysis on assumptions, which can be limited in scope and misleading.

Learn More

Related Research

 Worldwide Business Intelligence Tools 2008–2012 Forecast: Limited Impact of Short-Term Economic Uncertainty (IDC #211327, March 2008)

  • Business Analytics Software as a Service (IDC #209815, December 2007)
  • Worldwide CRM Analytics Software Applications 2007–2011 Forecast and 2006 Vendor Shares (IDC #208830, November 2007)

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Source: www.IDC.com
Date: January, 2009

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