Readers of this
blog may have noticed that Fizzback, an investment we made in 2005, gets lots
of coverage – here in and in tweets @robinklein. Aside from the fact that I’m
passionate about customer service being a fundamental competitive advantage and
one of the pillars of a great brand, I have a strong personal connection with
the company.
Today we are
announcing that a sale of Fizzback to Nice Systems (NASDAQ: NICE) for approximately $80m has
been agreed. The transaction is scheduled to close in a few weeks.
In many ways this
is a great result for the team and the investors to be celebrated. Nice is a
very good home for Fizzback and Fizzback is going to add considerably to Nice
(see product/market details below)
On the other hand,
its a disappointment that a company which had begun to make a global impact in
the world of Customer Experience Management, had captured some of the largest corporate clients worldwide, is not going solo ‘all the way’.
The TAG philosophy
has always been to support founders and to recognize that entrepreneurs’ own motivation must ultimately be the deciding factor in these types of decisions.
Some history of
this super company is relevant and I think interesting.
Our relationship with
Rob Keve, Fizzback's founder, goes back about 15 years and we invested in IMI
(Instant Market Intelligence – its former iteration) in 2005 - as part of the
company's small seed round. I well remember the 4 hours Rob and I spent driving to and
from the Cotswolds every month during 2003 for the Cotswold Company's board
meetings. Rob was thinking about starting IMI.
Like many successful
companies, the vision for Fizzback made a few pivots along the way.
Its initial vision was to
address demand for rapid market research and new forms of customer insight- kind
of vox pop via SMS. Selling a product to the market research community didn’t
seem to me to be a place where we’d find good sized budgets. Rob had another
much more appealing idea which he was running in parallel. A service to
retailers and service providers which enabled consumers to provide feedback at
the point of experience – in store, on the train etc – via their mobile phones
– via SMS. IMI would interpret the message (using NLP appropriate to SMS
‘speak’), categorise and direct the message to the appropriate department for
action.
This latter idea got me
excited. I agreed to invest and join the board as Chairman.
Rob and I pulled
together a small group of angels – including Jonathan
McKay – and what a great decision that was! Jonathan, who is a real
enterprise software/services guru, took over the Chair in 2008 and helped Rob
build the stellar sales team and been an invaluable guide to the business.
Step one back in 2005 was
hire a small team. Tech head was Herx
Fisherman who conceived and built the original Fizzback Enterprise platform.
Operations head was Jonathan Morris (my
son-in-law) – still the Operations Director of the group, often holding things together …. another reason for the
soft spot for this company.
Step two was creating a
brand which would define a category. With the help of Phil
Ley of Branded, Fizzback emerged. This was not about market intelligence,
it was about actionable feedback.
The learnings gleaned
from early clients like Butlins, National Express and others helped the
evolution of the product.
The 2 relatively modest
funding rounds – first from Advent £2.5m in October 2006 and later, at the end
of 2009 £1.6m from Advent, Nauta and TAG helped focus the company on bravely
targeting giant accounts like Tesco, Carphone Warehouse, BT, Vodafone, Virgin, O2, Waitrose, Eurostar and the rest.
These kinds of
customers ensured that the Fizzback platform was always at full stretch – not
just in terms of scaling but in their demands for enhanced functionality. Great
customers demand great products and service!
The support from our VC
backers has been magnificent – in the very early days from our good friends at
Advent - first Frederic Court and then from Mike Chalfen – who is a master at the insightful
intellectual challenge and has been an active practical support all the way.
Jordi Vinas, the Nauta
board member provided the Euro perspective and his knowledge of the mobile
vertical in particular has been hugely valuable.
So another great European company gets sold to a foreign company just 6 years after its foundation. No problem with that -and I do expect we'll see more of the proceeds being re-cycled and re-invested in the growing Euro tech eco-system.
Extracts from the
press release:
The Fizzback
SaaS offering is a real-time operational VoC solution. It sends consumers
requests for feedback relating to a specific interaction or transaction via
mobile, web or social media. The consumer is engaged at the point of
experience, for example in the contact center, branch, point of sale (POS),
mobile application, or web. The feedback is analyzed by the system to determine
a relevant response, and automatically conduct a dialog with the consumer in
natural language rather than a survey format.
Fizzback’s
unique approach generates game-changing response rates of up to 50%,
significantly higher than industry norms at under 10%, as it motivates
consumers to provide relevant feedback, at the moment of interaction.
Additionally, consumers provide feedback about their experience rather than
only about what was asked in a survey. With more than 150 million feedbacks
collected annually, Fizzback enables organizations to better understand their
customers’ perceptions, and be agile across the organization, while improving
customer experience at the various enterprise touch points.
The combination of Fizzback
and NICE will both improve CEM as well as operationalize VoC both for the
contact center and across the enterprise. Correlating customer feedback to
specific interactions or transactions helps improve performance enterprise-wide
with statistically validated responses, as well as enhance quality management
and processes. Key efficiency metrics that can be significantly improved
include First Contact Resolution (FCR) and Average Handle Time (AHT) in the
contact center and employee performance in direct
customer facing roles.
Capturing, analyzing
and acting on the Voice of the Customer (VoC) is critical to the success of any
Customer Experience initiative. NICE’s cross-channel analytics solutions
support VoC programs by: (1) analyzing customer interaction content (indirect
feedback), whether the customer is interacting with the organization or talking
about the organization through the contact center, social media, or other
channels, and by extracting insights from these interactions; and (2) by
analyzing customer behavior (inferred feedback), such as transaction and web
browsing patterns or their journey along different touch points. By adding
direct customer feedback with the Fizzback solution, NICE now provides a
complete CEM solution that delivers a holistic understanding of the customer by
combining on one platform the VoC from each of the three feedback dimensions:
direct, indirect and inferred.
Zeevi Bregman, President and CEO of NICE said, "
The adoption of and demand for CEM solutions, at all levels of the
organization, including Marketing, Finance and Operations, is on the rise. With
the addition of Fizzback, NICE is expanding the scope of its capabilities of Impacting
Every Customer Interaction by introducing a Customer Experience Management
solution with the most complete Voice of the Customer offering. This enables
our customers to more effectively capture, understand and leverage VoC as the
foundation to a cross-enterprise CEM strategy.”
Rob Keve, CEO of Fizzback said, “Our unique solution
has been enabling our customers to achieve exceptionally high response rates
from their customers, and to receive feedback in real-time. This combination
allows them to take immediate action for increasing customer loyalty and
driving efficiency across the enterprise. This has resulted in extremely high
usage rates for our customers, making Fizzback a strategic part of how our
customers make decisions and run the business. Thus, we are proud to have
experienced rapid growth and high rates of product adoption. We are looking
forward to combining these capabilities with NICE’s real-time, cross-channel
analytics to provide both NICE and Fizzback customers greater access to even broader
capabilities with a more complete VoC solution.”
Under the terms of the agreement, NICE will acquire Fizzback for a
total cash consideration of approximately $80 million. Subject to certain
conditions and satisfaction of terms, the transaction is scheduled to close in
the beginning of the fourth quarter of 2011 with 2 to 3 cents dilution of fully
diluted Non-GAAP EPS for that quarter. In 2012, the acquisition is expected to
add approximately $20 million to NICE’s non-GAAP revenues, to be slightly
dilutive, and to become accretive to fully diluted Non-GAAP EPS within four
quarters post closing.
http://www.marketwatch.com/story/nice-to-acquire-fizzback-introducing-the-most-complete-customer-experience-management-offering-with-the-integration-of-revolutionary-real-time-voice-of-the-customer-solution-2011-09-19
About Fizzback
Founded in 2004 headquartered in the UK and backed
by Advent Venture Partners, Nauta
Capital and TAG, Fizzback is a global provider of Voice of the Customer
solutions, providing software solutions
for Real-Time Customer Feedback that drive customer loyalty and employee
performance. The award winning Fizzback solution helps companies listen,
respond and act in real-time to their customers’ comments. Fizzback customers
include tier-1 organizations from a variety of vertical industries, including,
British Telecom (BT), O2, Best Buy Europe, Everything Everywhere, National
Express Virgin Media, Tesco and
several Tier 1 North American telecom carriers.
About NICE Systems
NICE Systems
(NASDAQ: NICE), is the worldwide leader of intent-based solutions that capture
and analyze interactions and transactions, realize intent, and extract and
leverage insights to deliver impact in real time. Driven by cross-channel and
multi-sensor analytics, NICE solutions enable organizations to improve business
performance, increase operational efficiency, prevent financial crime, ensure
compliance, and enhance safety and security. NICE serves over 25,000
organizations in the enterprise and security sectors, representing a variety of
sizes and industries in more than 150 countries, and including over 80 of the
Fortune 100 companies. www.nice.com.
Previous posts re Fizzback:
http://the-accelerator.blogspot.com/search?q=fizzback
http://the-accelerator.blogspot.com/2009/01/strong-momentum-for-fizzback.html
http://the-accelerator.blogspot.com/2008/07/fizzback-tops-them-all.html
