At the Cantech Investment Conference last month in Toronto, OMERS Ventures CEO John Ruffolo identified five Canadian companies that he felt were ready to IPO. Four of those companies have already attracted a healthy dose of press attention, owing to the relative sexiness of shopping (Shopify), social media (HootSuite), video (Vidyard) and educational software (Desire2Learn) and the convergence of any and/or all of those things. Occupying a lower profile has been the hypergrowth of Vancouver’s Vision Critical, a market research firm that chafes at the label “market research”.
Anyone of a certain age remembers the name Angus Reid as being synonymous with late-20th century polling and market research methods in Canada. It makes sense, then, that his son Andrew has both followed in his father’s footsteps and exploded the field in a way that hobbles the capacity of the term “market research” to either contain or describe the activity and ambition of Andrew’s activities with Vision Critical.
What’s clear from watching Vision Critical’s development over the last couple years is that this is no longer the 20th century, and this is not your father’s market research. A recent industry poll ranking the Top 10 most innovative market research companies globally placed Vision Critical at the #2 position, moving up from #3 the previous year. Google placed fifth (even with the advent of Google Consumer Surveys, which when combined with its Analytics really ought to move it higher up the list, if only by scale).
As Ray Poynter, Director of Vision Critical University, recently pointed out, mobile is no longer “the next big thing”. That boat has sailed, and companies still preparing for the shift towards real-time, mobile marketing are today operating at a disadvantage. Marketers who are unable to cope with the challenge of harnessing the power of ubiquitous mobile connectivity, preferring the ad hoc, “gut feeling” and imprecise methods of the 20th century will be overcome in short order by the agility and precision inherent in the method of companies like Vision Critical. Check that list again next year, to see who occupies the #1 spot.
Recently, Cantech Letter’s Terry Dawes talked to founder Andrew Reid by phone from Vancouver.
Andrew, in 2012, OMERS Ventures came along and put $20 million into Vision Critical and all of a sudden, people knew who you were. You’ve become higher profile since then, but maybe we could begin by talking just a little more generally about the company. It came out of a very 20th century paper-based, survey-oriented kind of a thing, which seems baked into the DNA of the company. Maybe we could just talk about the transition that you made from that to this more dynamic technology-based company.
Yeah, it’s been such a fun evolution. Growing up with Angus Reid as your father, sitting in the back of the car listening to him constantly working as he grew his business that he started in 1979 in Winnipeg. Growing up around that, I definitely did have some market research embedded in my DNA and I was around it so much. He did a lot to really dominate innovation on the telephone, ways that we could really transform and use the telephone for different kinds of methodologies of polling techniques, things like the Omnibus and other techniques that he spent a lot of time pioneering. And when the Internet came along and we started being able to use the Internet as a mechanism to do market research, we then entered this next era. And really Vision Critical has capitalized on that in a big way. I think, since the ‘20s and ‘30s people have been doing market research and people have recognized the importance of constantly talking to your stakeholders and getting feedback.
What has changed?
What is clear, and has been clear in the last few years is, we needed a way to figure to do that economically and to do that quickly. And I think that’s what Vision Critical has been able to capitalize on, is we’ve really brought market research into the 21st century and into the digital arena, where it can coexist alongside Big Data, where you’re able to look at all of your data and look for patterns and outliers and trends, which often result in a lot of questions you want to ask your customer, or non-customers, and a lot of hypotheses you create that you want to validate. But on the flipside, you’ve got social media and our ability now to voyeur in on customers and watch what customers are saying. What’s the street saying? Which is very interesting. Being able to have this connection with your customers in this constant interaction, I think, really augments or complements both what’s happening with Big Data and this phenomenon of social media. It’s always been important to talk to customers. It’s just, to do that scientifically, to do that with enough rigour, something that historically has cost $60,000 and takes 6 to 8 weeks to be able to get some answers, well, that just takes too long now. We need to find ways that are more economical, and that also can leverage the power of what we can do with technology. So that’s been exciting. It’s really been exciting, being part of Vision Critical and watching it grow, and how we have hundreds of these communities we run for very large brands all around the world in really every single segment, and we’re helping them have a continuous dialogue with their customers and really infused that voice of the customer into their everyday decision making. And we’re seeing that this isn’t just a trend. This is here to stay. And the market is really starting to run at us, as much as we’ve spent a lot of time building the market. We’re starting to see a lot of enterprises that are waking up to this model and recognizing the value.
It’s been a remarkable transition. When I think about the old-fashioned way of doing surveys, I tend to think of those multiple-choice circle things where you pencil in “C” or something and you’re cautioned not to pencil outside of the circle because the machine won’t be able to read it. And now we’re actually moving into this era where, with social media and people essentially having phones all the time, and theoretically marketers can know when a person is walking by a particular coffee shop, and if the coffee shop happens to know that the person likes a certain type of coffee, they can offer a discount in real time. Not to mention, I wrote an article last year about this pre-cognitive initiative that you have, developed I think with a Boston based company, where you’re trying to tap sentiment based on facial recognition.
Yeah, we’ve done a lot of that pre-cognitive, emotional response tracking. I’m a very curious person. We’ve been very interested in always exploring the depths of where we can go, but I think, to what you said before, it’s about trying to make sure you can connect the enterprise to the right people at the right time in the right context, to get the right decision and the right input to make decisions. And so being able to do that, sometimes it’s a big strategic initiative, sometimes it’s reacting to a “black swan” event, Hurricane Sandy, something significant that’s happening, major changes in the economy and people’s confidence in the economy. If there’s something significant that happens, you want to get that feedback immediately. That’s a lot of the power of this model that we’re bringing to the market, and why I think it becomes addictive, and it can be something that can literally change the culture of the enterprise.
Actually, that’s one of your strengths at Vision Critical, is because when I think of your background, it very much retains that element of the human touch. I see a lot of newer tech start-up companies talking about real-time social engagement, and it’s missing that whole earlier part, the analogue dimension, of how to talk to people like they’re people rather than, I guess, treating them as social media metrics.
I watched a video of the CEO of IDEO last week, and he was talking about “design thinking” and how pervasive design thinking is across the enterprise now, and this whole notion. And one of the big elements of design thinking is talking to your stakeholders. You have to make sure you have this two-way dialogue in everything you’re doing. And I think some people have lost sight of that, again because of that time and cost, and there’s so much other data surrounding the enterprise. “Why do I want to stop and slow down and talk to my customers?” Again, that’s where we can make it easy, we can make sure that it’s easy, it’s efficient, and you can get the actionable insights you need. Those barriers are removed, and now we can go back to having that customer seated at the table on a much more frequent basis.
That OMERS investment that I mentioned earlier seemed to be a signal event for Vision Critical, and you recently brought in some personnel, in the form of Derek Smyth, as your new Chief Revenue Officer, who used to be with OMERS Ventures. How has he been working out for you?
The OMERS investment definitely, I think, woke people up, the investment community and other folks in Canada, and gave us more exposure. And we’ve really been able to bring in some fantastic talent to help us grow. Derek Smyth being our new Chief Revenue Officer, really running our go-to-market strategy. Derek’s a great software guy. He’s had a lot of success in the past. He’s a real deep thinker, and he’s been around for about two quarters now, and we’re really feeling the effects of how he is to have on board. Kobi Ofir, who we picked up from Eloqua since they’ve been acquired by Oracle, our new CTO, is again a fantastic guy who’s brought some great experience from Eloqua and from Rypple, we’ve been able to bring in and help us on the software side. And I look at people like Nick Stein, who’s coming to us in marketing from Salesforce.com, or Donna de Winter, our CFO who we’ve had for well over a year now, who was at Varicent and Geac before that. So we’ve really been able to, I think, augment a lot of the people who have been at Vision Critical for a long time, that are fantastic leaders and real great entrepreneurs and bringing in some people that have been around high-growth technology firms and can really, I think, help us achieve our lofty goals for the future.
Kobi Ofir especially, who had a background coming more from the world of the start-up, more or less, and has very deep experience there. It feels like at Vision Critical, there’s some kind of dynamic between start-up, like two guys and their logo on a shirt, and these publicly traded companies. And Vision Critical has obviously risen to that point where it’s a larger than medium-size enterprise.
We’re trying to still think like a start-up, though. We’re trying to still have a bit of that mentality, which I think is exciting because you get this infectious enthusiasm around the opportunity, you have this excitement and frustration around time. You want to get as much as we can get done in a small amount of time. We recognize we have this exciting window, and we’re doing everything in our power to clear hurdles so that we can just charge forward as quickly as possible, and at the same time make sure we’re delivering a really good product with really great enabling services and the right message to the market.
Well, at this point you’ve got the scale that start-up companies lack. Every time I read a story now about Vision Critical in the news, it’s always got an international slant. You’re in Australia, there’s some new office space in Manhattan, there’s a London office. But you obviously feel that there’s a lot of room left for expansion.
There definitely is. We’ve actually done our best to, as I was talking about removing barriers, we’re really focusing on this insight community model and we’re finding a lot of success with it. And we’re recognizing that we don’t need to do a lot of other things besides enable that model, make sure that we can be successful, that we can integrate with other technologies. And we are finding success in every vertical in every region. So whether that’s our Hong Kong office, what’s going on in Cologne, Germany, what’s going on with our office in South Africa or Paris, we’re having really good success with this model. And I really think that the next evolution for us is to take that model and take it to other places in the enterprise, whether that’s the social media and social analytics group, whether that’s the CEO. We’ve got a customer based out of London and every single board meeting, they end and they ask their board members if they have questions for their customers. They go out and talk to their customers as an insight community and within a week they send a report back to their board members, which is quite remarkable. I’ve never heard of another company that has enabled that board member engagement with customers. So we’re not really finding a specific segment or market that there isn’t a fit with, which is very promising.
There’s a versatility, too, to the kind of verticals that you’re talking about. You’re doing a lot of work with municipalities around the world, like in Surrey, the City Speaks initiative. So how do you manage those dynamics around pure marketing and getting into the feedback, and I guess using the one to inform the other?
Definitely. The municipal government initiative is really exciting. I think we’ve got about five that are active now, and a whole bunch more that are coming into the fold in the next few months. With municipal governments, it’s very natural, this evolution of the town hall and trying to get people out together to talk about initiatives. We need to find other ways to engage people. And citizens have been very good to be self-organized using social media. It’s now time for the government to step up. This model of municipal governments recruiting a few thousand of their citizens so they can get feedback on everything from parks and rec initiatives to law enforcement to much bigger initiatives. I always think about the Occupy movement. We had the Occupy movement in Vancouver, set up for what seemed like forever, it was a few months. And had the city of Vancouver had an insight community, it’d be very easy for the chief of police to be standing on a bullhorn talking to people hours into Occupy, giving them feedback on what thousands of Vancouver residents thought about this. It makes it much easier to be empowered to take action. And for us, I think we’ve got the right platform and model that enables that. We just need to help the resources, any municipal government, to give them the right templates, the right tools, the right coaching on how best to be successful in leveraging their insight community. When I think about the future, it’s about, “What do we do to further democratize market research, so that it doesn’t require always having to have a specialist at the helm of every project?” You can have someone that’s in product development, or in marketing, or in sales or sales enablement, leveraging this model. And that’s really where we’re going, is to bring it as broadly into the enterprise as possible. Whether that’s municipal governments or that’s someone specifically at a product or service company.
Vision Critical is sitting at about $100 million a year revenue, I think. And recently I read that you aspire to $1 billion revenue. Up until recently, people among, I guess you could call them “legacy” businesses, have been pretty skeptical of the whole model of social media. There’s a lot of people who call Facebook “Faceplant” and stuff like this. But you actually see this happening, this panning out, and you feel that the room for expansion is there. It’s obvious that this has become real, that having a social media presence and engaging with customers is the new normal, and it’s called “table stakes” I guess for any small or medium-size enterprise now. You see that happening, then, how you will get from here to there?
Definitely. I like to think that we’re creating our own new category. The voice of the customer has always been important, and you’ve used things like customer satisfaction and brand tracking as mechanisms that the enterprise uses to validate, as a scorecard, to understand how well they’re doing. I think you’re going to see this new model of these insight communities and this idea of continuous dialogue. It’s not just about ad hoc or one initiative or one question, and once I answer this one question I’m in great shape. I’ve got to answer this one question, I want to go back and ask somebody some questions a few days from now or a few weeks from now or a few hours from now, and I want to build on that and I want to understand how their attitudes and opinions change over time. So we definitely feel that, because of the indicators that we’re seeing from the market, the sky is the limit. I’ve been bold enough to say that if I look at what Crystal Reports and Business Objects are able to do, really helping to define the business intelligence movement, I think we’re going to see a movement around the voice of the customer that’s as exciting, again, because the enterprise has more data than it’s ever had before, and we’re realizing now that it’s also more important to engage your customers than ever before, because at the end of the day they’re the ones that are going to decide how successful you’re going to be. So, yeah, it sounds crazy when you say the “B” word, but I really think it’s possible. I think it’s possible for us to get there and, yeah, obviously having a run rate now of over $100 million, it’s been that way for a few months, is a fantastic indicator, and I’m pretty lucky to be part of an amazing organization like this.