Norkom Technologies, an ambitious Irish start-up, yesterday unveiled its Alchemist customer relationship management product and mapped out its strategy to become European market leader in three years, and a major global player within five.
Paul Kerley, Norkom’s founder and CEO, said Norkom will distinguish itself from the mass of new CRM players by providing customers with the tools to improve their customer data management analysis practices, and not simply offering to automate front-office operations. My business is about creating profitable business relationships Kerley said.
Alchemist, which has so far consumed $3m in development funds and the efforts of eight researchers and 24 full-time development staff, is the key to Norkom’s strategy. At its heart is an analytic engine which has not been cobbled together from different old components, claims Kerley, and which incorporates some of the radical modern statistical techniques.
One of these, the Vladimir Vapnik technique, developed by a Russian mathematician employed by Bell Labs, has been taken on an OEM basis from KXEN, a French developer of military and meteorological analysis systems, and adapted to the needs of Norkom’s target markets, which include the retail finance, insurance and telecommunications sectors.
As well as being among the five-fastest performing statistical techniques in the marketplace today, Kerley claims the Vapnik method is faster and easier to deploy than conventional statistical analysis methods, and it is more robust.
Conventional statistical techniques generally require months of training against a subset of a customers consumer data, requiring several iterations before the same levels of accuracy achieved against the sample data can be achieved against the full production database. However Vapnik introduces noise to the sample data, making the training exercise more realistic, and increasing the likelihood that the same levels of accuracy will be carried over from the sample exercise to the full database implementation.
The ease of use of Vapnik should also make it simpler to put directly into the hands of the end-users, says Kerley, and Alchemist is configured as a thin-client system that will give users direct access to their analytic algorithms via a web portal. By expanding this approach using Java-based agents and tools, in time, Kerley says, Norkom will even make Alchemist available to its customers’ customers, by creating a corporate customer loyalty intimacy portal that will see Alchemist driving services directly to customers.
Alchemist is being positioned as a highly-engineered product, suitable for very large customers. An approach taken by SAP, and which Kerley admires. He said Norkom’s typical customers will have consumer databases of 500,000 or greater, and will require to monitor customer behavior against hundreds of variables. Five European companies are already trying the product on a beta basis, and the company is on course to generate revenue of around $7.5m in this, its second year of operations.
Kerley said he plans to sustain this growth at annual rate of 200% for the foreseeable future, and will move to add Scandinavian and US offices to the company’s existing Belgian, Dutch, French, Irish and UK operations by February next year. To be a truly global player, Kerley concedes that a US operation is essential, but for the next two years at least his chief focus will be Europe, where he plans to ring fence my market against the Americans and to take advantage of a backlash against always taking technological leadership from the US.
Once the company’s European roots are deep enough, (and the company is close to securing another $15m in funding as fertilizer) Kerley promises his team of Irish wild geese (educated Irish expatriates that have returned to Ireland’s new e-economy with global business skills and experience) will take the fight to the US in earnest. Along the way he expects to pick up the support of large systems implementers like Andersen Consulting, PricewaterHouse and Ernst & Young, who hopes to convince that Norkom is the new killer app for the post-SAP era.
At this point in, in about two and half years says Kerley, the company may consider an IPO or some kind of trade sale. But there will have to be at least $200m on the table before we’ll even consider any movement, Kerley said.
