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Posts Tagged ‘Alterian’

On Monday, the SDL acquisition of Alterian was officially announced. I will remain the head of the Social Intelligence Division for SDL, helping to roll out our solutions globally.

This is an exciting time because of the tremendous assets that SDL has within its family.

At Alterian Social, we’ve evolved our Social Media solutions beyond just social monitoring and listening to encompass analytics and insights. We’ve been on the leading edge of social monitoring and engagement by integrating social insights to answer critical business questions for our customers. We’ve validated the inherent advantages of the social data set – its authenticity, near real-time access, its predictive nature, its scalability and much more.

Now, we can integrate further with SDL’s world-class language translation capabilities with our social media solutions. We can now offer better insights and intelligence globally across cultures and languages. In addition, we will now be able to provide a Social Intelligence Framework that will allow analysis of social, campaign management, email and other data sets in one business intelligence environment. Eventually, I can see that within this environment the opportunity to truly link customer information from these different data sets to offer better customer experience to consumers.

SDL wants  to provide relevant content when and where people want them. Social Intelligence obviously fits well into that.

At new beginnings, we are all allowed to dream. But certain beginnings allow for bigger dreams. My dream is to be a disruptive force in traditional markets (i.e. BI, Market Research), and we’re better armed now than ever to make that a reality.

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I’m a big believer in the Social Media Listening space. I started a company in July, 2009 to provide reports and insights using social data and it has since changed its name three times through a merger and two acquisitions. Yet, the opportunities are just beginning. If you are an entrepreneur or an investor interested in the Social Listening Space, start by segmenting the opportunities into five overlapping but distinctive segments: Social Monitoring, Integrated Campaigns, Social Analytics, Social Consulting and Social CRM.

  • Social Monitoring is how it all began. It started mostly with those within the PR function tracking brand mentions that eventually evolved into customer engagement strategies and technological extensions. Currently, there are more than 400 Social Listening and Monitoring tools in the market that range from free (hopeless business plan) to enterprise pricing models. These tools will need to integrate with one or more of the other segments or become much more vertically focused to remain relevant in the future.
  • As always, brands will spend a lot of money on campaigns/ads. Social is fast being accepted as not only a legitimate but an effective platform for ad spends. Marketers must now think about an integrated campaign that includes social as part of the strategy. With all the “purchase intents” being tweeted and focused “segments” that are available on social platforms (Facebook, Linkedin), there will be a lot more opportunities moving ahead.
  • Social Analytics will disrupt some very large existing markets, such as market research and business intelligence. The more complex and useful application of the social data set to derive insights will change these worlds as we know it. The reason that insights have always been so expensive is because access to relevant data was so limited and difficult. Now, social platforms provide access to an authentic and abundant data set at very low cost in near real-time.  Think about that. The biggest application of social data won’t really be for the current “social” buyers (PR). It will be for those who are focused on answering critical business questions. It just so happens that the social data set will provide the best and most cost-effective insights, if applied correctly. At Alterian Social , we provide predictive analytics.
  • Social Consulting will be one of the fastest growing segments for years to come. With the incredible speed and impact of Social to all brands, they will look outside the traditional agencies for specialized help. Thus, there will be great growth of companies like Dachis Group, Altimeter, among many others that are about to take advantage of this growing service demand. For entrepreneurs, this may be the safest startup idea given the relatively low start-up costs and easy path to positive cashflow of service companies. Whatever brands spend on technology platforms in Social Listening, they will eventually spend twice as much on services if not more.
  • Social CRM should be the biggest bet and the most exciting. Salesforce.com’s acquisition of Radian6 (at a high premium) was with the vision of Social CRM. The problem is that Social CRM means different things to different people. The trust is, however, the idea of a 360 degree view of customers including their social activities may just be too ambitious. The path to Social CRM will start with baby steps and the market will settle for something much less the ideal promise. Take your chances at your own risk here.

As an entrepeneur, follow your passion and your tolerance for risk. As an investor, I would recommend picking 3-5, or 5-7 startups within one of these segments rather than investing across the segments. That should offer the best chance at success in this crazy, disruptive force called Social Listening.

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SDL To Take Over Alterian

Today, it was announced that SDL will acquire Alterian. Therefore soon,  a social media business that started as Lift9 will be getting its fourth company name within the last two-and-a half years.

I started Lift9 in July, 2009 to offer social reports to large brands. On April, 2010 we merged with a boutique market research company Intrepid to provide deeper insights from the social data set. Shortly thereafter we were acquired by Alterian in September, 2010 to compliment its social monitoring and listening tool SM2.

Social is a hot space. Four transactions in two-and-a half years may not be the norm, but there certainly are a lot of activities within the Social market. I believe we are only seeing the tip of the iceberg of what will happen as the Social space matures further. The social data set has disruptive elements that will attract many innovative minds who will build considerable values in this space.

For me, this acquisition is very positive. We will have greater resources to execute on our vision of providing social insights and foresight in compelling ways. SDL has language and statistical capabilities that can really improve our tools and solutions. I expect immediate impact in extending our social offerings.

My goal today remains the same as when I started Lift9. I want to answer critical business questions faster, cheaper and more accurately than anything in the market by using social data. I believe SDL provides a conducive platform for us to execute on this goal in even a bigger way.

So, how do I personally feel about all the changes — going from a two-person startup to now being a part of a Fortune 1000 company in two-and-a half years? I consider where we are now in such a short period of time as success. Being a part of large organization offers greater opportunities as well as additional challenges. I can live with that.

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Change may come at different spurts, but it is ever present  in business and personal life. You can count on it. Yet, there are those who resist it and are uncomfortable with the uncertainty of change. Others welcome change as exciting challenges and great opportunities.

A fully-functional organization requires both perspectives to varying degrees. Those who protect against whimsical ideas and put efficiency into proven processes help an organization become more scalable and efficient. Meanwhile as markets change an organization needs those who are forward thinking and optimistic about a new future. These people can put together strategies that take advantage of the changing environments.

Today, I think the ability to adapt to change is more important than ever. The culture you nurture must be around flexibility and change regardless of how large or small the organization. If Dell, and even Microsoft, do not change their business strategies to somehow compliment the consumer adoption of tablets, they could become irrelevant. Many traditional market research companies still haven’t incorporated social media data into their solutions in a meaningful way. That will reshuffle the current hierarchy of that industry. These types of examples are abundant, including around music, movie, or news content industries.

At Alterian Social, we have an Innovation Team that looks at trends and potential opportunities for “disruption”. We want to be as opportunistic as possible within the changing environment. You as an individual, whether working for an established organization or as a budding entrepreneur, need to understand that today offers more opportunities than ever. The rapid pace of change in the current environment is a great equalizer against more established organizations.

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Now it’s almost become routine. Work visitors from all over the world coming through the Alterian Vietnam office in Ho Chi Minh City, leaving with warm memories and a real affinity for the team.

This past week we had 10 visitors in the office. One group was there to launch projects for a wonderful new client, who has really created a partnership model with us as his company’s social media vendor. The team worked hard and endeared themselves to him with real insights, dedication and warm hospitality.

Our Vietnam team members have an authentic culture of enthusiasm and collectivism that just draws visitors in. They love doing things together. They think about activities from a group perspective, rather than from an individual perspective. They are instinctively inclusive. They don’t act entitled, but thankful for each day together.

I think our client knows he will get great work and effort from the team. He also now knows he has a group of people who really are interested in him as a person and cares about his success.

A second visiting group was there for our quarterly leadership meeting. We started scheduling these meetings in Vietnam because of the cost savings of hosting them there. However, now it could cause a mini-revolt if I tried to move the meetings to other cities. They say the positive energy and gracious hospitality of the Vietnam staff creates the best environment for these off-site meetings. Not to mention most of them are addicted to the Vietnamese coffee.

To date, every visiting person has been complimentary about their experience with the Vietnam office. That’s real credit to the team and its leadership.

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It’s been a whirlwind of a week here in the UK. After the resignation of Alterian’s CEO, David Eldridge, I arrived to share my ideas about moving our ‘Social’ line of business forward in the upcoming fiscal year.

The opportunity ahead remains tremendous. With Radian6 being acquired by Salesforce.com a couple of weeks ago and then Kana buying social media company, Overtone, the social media monitoring and listening tools space is red hot, yet still fragmented with an increasing power vacuum. Some may question the viability of these tools as a stand alone play. My thought is that there is such a play but not the way these companies are positioned currently.

Social media monitoring has to be about worthwhile insights moving forward. Social consulting companies now are becoming more popular as brands realize insights come from smart people observing the social data. Eventually, even these types of insights will become more commoditized and will need to be less of a manual effort. That means the social media tools themselves will have to become smarter, which is how they will be able to survive and then thrive as a stand-alone play.

There is a way a better way to collect, organize and interpret social data than what is being done today. So, success will not necessarily be doing what is currently being done better, but doing things differently overall. The market remains exciting and I look forward to its continuing maturity.

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Today is a gloomy day here in Bristol, UK. Yes, the weather is similar to the one I left less than 24 hours ago in Seattle. However, it is more than the weather that is affecting my mood.

Today, David Eldridge, the CEO of Alterian, resigned. According to the reports from the ‘street’, our company is expected to be around 10% short of revenue projections for the fiscal year, which obviously takes away straight from the bottom line.

I remember the stress and the pressure of being part of the executive team of a publicly traded company (ARIS was listed on the NASDAQ 1997-2001 prior to being acquired iteslf). Setting the right expectations when there are so many moving parts is no easy task. Reporting on a quarterly basis sometimes forces a smaller company to focus a disappropriate amount of effort into its infrastructure. Regardless, many successful companies have made it work well to raise needed capital and increase public exposure. But it does take a special breed of people to run a public company.

David was the man who shook my hand when Alterian completed the acquisiton of Intrepid. One reason I wanted to do the deal was because of his persona, and how loyal his team was to him. David is a very smart and capable business executive, who carried himself in an honorable manner. He’s continuing to do that by stepping aside to give, in his opinion, Alterian the best opportunity to hit greater heights in years ahead.

Appreciative, I will continue to work hard to make sure that our business line gives the company the best return on its investment possible moving forward.

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PART IV: Closing the Deal

Bob Hale, Senior Vice President of Corporate Development at Alterian, came to visit in June. It was obvious he had done his research and was asking good qualifying questions about our business.  He decided to stay for dinner at Barolo Restaurant that night rather than flying back home.

Everything just made a lot of sense. Alterian had a great suite of marketing products, including SM2 (social media monitoring software) that needed services support. A large part of their revenues came from their channel and we had a model with our research center in Ho Chi Minh that could complement, rather than threaten such partners. Also, we could help pull in Atlerian’s platform into our research and strategy engagements.  Intrepid had a global reach which matched Alterian’s need for services throughout its 14 offices.

The negotiations went quickly and were finalized by end of July. It helped that we had executives experienced in transactions like this. I hired my brother, Paul Song, to do the final negotiations because he is very knowledgeable in these matters, but also because I didn’t want to be negotiating with my future bosses.

Then, the due diligence started with a tight deadline to close the deal by the end of August. I must admit I was not quite as prepared for this process as I had thought. Given that Alterian is a public UK company, there were a lot of laws and regulations that I was not familiar with. Additionally, I had under-estimated the rigor of the due diligence process.

In order to protect my team from being too distracted from running the business, I took on most of the due diligence effort myself with the support of a fantastic attorney, Daren Nitz, who had supported me though previous transactions.

The deal had some dramatic twists and turns, but the business executives at Alterian would always help put the business objectives in perspective when things were at an impasse. They gained my respect through the process, re-affirming our decision to join forces together. Never did I have a backroom discussion about corporate politics with any individual executive. They were aligned in vision and on how to execute. This has not always been my experience with these deals.

I’m extremely optimistic about our future. Misia Tramp and Liz High are already incorporating Alterian suite of products into some of our solutions. Warren Sukernek, Wilson Raj and Ed Kim are preparing for the expected increase in demand for social media services from Alterian’s channel and direct sales force.

The decision to join Alterian was relatively easy. The process to complete the deal was very intense and challenging but well worth the effort. The momentum we are creating reassures me that our initial vision to help define the social media analytics market has just become much more probable.

So, thirteen months after starting Lift9, I was in the Alterian Bristol UK office signing the Stock Purchase Agreement with David Eldridge, having scarfed down some late night Dominos pizza, feeling relieved that the due diligence was finally over…  and looking forward to the future.

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PART III: When 1 + 1 Can Equal Something Greater Than 2

We met at Wild Ginger for the first time in December, 2009. Misia Tramp and I talked about leveraging the available social media data for market research projects. She obviously knew her subject matter as she had been providing market research services through her company, Intrepid, for more than 11 years.

Misia had charisma that was further enhanced by her proper British accent. I was intrigued about the rigor of market research methods that could be used with social media data to gain truly useful insights. We left that lunch with just a promise to reconnect, but my mind was already racing ahead about the possibilities.

Lift9 had expertise around social media data and analytics. We had an improving team of cost-effective analysts at our research center in Ho Chi Minh. Intrepid had agro rhythms, methods and rigor from market research projects that could potentially be applied to social data. They had a bigger revenue base, but struggled with margins that would be improved with Lift9’s cost structure and focus on accessible digital information.

My first proposal was to merge Lift9 with only the US entity of Intrepid. In the end, however, we decided to merge both the UK and US operations of Intrepid with Lift9.  Misia’s business partner, Liz High, had been running Intrepid UK.

We put together an operations agreement in late January, 2010 to test whether we could merge the two companies’ products. Meanwhile, we concurrently kicked off the due diligence of the deal.

The signs were encouraging from the start. Misia was able to get more attention from her client base by incorporating social elements into her pitch. In many cases we were able to deliver faster, better and more cost-effective outputs right away.

The biggest challenges were at the speed we needed to improve our cash flow, which had been a deteriorating issue for Intrepid, and how to effectively merge the two different cultures into working cohesively together. We allowed some turnover of people in the beginning, and focused on driving sales and improving margins and cash flow.

On May 3, 2010, we finalized the merger with Lift9 taking controlling interest, but keeping the Intrepid brand. From there, the financial performance began to improve so dramatically, I started to think about raising capital to acquire additional boutique market research companies that had solid client bases. We now had tangible proof that combining social elements with traditional market research methods provided compelling insights that resulted in better sales traction and improved financial results.

The management team approved plans to raise money for acquisitions, which included up to 11 potential transactions within a three-year period.

Right about then, I received a call from an Alterian senior executive about a possible service partnering deal using its social media monitoring tool, SM2. When he asked to come visit us, I had an inkling our world was about to change yet again.

My advice to entrepreneurs is to keep improving your companies’ stories through different possibilities. Don’t get too stuck in just what you are trying to do with your current resources. Understand what’s happening in the market around you and find ways to improve your story within that context.

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The Dominos Pizzas arrived while we were all scattered among the desks in front of the CEO office. It was late, nearing 10pm in the Alterian office in Bristol, UK. The “deal” team was frantically making the final changes to the stock purchase agreement, while others were trying to coordinate the signing of a wide range of documents from three different continents.

I called Warren Sukernek, the EVP of Intrepid US & Vietnam, who was in Seattle eight hours behind, imploring him to get all the new employment agreements signed. I knew he was trying his best, he always does, but my anxiety was growing by the minute.

Hungry, those of us in Bristol, devoured the pizzas without much enthusiasm. It was just necessary fuel to get us past the finish line.

We had gotten all the signatures from Ed Kim, Director & Country Manager for Intrepid Vietnam, and now were waiting for documents from the London and Seattle offices. The executives who had gathered in Bristol could not sign until all the other documents were first signed and accounted for.

Liz High, the Managing Director of Intrepid UK, informed everyone that all the documents were now accounted for from the London office. I resisted calling Warren again.

Meanwhile, the final schedules to the stock purchase agreement were ready for my review. I particularly focused on the list of our liabilities, which seemed to grow at every revision.

Finally, Warren called with the welcomed news of delivering the necessary documents from the Seattle office. Now, all the documents had to be routed to Alterian’s lead attorney in California.

David Eldridge, the CEO of Alterian, the company that was about to acquire my company, Intrepid, went to the printer while the final version of the stock purchase agreement was being printed. He playfully joked about how the stack of paper felt like a lot of money. We all laughed at the humor, but also with some relief knowing that the deal was about to happen.

It had been almost three months since Alterian approached Intrepid with interest, and five long weeks of grueling due diligence since negotiating the initial terms of the deal in late July. The month of August had been tremendously intense for me, and it was about to end.

With the stack of papers, David and I with the rest of the deal team walked to the front desk and signed the deal in front of the Alterian’s logo. Done deal!

How did I feel just then? Relieved mostly. I was Just happy at being able to move on from the grind of due diligence.

In the following blog posts, I will be writing a series about starting Lift9 a little more than a year ago and merging it into the Intrepid brand before signing this deal to join forces with Alterian.

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