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Euclid’s Funding Round And The ‘Logged-In’ Brick-and-Mortar Experience

CEO Brent Franson says there’s a certain level of commitment between the store and the shopper when it comes to offering a ‘logged-in experience.’

Wi-fi-based in-store analytics provider Euclid’s $20 million third round of funding was reported in the midst of a flurry of location marketing financings last week, suggesting that the proximity tech space was still hot — or that startups were tapping the spigot before the venture capital well runs dry.

Either way, as retailers’ adoption of indoor mobile app messaging solutions becomes mainstream, the race to differentiate not only the technology that startups in the space supply, but that they understand the delicate relationship between shoppers and stores.

As such, six-year-old Euclid is in a critical period if they want to achieve their goal of developing a “logged-in experience” for the physical world.

CEO Brent Franson is confident that marketing to mobile shoppers through in-store wi-fi not only avoids the relatively cumbersome need for users to turn on their Bluetooth to receive beacon-based notifications, he believes it’s key to understanding the way people want to interact with merchants.

GeoMarketing: What influenced the decision to seek a third round?

Brent Franson: Let me answer that a couple different ways. The need for capital is the most obvious reason. We want to be able to grow as quickly as possible. We are intentionally not profitable yet, because that’s the fastest way to grow the business. That’s just part of the startup process is building the capital you need for the things you need to do.

Euclid CEO Brent Franson
Euclid CEO Brent Franson

But in a higher level narrative, since the last round, we did what we said we were going to do. We are doing really well. Our footprint has increased times 25. We’ve been bring digital data to the physical world by understanding the relationship between phones and wi-fi. It’s worked really well. We’ve got over 65 different brands in 65 different countries using our cloud-based analytics. When you’ve got a venture backed startup, you really need to focus on growth first and profit second.

One of the things we’ve thought about with this round, since we’ve been lucky and doing well and we knew we’d have more demand than we did supply, we’ve focused on finding strategic investors to work with who would be helpful in building our business. We didn’t really want a big, Silicon Valley investor, we wanted strategic investors who we could work with. Cox has been extremely helpful because they think about the world the same way we do in terms of connecting online and offline.

What are these funds going to be put towards?

Let me give you a quick overview of what we do. We basically want to understand how people interact with places in the world and how places in the world relate to one another in the physical world. We do that with software and we do it in a way that’s massively scalable. The way we solve that problem is by understanding the relationship between phones and wi-fi. There’s one wi-fi access point for every 150 people on Earth. That’s approaching one for every 20. We’re approaching 80 percent of adults in the world with smartphones.

Smartphones are constantly sending out a unique ID that’s looking for wi-fi access and those access points pick it up even if you don’t log into it. We basically use that to tell our clients how many people are walking by their store, how many people come into their store, how long do those people stay in their store, and most importantly, loyalty and frequency – how often do they come back.

Because we have partnerships with a bunch of wi-fi companies, if a client has wi-fi from one of those companies, and 82 percent of stores have wi-fi already, we can just turn it on for them without having to install any new hardware or anything. We can have those analytics for people in under an hour if they want.

Now to answer your question, that $20 million is going to go into every area of our business. It will go into marketing, it will go into engineering, it will go into product development. The key takeaway in terms of what we’re adding is what we would call a “logged in experience for the real world.” So if you think about the advantages that, for example, Amazon or Netflix might have is that they have data about you and they can customize the experience for you based on that data. They can recommend you products or TV shows or whatever because you’re logged in, they know you are you, most importantly they know your history of previous purchases or interests. They also know what other people like you are interested in, so they can make your experience more efficient and enjoyable using data. That’s a logged-in experience. We want to create the same thing for the physical world.

Obviously, they’re not the same. For one, a retailer can’t rearrange the floor for every customer the way Amazon could arrange a new homepage for each user. But if I go into a retailer and I log into their wi-fi and choose to have a logged-in experience, then they now have a single view of me both online and offline. So they can now customize the experience for me based on the data they have on me. And that could take the form of arming sales associates with that data on me; what I’ve previously purchased or searched for on their website or whatever. I could get a welcome message when I walk into the store if I’ve previously opted into a logged-in experience. That’s what we’re focused on and it’s what we’ll be putting our resources toward.

About The Author
Daniel Parisi Daniel Parisi @daniel_parisi_

Daniel Parisi is a New York City-based writer and recent graduate of the University of Maryland. Daniel specializes in coverage of mobile payments, loyalty programs, and the Internet of Things.