Directions Magazine (DM): Congratulations on the acquisition. What was the primary reason for selling the company at this time?
John Fisher (JF): We have wanted to expand the company internationally for some time. In reviewing our options (raising money, IPO, M&A), the advantages of a strategic M&A were clear - in addition to the funding, you get a wealth of additional resources – existing customer base, complementary technology, in place sales and marketing team, infrastructure and market presence. When Neopost approached us we saw it as a great fit. This allows us to greatly expedite our expansion plans and take advantage of our unique technology, while fleshing out Neopost’s data quality offerings with a deep location component.
DM: What does Neopost bring to DMTI?
JF: Neopost is the ideal acquisitor for DMTI. As a billion euro ($1.4M) public company with 6,000 employees and a market presence in 90 countries, Neopost provides financial backing and market clout. Neopost’s customer base of 800,000 businesses around the world, from SMEs to large enterprises, provides a fertile market for cross sell/up sell, leveraging the entrenched sales and marketing teams from Neopost and our new sister companies (Human Inference, Satori and GMC). Within Neopost, we will be joining the rapidly growing Customer Information Management software division, which is projected to reach $280M this coming year. This software division is already recognized as Visionary within Gartner’s Magic Quadrant for Data Quality, and the addition of DMTI’s location technology and address management expertise further strengthens this position.
DM: Will the acquisition by Neopost allow DMTI to expand into Europe? Was that a factor?
JF: It absolutely was a factor. We will be launching in two countries in Europe in 2014 and at least two more in 2015. The strong market presence by Neopost and our sister companies in this market will greatly assist in gaining a foothold in this important market. DMTI’s Location Hub and Location Economics Ecosystem make very logical additions to the existing Neopost and Human Inference offerings and customer base.
DM: Will DMTI focus more now on data quality/MDM solutions and less on core platforms for geospatial analysis?
JF: DMTI already has a strong focus on data quality and MDM, particularly the Master Address Management sub-field of MDM, which we will continue to expand. As you and your readers appreciate, almost all information can be location referenced and analyzed, and it is this location component which is at the core of DMTI’s expertise and technology. Analytics are powerless without quality data, so ensuring data quality and integrity is the crucial first step. Our Location Hub Web services platform is designed to do exactly that, both with the customer’s data and with third-party datasets. By matching all incoming data to our master reference database and by stamping each data element with our Unique Address IDs, Location Hub establishes each data element in a common, high integrity, spatially referenced data framework. All information processed through Location Hub is automatically cross-referenced to all other information processed through the hub, and this provides an ideal framework for geospatial analytics – ours, our customer’s and third parties’.
DM: How are you seeing the location intelligence market play out at this time? More companies are entering the fray and specializing in analytics. Will DMTI look toward focusing some of its resources in analytics?
JF: We are expanding our range of spatial analytics substantially and will be making several announcements over the coming year. Our particular area of expertise is in real-time analytics and automated decisioning. A major trend we see evolving in the market is around integrated intercompany workflows such as mortgage or insurance underwriting or telco order-to-activation, where several independent companies each contribute component pieces to complete the overall transaction. Given the growing market expectation that these transactions will occur essentially instantly, this requires drastic changes in the way companies are currently doing business. Processes that used to take hours, days or even weeks are now expected to be completed in seconds. To accomplish this requires three key things: (1) that all of the data components are of high quality, and that they can be matched up in real time with a high degree of integrity and reliability; (2) that the business rules required to adjudicate the transaction are well understood, properly coded and integrated with all of the requisite reference data and analytical routines; and (3) that the entire system is supported by an infrastructure capable of performing the entire round trip transaction within a reasonable real-time window (typically less than a second or two). These are onerous conditions – they are only achievable if all of the parties work together to minimize sources of error and eliminate process bottlenecks. The Location Hub platform and the Location Economics Ecosystem are designed with precisely this in mind – to minimize the pain in creating an automated adjudication process.
DM: While Neopost is in Gartner’s Magic Quadrant for Data Quality, does the acquisition position the company for a move into BI and analytics?
JF: Data quality is a means to an end. The really interesting stuff happens on top of great data. BI and analytics are the next step. As always we will pursue this from a location perspective. We already have a number of analytics built into Location Hub, but this is only the thin end of the wedge. Our focus in on real-time techniques that are extremely fast and work with very large datasets (dare I say, Big Data). We are currently engaged in developing some interesting new optimization technology that marries spatial technology with more traditional data clustering and analytics. Cross-fertilization of techniques from different disciplines is proving to be fertile ground for us.
DM: What other goals do you have for the acquisition?
JF: We are keen to expand the Location Economics Ecosystem of UAID-enabled data and application providers, and grow it into a world-wide resource. Neopost’s global operation provides the kind of scale and scope to put this into effect. It won’t happen overnight, but each new addition makes it a more compelling proposition. The benefits to the participants are huge – both on the customer side and the supplier side. We are also working with partners to generate new hybrid products by marrying different data and analytical components in new creative ways. The whole cloud/SaaS/Web services environment is a great boon to product innovation.