There are a couple of startups in Colorado that are working on in-store kiosks that provide intelligent touch-screen oriented “guided selling” capabilities to retailers. You’ve probably seen kiosks like these in a few places – they help consumers compare products and make decisions based on their needs. This type of technology is not yet ubiquitous, but these companies hope to change that fact.
It was about a year ago that I first saw KioskTree. Seagate was hosting the CTEK Colorado Entrepreneurship Competition in February of 2006, and KioskTree was the entrant from CU-Denver. This was a college-oriented competition so when I never again heard of or crossed paths with KioskTree, I just figured they had simply died at birth. Then, just recently (randomly, through friends, on the way to a Mammoth game) I had dinner at the soon-to-be-viewless but still very fun Lola with Dan Krueger of KioskTree. Dan told me they’ve been in test mode with an early customer for about a year, and have refined the product based on their feedback. He also said that the next stage for KioskTree is to potentially raise some money and then to recruit a sales force to take the product to the market.
Now, a new company called Simple Decisions has sprung up and is targeting the same market. Simple Decisions seems to have some momentum. It’s being supported by the Bard Center for Entrepreneurship at CU Denver (a curious coincidence that I suspect there is more to) and has an investment from the affiliated Rutt Bridges Venture Capital fund. It was recently founded by Josh Churlik (CEO) who told me that the software can run as a part of the retailers web presence or it can be used to establish an in-store kiosk.
“In either instance the benefit to the consumer is on-demand high quality customer service. While the retailer benefits by providing a consistent level of customer service across multiple channels, driving sales with accurate product recommendations, and lowering the frontline operating costs associated with employee staffing and training.” – Founder & CEO of Simple Decisions – Josh Churlik
Josh wasn’t able to tell me about current customers specifically, but its sounds like they’ve landed a couple of early adopters. At least for now, there appears to be a heavy professional services component where the company customizes the look and feel of the software to match the brand of each retailer it brings on. I would imagine that over time the plan would be to create a more template driven experience.
Josh says Simple Decisions is “looking to raise $200k to $500k in the coming months”.
From an angel investors point of view, both of these businesses are a little tough to get your mind around because of the limited acceptance of in-store kiosks so far, the fuzzy ROI proposition, the very nature of having to depend on or work with hardware, and the large professional services component. These are things that these businesses have to watch out for since they can severely limit their ability to scale. Of course, landing one big fish of the Target or WalMart variety would quiet the nay-sayers.
Several years ago I was doing some due diligence on a company that was building music kiosks that burn CDs. I visited the facilities of KIS, the manufacturer of the kiosks, and I was blown away by the number of kiosks they were cranking out for big-name companies.
I left the plant thinking to myself that we were going to be absolutely flooded with kiosks of all kinds in the coming years, but it never really happened.
I was even so enthusiastic about the coming trend I contacted Red Box (DVD rentals) about a possible investment in their company. I liked their concept, and they had just started their limited test with McDonald’s. Needless to say, I was stiffed. I started with a point in all this, but I seem to have drifted off subject…here it is: I guess I overestimated the kiosk market.
Thanks for the wandering wisdom, mystery man.
I think your analysis is right. Fun to watch.
A similar play is going on right now with Red Box, which I love love love. Netflix is great, but I seem to need the immediacy of RedBox. I wish there was one on every corner, at every gas station, in every grocery store — everywhere.
I feel the same relief using that as I do Pay at the Pump for gas. I like people and everything, but it seems like every time you have to pay for gas in person you are in the middle of some weird sociology experiment. Same goes for Blockbuster.
Kiosks at Target? I dunno… have to see it, but it wouldn’t take much to get me spend a little time at one.
FYI, a bit of history. Both Dan and Josh were founding partners in Kiosk Tree. They decided to split up and go their own ways.
Also one of the reasons that the Bard Center invested in the technology that Simple Decisions is working on was that it was not limited to a kiosk deployment but could potentially be used online and replace the simple “compare” button you see on most sites. The guided selling will walk you through that process based on the attributes you tell it are important in the buying decision.
RE: Fuzzy ROI. Early feedback from retailers is that they like it as it provides and expert system to assist in a sale and actually train new sales personnel on the consumer’s decision process as well as product attributes. Hard ROI stats will have to be drive by increased sales in same store over a period of time.
Dave O’Brien
Entrepreneur in Residence
University of Colorado Bard Center for Entrepreneurship
This looks like a rehash of the “product configurators” of the mid-to-late 1990s… rules /expert-system driven, both for product recommendation (“needs analysis”) and technical configurability (what can work with what).
The projects I was in the cheap seats for (kiosks at Best Buy and Circuit City helping consumers select, configure, and buy Compaq and HP computers, repsectively) were not nearly as successful as they were expensive.
If the content/software can be done far more cheaply today, and the physical kiosks made much more robust and reliable… then it might work this time around.