Point Inside’s GPS for Shoppers Grows Revenue, Looks for More Investment
Josh Marti’s wife is one organized lady. When she sends him a text message with the night’s grocery shopping, it’s arranged like a roadmap to the whole store, with items listed in the order they’re found in the aisles for maximum turn-by-turn efficiency.
With four daughters at home, that list is one heck of a ruthless time-saver. But really, should she have to do that, with the location-aware minicomputers everyone carries around in their pockets these days?
Marti thinks it should be easier—and he’s working on a solution at Point Inside, the Seattle startup he co-founded with longtime collaborator Jon Croy. The company, founded in early 2009, is developing an indoor version of GPS by building interactive maps of shopping malls, big-box retailers, and airports.
Merchants and advertisers appear to be pretty hungry to develop the platform. Marti wouldn’t reveal actual sales figures, but says the startup’s revenue for 2010 came in double its goals. “And 2011 has already seen an increase on top of that, to the point where we’ve raised our estimates,” Marti says.
Clients include Continental and United Airlines, Clear Channel’s airport advertising branch, mall owner General Growth Properties, and Meijer, a regional retailer that operates big combination grocery-and-merchandise stores.
Big players are also looking at the indoor navigation sector, including Microsoft’s Bing search engine, which unveiled its own mobile mall maps just earlier this month. Marti says Bing’s move into mobile mall mapping is nowhere near an existential threat to his startup—instead, Point Inside sees the big guys getting involved as good partnership opportunities.
“I can confirm that we have formal relationships with large mapping players, whether they’re content providers or mapping companies,” Marti says. “We just don’t name who they are.”
In fact, he says, Point Inside has made a lot of its own mapping data available to companies like Google and Apple in an attempt to broaden adoption of interior location maps.
Point Inside had to expend lots of effort to get its mapping procedures down—projects that once took four months can now be banged out in four days. But getting big players involved “grows the pie” and gives Point Inside a chance to expand its services business, Marti says.
“We realize that we might be leading the space right now, but we are also pushing them further and further in this direction,” he says.
The need for a separate indoor location mapping infrastructure is based on a pretty basic problem: Satellite signals and radio towers can’t get inside buildings enough to map things down to the aisle-by-aisle specificity that Point Inside is looking for. But once detailed maps of a mall or retail store are created and uploaded, Point Inside can use a store’s existing wireless networks to communicate with smartphones and track a shopper’s location.
Once you have that platform enabled, a lot of interesting things become possible—perhaps most importantly from a retailer’s perspective, it’s an entirely new advertising channel. And Point Inside can blend information about where a store displays its merchandise to deliver coupons, loyalty rewards, and other offers right when a shopper is in the area.
So, say you’re shopping for cereal, and the store buzzes your phone to alert you that there’s currently a sale on milk—that’s possible with Point Inside’s platform. Those are exactly the projects that Point Inside wants to tackle with the money from its latest—and still open—round of fundraising, which stands at about $800,000 of a potential $2 million round of debt and options, according to an SEC filing this week.
Point Inside also has its own mobile apps, but the majority of its business is aimed at providing data and services to retailers. The company has about 24 full-time employees right now, and about a dozen more contractors. Its previous fundraising totaled about $1.3 million, Marti says, led by Silicon Valley-area angel investor Herb Madan, who is a board member.
Jumping into a developing field has its share of challenges for a small startup. Marti recently told thewherebusiness.com that “frankly, six months ago Point Inside was struggling to find its voice.” He told me that was a natural process of zeroing in on the company’s prime target in retail, and distilling its elevator pitch. But he says those struggles were worth it, and worth having even ahead of a final product.
“Our recommendation is—and thankfully it’s now possible—for startups to not get stuck in this development, ‘it’s got to be perfect’ mentality. We subscribe to the whole mentality of ship early, and ship often,” Marti says. “And if you stick to that, then the market will dictate to you where you should be heading.”