November 10-16, 207 | Vol. 18.35
By Marissa Nall
In the chaos of e-commerce, a Santa Barbara software startup is using artificial intelligence and a $2 million investment to create a little order.
TrackStreet works with brands to help ensure that online sellers aren’t undercutting retailers on price or posting outdated product descriptions or incorrect claims. The $2 million seed investment round led by Laguna Beach venture capital firm Okapi Capital will help it build out its Santa Barbara team and fuel its growth as it aims to pick up international customers.
“TrackStreet was really birthed out of the need for visibility in a market that’s really dark,” said CEO Andrew Schydlowsky, a former Business Times 40 Under 40 winner. “In the retail world, you walk into a store and you know where your stuff is. The internet is like a dark room … We’re the flashlight.”
Replacing stressed out compliance personnel using Excel spreadsheets and escalating email chains, the company has developed eight modules for its customers, starting by helping them locate where their products are being sold and tracking them across retailers whose names, pricing and branding can change daily, Schydlowsky said.
But the key service is when brands want to step in, enforcing minimum advertised price policies or developing a relationship with e-tailers.
“We automate taking action on things,” he said. “Data by itself isn’t very helpful. It’s too much information, and we’re all too busy. But taking action on information is really important.”
Goleta-based Deckers Brands is one of TrackStreet’s customers and it uses it to track its brands.
“TrackStreet has been pivotal to our brand protection program,” said Brooke Beshai, director of compliance for Deckers. “We get a real-time view of where the violations are happening, and the entire process of enforcement is more streamlined.”
Chasing pricing violators can be like a game of whack-a-mole, said Ryan Erickson, vice president of sales for TrackStreet. Moreover, it can affect decisions throughout the company, not only in marketing, but also in areas like new product development.
Rapidly changing customer behavior has many brands racing to keep up, Schydlowsky said, fueled by the rise of e-commerce giants like Amazon and eBay. With a trove of historical data like old photos and product information, the company can also match findings with data customers have in their systems.
“Every single brand has this challenge, and really, if brands haven’t started talking about this internally yet, they will in the next year.”
The company started out small and kept growth slow at first, he said, concentrating on ironing out mistakes and bettering the experience for its first few customers. Now, it’s looking to add to its distributed workforce by “aggressively building out the Santa Barbara team.”
“We are very excited about our investment in TrackStreet because they have built the best solution available for a massive problem that is growing larger and more acute by the day for any company that is utilizing e-commerce channels to sell their products — which is just about everyone,” said Jeff Bocan, partner at Okapi Capital, calling it an “essential margin-erosion prevention tool.”
The software, too, will get some upgrades.
“Behind all of this are really powerful true, AI-based systems that can recognize images and text-match and make meaning out of things,” Schydlowsky said. “The technology is really the backbone of what we’ve done.”
TrackStreet is also looking to expand from its customer base in the U.S. into global markets.
“Internationalization is big for us,” he said. “The rules for what you can and can’t do across the world vary in terms of region, but the visibility is the commonality that no one has.”
Along with the investment comes expertise they can tap into, he said, including partners with marketing, communications and distribution backgrounds including Stage Venture Partners, SaaS Venture Capital and Brett Queener, formerly of Salesforce.
“These investors are an extension of our team. It wasn’t just money,” Schydlowsky said. “Money is important, but these are all people who can help us accelerate.”
• Contact Marissa Nall at email@example.com.