MIAMI, April 4, 2014 (GLOBE NEWSWIRE) -- Big Data denotes the capture, curation, storage and analysis of high velocity complex data sets, often involving social media, demographics or purchasing history. Integration of Big Data has become a vital component of meeting customer expectations on line. IBM just announced a $100 million investment in its "Big Data" driven customer experience technology.
"The last best experience that anyone has anywhere, becomes the minimum expectation for the experience they want everywhere," stated Bridget van Kralingen, IBM Global Business Services senior vice president in a Bloomberg interview.
According to a 2013 Gartner Survey, Big Data investments continue to rise, with 64% of organizations investing or planning to invest in Big Data technology.
On April 3, 2014, the Development Capital Group (OTC:DLPM) announced that it had acquired Clearance.co - one of the world's fastest growing start-up ecommerce websites. The all-stock transaction was for approximately $40 million.
Launched only in April 2013, Clearance.co was able to achieve over $150,000 on Cyber Monday, just seven months later.
"The mandate of the Development Capital Group is to invest in early stage companies that will benefit from our skill-set in scalable technology and big data," explains Joseph Ricard, President of the Development Capital Group in an exclusive interview with Financial Press, "Clearance.co has been on our radar for a while. They came out of the starting blocks with solid numbers and then had a dramatic increase in users and sales."
When Ricard met Clearance.co President Shahbod Rastegar in December of 2013, the company had just achieved its first million dollar sales month.
"The merger with the Development Capital Group creates an opportunity to raise capital and to accelerate our development and marketing strategies," states Rastegar, "It also enables us to acquire companies."
"I know the mobile space, marketing, bounce rates and how to get customers to come back," states Ricard, "The merger will give Clearance access to capital and an injection of technical know-how. I believe Clearance.co will grow to over $100 million a year in sales."
Clearance.co currently has 344,000 people who voluntarily entered their emails to become members of the site. Membership makes them eligible to make a purchase. Each day the company introduces new products with radical discounts. The promotional program emphasizes a shrinking time window to make these purchases.
"Joseph Ricard is a significant value-add to our business model," states Rastegar. "He understands big data. He is a blend of business and technology. It is quite rare to find people who are genuinely innovative in both areas. Our numbers at Clearance.co are growing fast without mobile, but Joseph's expertise will help us explode into that space."
Companies like Facebook, Dropbox and Twitter all have an Application Programming Interface (API) that allows 3rd party developers to integrate with their websites. What Ricard does is stitch together multiple APIs to connect all this "Big Data".
Ricard, through the Development Capital Group is currently Beta-testing a web-based application, Realty Valuator, marketed toward investors purchasing houses in the foreclosure market.
"I bought my first house for $50,000 cash and I rented it for $1,000 a month," explains Ricard, "That's a return of 20%. I thought, 'What if I created an App that could pull data on rental rates, housing prices, zip codes, assessed value, list price etcetera and stitch it all together?' So instead of buying a single house, I could buy a hundred houses with a click of a mouse. That is what Realty Valuator is about."
"To grow Clearance.co you need to understand the metrics behind it," states Rastegar, "which means the lifetime value of user. If you can understand that number, you can raise capital and acquire more users. That is what I am good at: understanding the metrics behind the user value and user conversion rates."
Before negotiating the merger, Ricard did extensive due diligence on the Clearance.co metrics, their acquisition rates and how much they are generating from each user.
From the supplier's point of view, Clearance.co provides a ready-made distribution channel to sell discounted excess inventory without muddling up the branding on the rest of their inventory.
"We're not like Amazon that encompasses everyday products," states Rastegar, "We are a specialized deeply discounted consumer site. We have a traffic friendly design. It is easy to view the product. Everything is transparent and clear and vibrant."
"We negotiate with the suppliers to take control of their inventories of over-stocked items. You won't find a 2014 Samsung TV on our site, but you might find a 2-year-old model at close-out price that is not available anywhere else. It's an efficient, fast growing business and our margins are around 30%."
"Clearance is making huge strides as a new ecommerce company," states Ricard, "You are seeing a huge shift from retail to ecommerce. Additional growth will be apparent when we incorporate mobile platforms and integrate new advertising technology."
The Development Capital Group is currently trading at .65 with a market capitalization of $17 million.
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