Global retail ecommerce sales reached $4.9 trillion in 2021 and are expected to grow 50% over the next four years to reach $7.4 trillion in 2025, according to Statista.
And while ecommerce giant Amazon commands a dominant position in retail, most retail operations have their own ecommerce initiatives outside of Amazon. Yet few have the skills or data capabilities and resources that fuel Amazon’s leadership. Companies like SoundCommerce are working to change that dynamic.
SoundCommerce is the end-to-end retail data and intelligence platform that connects and models marketing, operations and merchandising so retailers can optimize order and shopper profitability across all business functions. The company was co-founded by Eric Best and Jared Stiff in 2018 and is based in Seattle, Washington.
SoundCommerce C-Founder and CEO Eric Best.
“At SoundCommerce, we're trying to effectively productize the data work and operational work that is necessary to think and act like Amazon, but as an independent brand. So, in plain English, and we take data from Shopify and Google Analytics and the digital marketing channels, but also NetSuite the ERP system, and maybe Manhattan Associates, the warehouse management system, and ShipStation, the ship manifests— and we're building data models that we drop into a cloud data warehouse, that are designed to track things like profitability and customer lifetime value,” says SoundCommerce founder and CEO Eric Best.
Few understand what’s required for retailers to control their own ecommerce destiny better than Best. He’s a serial entrepreneur that was involved in ecommerce from the start, showing a knack for being in the right place at the right time. He started a company that helped companies build their online retail presence right after graduating college in the ‘90s. That company was acquired by Amazon for whom he then worked, providing an insider’s knowledge of how Amazon operated. That led to a series of start-ups and positions at ecommerce tech companies prior to founding SoundCommerce. He even worked for a time at a lifestyle retailer to help them transform into a direct-to-consumer model and to provide himself with retail experience.
“When you sell through a marketplace like Amazon and to the same degree Walmart and other wholesale partners, they take on the heavy lifting of demand generation, logistics and all of these things. But in the process of selling through those channels, as a consumer brand, you end up capitulating on the things that are most important in terms of sustainable value creation. You give up control over your data, you give up the direct relationship with the end customer shopper. And in most cases, you give up control over margin and you give up margin along the way. And conversely, the problem that we are solving at SoundCommerce is if you try to take on that complexity yourself, you’re taking on all of that complexity and execution risk,” says Best.
According to Best, the goal is for SoundCommerce to help its customers better inform the real time and predictive decisions that take profitability and future customer behaviour into account and reduce operational risk.
The company’s intelligence platform, connecting marketing, operations and merchandising data provides an easy-to-use, no-code environment for users and is designed for retailers of any size or complexity. It has enabled the company to attract retail companies of all sizes, from small, regional brands, to some of the largest ecommerce retailers such as PacSun; FTD Proflowers; Bed, Bath & Beyond; Eddie Bauer; Bala and Rainbow Shops.
Its fast growth and founder’s ecommerce pedigree have allowed the company to raise a total of $39.5 million in venture funding over three rounds. Their latest $15 million A round in August 2021 was led by Emergence Capital. Other investors include Defy.vc, Voyager Capital, Alliance of Angels and Stage Venture Partners.
Best grew up in Seattle, the son of a Boeing engineer. His family moved to the outskirts of Spokane, Washington at the age of 12 when his father gave up big company life to start his own engineering business. “I observed how hard it was for my dad to start the company. We went from being middle class in Seattle to watching every penny of the family's net worth, which was not high when he started this business, which is still running today as a successful, regional engineering company. So, it was it was really formative for me to observe his journey,” says Best. “It was also really helpful to have the cultural experience of going from sort of blue state city living in Seattle to deep red state, Eastern Washington. And I think it actually helped me relate to just about anybody that I meet now.”
He graduated from Seattle Pacific University with thoughts of going into medicine. But he “failed” his med school interview and decided to shift gears and get his business degree. He then followed a professor of his over to Microsoft and ended up working with the team that launched Windows 95. “The ecommerce opportunity arose when Microsoft acquired this company called E Shop. And it became the IP that became Microsoft Commerce Server. And so, we were definitely in the right place at the right time. And it's worth noting that my co-founder and CTO, Jared, was also my co-founder in the company that came out of this Microsoft work,” says Best.
Then Microsoft set up Best and Stiff as independent contract workers as a separate business creating online store fronts, which become MindCorps in 1996. MindCorps was then acquired by Amazon in 1999. With the Dotcom bust, Best thought it wise to leave Amazon after its stock dropped from $66 to $4 in 2001. He went on to start digital marketing agency Morse Best (now Sappington). In 2005 he started retail technology company Mercent, which was acquired by Liberty Interactive subsidiary, CommerceHub, which Best helped grow and take public prior to reuniting with Stiff to found SoundCommerce in 2018.
As for the future? “We're trying to think big but stay focused. In some ways, this decision to focus on the retail industry first was somewhat arbitrary. We had a bunch of domain knowledge in here, but the things that we're building, I think, ultimately can have applicability in many other industries like pharma or finance or the mortgage and insurance industries,” concludes Best.
