Our investment thesis in SCHAMAN
We’ve done it again!! Inveready invests in telecom company after successful investments like Parlem, Voz Telecom, or our beloved unicorn: MasMovil. I’m excited to introduce the latest addition to our portfolio companies: Schaman, the automated diagnosis and resolution tool for technical customer care.
- 🎧 Si desea ser atendido en Castellano pulse 1. If you want to be attended in English press 2.
- 📞 2.
- 🎧 Please press the digits of your ID.
- 📞 4–6–1-… 😠
- 🎧 Please indicate the phone number with the issue.
- 📞 6–8–4-… 😡
- 🎧 Please indicate your problem.
- 📞 My smartphone has no internet connection…😭😤
- 🎧 I didn’t understand your problem. Please hold the line.🤬🤬🤬
Back and forth, back and forth, back and forth… Every time I must deal with my network provider, I end up asking myself: How is it possible that a high competed sector such as the telecom market, grounds its main contact point with the customer with frustrating, inefficient bots? In fact, after some digging, I found out that 68% of telecom clients feel poorly treated, and 40% of Mobile Operator’s churn rate is generated by poor technical customer care (according to Accenture Strategy Pulse Research).
It happened to all of us, hasn’t it? Long waiting times, conversational loops, and suddenly the system hangs upon us. There are plenty more situations that occur, am I right? Following these types of situations, the same question always pops-up: what’s behind this process? Surely you have thought about this at some point.
The answer is simple: a very outdated and complex decision tree with technology from the ’90s built by legacy consulting companies. That turns in static decision trees integrated into the Mobile Operators’ ERPs.
Occasionally, telecom products change, and new connected devices emerge. Consultants have stuck with adapting their processes, based on decision trees, to new standards of the industry.
Schaman challenges this problem by creating a dynamic technical customer care software that gives a new approach to the ticket resolution in the telecommunications sector, resulting in a 20% increase in first call resolution, a 40% recall reduction, and a 75% reduction on time and cost implementation among others. That sounds promising, doesn’t it? Let me explain the secret sauce behind it.
- From Static Workflows to a Dynamic Solution. Schaman takes inputs from different places to automatically detect potential problems and create an adapted [solving process] decision tree that helps to solve them. Say goodbye to all the stupid questions, say hello to spending your time in interactions that help to address issues.
- From reactivity to proactivity. When a customer reaches the telecom customer service, Schaman’s tool recovers all available data from the customer (connectivity of his devices, historical problems, contracted services, etc.). It anticipates the potential issues she might be facing. This way, if the problem cannot be solved autonomously, the appropriate technical care employee (or even the on-site technic) will be reached with all available facts to resolve the issue in the shortest period.
- From rigid structures to adaptative architectures. Adaptability is in Schaman’s software DNA. The platform’s architecture allows the addition of new products, networks, or potential diagnoses without having to reshape the original set-up of the software. That translates in 4 times lower adoption process than legacy solutions and stable performance.
Apart from the change of paradigm described above, which makes Schaman a very interesting company, two more facts turn Schaman into a great investment opportunity.
On the one hand, validated product-market fit. Schaman has several satisfied clients among Spanish and South American top-5 telcos, who are continually giving good references about the service received.
On the other hand, a world-class founding team. The first thing they teach you at Business Schools is the key attributes of a founding team: (i) seniority, (ii) sector expertise, and (iii) balanced skills. Well, Eduardo and Mª Jesús are the perfect matches for these statements. Multiple years of experience in managing positions in technical and product areas at ONO. On top of that, during the Due Diligence process, they have proved to be very competent partners, and we are very excited to partake in their journey to success.
Following the structure of my last article, I’d like to finish the post explaining why this investment opportunity I just described matches Inveready’s thesis. As always, simple and threefold answer:
- Industry know-how 🤓. We can’t hide our love for telcos (maybe you detected that in the passion of my opening sentence!!); over the years, Inveready has had a good eye when it came to telecom companies. Why? Maybe, because, when you spend so much time taking care of MasMovil, our proudest investment, you become a part of the sector, understand its needs perfectly, and get the knowledge to guide our portfolio companies better to flourish.
- Capital-efficiency 💰. I promise to write a post about our point of view regarding capital efficient companies, but I can advance that it’s one of the main pillars of our investment strategy (expansion on that will come during Q1 2020). Schaman has proven to be capital efficient during its first years of life, sustaining the company with its sales and founder’s equity, resulting in a structured company with 20+ team members, top tier customers, and growing recurring revenues.
- Growth sweet spot 📈. Following the last point, Schaman’s founding team has self-sustained the company until it has reached point commercial scaling readiness: Huge pipeline, excellent retention KPIs, and a defined go-to-market plan.
To sum up, a capital-efficient company led by top tier management that is disrupting a very well-known market by Inveready. This was meant to be my last article of 2019, but we had a crazy year closing 🤯 , and I never found the time to post it. The good news: this means I’ll be able to share some new additions to our portfolio soon, so stay tuned 📻🎉.
