Raleigh startup Pendo is getting into the machine learning game with new product
Pendo, the fast-growing Raleigh technology startup, is adding machine learning to its list of capabilities.
Pendo, valued at $2.6 billion, is the maker of software that helps its clients collect data on how customers use their products and websites.
The company’s technology collects huge amounts of data for its clients to analyze, which in some cases can be overwhelming, Pendo CEO Todd Olson said in a telephone interview. Pendo says it now collects more than 12 billion data events from its customers every day.
Earlier this year, the company started working on a machine learning system, called Pendo Simon, to help customers parse all of that data and even begin to make predictive recommendations. The name Simon is an homage to Herbert Simon, a Nobel Prize-winning researcher of artificial intelligence who taught at Olson’s alma mater, Carnegie Mellon University.
Simon was built out of Pendo’s office in Israel, after the company hired Inbal Budowski-Tal, who holds a doctorate in computer science and is a former researcher at Microsoft, to start Pendo’s machine learning group.
“We have been working on several projects, where (the machine learning group) takes our data and finds interesting ways to drive more predictive models and drive more insights from the data,” Olson said.
The first application will focus on qualitative data that Pendo collects, or the information that is not easily summarized through numbers.
“We collect billions of data points of qualitative feedback,” Olson said. “That’s people’s opinion of what they want in software products and what they think of software products. It’s a lot of text.”
Olson said Simon employs natural language processing to pull out themes and “hot spots” from things like surveys to quickly pinpoint what customers are happy or dissatisfied with.
“If you’re a product manager, are you just going to sit there and read hundreds and hundreds of qualitative pieces of survey? Like that’s just not scalable,” Olson said. “So really, it’s all about efficiency and helping people understand what needs attention.”
Future applications
Olson said Simon’s next application could focus on determining if and when a customer will stop using a product or website.
“We have a lot of indicators of usage,” he said, “Could we start detecting well in advance when we think someone is leaving and ... help customers, intercede and save those customers? I think that’d be a great application of Simon.”
Simon is one part of Pendo’s larger strategy to boost revenue in the coming years. The company recently hit the milestone of $100 million in annual recurring revenue, a figure that tracks how its subscription-based business is doing.
“We’re thinking about the next $100 (million), and, you know, potentially, thinking about how to get to a billion in ARR,” he told The N&O in July.
Some of that growth will have to come from introducing new product lines, Olson said. Simon, which will be a premium offering from the company, is just one of its latest examples.
“This is the way the world’s moving. Data is becoming more prevalent,” he said. “... It’s just a natural evolution.”
This story was produced with financial support from a coalition of partners led by Innovate Raleigh as part of an independent journalism fellowship program. The N&O maintains full editorial control of the work. Learn more; go to bit.ly/newsinnovate
