When one public business in a given sector reports a bad quarter, the stock price of the other companies in the sector tends to fall. However, for private enterprises, it’s difficult to determine why costs rose last week – was it due to the company’s success, or was it something that happened to everyone? Varos, which has offices in San Francisco and Tel Aviv, is casting light on how organizations compare to one another in terms of critical performance measures like client acquisition expenses.
Varos was started in 2021 by CEO Yarden Shaked, CTO Lior Chen, and his father, Gil Shaked, as part of Y Combinator’s summer 2021 cohort. They built a data-sharing solution that crowdsources data through API interfaces with their customers’ tech stacks. According to Chen, the data is pulled in real-time and requires no client maintenance. Yarden Shaked told TechCrunch that e-commerce companies are data-driven, but they often just have their own past data to work on.
“You’re flying blind,” he continued, “because you don’t know if you’re doing well or not, and you can’t say whether your KPIs are good or terrible, so you don’t know what levers to pull because you don’t know what the problem is.” “Trends, on the other hand, are on the rise. It could be a market trend if your customer acquisition costs increase. We step in and deliver that solution by collaborating on data. People provide the data, which we anonymize and return to you for analysis.”
It’s completely self-serve at Varos. Customers connect their data, which is then organized into verticals and labelled in various ways. Users are given a dashboard where they can compare themselves to, say, an apparel firm that spends $100,000 per month on digital marketing and has an average order value of a specific amount and see a graph of how that has changed over time. Varos’ Monday morning trend report, in which customers may compare their weekly data to weekly benchmarks, is one of the most popular features. Yarden Shaked explained that this is a new type of data analytics that enables customers to analyze their own performance in comparison to direct competition.
This type of data collaboration, he argues, is common in other industries such as farming, travel, and late-stage investing, where valuation is based on competitive data, but it’s new in the e-commerce and SaaS spaces. Since its soft launch in August, Varos has gained traction, with over 250 users feeding marketing data into the platform to see how they compare to their peers. Varos has been a free service as it develops its data marketplace, but it already has a number of paying users.
To meet demand, the company raised $4 million in seed funding from Ibex Investors, Y Combinator, and a group of individual investors, including Tom Glocer, former CEO of Thomson Reuters, Andy Dunn, co-founder of Bonobos, Amol Deshpande, co-founder of Farmers Business Network, Bob Moore, CEO of Crossbeam, and John Jersin, co-founder of Connectifier. Varos, which debuted on Wednesday, began with marketing KPIs but has no plans to stop there. The company will expand into other areas, such as finance, product, and sales, in addition to integrating Shopify, Google, and TikTok connections and others around revenue growth and conversion rates. Yarden Shaked expressed his thoughts.
It was simply the three founders until a month ago, but the company now has a crew of seven, mostly in product and design. By the end of the year, the goal is to double the number of employees. Yarden Shaked stated, “We’re glad our hypothesis is working.” “In the past, if anything was spied or altered without Varos, there was a learning time to figure out where it wasn’t operating effectively.” We now say that with Varos, you may focus on the creative, but only based on what you observe.”
