Austin isn't a retail town. Not in the way Chicago or Minneapolis are. In fact, none of the biggest retail companies have a major presence in Austin.
So it's a bit of an anomaly that Austin has hatched several successful retail tech companies that are helping those big box stores like Wal-Mart, Target and Home Depot -- and dozens of smaller ones -- land more sales and operate more efficiently.
"Austin has a really strong entrepreneurial retail tech scene for e-commerce and mobile, and somehow it's made it onto the map," Shelfbucks Founder and CEO Erik McMillan said. "It doesn't make much sense to me because there are no retailers here except Whole Foods, and most retail and e-com companies are spread out far from Austin."
But they like Austin's tech.
Companies like Starmount, the retail inventory management and point of sale software company acquired earlier this month by Infor, Bazaarvoice, Shelfbucks and RetailMeNot have put Austin on the map as an emerging retail tech hub.
McMillan traces the story back to his friend Brett Hurt, who founded the marketing and web analytics company Coremetrics Inc. in 1999 and rescued it from near failure during the dot com bust before starting Bazaarvoice in 2005. (Coremetrics was acquired by IBM in 2010.)
Hurt, along with partners and friends, helped build a network among retail tech professionals, giving newcomers access to advice, potential investors and skilled employees. That network expanded greatly when Joshua Baer founded Capital Factory in 2008. The accelerator not only provided a network for all kinds of tech talent, it also quickly attracted visits from top retail executives who wanted to check out what startups had to offer.
"That's a big part of what makes us more powerful," McMillan said.
Not that it's easy, especially for retail tech startups trying to compete with companies in Silicon Valley and the East Coast.
"Funding is really hard. I'm always working on funding," he said. "Austin has a lot of great early investors. I don't think they have a lot of investors who understand retail. So you need to have a strong network."
Many retail tech startups have to operate lean before they can attract significant money.
"People are stuck taking small angel rounds and not knowing how to grow out of that," McMillan said. "The key is finding a strong network that's plugged into retail tech."
Here are a few of the most exciting Austin retail tech companies to watch.
Bazaarvoice: They make software platforms that collect, curate and display consumer-generated content, like ratings and reviews, Q&As, social media, photos and videos. The company was founded by Brett Hurt in 2005. It went public in 2012.
Shelfbucks: Shelfbucks helps retailers get the most out of their in-store displays. Their software and sensors track where the promotional displays are in the shipping process, track how long they sit in the back room before being set up and analyzes sales data while the displays are active in the store. It can then send product information, reviews and content to consumers' smartphones without opening or even unlocking the phone.
Convey (formerly Pivot Freight): Led by Rob Taylor, former president of retail software company BlackLocus (acquired by Home Depot in 2012), Convey makes end-to-end delivery software that connects carriers and fulfillment managers to speed up delivery and improve communication and shipping optimization.
Edgecase: They help e-commerce companies with product data and insights to help consumers find the products they want. The company was founded in 2010 as Compare Networks by Garrett Eastham, Mikael Solomon and Stephen Goodwin. It's most recent fundraise was a $7.5 million Series C in October 2015.
Epicor: The company makes a range of industry-specific business software, including retail, manufacturing, distribution and services. Its point-of-sale software helps retailers by automating processes and engaging with consumers. Their customers include Ace Hardware and True Value.
Vyze (formerly NewComLink): Their software makes it easier to provide financing options to customers at the checkout register. It was founded in 2008 by retail veterans Suneet Paul and Jim White.
Humm: People often write restaurant reviews when they're upset -- and often its well-after they've left the restaurant. Humm provides customer feedback options inside restaurants to get opinions while they're hot. The customer feedback can help build a better reputation and help businesses improve. The startup was founded by Bernard Briggs in 2012.
EyeQ: This company helps retailers learn about customers. Their in-store software provides customized interactive displays that react to age, gender and emotions. That gives retailers more understanding of shopper behaviors. The company, founded by Michael Garel in 2012, got a $3.5 million Series A investment in May.
Square Root: Square Root's software has been helping car dealerships track inventories and sales. More recently, it has branched into other retail segments to help franchises connect key data points across multiple locations. The company was founded by Chris Taylor in 2006, and it has been consistently recognized for its fast growth and company culture.
RetailMeNot: They're known for the direct-to-consumer online coupons. But RetailMeNot has increasingly used in-store technologies, including beacons, to target consumers with deals. Its in-store products are becoming a bigger share of its overall revenues.
(Photo via Pixabay. CC0 Public Domain)
