ExactChoice was a company I co-founded with Howard Burrows, a friend and colleague from the early Personify days. At ExactChoice, we developed Web-based applications that did analytics and mining of complex product data. The company started in November 2002 and was acquired by CNET in December 2004.
Our best-known app was the ExactChoice Recommender. Using various forms of personalization, it helped people quickly identify, learn about, and buy the best computer for their needs. First among its technical innovations was that it recommended not just products but also product configurations.
For perspective, a typical recommender represented a Dell computer as just that: a single computer, usually the default configuration. ExactChoice represented the same computer as 5,000 different possible configurations, each with its own price and features. If you could configure it at the Dell site, we could represent it. Not surprisingly, when consumers told the system what they wanted in a computer, the results were better when considering 5,000 times the possibilities. (This was not Dell-specific. We covered all the major computer manufacturers, each of which offered both packaged and customizable models.)
ExactChoice built other apps on the same technical foundation. We had one that let call-center reps instantly identify their best answer to a competitive challenge, complete with hints for how to counter-pitch. We also had an app for executives and marketers, who could track the relative feature/price-competitiveness of their offerings versus those by competitors; we even threw-in a “what if” feature for running scenarios with different components and pricing.
From ExactChoice’s inception to acquisition, we did it all with two people, in 25 months, with a total capital outlay of less than $15,000. By design, ExactChoice was owned and operated by the founders, based in a virtual office. (I once had to fill-in a form that required the square footage of our office, so I provided the dimensions of our P.O. box slot.)
In many respects, it was an experiment to see what we’d do with total control and accountability, not to mention the lack of a safety net. If it failed, it was our money at stake—not just the dollars-in but also the bigger cost of not taking a normal salary. When the term “burn rate” gets personal, it’s a focusing thing.
At the end of the day, ExactChoice succeeded. We had enormous freedom to do the right thing, designing and implementing not just the product but the business with continuous user feedback. When you are constantly testing and evolving toward what people will use or buy, creating value is inevitable. That said, the process is neither easy nor predictable, which is why it is rarely done end-to-end.
Another key factor was a good call we made in 2002: that online shopping was going to rebound and be increasingly ready for a new wave of innovation. Never underestimate good timing.
Because ExactChoice had a happy ending, there’s a tendency to forget the unglamorous parts along the way: trudging over to the P.O. box to deal with the latest small-business tax forms, cold-calling prospects, and other stuff that magically happens elsewhere in bigger companies. But everything has trade-offs, and in this case, they were well worth it.
[Update, 12/10/2007: After running the original ExactChoice Recommender for two years, CNET in 2007 created a set of new, ExactChoice-inspired recommenders in several categories. Details here.]