MADRID (7 July, 2023) – Algori, a data insights startup for the consumer goods vertical reimagining the consumer panel has secured €3.3 million in funding. The seed investment was co-led by Shilling Capital and Change Ventures, and joined by Flashpoint VC. The round also featured several angel investors, including former Numerator Board Member and Infoscout CEO Jared Schrieber, who led Numerator to a $1.5 billion exit to Kantar. A number of Algori’s own employees also invested as part of the deal. The startup is currently active in Spain, where its consumer panel is four times the size of the country’s largest incumbent. Algori will direct its new funds toward scaling the business in Spain, expanding data science capabilities, and extending operations into new markets in Western Europe.
Today’s challenges of inflation, supply chain disruptions and rapidly evolving consumer preferences are putting enormous pressure on fast-moving consumer goods (FMCG) companies. Better data and insights could hold the key to overcoming these challenges. According to McKinsey, successful consumer goods companies are 3.5 times more likely to use granular data for accurate decision-making. However, data offered by incumbents lack granularity and speed. Point-of-Sale (POS) data providers exclude significant discounters, such as Lidl and Aldi, and are therefore unable to provide a complete picture of the retail market. In addition, they cannot report retailer-specific sales figures, producing aggregates only. On the other hand, traditional consumer panels lack adequate sample sizes to provide granular, accurate data on individual products. For instance, Spain’s largest incumbent consumer panel claims 12,000 households to represent a 47 million resident population.
Algori overcomes limitations of traditional consumer panels by leveraging data science, machine learning and its own consumer app, which rewards money to users in exchange for providing their shopping data. The Madrid-based startup has amassed 50,000 weekly shoppers allowing it to capture 1 in 400 grocery receipts in Spain. On average, it takes 12 seconds for Algori’s app users to submit the receipt and register their full shopping basket data. This is significantly easier and faster than the 8 minutes needed when using conventional household panel barcode scanners. Thanks to Algori’s AI-enhanced data organization capabilities, the company identifies the shopping basket items on the product level without the need of any retailer sales system integrations. The basket data is further enriched with shopper demographics, psychographics, past purchase history, store locations, and other valuable data points. This data is then integrated into a platform providing stock keeping unit (SKU) level insights. The entire process unfolds in near real-time, significantly outpacing incumbents in delivery and scale.
Andrius Juozapaitis, CEO and co-founder of Algori, said: “FMCG brands, retailers as well as media agencies have reported to us that a lack of high quality data is holding them back from making the right insight-driven decisions. These companies need data that is much more granular and fresh. Unfortunately, the consumer goods market research oligopoly has deterred the innovation required to get there. We are leveraging technology in a new way, rethinking the entire process to push the boundaries of FMCG data insights and significantly accelerate the data-driven decision making capabilities in the sector. Our ultimate goal is to help consumer goods companies get more distribution, more sales and execute their marketing strategies better.”
In an industry characterized by business models relying heavily on client services and consulting, Algori is also innovating on the insights delivery model. Algori simplifies data interpretation and speeds up decision-making with the streamlined web interfaces of its Insights Portal. This broadens the range of consumer goods professionals who benefit from the insights provided, as it removes the need for additional technical intermediaries working on the data.
The panel's size and accuracy enable Algori to cover SKUs from smaller brands and products, previously not covered by incumbents. This means that both traditional and challenger brands are covered. Algori’s clients can receive insights on a weekly or monthly basis, instead of solely relying on quarterly and annual data as is the current norm. Moreover, customers can choose specific data views and pay based on category and SKU count, eliminating the need for commitment to packages bundled with irrelevant market information.
Ricardo Jacinto, Partner at Shilling Capital commented: “Algori has identified an unmet market research need and an opportunity to radically improve the way FMCG brands use consumer data in an industry worth more than €1 trillion in Europe alone. The team is abundant with industry veterans possessing deep expertise, exceptional for a startup at this stage. Their product has surpassed competitors in terms of methodology and utility. It is future-proof and unchallenged by AI. We believe Algori can usher in a new era of FMCG market research.”
Jared Schrieber, exited co-founder of Numerator said: “Algori's SKU-level insights are game-changing and long awaited by the FMCG industry. Some of its capabilities greatly exceed comparable incumbent consumer goods analytics offerings. These order of magnitude improvements in speed and granularity of data insights will allow brands to gain a new level of understanding about the ever-changing consumer behavior and preferences. Consumer goods companies making use of Algori’s data first stand to gain a significant performance advantage.”
The round takes Algori’s total funding to €4.3 million. Founded in Madrid in 2019, the startup already partners with several leading FMCG companies in the Iberian region. Algori plans to roll out its new products in Spain prior to expanding into additional major Western European markets.