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The following was announced by Guy Yehiav, CEO of BGV II portfolio company Profitect, on December 7, 2017:

‘Profitect was voted #1 by customers in the “OSCARS” of retail tech – the RIS Software LeaderBoard. Profitect is singled out in the just published report as a Leader in 19 categories; #1 in 3 categories as top performer against some real technology giants. So proud of the Profitect team and appreciate the validation of our Patterns of behavior, Machine Learning & AI technology and kudos from our customers. Great start of the holiday season!’ Full report here:


The following was written by Paul Vachon for Stores magazine, December 2017.

As retailing continues to change and make use of ever more sophisticated technology, the number of statistical reports produced increases exponentially, which presents a problem: What exactly is a merchant supposed to do with all that information?

Making that data actionable — organizing, interpreting and acting on it — has proven to be a daunting task; Profitect just may have found the magic bullet.

Profitect’s software as a service platform of eight autonomous, fully integratable modules approaches the challenge with a singular goal — extract data from myriad sources and transform it into clearly stated prescriptives, instructing store management and associates on specific actions to take based on the system’s extrapolation.

“Profitect is a platform for retailers to change the paradigm of reporting to prescriptive analytics. The platform takes raw data from any number of [existing] systems and uses machine learning algorithms and patterns of behavior to identify opportunities to improve a retailer’s operations,” says CEO Guy Yehiav.

Profitect is set up based on the idea that people in different levels of an organization read, interpret and react to traditional statistical reports differently. To remove this obstacle, the prescriptive tasks are stated in plain language and STORES.ORG STORES December 2017 61 include enough background so that anyone performing the tasks will see how they fit into the larger whole.

Yehiav illustrates by offering an example of how Profitect’s inventory module works at a grocery store: The system notices at 5 p.m. that a regularly stocked bottle of water has not sold since 12:30 p.m., though the rate of sale should be one every five minutes. Through machine learning, Profitect reasons the probability of the water not being on the shelf as 98 percent since the system “thinks” there is inventory. Therefore, the system will send a text message to store employees asking that they check the stock level on the shelf.

If the shelf is empty, staffers are directed to the proper location where a stated amount of back stock should be. If the stock area is empty, instructions are provided to override and reset the inventory to zero, which will trigger an automatic replenishment order.

“The challenge for the user is minimal — all the complexity is on the back end,” Yehiav says.


The inventory module is also useful in loss prevention; Yehiav says the system can take traditional exception-based data to the level of an individual till.

“We can look to the data to see why an individual associate’s drawer came up short. Perhaps he is coupon stacking or ‘sweethearting.’ We can then offer directives to managers to take appropriate actions.”

The same module can also provide prescriptives to analyze inventory issues stemming from damage and waste, markdowns, inventory distortion and other factors.

Profitect client DSW has found that the inventory module alone has yielded substantial benefits. A customer since 2014 when Profitect rolled out the inventory module, DSW has seen improvements in loss prevention, inventory control and merchandise planning and analysis.

An especially useful feature of the system is its ability to be mastered by people with non-technical backgrounds.

“Profitect can take very detailed data and express it in layman’s terms for anybody to be able to interpret with those prescriptive actions,” says Jordan Rivchun, director of loss prevention at DSW.

“We’re bringing data from hundreds of sources that are not themselves related, but the system allows us to paint a picture if something is either good, bad or neutral that we need to take action on.”

“We’re triangulating the data to find patterns of behavior,” Yehiav says, “with the presumption that most products, people and vendors are well-intentioned and committed to doing the right thing.”


The total Profitect system includes seven additional modules, each of which monitors and provide guidance relative to specific areas of a retailer’s operation.

The sales module, which DSW implemented in May, connects directly to each individual till. Besides transmitting basic point-of-sale data, it also analyzes customer loyalty, traffic conversions and labor costs relative to volume and similar data.

The delivery and receiving module harnesses relevant data to flag opportunities for improvement stemming from in-store errors, delivery discrepancies or even driver fraud and/ or collusion, such as fraud detectable from GPS route discrepancies.

The logistics and warehouse module keeps tabs on internal warehouse practices, and can identify opportunities from operator error and noncompliance or stocking inaccuracies. In this setting, the module can link improper warehousing to inadequate associate training and suggest corrective measures.

The planning and buying module uses forecast, order and allocation data plus information from sales and inventory to identify opportunities for improving profit, sell-though, fill rate and inventory adjustments. For example, the module can identify inaccurate forecasting due to an inferior store allocation model.

The marketing module mines data from various sources to identify and recommend new strategies necessitated by changing customer behavior, response to promotions and the impact of existing marketing strategies on basket size. The module can, for example, identify customers with high promotional participation but low average basket size.

The omnichannel module takes data from various sources — sales, customer, logistics and vendor — to refine the merchant’s adaptation of new selling channels and create a seamless brand experience to enhance customer loyalty. The module can offer directives toward maximizing inventory to satisfy store pickup of orders placed online.

Each module can be used on its own or in conjunction with each other.

The mobile field application is perhaps the most impressive aspect of the Profitect platform; Yehiav calls it “the extension of our product for the person on the move.”

Compatible with a variety of mobile devices, the app does not replicate the content of the full modules, but provides key ready reference information to managers, including side-by-side store metrics and the latest social media feeds.

The versatility of the Profitect system is demonstrated by the wide variety of retailers that it’s signed on as clients, including hardline merchants such as Auto Zone and Sunglass Hut, cosmetic stores Sally Beauty and Ulta Beauty and grocers Ahold Delhaize, Stop and Shop and Lowes Foods.

The system can also be efficiently implemented. “The system integrates data very quickly. DSW’s Inventory module was up and running in just three days,” Yehiav says.

Most new technologies and software packages increase the total amount of data generated, while Profitect works to synthesize, distill and interpret all those numbers — undoubtedly a great source of relief to any retail manager or senior executive.


Asda is using data analytics to identify a series of patterns to reduce unnecessary information in its weekly reports. The grocer conducts 95 weekly reports, but is working with software company Profitect to reduce the noise in those documents which are not actioned by the business. “I have a small team of five, and just under 100 pieces of reporting gets circulated around the business – drowning in reports is the position we found ourselves in,” said James Newton, insight manager at Asda. “We became leaner in our retail model, but our reporting didn’t suit that.” So far the retailer has identified 50 patterns with Profitect to help improve its weekly reporting. One such pattern will reduce the workload involved in price changing by 60%. Newton described to delegates at RBTE 2017 how the Asda has identified repeated actions conducted when price changing, which takes place in every Asda store every week. Traditionally an associate reviews a report, keys item numbers into one system and reviews the price changes in another, before finally carrying out the financial correction. By spotting a pattern in this work load, the retailer can reduce efforts by 60%. Despite this, Newton warned that the routine of weekly reports can be difficult to wean the business off. “It’s a crutch for end users,” he said. He said involving all the end users in patent decisions helps to get the business on board. “Understanding how much noise is in the current reporting and how the end user’s time is sparse…if you can offer them time back to focus on their role, that’s the common denominator to break through that barrier.”

Breakout Session to Feature How DSW Leveraged Prescriptive Analytics to Redefine Shrink and Exception Based Reporting (EBR) to Drive Success at Renowned Retail Technology Conference WALTHAM, Mass., June 26, 2017 (GLOBE NEWSWIRE) — Profitect Inc., the leading prescriptive analytics provider for the retail and CPG industry, today announced the company will be attending and presenting at the NRF conference taking place at the Gaylord National Harbor Hotel in Washington, DC, June 26-28, 2017. Profitect will be presenting with a leading shoe retailer on how the organization leveraged prescriptive analytics to redefine shrink and EBR to drive success. In addition to presenting, Profitect will be hosting meetings and demonstrations of the company’s award-winning prescriptive analytics solutions at Booth #135 on the show floor. “We are thrilled to be presenting at NRF with one of our marquee and longtime customers, as they discuss strategy and the benefits they have seen with prescriptive analytics,” said Guy Yehiav, CEO, Profitect. “This also continues a roadshow customer showcase at industry events following recent customer presentations such as Walgreens at the NRF Big Show, ascena retail group at RILA, and Asda at RBTE. We are immensely proud our customers continue to be our biggest champions in educating the industry on how our solutions have enabled them to easily understand, and more importantly act on their data.” The session will feature how the shoe designer leveraged internal data through the use of prescriptive analytics and machine learning to guide decision-making to predict and manage shrink, as well as take Exception Based Reporting to the next level. Attendees of this session will learn how the retailer redefined what it means to look at shrink through EBR to create a self-sustaining system of identifying profit opportunities and acting on them appropriately in real-time to drive success across the enterprise.
  • Session Title:Exhibitor Insights: How DSW Redefined Shrink and EBR to Drive Loss Prevention Success”
  • Date and Time: Tuesday, June 27, 2017, 11:15-11:45 am
  • Speakers: Jordan Rivchun, director of loss prevention, DSW; Guy Yehiav, CEO, Profitect
  • Location: Expo Hall – Exhibitor Insights
  • Profitect Booth: #135
Profitect continues to lead the industry with robust solutions that augment and/or replace an organization’s existing business intelligence and EBR reporting tools with solution modules that identify, resolve, and measure opportunities for improvement. To follow Profitect’s activities at the conference on Twitter, visit @Profitect. Learn more about upcoming events, by visiting: About Profitect Since 2012, Profitect has helped companies leverage existing big data investments to identify, resolve, and measure opportunities to transform the business by delivering actionable prescriptive analytics to the right person, at the right time. To learn more about Profitect visit

In a ceremony at the Retail Asset Protection Conference in New Orleans yesterday, the Retail Industry Leaders Association (RILA) honored Digital Safety USA as first place winner of the 2017 (R)Tech Asset Protection: Innovation Awards. The Awards showcase emerging, game-changing technologies that mitigate total retail loss, as defined in a groundbreaking research report published by RILA last year. Digital Safety offers Point-of-Sale Activation (PoSA) technology for “intelligent” products and single-scan UPC serialization for both “intelligent” and “non-intelligent” products. PoSA benefits include, but are not limited to, open sell of product which promotes increased sales, reduced shrink, elimination/reduction in cost from current theft deterrent solutions, reduction in returns fraud, promotes PI accuracy, and allows for true, non-assisted self-checkout options for the customer. Second and third place winners were Profitect and Wal-Mart Stores Inc., respectively. Retailers’ Choice Award, which was voted on by conference attendees throughout the week, was awarded to Profitect, for the second consecutive year. The first, second, and third place winners were selected by a panel of top executives from a group eight finalists. “Each year, we ask companies to bring us their game-changing technologies and each year, they deliver and exceed expectations. This year in New Orleans was no different,” said Lisa LaBruno, RILA’s senior vice president of retail operations.“Recognizing innovations across the industry and learning more about how we can implement them to improve the field of asset protection are what the Awards are all about. Thank you to all of the participants and judges, and we look forward to seeing more cutting-edge technology in the future.” Winners of the 2017 (R)Tech Asset Protection: Innovation Awards are:
  • Digital Safety USA (First place)
  • Profitect (Second place)
  • Wal-Mart Stores, Inc. (Third place)
  • Profitect (Retailers Choice)
The Awards come on the heels of RILA’s public announcement of the (R)Tech Center for Innovation. (R)Tech is a new term coined by RILA to describe the confluence of retail and technology. An (R)Tech company embodies the core values of both those industries – global and local, nimble, and entrepreneurial – to win the loyalty of today’s empowered consumers. The Center’s mission is to is to help retailers navigate the industry transformation, and to spur the adoption of the “(R)Tech” term within the retail innovation ecosystem. To learn more visit For more information, visit the awards homepage. RILA is the trade association of the world’s largest and most innovative retail companies. RILA members include more than 200 retailers, product manufacturers, and service suppliers, which together account for more than $1.5 trillion in annual sales, millions of American jobs and more than 100,000 stores, manufacturing facilities and distribution centers domestically and abroad.   Source:

Anik Bose, BGV General partner shares his perspective on the Digital Transformation of Retail. The digital transformation of retail is reinventing how retailers engage their customers, utilize their assets, improve worker productivity and drive supply chain visibility. Not only RFID, BLE and IoT sensors but also video cameras equipped with advanced computer vision algorithms are becoming instrumental in enabling supply chain reinvention while advanced behavioral analytics are changing in-store execution, pricing and marketing functions. While technology innovation is serving as a catalyst for this transformation, the shift in customer behavior is playing an equally strong role, as customers increasingly prefer using multiple touch-points for resolving issues. They often expect an integrated and seamless experience and furthermore, enriching customer experience requires that traditional and digital channels complement each other and be used simultaneously. The customer journey from engagement, product discovery, purchase and post purchase provides a good set of illustrative examples of this digital transformation.
  • Engagement – Mobile devices are becoming central to customer experience and engagement; Social media is changing the ways of creating brand value and loyalty
  • Product Discovery – Digital mediums and interactive displays are providing relevant context-aware messaging leveraging IoT and analytics; Need is being created on the go, at the point of discovery – not restricted to physical or virtual retail channels.
  • Purchase – Omni channel is becoming a mainstream trend supporting the integration of the best of online and brick and mortar retail. Digital wallets and NFC are fast becoming a reality.
  • Post-purchase – Point of service is being reimagined with proactive insights to delight customers. Customer 360 driven engagement and post purchase experiences and actions are coming together to resolve customer issues. Self-service is becoming easier with automation and digital IVR tools.
In order to compete effectively with ecommerce giants, retailers are required to increasingly leverage technologies that enable them to blend the best aspects of in-store and online shopping. One example is to provide real time customer reviews and ratings at kiosks or via mobile apps to help on-site customers make informed purchasing decisions while they can touch and feel the product. Another tactic is leveraging social analytics tools for frictionless commerce by better understanding customer sentiments. All of these tactics require collecting and leveraging consumer data to make real time decisions in-store and online at multiple levels of the organization. This requires both a culture shift as well as embracing cost effective technologies to automate the data collection processes, be it at the store, warehouse and or distribution centers levels. Profitect ( a BGV portfolio company is a SaaS firm that is transforming in-store workforce productivity through advanced prescriptive analytics to drive improved profit performance. The company’s turnkey solution utilizes customer’s data to deliver store level optimization actions instead of static reports to increase sales and margins. The company’s prescriptive analytics technology utilizes pattern recognition to identify performance improvement decisions and automatically delivers prescribed actions to the appropriate personnel and then tracks and monitors execution across store operations, loss prevention, omni-channel, marketing and merchandising. This closed loop solution often generates 100% ROI within 6 months. Profitect has successful deployments at retailers like ASDA, Ahold, Lowe’s, DSW, Weis and dozens of other key retailers. Gartner’s view on improving in-store worker productivity is highlighted in the next chart. Slide1   Intellivision ( another BGV portfolio company applies advanced video analytics across multiple markets with Retail being one of the key customer segments. The company’s product enables retailers to capture and analyze video data around store metrics and customer analytics – this includes customer counts, demographics, store traffic, dwell times, customer service times as well as queue management and metrics (one of the highest accuracy rates). The company provides management dashboards and store reports and works with leading OEM partners like Zebra, 3VR and NLSS amongst others to service the retail market. When it comes to in-store business intelligence, retailers can now literally remove the blindfold that has been holding them back. With the use of real-time affordable visual intelligence, today’s retailers can clearly see the path to understanding daily activity in the store and maximizing the use of every square foot.   New data from network-based video, combined with data from existing sources, presented as actionable data, can drive more targeted decisions about merchandising and promoting products, directing traffic more effectively through the store and maintaining best-in-class customer service at all touch points. Grid Dynamics ( another BGV portfolio company helps enterprises transition to the cloud and to enable them to develop new features, test new ideas and evolve new services to address insatiable appetite of consumers for new digital services. The company has enabled retail customers like Macy’s, Kohl’s, Sephora and American Eagle make this transition. BGV believes that Digital Transformation of retail is a multi-year journey, one that requires a fundamental technology enabled redesign of the underlying processes and business models. Retailers that embrace and invest in technology innovation will be able to thrive in this new world. Those that pursue incremental piecemeal improvements will struggle to survive. Finally we believe that much of the needed technology innovation will come from start-ups not just incumbent retail vendors thereby requiring greater collaboration in the retail eco-system – amongst retailers, suppliers, incumbent vendors, start-ups and system integrators.

Anik Bose, BGV General Partner shares his perspective on global technology innovation and the implications for early stage cross-border venture investing. Silicon Valley remains the center of the technology universe with an established major technology ecosystem with companies such as Google, Intel, Cisco, Salesforce, Facebook, Oracle and Palo Alto Networks anchored in the area. While the cross-fertilization of ideas and innovation created by such an ecosystem is difficult to replicate, innovation continues to emerge from other parts of the world such as Israel, China, UK, France, Japan, India and Korea. A few key data points:
  • Israel has successfully established itself as “Startup Nation” – Ranked first in the world for innovative capacity by the IMD Global Competitiveness Yearbook 2014 and third for innovation globally out of 148 economies by the WEF Global Competitiveness Yearbook 2014–2015. The region has established an enviable track record of technology innovation in the sectors of cybersecurity, cloud and mobility.
  • China’s tech savvy consumers are propelling advances in Cloud adoption, IoT and autotech and are rapidly emerging as the only region outside Silicon Valley that has the benefits of scale and the aspirations to be a significant player on the global technology landscape. Ecosystem players like Alibaba, Tencent etc are playing a key role in fertilizing technology innovation in the region.
  • UK – London has a higher density of startups than any other city in the world with Fintech deals experiencing a five year compounded annual growth rate of 74%
  • France has the second largest VC ecosystem in Europe (US$1.2 billion in 2013) and has produced strong innovative startups in the areas of Analytics, IoT, Adtech and Drone technologies
  • India has launched several initiatives to promote the growth of the technology sector including Digital India, a $2Bn technology catalyst fund, and an ambitious plan to build 100 smart cities, which will push the innovation paradigm for technology companies.
  • Japan is setting new standards in Robotics with a focus on integration of the artificial intelligence sensors, software and big data.
  • Korea is fortifying its technology economy with promising technologies such as 5G telecommunications, realistic media and content platform devices
I believe that this emergence of global innovation hubs represents a unique opportunity to build strong technology companies – ones that practice the mantra of “Innovate locally, Scale globally.” These companies pick the best talent from the appropriate region to gain competitive advantage and then connect with the Silicon Valley ecosystem/US market to scale the business. Startups are able to find extremely talented engineers with advanced degrees able to help build early products. But in order to reach the global markets, connection to Silicon Valley is absolutely essential to these startups – for scaling growth (organically or via eco system partnerships) and brand recognition.  As LinkedIn co-founder Reid Hoffman writes in his blog – Expertise in scaling up is the visible secret of Silicon Valley (link), connecting with Silicon Valley allows cross-border startups to scale market reach in addition to scaling technology quickly and cost effectively based on the inherent advantage of their non US R&D teams.. BGV has the global company building/scaling experience as well as the experience of assembling global investment syndicates and building distributed management teams across continents and cultures – the competency required to build successful cross-border technology companies. The firm possesses this experience and DNA by design and by strategy and is a competency that is difficult to replicate. We believe that this is an increasingly relevant source of competitive advantage because of the dynamics of global innovation outlined earlier in this blog.. At BGV, we have successfully helped technology companies from China, Israel, Western and Eastern Europe and India scale up. In 2014/15, BGV has invested in Ayehu (R&D in Israel), Profitect (Developed its core analytics algorithms in Israel), Grid Dynamics (R&D in Eastern Europe), Survela (R&D in Spain), Intellivision (R&D in India and Russia) and Identity Mind Global which is growing rapidly in China. All these companies are headquartered in the US but leverage cross-border innovation.  We firmly believe that this trend of global innovation represents a unique opportunity to build new generation of enterprise technology companies. Every BGV partner is an immigrant who has participated in building global technology companies and as a consequence we tend to view early stage cross-border investing as an opportunity not as a risk.

Anik Bose and Yashwanth Hemaraj from BGV share their perspective on the next wave of Enterprise IT Innovation. The democratization of knowledge is the acquisition and spread of knowledge amongst all workers, not just a fraction of highly educated workers. The printing press was one of the early steps in that journey. The creation of libraries during the industrial revolution was another, with the Internet raising the sharing of information and knowledge to unprecedented levels. BGV believes that the digital transformation of the enterprise will create a significant wave of innovation around empowering productivity and continuing the process of democratizing knowledge – not only through automation of knowledge workers but also by enabling less skilled workers to do more. The innovation around big data storage and analytics has pushed businesses to adopt data analysis tools to make data driven decisions that lower costs, improve productivity and deliver increased value to customers. Advances in artificial intelligence, machine learning, and natural user interfaces (e.g., voice recognition and semantics analysis) are making it possible to automate many knowledge worker tasks that were long been regarded as impractical for machines to perform. For instance, some computers can answer “unstructured” questions (i.e., those posed in ordinary language, rather than precisely written as software queries), so employees or customers without specialized training can get information on their own. Prescriptive and predictive analytics tools are being used to augment the talents of broader sets of employees as well. In addition, visualization tools are beginning to democratize big data by giving users broader flexibility to analyze data within a self-service business intelligence environment. Allowing users to explore, summarize, and visualize data in the way they see fit enables users with less advanced data skills to gain greater comfort with data and draw increasingly sophisticated insights. We believe this opens up possibilities for far-reaching changes in how work is organized and performed to drive productivity gains. Several underlying technology trends are enabling this emergence of innovation in the areas of advanced analytics and data visualization tools. These include:
  • 100X increase in computing power from IBM’s Deep Blue to Watson
  • Advances in machine learning, AI and natural language interfaces
  • Breakthroughs in new algorithms, data storage principles and new data sources
We believe that empowering “broad based” productivity will become an increasingly important component of any successful startup’s overall value proposition in the future. The economic rationale is simple and compelling – a broader user base will significantly shorten time to value for customers, drive faster adoption and therefore revenue ramp for such startups. Enterprises are facing increased pressure to make data driven decisions in order to remain competitive on one side, and a severe shortage of people with data analysis skills on the other side. This is true across multiple verticals. A research by the McKinsey Global Institute projects that by 2018, the US alone may face a 50% to 60% gap between the requisite demand and supply of deep analytics talent, i.e. people with advanced training in statistics or machine learning. In November 2014, a special Parliamentary Select Committee in the United Kingdom’s House of Lords reported a global shortage of “no less than two million cybersecurity professionals” by the year 2017. This gap is preventing companies from effectively executing their critical business strategies. The presence of such severe talent shortage and high demand also leads to high turnover and hyper wage inflation, further increasing economic pressure on enterprises. A few examples:
  • Cyberflow Analytics ( visualization and network scale behavorial anomaly detection allows IT personnel in the Security Operations Center to deliver automated incident response and remediation without needing to rely purely on highly skilled security analysts who are in short supply. This is an increasingly important value proposition for enterprises as they turn to MSSP’s to manage their security needs
  • Profitect ( offers prescriptive analytics solutions for workers in retail stores aimed at optimizing store level decisions that impact profitability without needing to incur the expenses of a dedicated data science/analyst team
  • Swiftshift ( enables retail and health care enterprises to communicate and optimize scheduling for their shift workers by leveraging a mobile automated workflow management tool thereby improving productivity, minimizing operations disruption from due to absenteeism while reducing agency costs
  • Ayehu ( enables the rapid automation of any IT process workflow, thereby freeing up time to allow IT personnel to improve customer service levels as well as implement complex solutions without having to rely purely on expensive IT resources (e.g. ServiceNow help desk implementations)
We are not advocating that blind automation is the panacea because continuous learning, manual control and governance policies will continue to be a necessary ingredient within any automation framework. In the 1990’s IT tools enabled creative managers to redesign core processes or innovate around products and services in response to changing business conditions. But by far, the narrowly defined IT producing sectors made the most direct contribution to productivity growth – accounting for 8% of GDP in 1993 yet contributing a disproportionate 36% to productivity growth between 1993 and 2000 (Source Mckinsey Global Institute Report 2002 – How IT Enables Growth). over the coming years the impact of IT on productivity will be far more broad-based, with advanced analytics and data visualization cutting across sectors (retail, healthcare, banking, manufacturing, etc…) with mobility and cloud becoming delivery foundations for such applications.