One to watch

Interactive Week
June 18, 2001
By Mike Cleary

David Bowman thinks he can make businesses smarter with smaller brains. "We're going from the Cray-1 to a Pentium chip. It's that kind of a jump," he says.

The founder of Virtual Strategy, a 2-year-old Boston-area start-up, plans to tackle the market for business intelligence (BI) software, primarily in banking and retail markets. He has his work cut out for him. The market is controlled by large established companies, such as Informatica, SAS Institute and SPSS.

According to Bowman, formerly chief operating architect at Wang Laboratories, most BI systems are slow to install and expensive, costing hundreds of thousands of dollars. Furthermore, they analyze data based on complex but inflexible models that accept data only in preset definitions and ways.

Bowman came up with an architecture that breaks down large arrays of data into "microcubes" that can be analyzed in many ways and updated in real-time. The system is smaller, faster and less expensive, he says. It also appears to be catching the attention of analysts like Ronni Marshak at Patricia Seybold Group.

"Virtual Strategy has a great idea on how to do things traditionally done in database-heavy settings but in a much more real-time way," says Marshak, a senior vice president at Seybold. She says her firm has not yet encountered a company with a similar approach.

In less than two weeks of part-time work, Ryan Fuller, Virtual Strategy's manager of product development, says he assembled a prototype BI application for a Boston bank that could show its most profitable products, customers and branch offices, or its least profitable. He further demonstrated how dropping one product line would still leave the bank ahead by $89,000, even if it cost the bank all the other business from the customers who used it.

"Because we don't have to preprogram para meters, we can go down as deep as you want and it comes back in seconds," says David Bowman, Virtual Strategy's CEO.

While analysts call it an interesting solution, they also say it faces tough, well-entrenched competition. "The existing players in the space are pretty big," says Lisa Williams, an analyst at The Yankee Group.

Virtual Strategy, Inc.
236 Huntington Ave. Suite 316
Boston, MA 02115

Contact: Peter Burton
Phone: 617.262.4500
Fax: 617.236.5560