NGDATA positions Lily as a 'big data' platform for consumer intelligence

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1 NGDATA positions Lily as a 'big data' platform for consumer intelligence Analyst: Matt Aslett 15 Oct, 2012 NGDATA recently announced the launch of Lily a platform for storing, processing and analyzing consumer data. The product is based on the open source content-repository project of the same name that NGDATA acquired, along with Outerthought, earlier this year. NGDATA brings greater commercial resources to Lily, as well as the focus on consumer intelligence, and has recently raised a first round of funding to take the product to market. The 451 Take We first spoke to Outerthought a number of years ago, and while the original Lily represented an interesting open source project, it was not clear whether Outerthought had what it would take to turn it into a commercial business. NGDATA is a different proposition, and has brought commercial focus to the project, as well as consumer intelligence data management and application advances. We think the consumer intelligence space is likely to be a happy hunting ground, and NGDATA's ability to provide an automatically updated repository of consumers for targeted advertising will go down well compared to the complexity of assembling the various separate components. Context We first encountered Lily through our Commercial Adoption of Open Source (CAOS) practice, seeing it as an interesting project to create a content repository on top of NoSQL database and search technology. Outerthought, the company behind Lily, offered consulting and support services for Lily, as well as other open source projects, but had not achieved much in the way of commercial traction Copyright The 451 Group 1

2 before being acquired by NGDATA earlier this year. NGDATA has a background in artificial intelligence technology, but saw the opportunity to build a platform around Lily to enable companies to integrate, store and process data from multiple sources to analyze consumer behavior. Based in Gent, Belgium, but with offices in New York and San Francisco, NGDATA is now poised to expand its US operations and bring the expanded Lily consumer intelligence platform to a wider audience. The company has raised $2.5m from ING, Sniper Investments, Plug and Play Ventures and angel investors to further product development and grow its sales and marketing opportunities. The company currently has 25 employees including SVP product Steven Noels, who created the original Lily project, as well as cofounders Luc Burgelman (CEO) and Frank Hamerlinck (COO), who previously cofounded trade management SaaS provider Porthus acquired by Descartes Systems Group in NGDATA currently has 10 paying customers, and an initial focus on the banking, retail and insurance industries. Products The original Lily project, which is now the Lily Data Repository, is an open source content repository based on the Apache HBase NoSQL database and Apache Solr search projects. NGDATA has added two layers on top of the Lily Data Repository to form the complete new Lily consumer intelligence platform: the Lily Consumer Database and Lily Consumer Applications. Together these form a platform for consuming, storing and processing data on consumer behavior from a variety of sources in order to generated personalized marketing and product offers. Other potential applications include fraud detection, risk profiling and management, and customer retention. Technology The Lily Data Repository is designed to aggregate structured and unstructured data from internal and external data sources, including enterprise applications, operational infrastructure and social-networking sites. It includes data integration and ETL capabilities, and stores data in Apache Hadoop and Apache HBase. It also offers indexing to enable faster retrieval of relevant data. Lily Consumer Database sits on top of the data repository and includes Data Organizer to identify a single consumer and match relevant data from multiple sources. The resulting consumer profiles are updated as new data is ingested into the repository. Lily Consumer Database also includes capabilities for data-quality management and Explorer, for faceted search. Copyright The 451 Group 2

3 Lily Consumer Applications includes a machine learning and recommendation engine developed in-house, as well as an application called Insight that enables analysts to reverse-engineer machine-generated recommendations to understand how they have been made, and do reverse-segmentation to target clusters of similar individuals. Also included is a SDK through which developers can add their own business rules and algorithms. Competition NGDATA sees the greatest competition at the moment coming from traditional data-warehousing and business intelligence marketing tools, but maintains they are limited in their ability to ingest data from social media and other external sources, and in their suitability for processing large volumes of data especially from a cost perspective. Generating and maintaining a single view of the customer is certainly not a new concept, and larger data management companies with greater resources and higher profiles will continue to dominate mainstream accounts, but we would agree that emerging data management platforms such as Hadoop and HBase have changed the cost model for bringing together the data and processing power required for such a project. In addition, there are a number of vendors offering Hadoop-based machine learning, including Predixion Software and Skytree. Aside from traditional approaches, the greatest immediate competition probably comes from companies attempting to build their own consumer intelligence platforms based on Hadoop, machine learning and other advanced intelligence applications. NGDATA argues that it enables users to get the same result while focusing on their domain knowledge, rather than technical expertise. It further argues that it does not compete with the various Apache Hadoop distributors and can point to a partnership with Cloudera as evidence of that. One emerging company that NGDATA does expect to compete directly with is Continuuity, founded earlier this year by Todd Papaioannou, former vice president of cloud architecture at Yahoo. Continuuity is very much in stealth mode, and it is not clear exactly what technologies it is bringing together in its big-data platform, but consumer intelligence appears to be a target use case. SWOT Analysis Strengths Weaknesses By acquiring Outerthought, NGDATA has brought together two teams with complementary technological and entrepreneurial skills. The company is not well known, and will need to establish a larger US presence to raise its profile. The recent funding will aid that effort. Copyright The 451 Group 3

4 Opportunities Threats Technologies like Hadoop have changed the cost equation for targeted advertising, and Lily has the potential to reduce the complexity as well. NGDATA will face many larger challengers that are also adopting approaches based on Hadoop and other big-data processing technologies. Copyright The 451 Group 4

5 Reproduced by permission of The 451 Group; This report was originally published within 451 Research s Market Insight Service. For additional information on 451 Research or to apply for trial access, go to: Copyright The 451 Group 5