Last updated on July 2nd, 2019 at 09:04 pm
Socialeads, established by entrepreneur Larry Hitchcock and solutions architect Matthew Salzer, created a product that addressed Northwestern Mutual’s challenges regarding salesperson market potential and referral friction. It uses a Northwestern Mutual financial representative’s social networks, with data science and machine learning, to help them reach the right people in their network at the ideal time. For example, it can analyze social media data to determine when a contact is planning to buy a home, save for college or plan for retirement.
“They killed two birds with one stone. Their solution leverages data science, advanced machine learning and a few other big data analytic techniques to solve this very important both personal and professional social networking problem,” said Karl Gouverneur, vice president of digital workplace, corporate solutions and head of digital innovation at Northwestern Mutual.
Northwestern Mutual announced the contest in September and kicked it off with its Reverse Pitch presentation on Nov. 6, during Milwaukee Startup Week. More than 150 innovators from as far as New York and California traveled to Milwaukee to take part in Reverse Pitch. After the challenges were pitched at the Startup Week event, 19 teams applied for the contest and six were chosen as finalists. The final presentations took place at a Startup Pitch Day Jan. 8 at Northwestern Mutual. Hitchcock and Salzer met at the Reverse Pitch event during Startup Week.
The challenges were:
- Legal automation: A way to automate the procurement contract process by disaggregating key components and virtually red-lining language of concern in contracts – an efficiency win for any corporate law department and procurement professional.
- Referral friction: A creative solution to overcome the friction its financial representatives encounter in acquiring referrals and new leads.
- Compliant communication in the digital world: A way to allow clients to reach their advisor using their preferred digital communication method while remaining compliant.
- Salesperson market potential: An automated way to identify prospects based on a financial representative’s publicly available social media contacts.
- Real-time spending capture: Software to act as a platform linking several cards a customer already uses to capture real-time transactions and offer the ability to automate future credit card actions through the platform, based on business logic.
As the winner of the competition, Socialeads will receive a seed investment of up to $85,000 from Northwestern Mutual’s Cream City Venture Capital Fund, becoming its first portfolio company. Socialeads has received $10,000 from Northwestern Mutual to create a new legal entity and form the company. Northwestern Mutual now plans to invest up to $75,000 more, split into three tranches based on mutually agreed upon milestones.
Socialeads will also receive corporate mentorship and working space in the Innovation Lab at Northwestern Mutual’s headquarters downtown. Salzer lives in southeastern Wisconsin, and Hitchcock is based in Los Angeles, but is a Shorewood native and plans to move back to Milwaukee, Hitchcock said. The company will continue to operate independently within Northwestern Mutual, including hiring outside employees.
Salzer and Hitchcock are still developing the prototype of their platform, but the goal is to help people understand on a real-time basis what is happening in the lives of their social connections to offer actionable insights to salespeople not only at Northwestern Mutual, but at other companies across the country, Hitchcock said. It will use tools including natural language processing and image recognition to scan social media posts for important life events.
“Even somebody with just several hundred friends in their social networks across a variety of the platforms has too much data to be able to understand everything that’s happening all the time,” Hitchcock said. “We’ll be able to surface that data on these life events to these financial representatives as quickly as the platform sees it happening, and then over time melding that data with the multiple pools of data that Northwestern Mutual keeps track of.”
Northwestern Mutual launched its $5 million Cream City Venture Capital Fund in October, with plans to make $100,000 to $250,000 investments in technology startups in the Milwaukee market.
A couple of the other companies in the Reverse Pitch competition are still in discussions with Northwestern Mutual, but it’s not likely to produce another investment, Gouverneur said.
“There are conversations that are continuing on. Perhaps a couple of them we could potentially buy their product,” he said.
The company has not yet decided on hosting the competition again next year, but plans to continue its efforts to boost Milwaukee’s technology community, including other Cream City Venture investments.
“We do have other investments that are on the radar and very close to a deal,” Gouverneur said.