Silicon Valley startup Aviso, Inc. is applying predictive analytics to a task that has until now stubbornly resisted statistical rigor: sales forecasting.

The company yesterday announced Aviso Insights, a cloud-based analytics tool that sucks in data from popular customer relationship management (CRM) and enterprise resource planning (ERP) systems and uses it to advise sales managers on where to direct their resources.

Co-founded by serial entrepreneur K.V. Rao and Wall Street veteran Andrew Abrahams, the company is seeking to apply the same principles institutional investors use in placing bets on companies to figuring out which sales deals are most likely to close. Its analytics engine currently relies heavily on historical data but will be expanded in the future to include factors ranging from market growth to the weather for help in guiding sales executives.

Aviso Insights uses an extract, transform and load (ETL) process to download sales and financial data, usually on a daily basis. Its reports not only give an up-to-the-minute view of sales performance but form the basis for identifying immediate opportunities. It’s also useful in managing sales rep performance.

Aviso seeks to go beyond performance snapshots to actually predict the future. “Our goal is not to be accurate,” Rao said in an interview. “It’s to help our customers use insights from analytics to tell you how you might increase the velocity of deals based on similar deals you have won in the past.”

Forecasting the future

Sales forecasting is a notoriously subjective process, often consisting of sales reps presenting educated guesses about their prospects to sales managers who work largely on experience and intuition. CRM systems are good at presenting information about individual deals and accounts but lack the analytical foundations to create reliable forecasts. That’s the gap Aviso hopes to fill.

While sales rep estimates are factored into Aviso’s guidance, the system seeks to temper guesswork with hard data that may point to missed assumptions or information gaps. Aviso Insights currently works only with historical data from an individual company but will be expanded with best-practice data from leading sales organizations over time, Rao said.

One self-described “happily paying customer” is David Berman, president of cloud-based business communications solutions provider RingCentral, Inc., which has been using Aviso Insights since the spring. Berman said he appreciates having the ability to drill down to individual reps and opportunities on a near-real-time basis.

“Sales reports have traditionally been lagging indicators that told me what I had done in the past,” he said. “This is a leading indicator, a forecast based on where deals are in our pipeline and how likely they are to close.”

Aviso applies hard data to a process that has historically been the realm of guesswork and optimism. “Sales reps never want to tell you they aren’t going to make a plan,” he said. With Aviso he can see progress based on the key performance indicators of individual reps, which helps in spotting problems and assigning resources more effectively. It also helps with coaching and performance management.

Berman said it’s too early to calculate an ROI on Aviso, “but it helps me sleep a lot better. I’ve never seen anything like this,” he added.

With a minimum subscription fee of $100,000 per year, Aviso Insights is aimed at enterprise customers with 50 or more sales reps, Rao said. Although availability is only being formally announced today, Rao said the company has already signed up eight paying customers and has more in the pipeline. The company has raised $8 million from venture capitalists that include Shasta Ventures, First Round Capital and Cowboy Ventures.

Image courtesy of Aviso, Inc.