KhiMetrics - A Sacramento Story of What Could Have Been
Kenneth and Timothy Ouimet founded KhiMetrics in 1997 in Sacramento.
They built a product to deal with 'price optimization'. Almost no one had heard of price optimization. The brothers were ahead of the market. But a few people believed in them. One or more were members of the Sacramento Angels, an Angel investor organization. They invested seed capital in the startup.
But then the company needed additional funding and no local funding was to be found.
In November 1999 the Compay received $3M in funding from Telos Ventures Partners of Palo Alto, CA.
They got a new CEO. The CEO had run successful companies in Arizona. The company moved to Scottsdale, AZ.
Over the next few years, KhiMetrics made considerable progress. Their sales increased more than 1,600 percent since 2001. Customers included Albertsons, PETsMART, Lowe’s, 7-Eleven, Sterling Jewelers, ShopKo Stores, Pamida and Big Y Foods.
Speed ahead to 2005 - price optimization is hot. All the big players want to play in this space. There are only a few companies in the space worth acquiring- those the visionaries started in the mid-90's.
And then the big breakthrough. SAP acquires KhiMetrics. Terms of the deal were not disclosed. But there were some pretty happy people who were smart enough to see KhiMetrics' potential way back when. Word is they did VERY well.
Of course, if we had figured out how to keep the company in Sacramento in the first place, there would be many more local celebrations. And some capital to start more high-potential companies right here in Sacramento.
But we still have an opportunity to recover. One of the original founders of the company stayed behind in Sacramento and has started his own price optimization company. The company has traction. The market space is hot and validated.
Question is: has Sacramento gotten smart enough to figure out how to get this company funded and filled with local talent and firmly planted in Sacramento? Let's hope so.
Weigh in....
Gillian Parrillo
The Sacramento Executive
