Satmetrix Gets $8M Cash InfusionSatmetrix Gets $8M Cash Infusion

With the economic downturn, businesses struggling to remain profitable are placing a higher priority on keeping their best customers happy. But how can they tell when customers are satisfied or are about to leave for another company? And what should they do about it?

Satmetrix Systems Inc., which provides software and services to help businesses answer those questions, has raised $8 million in third-round venture funding from Sutter Hill Ventures and Stanford University. The Mountain View, Calif., company raised $22 million in two earlier rounds of funding. The money will be used for expansion, focusing on sales and marketing efforts, says Roselie Buonauro, Satmetrix co-founder and chief customer officer.

Satmetrix surveys its clients' customers by E-mail to determine how happy they are with a company's products and services. That information, combined with other data provided by the client, such as customer purchase history, is analyzed by Satmetrix to gauge the level of customer loyalty and determine what steps need to be taken to maintain or improve that loyalty. The findings are given to operational managers, who make the necessary process improvements. "Everything in today's economy is about keeping customers," Buonauro says. "Customer loyalty drives cash flow."

Online auctioneer eBay Inc. uses Satmetrix' services to monitor customer satisfaction with its processes and with individual customer-service representatives.