The CX Fund
A few days ago, Geoff Teehan, Product Design Director at Facebook, posted an update on the UX Fund experiment he and his former company (Teehan+Lax) conducted 10 years ago. For those of you unfamiliar with the UX Fund, it was essentially a stock portfolio comprised of the 10 publicly traded companies that embodied user experience (specifically on the design side) above all else. The experiment consisted of buying $5,000 in stock for each of the 10 companies, then sitting back for a year to see what happened to that initial investment. The thesis was that companies that focused on delivering great user experiences will see it reflected in an increase in stock price.
At the end of the first year, it seemed as though the thesis was correct. The initial $50k investment had grown to nearly $70k. And after ten years? Well, the thesis still appears to hold true as the initial $50k investment would now be worth somewhere around $250k – a remarkable 500% increase.
I vividly remember when Geoff and team started the UX Fund, as I was actively engaged with Teehan+Lax in a project with a former employer. It was a great idea then, just as it is now.
Much like Teehan+Lax felt that companies focusing on delivering great user experiences across their products would lead to successful businesses, we at SaleMove feel that companies focused on delivering a great customer experience will likewise be rewarded. This especially rings true if Gartner’s research saying that 89% of companies expect to compete mostly on the basis of customer experience in 2016 is accurate.
So, with the success of the UX Fund, we decided to see how a CX Fund would fare.
Using a similar model for selection, we first decided to compile a list of the companies we felt were delivering the best customer experience. We then went through our list to see which were publicly traded on an American exchange and limited the list to 10 companies (this was tough as our list had about 20 companies on it). Our final list looked like this:
Now, as much as we wished we could invest 50,000 real dollars into this fund, the reality is that we’re a small startup. So, we’ll be “paper trading” this fund.
We’ll check in on the CX Fund quarterly and provide an update before a final analysis a year from now. While a lot can happen in a year, we feel confident that companies that have customer experience at the core of their business will come out the other side in a better spot.
And if we’re wrong? Well, at least we won’t go broke.