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innovation economy

Site lets you shop online for best deal on oil

Excerpts from the Innovation Economy blog.

When you buy a house or condo that has oil heat, the dealers send you a piece of direct mail to persuade you to become a customer. And once you pick a provider, they assume you will be with them as long as you own the home. The relationship is simple: They send a truck to deliver oil every few weeks, and you pay the bills.

An Andover start-up, NeighborOil, wants to inject some modern marketing into the relationship. Namely, it wants you to be able to shop online for the best price per gallon - the same way you can when you fill up your car’s gas tank - and they want to reward you with discounts if you refer friends to the service or shop online with any of NeighborOil’s 4,000 retail partners.

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“There are about 9 million homes in the US that use oil to heat their home or to heat hot water,’’ said founder Paul Harkins. “And about 6 million of those homes buy oil on an as-needed basis, as opposed to being on a long-term contract. But most people don’t know that they can shop around to find the best value.’’

When you create an account, NeighborOil asks for your ZIP code; the service currently covers more than 80 percent of the parts of the United States that use oil. You accumulate points by inviting friends and neighbors to use the service; by allowing NeighborOil to post a marketing message on your Facebook wall; or by shopping at sites like Home Depot, Sears.com, and Barnes & Noble. You also earn points when you buy oil through NeighborOil. Each point can be converted into a dollar off when you purchase oil.

The behavioral shift that NeighborOil asks consumers to make is to start monitoring the level of oil in their tanks, so that they can order a refill well before they run out. But the upside is that you can save a Boston-area customer about 30 cents a gallon, according to the site.

Harkins said the company has been self-funded so far but has lately been in conversations with several venture capital firms. No doubt January is a better time of year than July to be pitching this business to investors.

Is your texting creditworthy?

Does the number of text messages you send or the time of day you make your first phone call say something important about how credit-worthy you are?

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Cignifi, a small Cambridge start-up with roots in the United Kingdom, believes it does. It is raising $2 million to commercialize its technology this year, after a test in Brazil in 2011.

“There’s a vast market of consumers in countries like Brazil, China, India, and the Philippines who want access to financial services like credit cards, loans, or insurance,’’ said Jonathan Hakim, chief executive. “But while they may have jobs, and some have bank accounts, there really is no credit history for them.’’

One thing they do have? Mobile phones.

Cignifi has been developing sophisticated software that can look at usage data from consumers’ mobile phones and make predictions about who that person is and how they live. There’s no single data point that suggests someone is a bad credit risk.

But, Hakim said, “The way you use your phone is a proxy for your lifestyle. It’s not random. So we’re looking at things like the length of calls, the time of day, and the location you make them from. We want to see how stable the patterns are. When you look at that, you can create these behavioral clusters that give you information about users’ appetite for new [financial] products, and their ability to repay a debt.’’

Cignifi plans to pitch the technology to financial services firms in Brazil first, and perhaps Mexico second.

In 2011, Cignifi raised about $600,000 from individual investors. Last month, it got a $125,000 grant from the World Bank.

Visit www.boston.com/innovation for the full Innovation Economy blog, updated daily.

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