Think 3D printing is all the rage? Or sharing economy apps like Uber and Airbnb? Well, these are no longer exciting to some tech entrepreneurs. Instead, they’ve shifted their attention to the Internet of Things (IoT), and specifically in developing wearable technology such as smartwatches or Augmented Reality (AR) headsets.
The potential in IoT is that it connects devices on a global scale. A smartwatch, for example, can be connected to a supercomputer that can crunch information fed into it by devices around the world. With this technology, the spread of worldwide diseases can be tracked, and it would be easy to pinpoint a specific factory that is polluting the most, said Yobie Benjamin, former Chief Technology Officer for Citibank and co-founder of Avegant, a wearable technology startup.
Speaking at the Asia’s first Wearable Wednesday conference hosted by Wearable IoT World yesterday in Causeway Bay, Benjamin recalls getting his first investor cheque at the first Wearable World conference in San Francisco three years ago. “I brought my really clunky prototype and showed it to an investor and he wrote me a cheque right there. He’s like, take my fifty [thousand dollars], right now,” he said.
Benjamin is senior advisor to Skully, a firm that develops AR motorcycle helmets. Last year, it set records on crowdfunding website Indiegogo as the fastest campaign to raise US$1 million for pre-orders of its helmet. The campaign eventually reached a total of US$3.4 million. Two months ago, it announced it has further raised US$11 million from venture capitalists.
Research firm IDC projects that the global IoT market will reach US$1.7 trillion in 2020, up from US$755.8 billion in 2014.
And it’s not just techies in Silicon Valley coming up with these new technologies. In 2014, 19-year-old Noor Siddiqui designed Beam, a secure Google Glass app that can stream first-person videos of patients to a remote specialist. Siddiqui is a fellow of the Thiel Fellowship, which gives US$100,000 to young people aged 22 and under to stay out of university to develop their own ideas.
“I know a founder who is very old. She’s now 18, developing personalised medicine in genetics,” Benjamin tells Young Post. Yeah, he's funny. “She’s not even an expert (in the field). She works with people with the technical skills.”
Benjamin's advice is to get a crazy idea, and get working.
And he says Hong Kong is the perfect place for tech entrepreneurs. Besides a lot of talent and money here, it’s also just an hour away from Shenzhen, China’s manufacturing hub, a great place to make prototypes for your ideas. Anson Bailey, the Principal of Business Development of KPMG China, added that there were also many retailers with global sourcing offices in Hong Kong, such as German chain Tchibo, which puts out 40 new IoT products on its platform every week.
“Marketing time has gone down from one year to two days,” said Duncan Chiu, managing director of Radiant Venture Capital. His fund has invested in 20 startups in the past 18 months, injecting seed money ranging from US$100,000 to US$2 million into various projects.
Money is always an issue for tech startups. In order to attract major investors, Benjamin advises looking for big problems to solve. “If it doesn’t solve the problem of a billion people, then I’m not interested. Because the easiest way to make a billion dollars is to solve a problem for a billion people,” he said.
Chiu adds that when he considers pitches, he looks at how big the potential market will be. If the idea is just targeted at a local level, it’s too small.
It's also important to demonstrate that you have a business plan and a clear view of what you're trying to achieve, said Bailey.
But no idea is perfect, and one strategy to refine it is to be open about it. “You don’t know how bad your idea is until you communicate, and you don’t know what problems you’ll need to fix until you do. People at Silicon Valley are very open,” advises Redg Snodgrass, co-founder of Wearable IoT World. Paypal’s business model changed over multiple times before it got to what it is today.
While working on your idea, keep updating potential investors of the progress you’re making. It took Snodgrass 60 days to close his deal with Radiant Venture Capital, but two years to confirm an agreement with Wavemaker. “Be persistent. Only quit when you can spend your time doing something better for you and humanity,” he said.