The CEO and Founder of Augmate, Pete Wassell, sits down with us to discuss the past, present and future of Augmate.
1) Talk us through your experiences in the business sector prior to Augmate and then how that led you to set up the company?
I went to engineering school in the US and got picked up by IBM. I was working in Silicon Valley for IBM, and I had noticed a lot of startups with a very different culture from anything that I had seen anywhere in the world. They had this methodology where they were using software to solve problems in the marketplace. Every year a new software came out, that might only be incrementally better than the previous year, but nonetheless, it was in fashion, and people gravitated towards it.
When I was at IBM we had bought ninety companies. There is a lot of inherent reasons as to why big companies can’t be innovative. When they get to a certain size, and departments are segmented, it becomes very difficult for traditional companies to innovate their product. They fall more in the line of making slight adjustments to the business model, but nothing radical. It’s easier for a big company to look across the landscape and see a company that has some traction in the marketplace, they have some complimentary software, and these small, agile companies, they don’t have to deal with the bureaucracy, and the red tape. They can just react to the market quickly, and that’s what it’s all about. Going out into the market, 90% of what they try, fails. But they can quickly go back with an adjustment and then figure out the business model and the technology model. So they do all that hard work and then the acquiring company always has a growth play. They take that company, they’ve got an aqua hire, they get the engineers, they’ve got the product, and then their growth play is to sell that product to their 100,000 customers.
This is a formula that I’ve witnessed in Silicon Valley, that just worked. Most geography’s can’t replicate Silicon Valley because it was 50 years in the making. You had finance coming in from San Francisco, tons of skills coming into that area over 50 years, it’s hard to repeat that in 3 years time. No one can quite do that. After witnessing that, I said to myself “I ran hundred million dollar projects for IBM and I could do this”, so when I came back to New York, I started Augmate.
2) Did you have any early mentors, anybody that really inspired you?
There are a number of different people. At IBM there was a guy called Greg Lotko, he was a general manager at IBM, working with people that had really good discipline, leadership skills. It’s a good company to grow up professionally. In this particular space [Wearables], there’s a guy named Kip Kokinakis – he had a company called MicroOptical Myvu, and his engineering team became Google Glass. Steve Feiner, out of Columbia University, his academic research had a lot to do with smart glasses. That was kind of my passion, what I felt was relevant. He was doing a lot of the papers to show efficiency, and productivity savings. Another guy was Steve Mann out of MIT. He showed up for his interview at MIT with smart glasses. The guy bringing him in said “this guy is either crazy, or a genius”. He did a lot of work on the research side when it came to figuring out smart glasses. He wore smart glasses for years, before there was any commercial product, so he was another mentor. There was Christine Perey, with augmented reality, she had a lot of AR standards work. A lot of these folks would give me the time of day when I was younger, answer my questions, sit down with me, and I would tell them my thoughts. So that was beneficial, working with these folks.
3) During your time at Augmate, what challenges have you encountered there?
One thing in particular is that you can know the direction of technology, but timing is difficult. I put together presentations that show timestamps of when inventions were done, or papers were written, or companies that made certain products, and you try to get a trajectory of where something is going, and then make your prediction of market adoption. We were early on wearables, and with the presentations that I had put together on this, I was thinking that the right time was around 2014. That was the time that we became a glass network partner with Google.
From that perspective, we had gotten those things right, but the device wasn’t mature and there were a lot of issues with battery life and applications. One of the problems we ended up solving was when building applications for pilots, you could have a great product, you could save a worker 30 minutes a day, you could reduce errors by 7-8%, times that by 500 workers and you’ve got a pretty good
business case for ROI – but at the end of the day, most companies didn’t have the tools or processes to deploy fleets of wearables. They were pretty good at deploying a tablet device, but IT directors needed the ability to remote wipe a device, or reset someones password or install applications out to different folks, and that stuff just wasn’t available. We ended up putting together the platform that did those types of things. We put provision software on a device that would talk back to a web platform. Our provision software was signed by the keys of hardware companies so we’d get special privileges. That was our approach, and we believe that wearables are a subset of IoT and the second part of our road map is expanding from wearables to all of IoT. In the beginning we just wanted to nail down the security features, and device management features and do that on a small set of devices, in this case it was wearables, and then at the right time, move into the expansion to all of IoT.
4) What lessons have you learned since starting Augmate?
Wow, goodness! There have been so many lessons learned along the way. Coming from IBM, it didn’t really prepare me for a startup. IBM is kind of like a parent and they do a lot of things for you. Coming into the startup space, you have to do a lot, and wear many hats. So that transition was interesting. I was pretty good at doing big projects at IBM, but you’ve got a lot of support. So when you’ve got a small team you’re dependent on a lot of different people for doing things. You’ve got to get the right team and be able to execute with that team very efficiently. Have good communication and have all of that sort of stuff.
5) What advice would you give to Tech Startups?
Running lean is most appropriate. You can start a business with 3 people. In a tech business, you could have one engineer, one guy who is sales/marketing and one who is in financing and can keep track of numbers. It’s really a matter of building things out. A lot of people really need to take a leap of faith in the beginning. You’ve got to work with like minded individuals that share the passion, or believe enough in the vision to take that leap of faith and get things off the ground, and that’s what is needed early on.
6) What has been the highlight of your career thus far?
Goodness gracious – I think that the move to go out on my own. It was risky because I essentially took $300,000 of my pension. I’d spent 14 years at IBM, maybe that was 12 years too long. I took that money and I became my own seed investor to start. I would say, be your own lottery ticket. You have to be the type to bet on yourself and know that you’ll figure things out. You might not have all of the answers, but if you can learn and learn quickly, you’ll figure it out. You bet on yourself. Starting Augmate was really, betting on myself.
7) Where do you see Augmate in 5 years time?
What we’re building for is the fourth generation of the Internet. What we believe is over the next three to four years, you’re not going to be able to buy equipment, a device, an appliance that’s not connected to the Internet. What we’re talking about is a layer of connected things. Just like back in 2006 you didn’t realize you’d be dependent on your phone, you’d be carrying around a second brain around with you with all the answers to humanity in your pocket.
Likewise, with this infrastructure layer of connected devices, the applications and services that ride on top of that layer, will transform humanity. We’re building for that layer. We see this as the fourth generation of the Internet. The universal transaction layer is the next step. So there’s protocols and things that have to be defined but when this is sorted out and figured out, again, the applications and services that ride on top of that will be tremendous. The use cases are incredible and it will change the world and change peoples lives as we know it.
8) Would you be able to tell us about your journey from the Wearable Environment Manager (WEM) to launching the Augmate Connect?
We essentially have a system with wearables that was designed to do device management, user management, policies, and security and over the air updates. Where we transformed to all of IoT it’s a slightly different process. We manage between devices and for really smart devices we can put software on it and that kind of thing, but it’s a different process. So we’ve been using blockchain to do so, which is why we’re a different kind of IoT platform. With blockchain, just like you would do a transaction, its encrypted. You know that you can have trust in a trustless environment, communication or transaction between in points. What we’re looking at here is, over the next couple of years, is upwards of 50 billion devices, by 2025, a quarter of a trillion devices, within the next twenty years, a trillion IoT devices. So that many devices and sensors creates a lot of data. There’s no way of centrally managing all of that data, so by using a distributed ledger technology, like blockchain is something that makes sense as you’re able to track where things go. With digital currency, you could track it so you would know every transaction its ever made, every person it has ever passed through because you’ve got an immutable ledger that you could reference.
So in our platform, we wanted to be able to track the customers that are using our system. What services are they using, and how would we fairly charge them. When we started talking about expanding to all of IoT, we spoke about whether to charge by device, by transaction, by the data that we share, the data that is stored, and we came to realize that we need a way of being able to track all of these services within our own platform, so that customers are treated fairly and equally. So really building out that marketplace of applications and services on top of this layer, that could be done through what is called, decentralized applications on blockchain and smart contracts. We’re taking quite a unique approach to doing this. With Challenge Advisory, they actually did some recruiting for us and we’re now hiring the former CTO of Cisco, Dave Evans. Cisco literally built the hardware layer of the Internet with routers and all that equipment. Dave Evans defined the IoT strategy at Cisco, and now he works for Augmate. We take a pretty serious approach to this market. We’re coming in as lions, we’ve got a unique perspective coming from our heritage and roots of wearables, and now going to all of IoT. We’re excited.
9) What makes the MATE™ token different from all of the others out there on the market?
What makes us different is that we’re really thinking about this new economy. Four hundred years ago, people would take gold to a goldsmith and melt it down. Of course they could use gold in the marketplace, but who wants to carry around ten pounds of gold. So they would melt it down and get a receipt, a paper receipt. After some time, people were trading these paper receipts, that eventually became money. At that time, it made a lot of sense. Even from an adoption standpoint, it took a decade or two before paper money came into existence, backed by the gold standard. Then you need to think of it now, if you use Amazon or any of these other services, does paper money make sense? Probably not. So digital money makes sense in this new era. The sheer volume of devices that we’re talking about, and the sensors involved, the amount of data is going to be incredible. There’s going to be opportunities to sell data, combine data, and use artificial intelligence in ways that are going to help humanity. So this is really a currency of data, and to be able to use the Augmate platform and the marketplace, third parties to be able to put apps on the marketplace, using our system, we’ll be using the MATE token all the way through, so I think it makes it pretty exciting.