ABOUT THIS EPISODE
IoT data can have a profound impact on the quality of your product. But don’t stop there. It can also potentially improve every single aspect of your business.
- Using IoT data to inform decision making
- Hardware mistakes and lessons learned
- Tips for entering a contract manufacturer relationship
- Thoughts on core competencies and outsourcing
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Episode · 5 months ago
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Episode · 5 months ago
IoT Data: Using Smart Tech to Outsmart Analog Competitors
ABOUT THIS EPISODE
IoT data can have a profound impact on the quality of your product. But don’t stop there. It can also potentially improve every single aspect of your business.
- Using IoT data to inform decision making
- Hardware mistakes and lessons learned
- Tips for entering a contract manufacturer relationship
- Thoughts on core competencies and outsourcing
What's Nice about it is that it givesyou more information to do whatever you want with, and you might not even knowwhy that information is valuable until after you have it or until a certainmoment or certain challenge occurs. You are listening to over the Air Iotconnected devices and the journey brought to you by vary in each episode. We have sharpunfiltered conversations with executives about their IOT journeys,the mistakes they made, the lessons they learned and what they wish they'dknown when they started welcome back to over the Air Iotconnected devices and the journey, my name is Ryan prosser. CEO, very my nameis Lowell. I'm chief product of Sir, very and today were joined by SeanGrundy Co founder and CEO Bevy. We're going to be discussing how to use yourio te data and weighs your analog competitors can't son thanks for beingon the show. Thank you for having me. I'm excited to be here. Sean, let's say,introduce you to the audience a little bit. Can you walk us through yourjourney and how it led to you, Co, founding bevy and follow a question?Can you give us a little background on how someone goes from being aphilosophy major to founding one of the fastest growing beverage companies inthe country, sure sure there's? Actually, I think it's a bruce leakvote where he says something like I was a philosophy major. So so I think deepthoughts about being unemployed and I do feel like unless you go to lawschool or unless you go to Grad School for philosophy, unemployment is maybe the third default option. Iactually, after Undergrad, went and worked for an environmental N go notdue to any particular training, but just because I was very excited about trying to makean environmental impact, and while I was at the Ngo, I got committed to thisidea of starting an environmentally focused business. The motive was twofold part part of it was that I think inherently a business with with environmentalists baked into itsbusiness model is likely over time to have more impact than an NGO like thechallenge, with an NGO is that you always have to raise more money, andyour fundraising ability is often a lot more based on how much of the budgetyou spend on marketing versus how much of the budget you spend on actuallylike whatever it is. You do whether it's cleaning, rivers or saving animals,or you know what have you, whereas in a business if your business model is designed to have apositive impact as you go along, then, as you succeed as a business likepurely by investing in growth which which you would do anyway, you can makea difference, and the idea of Bevy is really have this positive impact byreplacing single use, plastic bottles and single used cans with point ofviews. Beverages so anyway, like one reason I got into the idea ofenvironmental business was just impact. The other reason candidly was, I didn't,want to have an NGO salary forever, like like. I wanted at some point tohave a for profit salary like I think it was cool. It was cool like living ininteresting places and having no money when I was like twenty five, but Ididn't want to be doing that at forty five, so I went to business school atMit with the idea of getting a basic grounding like a basicbusiness education as well as in particular, finding some opportunity tojoin or start a company that was going to have a positive environmental impact,and I started bevy coming right out of my second year of business school. Youtalk about the Environmental Impact...
Angle, can you you know for people thatmaybe aren't making that leap? I know from you know, having talked with youpreviously beverage manufacturers or beverage companies. Are you know one ofthe largest contributors to plastic waste, because that's where a lot ofconsumer plastics are coming from? Can you talk a little bit about that? Justsome backdrop, information about why Bevy is environmental impact TypeCompany for folks that didn't make that leap with you just now. Yes, so so it'strue that there have been studies done by by independent organizations toassess the biggest plastic polluters in the world and the the world's threelargest plastic. Polluters are also the world's three largest beveragecompanies. So so the industry goes through an astounding amount of singleused plastic, as well as as well as aluminum and and fuel used to truckbeverages like the the beverage industry as a whole wastes a lot ofnatural resources and the concept of Bevy was to create a high quality,essentially like a premium beverage brand that was built around a much moresustainable way to deliver beverages. So our product is a Internet connectedbeverage machine that purifies tap water and then, let's users get get avariety of custom drinks directly from the machine. Those could be plain,filtered water, they could be sparkling water could be flavored or vitamin infused drinks. So so the idea is to provide all of these same beveragesthat people are purchasing in single use. Disposable bottles, but makingthem available directly from the top, via just a good filtration system andgood hardware that that mixes drinks in a high quality and repeatable way. Soessentially, we cut out all of the packaging as well as an enormous amountof the fuel that goes into transporting beverages. Can you talk about some ofthe processes you guys use to inform decisions you make about like productcustomer satisfaction, product evolution like how are you guys usingdata or access ing it to kind of inform some of those decisions? Sure? So so sofor context here, when we first started the business, ourwhole goal was to make sustainable beverage machines and we were reallypurely thinking about the hardware we were thinking like. How do we filterwater so that it reaches the level of quality that people would expect fromfrom a premium bottled water brand? Or how do we carbonate water and retainthe CO to at a high level, which is actually like, surprisingly difficultto do an in line tap connected system? That's dispensing tens or hundreds ofbeverages a day, so we were all focused on the hardware side of just likemaking great drinks and actually when we first started the business. My Cofounders and I made fun of Io t businesses, because at the time this isback in two thousand and thirteen a lot of companies were were kind of pursuing io t almost like wefelt to be trendy whether or not there seemed to be a clear reason, but in ourcase very quickly, within probably six months of incorporating. We realizedthat having Internet kind activity would becritical to our business model. The initial way that we used an Iot systemand the reason we initially built it out, was simply to know when toreplenish machines with different ingredients, because for the beveragesthat we create there are fruit concentrates for the various flavoredwaters, their co two and then filters also need to be replaced with somefrequency for the flo rate of the machine to stay to stay at a level thatthat users want. So we either had to set up a route system where every weekor every two weeks or every month we...
...went out and visited a particularmachine, and that's actually what the majority of companies in our industrydo, where they physically go to a machine, look at what needs to bereplaced and then make a second trip to actually deliver what has to bereplaced. So that was one option or what we thought was a much betteroption was to know that remotely and you know to track exactly how much ofits useful life does. A filter have left what percent of the initial amountof co two and a yer two tank is remaining. When does each flavor eitherrun out or expire? So we initially built out the IOT system just to havethat level of insight which we use to manage field operations, and it wascritical for that. But over time we realized that was just scratching thesurface. So so the Monte now is really use, io t to run the business, and thatapplies to literally every department at baby like it applies to to ourcustomer service team, where, if they get a call from a customer and they caninstantly go and check, is the machine working properly but like they cancheck that remote is the machine working properly? Does it have all ofits flavors in it? It applies to sales because we can actually see, forexample, is this customer actively using their machines? is their usageincreasing or decreasing? Are they using it enough that maybe they need tobuy additional machines, so so we can reach out either of usage,significantly increases or significantly drops like, like we canreach out for for either reason, and even like quality is another big areawhere, for example, initially we started developing features to remotelytrack. If there was a problem in the machine like if some component broke orif the Internet kind activity got lost, but but what that's leading to overtime is now US developing features to proactively address those problems, a nand stop them before they occur, as well as to share quality data back withour with our manufacturing team, so that we can just continually improvethe product so really like. It is now involved in every single element of thebusiness yeah I'd say so it's interestingparallel. We see a lot of that at varias. We get involved with a kind ofindustrial iot and putting brains on machines. A kind of what you justdescribed is like a predictive maintenance, Autori and kind of gettingin front of maintenance problems that you see on a line and making the linesmore efficient, more up time and overall of our gos to produce things sois definitely exactly Shan. I don't for all of the Vodka Soda fans out there.You know we're totally dependent on high quality soda with High Carbonaiorate out of the gun, but it's a very mixed bag, and I always assumed thiswas a pretty straightforward science hearing you talk about it beingsurprisingly complicated. I don't want to derail the interview he give usthirty seconds on why producing carbonated water out of the Gun, Akathe tepent the hand held dispensing hose fed apparatus. Why is that morecomplicated than measther couple reasons at one reason is temperature, so thecolder the water is like the more it approaches your degrees Celsius, thehigher the carbonaio level colder water retains more Co. Two there's actually ahuge amount of research on this going right now related to climate change andCo to being released from from the ocean with climate change, but it'svery relevant to beverage production as well. So one challenge is keeping thetemperature as cold as possible, but not letting any of your tubing or pipesfreeze. So you want to kind of adjust above zero degrees Celsius, so that sothat's one challenge. Another challenge is absorption time, so actually, likeCo. Two typically needs to be exposed to water for a long time like I'm,trying to remember the research I've...
...seen, but typically like in aproduction facility like a bottling plant, it would be exposed for over anhour before it's bottled, but in an inlinesystem where water is running through the machine and being dispensed. Youdon't have that you don't have that much time like you, don't have thatmuch time to get your cot into a particular batch of water, because thewater's always being transported through the system. So that's anotherchallenge, and actually I said to but a third, a third that I'll just throw outit turns out. A surprising amount of the COT in dispensing systems isactually lost in the final. Dispensing often has the carbonator water poursout of whether it's a bar Gan or the Nazil of a Soda Fountain, often like asit's pouring out and hitting the cup, is when the water is most agitated andthe Cot gas escapes the water. So those are all factors to deal with whentrying to produce high quality sparkling water consistently totally derail this again, but I'vealways wondered that thanks for thanks for humoring me, its SuperInteresting Mechanical ungive spent too much time. Thinking about it, but likewe definitely had a mechanical engineers join our team who, beforejoining, were sceptical, especially if they came from, sayrobotics they were like skeptical. The work would be hard enough to be to bevery interesting to them, and then we started explaining some of theseproblems and they were like okay yeah, like I see how that would be. I see Isee how this would keep me busy for for at least a couple months. Yeah it is.It is surprisingly difficult. So, okay, on the subject of Amis and hardware, you know having a pretty solidunderstanding of machine performance is pretty, I think, to put it mildly,important for having a successful connected device like understanding howit's failing, you know how it's doing what needs to be replaced, etcetera asyou look back at you guys is journey. You know everybody. We interview, Imean a hundred percent one hundred percent of the people we interview havehad like big failures. Not One hundred percent is comfortable talking aboutthem on the air, but one hundred percent has had the fit. You know thefailures, lessons learn where some things that you guys learned or didwrong along the way that you know have have made you stronger or that you youknow and or that you wish you would have done differently, looking back inhardware in particular, because you could literally take your pick of likefunction, and I can give you a problem. Yes, yes, hardware, you're, just yourjourney as it pertains to hardware of the you know the connected device. Yougot it because yeah we have no shortage of other other challenges for hardwarein particular. There are a couple issues. One is forecasting. Cost is always extremelydifficult, so I think one lesson learned for me is always are on theside of like, if you have a high estimate and low estimate, alwaysexpect it to to cost closer to the high estimate, at least or to at least planfor that another key area, just with with hardware development in general, is really to like invest as much aspossible in quality from day one and by quality. I mean really controlling forbreakdowns, as well as as well as being thoughtful about whattypes of breakdowns. If you have limited resources, what types ofbreakdowns do you want to prioritize, avoiding in the beginning with us likelike when we first launched our product back in two thousand and fifteen? We didn't really think that much aboutit like we tried our best to make machines work. Well, if a machine everbroke down, we just tried to have great customer service so like we sawprimarily to offices. If we had a machine in someone's office and all ofa sudden, the touch screen died and nobody could dispense any beverages for...
...the like there used to be this bluetooth connection between between our touch green and the machine control solike. If that went out, the touch creen itself worked, but it didn't actuallydispense beverages, as as people wished. When that kind of issuehappened, we would just hustle over. So we would. We would get to that office as quickly aspossible, almost always same day. We'd, sometimes stop and buy cookies. On ourway to visit the client and literally like use a box of cookies to smoothover the fact that the fact that their customers machinewasn't working and and we'd solve their problem, getthe machine up and running and move on. It probably wasn't until two to threeyears later that we actually started systematically collecting andcollecting and categorizing breakdown data, and that that was a big miss.That was a big miss on our part, because we had an opportunity early onto to be really rigorous about documentingthe failure mode taking photos it sharing. Sharing the the instances, aswell as the high level summary of data of what exactly was breaking and why,with our with our contract, manufacture, so that and with our suppliers, so thatthey could so that they could help diagnose the issues and make sure theydidn't happen again, as well as honestly, to fully understand our uniteconomics, because, no matter what you do, some level of breakdowns is goingto occur. Like that's that's inevitable. I'd say in our early years we were justso focused on, like fix. The issue, show great customer service move onthat. We miss this opportunity to be more structured around machine qualityand we probably could have saved ourselves cost and and just emotionalpain. Over the years had we had we invested in that sooner yeah. I think it's like another way ofdescribing that it's kind of that fenda part with the product development lifecycle. Like you come with that idea, you build it. You ship it and if youdon't do a good job of connecting the lessons learning from the field back tothe Practvolles I go. Your next generation is not going to be as goodas it could have been so and learn all those lessons and keep that that fortwo of Tis, like we'll go exactly, and ideally it wouldn't just be like for aone time, post mortum. Ideally it's like a ongoing. You know, weekly ormonthly or quarterly activity where you're constantly reviewing okay. Whatare the new issues that are popping up diagnosing? What the root cause issharing that information back with your contract manufacturers and with yoursuppliers finding new suppliers if needed, but like. I can tell you forsure that if I ever start another hardware company from the verybeginning, even if we only have whatever the product is ten or ahundred products in the field, there's going to be something whether it's justa spreadsheet or a more sophisticated system. There will be somewhere wherewe're tracking the serial number of the product the date an error occurred, thethe characteristics of that Er and just develop a culture really early of offocusing on that as well as I think I would. I would try to be morestructured early about figuring out like what your tolerance is fordifferent errors to occur, because that's important as well like you couldeliminate them completely, possibly with some massive amount of spending.But then your product would be so expensive knowing what ever buy it. SoI think it's important to really think through, like kind of what's anappropriate frequency of different types of errors occurring. I think what you're basicallydescribing is how io t is empowering smarter and smarter quality systemsreally because, like what you're describing is a quality system that youput into your design manufacturing and this connectivity to it and think aboutit. Very earlyy in the proces ign cycle...
...really enables that to be a much betterthan it has been in the ENA lote bit exactly Sean pushing the topic forwarda little bit. So we talked to a lot of companies that are their innovators,they're innovative oftentimes. They, you know, tried to doa lot themselves. You know a very one of the things that we say a lot is youcan you can do anything, but you can't do everything you know. These are theconversations we have of clients a lot. What are some of the things that you think of as core to what bevy doesand needs to be great at versus areas where you guys look for partners, youknow that would be able to either do it more cheaply or quickly or they're,just not things where you think it's important for you guys to build up thatcompetency. What are the things that you guys want to be great at and do notat all think is important to be great at sure. So so one challenge candidly.One Challenge I have with the court competency model is that I thinksometimes it gets used as an excuse to like it gets used by companies as anexcuse to let the like they use it to let themselves off the hook, because usas an excuse to not hire someone great in each area and my my thought. The Way I think about core competenciesis more around. Like where do we want to invest the highest amounts of budget,and even if there's some area of the business, where we're primarily outsourcing and we're only going to invest like one percent of budget there? Iwant that one person to be like a star, you know, like the one person who'smanaging the or partnering wit with Outsource Teams, should be really good, but for us in the beginning we didnearly everything ourselves like even for the first handful of machines, wedid assembly in house and then, as time went on as we had to start allocatingbudget. It really became clear that we needed to start shedding certainfunctions and partnering out certain functions, and that's where I think wehad to get serious about court competencies like thing of it. As youknow, if we're going to invest like twenty or thirty percent of our companybudget in one area that better be our own core confidency, it varies bydepartment like right now we outsource, we outsource quite a number of thingsand the way we think about it, I think, varies by department from anengineering perspective. We think a lot about how much work is recurring versusone time and how much work is like isolated versus, like heavilyintegrated with with the rest of the products. So an example where weoutsource with some considerable success, it was actually a mix of inHouston, outsource development. Work was a was a designing, designing a weat for touchless,dispensing which we had to do in a hurry due to Ovid, and even thoughthere's an area of interface with the machine. A lot of aspects of that don'tactually stand independently and don't need to like that heavily integratedinto into what the rest of our team is doing. So I think that's a greatcandidate for out forcing another area that what out source is product development. That's very likeone time like if there's a big project that we have to do once like designingthe electronics of a system. We can rely on partners to help develop that,whereas, if it's something that requires like tons of ongoing iterationlike like more of our like more of the machine controls that manageddispensing or like the logistics apt that we and our distributors used tomanage machines in the field there, there were pushing, probably monthlyupdates. So it makes sense for us to own it just because of the frequency ofiteration and in the level of interaction with with our otherdevelopment work and then more broadly.
We really think about our our courtcompetencies today as product development like, and I mean thatholistic ally, like engineering and and what what typically gets called designand then what we're really attempting to do is build a brand around aroundthose products that, like like, build a brand around the quality of the userexperience. So so I'd say we view brand as a core competency, but not not inthe way most companies would use it like not in terms of like awesome adslike we don't, really spend any money on ads more like the quality of theuser experience itself and most other areas are partially outsource, whetherthat's manufacturing, whether that's field service, even sales. In somecases we go to market with a number of channel partners who who, in additionto our own team, are actively selling. Would you say that, like I think ofdyson as a a company that feels a little bit like what you just described?I don't know if you would appreciate that comparison, but dicens brand. Iknow if I buy a dicon product forget about advertising. Like you said, Iknow. If I buy a dicing product, it's going to be powerful, it's going to age!Well, it's going to do the job. Well! Is that, like what you're talking aboutexactly son, you mentioned contractmanufacturers that a follow up question for folks out there that are developinga product and either they've had a bad experience or they have never had a product manufactured via contractmanufacture? What are some mistakes? You made that you would tell to thisperson out here. Hey, be aware of this, or here is something that worked wellfor this. If you have just two or three hot tips, what is what is somethingthat you would tell to someone over a beer that was looking to enter into acontract, manufacture, relationship? Sure, absolutely. I think the twobiggest tips I have one is to this sounds probably obvious, but hiresomeone to lead the manufacturing search for for a contract manufacturingpartner, that's done it before and and the second tip is really whenevaluating. Potential partners try to be a big fish in a small pond versus asmall fish in a big pond in terms of someone, and these are Lang.So so in terms of getting someone to run the process. A search for acontract manufacturer can look very different and I think it's important,especially if you're a start up to get someone who's, found a contractmanufacturer in a start up context before- and I say that because if youwork at a large company that is going to spend tens of millions or hundredsof millions of dollars manufacturing products each year, you'll havecontract manufacturers knocking on your door. Begging for Your Business and andthe process of selection is much more about reviewing their proposals anddeciding who's a good fit for you. If you're in a start up trying to findyour first contract manufacture. You probably have little to know revenue,and you have to realize that any contract manufacturer has to take apretty significant risk in order to be willing to work with you like there'sreal opportunity cost for them in giving up the floor space and theresources to focus on your business, there's even like real time, commitment requiredfrom them just to put together a thoughtful quote. They really have tounderstand your product and go through your bill of materials and thinkthrough how they source everything and, if you're part of a start up trying toget somebody to to manufacture for you, it's much more of a process of youselling them versus them selling. You like you really have to go out andpitch and kind of hunt the business and...
...convince them why you're going to growand why you're going to be a valuable investment, and I that that just mighttake a different skill set from someone. That's only that's only found acontract manufacturer as part of a big company as being part of like largecompanies like the apples of the world and smaller companies. Like many of thestartups that have been- and I completely agree with you- and you haveto remember that- that Cem world was a very cut throat model like their profitmargins, are not huge, and I think one of the start up things that peopledon't appreciate is how much work it puts on the startup company, YourCompany, to actually define your product to a point that anybody can gobuild it. You take a lot of that for granted and that guy gets under underappreciated. Getting me a massive time commitment, they didn't think about orhire for absolutely and that's an area to where, where I feel like it's goodto get someone who's led a manufacturing process in a startupcontext before in part, because they know to look for a contractmanufacturer that can function with the start up like the like. They know tolook for a contract, manufacture that is used to dealing with messydocumentation or is used to having to help start up source when they don'tknow how to do it versus in a larger company. Often often the companyalready has a lot of skill sets which, as a start of you'll, be relying onyour contract, manufacture for the other big area about about being a bigfish in a small pond. We have worked with a couple country manufacturersbefore and especially in our early years, wefelt a lot of pressure to partner with a large internationalcontract manufacturer and that pressure honestly wasn't coming from customers.It wasn't so much about needing to cut costs. It was more like it was morelike proof of scale ability like in the beginning. We were really concernedwith scale Abilitye and I think, to facilitate our own fund raises like toattract venture capital. We thought it was really important to find some largeinternational contract manufacture just to demonstrate that there would be nosupply shortage if demand really took off just to say, like hey, you're,investing millions of dollars in US we're going to spend a lot of that incells in marketing. Even if demand goes through the roof. We've got this hugeinternational contract. Manufacture like there's no way will ever not notbe able to produce enough machines, and it was this way of kind of conveyingthat we were serious and in retrospect I think it was a mistake to do that too.Early, like I think I found that there are so many benefits to working with alike a small, often local, contract manufacture. In terms of like mindshare, you know like if you're working with a huge contract, manufacture andyou're a start up, and you have a problem and they're. Also supportingapple and apple, has a problem. I mean apple is going to get their health likewe're, not going to get their help versus. If it's a small contractmanufacturer where we make up a significant share of their business,then we'll be he the client that gets support, whether it's support withquality or support with working with suppliers or whatever issue there maybe, and the other issue here is actually that a lot of people don'tthink about this. But often, if you're in the hardware business your contractmanufacture, is a bigger creditor than your bank. That's something that I didnot fully appreciate, but but often the way it works is your contract,manufacture, places, purchase orders for all the components that go intoyour hardware device several months out and they're paying for those in advanceof delivery and in advance of assembling machines, and that can addup in our company and in many other companies that can add up to millionsof dollars of component costs being floated by your contract manufacturer,and you probably like when selecting the Cam at least historically like wewent when it selecting our country.
Manufacturers didn't always appreciatethat, like we didn't always appreciate that this is not just a production partnership. This is aserious financial partnership as well, and the same way that we're verycareful about selecting what bank we work with or what investor we work with,essentially realizing that your contract manufacture is investing inyour two and you're more likely to get good investment terms when it's acompany that really cares about you, where, where you're a very importantpart of their business, that's great Shan follow question. When you'retalking about you know, you were just talking about out sourcing and whatthat looks like, as you guys have gone through, the product development wouldhave been some. You know critically important things that you guys haveselected to outsource to a partner looking forlike technical things, not like brand help work but like in the actualproduct. What are some times when you said Hey, for example, firm ware. Youknow we're going to go out and find a partner, because this is reallyimportant. It's an extremely specialized skill. Where can you thinkof an example of the time where either you did that or you wish you had done,that yeah yeah? Absolutely so all or as mentioned all ERmanufacturing like machine manufacturing as well as all our flavormanufacturing is, is outsource and done by partners firm. Where is aninteresting example, we have. We have absolutely out sourced outsource, firm ward development beforein part, because on on a lot of the electroniccomponents in a machine, they don't need to be iterated on all that muchit's more. They have to be done right once and then may be modified from timeto time, but done but done right before get before your product is ready formanufacturing. So so, for a lot of that work thatdoesn't need to be constantly iterated on. We found that it's it can be more efficient to outsourceit and and just make sure you're getting the rightpartner like like make sure you're prioritize the right partner in termsof work. I wish we had. I wish we had out source one area. I go back and forth on it,but but one area when I think about our early product development, we spent anenormous amount of time on the physical, looking feel of themachine, like we put a lot of effort into the frames of our initial machines,and I remember when we were first producing them back in two thousand andfifteen two thousand and sixteen like at one point. We spent a couple monthsjust trying to get the doors to like fit properly, and we realize that doorscan actually doors on like a large steel machine can actually be quitedifficult to align and they can get bent or messed up in shipping, and we spent a couple months working onthat ourselves and didn't really at the time think about the opportunity cost,and this is at a time when we had a smaller team too. So so the opportunitycost was more serious and what I realize is like in retrospectthe opportunity cost was that a lot of the actual beverage components whichdetermine the temperature, the carbonator level, the flavor, mixing,the the reliability and consistency of the beverages that people get a lot ofthose we were just. We were just buying off the shelf just because that wasfaster and and that's what we had time for, given all the all the effort weare putting into like the physical frame of the machine and like that's anarea where, in retrospect, there are a lot of companies out there that aregreat at making dors like we could have pretty easily outsource that and found some companythat could make a door that sealed...
...properly and we should have insteadprobably focused on the areas where there's real, where there's real Ip.You know like, like actual proprietary areas that determine the success of thebusiness like, like the the all the components that mix the beveragesthemselves and give users the right experience. It's interesting were so where we are,with very we've kind of built, a complete end to end like from the user,or face the UIU X to the front end to the cloud back in to the hardware tothe physical PRAC designs like we can do all these different things andpeople come to us with a very crazy range of asks, and what we try to do issay: Look if you're going to do a thing. If you need to be able to do a thingover and over again for every generation or continuously stay on topof it. That's something you really should staff up. When we can help youdo that we can help. You find the right people to do that, but it's importantthat you have that capability and were we think we try to step in just likethe door may aface and the door example is a place where we have a greatexpertise set that can solve a problem that Ed iself once and then you canmaximize that value from. But you don't need every single time. I think that'skind of how our business not of works and why we think it brings value tocompanies like yours, yeah and I'm sure, there's still a lot of repeat businessfor you guys in that right. If you have like a version tosoon enough to come in, I ans a version two point, one or version two point twoor their new features they want. So it's like they're still still a hundred a hundred percent. Whatwhat winds up happening is a lot of time like they have such a greatexperience as work ones that they'll in their next sideration they'll have adifferent one time thing they need to go do and they know that while they dida different one time thing with this last time when they know we also hadthis girl said to cover that this one time, and so the kind of moves aroundthe expertest depending on where they are and their product is like that'sinteresting. That makes sense. John Moving towards clothes. Now, a two questions for you, one I don't this is this is definitelysolidly the world according to Ryan. But you and I had you and I and Luke,had a really interesting conversation about philosophy in the pre interviewand turned out that all of us had recently read Plato's Republic, which Imean good luck, getting three people together. That had recently read that,but I was just kind of curious to read it so and I don't know why Luke rent it,but I love it. I think of philosophy. You asked me whyI was interested in it and I took the weekend to really think about theanswer, and I think that for me to answer what I really am interested in, uncoveringfundamental truths. You know things that are just fundamentally true and Ifind that often in philosophy whether or not you agree with thatdefinition, I'm not going to ask a guy a Princeton guy who studied nothing butphilosophy whether or not I've defined philosophy correctly. Let's move pastthat my question is: What's a fundamental truth: you've discoveredabout Io t I mean I haven't. I haven't thoughtabout it this way before, but but it's funny right like like, if you viewphilosophy, is this like search for search for truth? I mean what's Niceabout it. Is that it just gives you more information. It gives you more information to dowhatever you want with, and you might not even know why that information isvaluable until after you have it or until until a certain moment or certain challengeoccurs. So so that's any anyway. That's that'sone thing right that it's just this, this source of knowledge about your ownproduct and your own customers and another another really interesting thing Ifound with iota. This is something we haven't taken enough advantage of yet,but I deal hey will over time is that the more objects you'reconnecting essentiallylike the more valuable the overall data...
...set of like io t things becomes like there are? There are pieces of information thatmight not be particularly useful on their own, but might be very usefulwhen, coupled with other information, so so like an example of this would befor Bev Bev user. We don't aside from our couchless dispensing Weber, wedon't currently have like a user up where users say store their preferences,but part of the reason. Part of the reason we haven't developed one yetpart of is just band with an priorities, but but it's also because there's not all that much excitinginformation to track other than like how much water you're drinking, maybewhat vitamins you're consuming it like some basic infult like that and on itsown, that's probably not particularly interesting to track like how manydrinks to day you're getting. But what I realize is like in Tantum with otherinformation. If someone has that information, but they also have a fitbit or a whoop, and they also know like how well they slept or how good theyfeel or overall how healthy they are and all of a sudden you can correlate.You can correlate the information and realize that, like Oh, when you drinkmore water or when you drink this amount, this is the right. This is theright amount for you for you to like feel good or sleep well or have a greatwork out. That starts becoming really interesting,so I think, like the more the more we can combine, data sets the morevaluable it all becomes so follow question Sean, it's the time of Sky Netand the robot. The machine uprising has begun. Bevis machines are out front in in the assault against the humans. Do you feel incredibly proud that your machines areintelligent enough to be to play a leadership role in the uprising, or areyou horrified that you have helped make skiet possible? I'm I'm a John ConnerFan, so so, probably probably more horrified yeah yeah, it's funny. We once we onceinterviewed. We once interviewed this guy and he would. He was a softwareengineer and I asked him why he was excited to join bevy and, like theanswer was typically like a tip of my answer would be like I'm excited aboutthe environmental impact or like I love it, and, and I think or two devices arefun like those would be typical answers, and his answer was like he's like. Ifbevy succeeds, you'll eventually control people's water supply becauseyou'll have the device you'll have the device between themunicipal tap, that's purifying the water and creating water that peoplecan drink and he's like as pollution increases. This will become more andmore valuable and eventually, like the company that controls the world's watersupply, will have the most power, and I was like- Oh my God- We ei know I know,and he was really he was really excited about that potential power and I waslike I don't think he's a good fit for us, but so so we didn't hire him, butVidya yea. It is. It is scary, I guess, when you think of like yeah yeah, when you think of all of thedata in kind of all of the data available on us. Ithink in our case it's relatively benign like like we're, not collectingpersonal info. You know, I think I think in our case, it's all it's allrelatively benign last question: What's a company in theIot space that you guys really look up to and admire, you know somebody thatBevy says hey, that's we want to be like them when we grow up the companythat that we most emulate I'd say is...
Peleton. Also I mean we also it's hardto be in the hardware business and not think about apple. You know what wealso, of course, to think about think about what we can learn from apple, butbut it's sae. The company we most emulate is Peleton, just in terms ofthey took what was considered a boring product, in their case, a stationarybike, in our case, a water machine. They completely redesigned it withextreme focus on the user experience like really trying to get the detailsright so that people love the product. They created a recurring revenue,business model which we did as well and- and they really have now built a brandaround how good their product is like both the physical product itself, aswell as the content that they stream, and that is the same opportunity I see fora bebby like like a that's, essentially what we're trying to do to reallycreate this product, that's best in class that just relies on excellentengineering and like build a brand around it that that becomes extremelydifficult to imitate because, like you can't copy the brand, unless you canoutdo our years of engineering, we are also huge fans of Peltontelephones, a big client of ours. But so it sounds like the takeaway is:There's there's a lot of things that can be maybe copied or fast followed.But you know a really well engineered into, and product is not one of thosethings, there's really no short cut, and that's the piece that you guys aresaying. Peleton did that. That's that's the bevy approach, exactly exactly like,rather than having our brand be based on like awesome, TV ads or like acelebrity sponsor, or something that with money, you can kind of quicklycopy like it's really hard. If your brand is built around quality, evenwith a lot of money, it's really hard to to outdo another company on thedetails of the engineering and the product experience without putting inthe work like without going through the design cycles and seeing yourself whatgoes wrong and fixing that over time. So so I just feel like, especially ifyou're a start up where you don't have a lot of money, but you do have goodpeople and dead and in dedicated people it's really an O and where your firstto market, it's really an opportunity to to get a leg up so sean for all the philosophers outthere listening today, as we moved to wrap this episode up for all thephilosophers turned entrepreneurs that want to follow you. Where, where canfolks find you out on the Internet? I do not really have a social mediapresence like I'm. Not I'M NOT! Really linked in as honestly, it's pretty lame,but linkin is like the only social media apt that I use so so I guesslinked on or you could just email me. My emails just my first name Ad BevyDat, Sio, so Shan San at Bevy, dot, Co couldn't afford the m all right. Folks, that's it! For today,I'm Ryan. This is Luke. Thanks for listening, see you guys on the Internet.Thanks Gus, you shouldn't have to worry about IOTprojects dragging on or unreliable vendors. You've got enough on yourplate. The right team of Engineers and project managers can change a pivotalmoment for your business into your competitive edge. Various close knitcrew of ambitious problem, solvers, continuous improvers and curiousbuilders know how to turn your ideas into a reality on time and up to yourstandards, with a focus on mitigating risk and maximizing opportunity willhelp you build an Iot solution that you can hang your hat on. Let's bring yourIot idea to life, learn more it very...
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