The Backup Plan
In the summer of 2002, Simtrol cut its staff down to a skeleton crew of four developers. I thought the cut was too deep for the Company to survive. If you are going to attack a certain market, you need to have a team that is large enough to win the battle. With its new strategy, Simtrol was too small to win any significant portion of the A/V control system market. They were abandoning hardware development entirely, which I thought was a mistake. Simtrol had one box, called an ONSIRIO unit, which was being sold with about 80% of its systems. It was the box that provided digital I/O and infrared transmitters and receivers. With this box, Simtrol had a product competitive with AMX and Crestron integrated controllers. Without it, they were not a product company, but only a software company.
The ONSIRIO used firmware licensed from a company on the West Coast called Nirvis. There were a few known technical limitations with the firmware licensed from Nirvis.
Ed Castro was a hardware engineer cut from Simtrol at the same time I was laid off. I believed that Ed should have been kept on the staff, as any control system manufacturer needs a certain level of hardware competency. The project Ed had been scheduled to work on was a better and cheaper replacement unit for ONSIRIO. I lobbied to keep Ed off the layoff list, but when the cuts were made, Ed was gone with the rest of us.
When I left Simtrol, I thought I could get attention for CycleFree Software and then win back Ed Redstone and Larry Carr's support for working together. But I wanted a backup plan. Simtrol had ONGOER, which was over 10 man-years of development, and the only CycleFree application. I knew it would be really, really hard to get some other Company interested in building their application on top of the CycleFree Kernel, and I didn't have the resources to build a CycleFree App on my own.
But Ed Castro and I could build the replacement box for ONSIRIO. We formed a Company called Zreo, and built the "ZeeBox," a better replacement box for ONSIRIO. We could provide Simtrol with a better box, at the same price point, or sell direct to Simtrol's customers giving Simtrol a 6% sales commission. Mike Miller was enthusiastic about us building an improved box.
I had confidently told Ed that there were only two possible outcomes for Simtrol, (1) they would start selling systems and become profitable, or (2) they would go out of business. Either outcome would work for me. If they became profitable, I estimated we would be selling 300-400 ZeeBoxes. Ed and I would make enough to live on and be able to expand Zreo's product offerings. If they went out of business, now that was the really exciting prospect.
Who would buy the ONGOER software from bankruptcy court? I would find a way to do this! I would then have the CycleFree Kernel, the ZeeBox, the Patent, AND the CycleFree control program. This was the backup plan. If I had been a betting man, I would have bet on the back-up plan.
I didn't really believe in the steps Simtrol was taking. The pricing plan I had advocated while Chief Technical Officer at Simtrol had been scraped. I had advocated a cheaper base price, and additional charges for "Component Technology" which was pricing based on features. This was replaced with a "device count" pricing model, selling medium, big, and small ONGOER systems.
Mike Miller had estimated that we would sell 400 in 2003. In 2001, Simtrol had used about 80 ONSIRIOs, and I told Ed I would be satisfied if we sold 100 in 2003.
We sold 19 boxes in 2003.
Ed and Larry kept Simtrol a float.
By the end of 2003 all mention of CycleFree technology had been removed from the Simtrol web site. The distance between Simtrol and the CycleFree technology kept increasing.
The ONSIRIO used firmware licensed from a company on the West Coast called Nirvis. There were a few known technical limitations with the firmware licensed from Nirvis.
Ed Castro was a hardware engineer cut from Simtrol at the same time I was laid off. I believed that Ed should have been kept on the staff, as any control system manufacturer needs a certain level of hardware competency. The project Ed had been scheduled to work on was a better and cheaper replacement unit for ONSIRIO. I lobbied to keep Ed off the layoff list, but when the cuts were made, Ed was gone with the rest of us.
When I left Simtrol, I thought I could get attention for CycleFree Software and then win back Ed Redstone and Larry Carr's support for working together. But I wanted a backup plan. Simtrol had ONGOER, which was over 10 man-years of development, and the only CycleFree application. I knew it would be really, really hard to get some other Company interested in building their application on top of the CycleFree Kernel, and I didn't have the resources to build a CycleFree App on my own.
But Ed Castro and I could build the replacement box for ONSIRIO. We formed a Company called Zreo, and built the "ZeeBox," a better replacement box for ONSIRIO. We could provide Simtrol with a better box, at the same price point, or sell direct to Simtrol's customers giving Simtrol a 6% sales commission. Mike Miller was enthusiastic about us building an improved box.
I had confidently told Ed that there were only two possible outcomes for Simtrol, (1) they would start selling systems and become profitable, or (2) they would go out of business. Either outcome would work for me. If they became profitable, I estimated we would be selling 300-400 ZeeBoxes. Ed and I would make enough to live on and be able to expand Zreo's product offerings. If they went out of business, now that was the really exciting prospect.
Who would buy the ONGOER software from bankruptcy court? I would find a way to do this! I would then have the CycleFree Kernel, the ZeeBox, the Patent, AND the CycleFree control program. This was the backup plan. If I had been a betting man, I would have bet on the back-up plan.
I didn't really believe in the steps Simtrol was taking. The pricing plan I had advocated while Chief Technical Officer at Simtrol had been scraped. I had advocated a cheaper base price, and additional charges for "Component Technology" which was pricing based on features. This was replaced with a "device count" pricing model, selling medium, big, and small ONGOER systems.
Mike Miller had estimated that we would sell 400 in 2003. In 2001, Simtrol had used about 80 ONSIRIOs, and I told Ed I would be satisfied if we sold 100 in 2003.
We sold 19 boxes in 2003.
Ed and Larry kept Simtrol a float.
By the end of 2003 all mention of CycleFree technology had been removed from the Simtrol web site. The distance between Simtrol and the CycleFree technology kept increasing.
posted by xlbder at 1:43 PM
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