A Ray of Hope
In November 2001, things looked pretty bleak, I had spent the better part of 18 months trying to get some recognition for the CycleFree technology without any results. I had e-mail correspondence with several very smart people, James Gosling, Grady Booch, and others but they did not recognize the "diamond in the rough." Cash was running out, and we had dropped the Omega business and our customer accounts without getting any integrators interested in selling ONGOER.
It wasn't in their best interests to sell ONGOER.
Even thought ONGOER was a strong PC based control system, that DID NOT CRASH, integrators made more money selling Crestron and AMX than they would selling ONGOER. A AMX color touch screen retailed for $4,000 and the integrator could make 40 points selling it. This is $1,600 of margin. An equivalent PC based touch screen cost about $900, but it was a commodity, and the integrator could only mark it up about 25 percent, making only a little more than $200 on the item.
So even though ONGOER was a great system for the customer, it wasn't great business for Integrators. We had a marketing problem. I got involved after the departure of Scovell, and put together a plan to differentiate ONGOER from the competition. I set a base price of $500 for the software, making ONGOER dramatically cheaper than the competition, and implemented a licensing system that would let us charge more money for "component technology." These were basically features, like Click&Zoom camera positioning, that could not be provided with the competitor systems. My thinking was we needed to define the "VALUE" our system delivered and price the system according to the value.
Then we got a Ray of Hope on the CycleFree front. I had received another rejection for a paper submitted to the ICSE 2002 conference, but one reviewer had something positive to say about our paper. "In spite of its deceptive simplicity, the approach is novel and the claims appear sound." Exactly!
I wrote to the selection committee and asked if I could get in touch with this reviewer. What was it that made him see the value in the CycleFree Technology when apparently all the other reviewers didn't get it?
They contacted the reviewer, and he agreed to an e-mail correspondence. As it turns out, he was a researcher for Microsoft! Finally! Someone within the monster software organization that sees the value of the software!
Then we got another piece of good news. Although the paper had been rejected for the "academic track" of the conference, it was accepted as an "industrial expereince" paper. We would be going to the conference in May of 2002, and I would be meeting the reviewer that was intrigued by CycleFree Software.
I was convinced once the reviewer understood the technology, I would be back in at Microsoft. A patent on a fundamental major software result belongs only one place, and the smart people at this great company would see it.
We just needed to keep Simtrol going until then. Ed and Larry were tired of writing checks to keep the company afloat. From Ed and Larry's point-of-view, I could understand why they were leary of the technology. The crash proof system had crashed at Michael Dell's house, my prediction that Microsoft would jump on the technology did not happen, and I couldn't get any of the smart people to believe the technology had merit.
We needed some fresh money that was enthusiastic about what we were doing. I suggested to Rick that we needed to find a money guy that had made his fortune in technology. Someone that could understand the potential of CycleFree Software. Rick found a guy, Dan Gittleman.
It wasn't in their best interests to sell ONGOER.
Even thought ONGOER was a strong PC based control system, that DID NOT CRASH, integrators made more money selling Crestron and AMX than they would selling ONGOER. A AMX color touch screen retailed for $4,000 and the integrator could make 40 points selling it. This is $1,600 of margin. An equivalent PC based touch screen cost about $900, but it was a commodity, and the integrator could only mark it up about 25 percent, making only a little more than $200 on the item.
So even though ONGOER was a great system for the customer, it wasn't great business for Integrators. We had a marketing problem. I got involved after the departure of Scovell, and put together a plan to differentiate ONGOER from the competition. I set a base price of $500 for the software, making ONGOER dramatically cheaper than the competition, and implemented a licensing system that would let us charge more money for "component technology." These were basically features, like Click&Zoom camera positioning, that could not be provided with the competitor systems. My thinking was we needed to define the "VALUE" our system delivered and price the system according to the value.
Then we got a Ray of Hope on the CycleFree front. I had received another rejection for a paper submitted to the ICSE 2002 conference, but one reviewer had something positive to say about our paper. "In spite of its deceptive simplicity, the approach is novel and the claims appear sound." Exactly!
I wrote to the selection committee and asked if I could get in touch with this reviewer. What was it that made him see the value in the CycleFree Technology when apparently all the other reviewers didn't get it?
They contacted the reviewer, and he agreed to an e-mail correspondence. As it turns out, he was a researcher for Microsoft! Finally! Someone within the monster software organization that sees the value of the software!
Then we got another piece of good news. Although the paper had been rejected for the "academic track" of the conference, it was accepted as an "industrial expereince" paper. We would be going to the conference in May of 2002, and I would be meeting the reviewer that was intrigued by CycleFree Software.
I was convinced once the reviewer understood the technology, I would be back in at Microsoft. A patent on a fundamental major software result belongs only one place, and the smart people at this great company would see it.
We just needed to keep Simtrol going until then. Ed and Larry were tired of writing checks to keep the company afloat. From Ed and Larry's point-of-view, I could understand why they were leary of the technology. The crash proof system had crashed at Michael Dell's house, my prediction that Microsoft would jump on the technology did not happen, and I couldn't get any of the smart people to believe the technology had merit.
We needed some fresh money that was enthusiastic about what we were doing. I suggested to Rick that we needed to find a money guy that had made his fortune in technology. Someone that could understand the potential of CycleFree Software. Rick found a guy, Dan Gittleman.
posted by xlbder at 2:42 AM
0 Comments:
Post a Comment
<< Home