Here's a great little tale of a son's startup helping out his dad's company, which suffered a knockback when Bosch product it was selling fell behind the times.
Here's a great little tale of a son's startup helping out his dad's company, which suffered a knockback when Bosch product it was selling fell behind the times.
The pair are now on the cusp of a multimillion dollar opportunity - and also open to capital, and experienced advice to help them get there. So NBR Rich Listers, read closely.
Our story starts with NBR subscriber Jason Mackie.
Jason cofounded Security Supplies Ltd in 1996, which was partly acquired by Detection Systems Inc., a Nasdaq-listed American company, which was in turn fully-acquired by German multinational Bosch in 2001.
Mr Mackie was appointed general manager Bosch Security NZ and director of Bosch NZ through to when he acquired the company back off Bosch in 2010. It's now known as Connect Security Products Ltd (CSP) and is sole importer and distributor of Bosch Access, Fire, and Intrusion products in to New Zealand.
Things started to go south when competitors to Bosch released a touch screen control interface
Because of Bosch’s initial reluctance to develop a touchscreen controller, and its business model preventing development and advancement of such technology in a timeframe acceptable to the market as Mackie tells it, this has "a significant reduction of marketshare in New Zealand, and of late Australia."
The German company thought touchscreen controls would not take off internationally. Jason thought from his first-hand experience that it would. He discussed the problem with his 23-year-old son Liam (who has worked for Vodafone and DPS, and whose team recently placed third in the Enterprise Angel's Tauranga Startup Weekend competition). Liam came up with a concept product, that he developed further with his friends Tom Tiang and Jon Ngo into "TouchOne". A company called 8 Ltd (with Jason and Liam as shareholders) was formed to commercialise the technology.
Old-school security system controllers beside one featuring the new TouchOne interface developed by Liam Mackie and his friends.
The product developed by Liam and co features the kind of touchscreen interface people have become accustomed too in the age of smartphones and iPads.
That's a no-brainer. But TouchOne's technology also allows control of many devices to be centralised over the internet, and support an ecosystem of third-party software apps. The ability to connection, control and monitor a security device via a a smartphone will be added in 2015. As will remote firmware upgrades.
The team behind TouchOne Tom Tiang, Liam Mackie, Jason Mackie, Jon Ngo.
"Seeing the potential, Bosch decided to take on the product under their own brand and sell throughout Australia and New Zealand, with a view of launching in to the lucrative American market if the product proves successful in Australasia," Jason says.
His pitch is that TouchOne has not just allowed Bosch to catch up with rivals, but leapfrog them.
The initial strategy will be to make high quality, simple to use touchscreens that will be integrated into Bosch security products such as burglar alarms and CCTV systems.
8 Ltd make money from sales of TouchOne devices by Bosch. The German company has an exclusive license though to 2017.
And Mackie says it will also generate revenue by charging third party developers to put their software on a TouchOne device - in the same manner that Apple takes a 30% cut whenever a developer sells an app for iPhone or iPad through its AppStore.
It'll be a global first for a security product, Mackie says. Want some extra functionality for your closed circuit TV system? Just buy the app of your choice over the internet.
Bone of contention
The technology behind TouchOne is patent-pending. Mackie ackowledges the area of intellectual property can be fraught.
It's fiercely expensive to patent a product, given you have to research, apply for and if necesary defend your IP country by country, or territory by territory. Startups have to target their spending.
"We have a patent budget this year of $50,000, which is just to lodge the provisional patent application in to our key markets of Australasia, American and possibly Europe - which may not be covered this year due to the huge costs in getting a Patent filed in the EU. Our patent attorney is suggesting we will not get any change from around $150,000 once done, and that will depend on the number of patents we are successful with," Mackie says.
"Our patent budget is a bone of contention, and is one of the areas we hope a future investor who has experience in this field can provide some guidance."
