Earlier this morning, Upskill announced it has raised $17.2M in new capital to fuel growth and accelerate the business. I sat down with our CEO, Brian Ballard, to discuss details around what’s happening in the AR industry and how that led to this latest round, and what he plans to use the funds for.
So what were the events that led to this round of financing?
Brian: The primary factor behind raising new capital is that we are gearing up for the growth phase of the market and that means expanding our capabilities to match pace with accelerated demand. We’ve had a lot of success over the past year and the momentum has picked up.
In the early stage of the market, like that preceding our earlier financing, most of our revenue came from pilots where the main goal is to prove out that customer return on investment meets the marketed expectation. As many of our customers are now shifting to production phases and some preparing for very broad expansions, we must deliver consistent experience and value. The team is very focused on meeting consistent, supportable Skylight experiences around the globe. The AR software technology we provide must run all day, every day reliability. We must expand from factory to factory, warehouse to warehouse, and region to region with ease for our customers. I think that last part is the key: “with ease.” Anyone can expand. We have to make it efficient.
These are just a few of the principles of how we operate and how the increased maturity of the AR ecosystem has helped Upskill build a better, sustainable product in the marketplace.
Let’s talk more about efficiency. Where is Upskill aligning its resources at this stage of the AR market?
Brian: Part of our focus on efficiency is making sure we can ignore the shiny, but distracting opportunities, and really hone-in on customer feedback to build features and new capabilities of immense value. Creating strong partnerships with our clients has always helped us see where their needs are, and we are investing to ensure we are always a few steps ahead of the demand curve. Last year we launched new product capabilities like Skylight Application Builder, Skylight Connect, and our SDK to go along with investments in equipping our partners and customers to go-to-market with them/take full advantage of them. And already, our hard work is paying off: in 2017, we saw Skylight usage increase more than six fold and the number of enterprise clients grow 300 percent. We now have customers in more than a dozen countries globally.
When it comes to how you evangelize, training, support, and ensure IT compatibility across a wide variety of environments, we must get it right the first time, and our new and existing investors are some of the most practiced organizations in the world at large scale digitization and modernization. Accenture and Boeing are among the world’s largest employers and deal with incredibly complex organizational systems that overlay digital strategy. Even before investing in our business, they were as much mentors as they were partners or customers – helping us build a better product and tackle challenges that unlocked higher value outcomes.
New investors, Accenture and Cisco, are critical players to the AR value chain. What does their participation say about what’s happening in the broader ecosystem?
Brian: We’ve had a really successful track record of incredible results from strategic investments. Boeing’s HorizonX and GE Ventures have both been model examples of how the right strategic investment chemistry benefits each other and the industrial base as a whole. We’ve been better for it, our hardware partners gain extremely valuable insights in end customer needs, etc. The list goes on and on.
So this time around, when we looked to raise capital, we sought to have at least one more strategic investor. We got two.
From the get go, our belief was that AR would be the interface to IoT. Having Cisco as a partner in our investment, allows us to focus on the piece of the value chain we can excel in while having a global leader with a vested interest in helping us better meet the needs of CIOs that work for large multinationals that we engage with.
So from that point, it was a match made in heaven in driving the capability and connectivity so we can realize our vision. I’m pretty confident that every one of our customers has Cisco inside their organization – Cisco equipment, Cisco protocols — the more we are in line with what our customers are using and their enterprise environments, the faster we can accelerate their AR goals.
With Accenture, we had a three-year relationship on the go-to-market side of the business and have partnered together on numerous client engagements across multiple industries. We’ve gotten to know one another very well through that time. Two of Accenture’s practices share an overlapping philosophy with our own – the Connected Worker and the Industry X.0 practices. We both deeply care about the future of work and the role that people and technology play in it. While Accenture has a 435,000 person workforce dedicated to helping their customers navigate any number of strategic initiatives that may need to be considered in their digitization strategies, we have built a technology platform that dramatically lowers the total cost of ownership of AR in the enterprise. The investment is a signal for the timing of the market and our recently announced strategic alliance is aimed at unlocking value for our customers at the nexus of that opportunity.
Given the acceleration of the market, and the capital to respond, what are the Top 3 priorities for Upskill now?
Brian: I think we are all very excited to have that resources and the ecosystem to tackle our priorities. I’d put the top three out as this:
- Product superiority
- Applicability across the entire supply chain
- Repeatable ROI to our customers
For product superiority, Upskill has always looked at things through the lens of true enterprise value. This means that it has to solve an immediate and large problem in the critical path. Our product has to be the easiest to adopt – for the individual user and the organization, have strong compatiblity with enterprise IT systems on a production floor, and it has to enable the fastest development for both our developers and our customers in tackling new AR use cases. We rolled out a lot of industry firsts in latest release of Skylight last October, and we’ll be unveiling a whole lot more as we productize more and more of our patent portfolio and deliver compelling features that work on any device in the AR spectrum.
The second priority – applicability across the entire supply chain – means that our product works equally well across manufacturing, material handling, and maintenance. We don’t want to solve one problem in the supply chain, take for example Final Product Assembly, only to have the warehouse not be able to keep up. Good news for warehouses – more and more of our customers are reporting great throughput jumps by implementing Skylight. That is just one example, but our vision is for every role in the supply chain to be aided by AR. We can do so much for our customers when we can help across functions. We also don’t want to just make a bunch of verticalized applications that aren’t designed to talk to one another. It has to be a coherent platform to be able to deliver maximum value to our customers.
The final one – repeatable ROI to our customers – comes down to the delivery side of our business and it has always been a tier 1 focus at Upskill. I find this similar to what I saw in one of my old (pre-startup!) hobbies where I used to race cars and motorcycles. You could give a championship winning machine to a novice and you are going to finish last. We very specifically work with ecosystem partners that we know are well-trained, excellent in what they do, and can trust to drive to a successful outcome. It means knowing the business, the use case, and the technology that makes up a true and compelling ROI with a happy customer. Our clients need to trust that we are going to deliver a product that they can build lasting value on.