Periodic Reporting for period 1 - FITT-iN (Fast IoT market take-up through The Things Networks)
Berichtszeitraum: 2018-02-01 bis 2018-07-31
The Things Industries (TTI) helps companies and governments around the world to utilise scarce resources more efficiently. Our solutions enable users to reduce their CO2 footprint, respond to events faster and in a more informed way, build interoperable infrastructure, be compliant with HVAC regulations, maintain assets just-in-time, shift their work force from blue to white collar workers, create new business opportunities, etc. This impact can be achieved by monitoring and controlling the environment through sensors and activators.
We enable this by offering a horizontal technology based on the open LoRaWAN standard, used to connect massive long-range and low-power sensor networks at zero to minimal opex. Our implementation of the standard has proven to drive its global adoption, through a powerful combination of open source assets, developer engagement, and enterprise-grade software and services. Our core product is a LoRaWAN Network Server, the software required to securely and reliably route data to and from sensors over IP.
Our overall objectives are to create abundant access to this emerging technology, by taking away complexities and opening IoT up for anyone.
We enable this by offering a horizontal technology based on the open LoRaWAN standard, used to connect massive long-range and low-power sensor networks at zero to minimal opex. Our implementation of the standard has proven to drive its global adoption, through a powerful combination of open source assets, developer engagement, and enterprise-grade software and services. Our core product is a LoRaWAN Network Server, the software required to securely and reliably route data to and from sensors over IP.
Our overall objectives are to create abundant access to this emerging technology, by taking away complexities and opening IoT up for anyone.
For our feasibility study, we carried out desk research, interviews with renowned systems integrators and end users, site visits, and we launched a few tools for marketing automation to capture traffic and convert these into conversations with prospects. At the same time, we realised significant month over month growth in both our commercial as well as developer community activities.
Key insights and main results from the feasibility study:
• The LPWAN market is very fragmented and will only reach critical mass towards the end of 2019 or in the course of 2020. This gives us time to perfect the product and distribution.
• IoT development remains complex and expensive, which puts up barriers to entry. This is a massive short-term opportunity for us to generate income from customer projects and consultancy.
• Our product strategy will focus on product leadership. We will outperform based on feature richness, scalability, and value-add extensions for managing large scale networks
• Our go to market will be through long tail resellers and systems integrators.
• We will pilot our horizontal technology in three verticals to seize market share in a specific market.
• We can fund our core development and innovation activities for the coming 12 months from our own revenue sources. No external funding is required.
• We managed to grow recurring revenue in 2018 significantly with exponential growth in the second half of the year. We consider this 1) a validation of our product-market fit and our ability to deliver and 2) a reason to be positive on the expectations for 2019 3) an affirmation that we can in one to two years drive profits from recurring software sales.
• Enabling our customers to be successful is our ticket to low-effort growth: because of the network effects of our products and services, we grow along with the successes of our customers. So next to product leadership, customer success needs to be an equally important strategic focus.
Key insights and main results from the feasibility study:
• The LPWAN market is very fragmented and will only reach critical mass towards the end of 2019 or in the course of 2020. This gives us time to perfect the product and distribution.
• IoT development remains complex and expensive, which puts up barriers to entry. This is a massive short-term opportunity for us to generate income from customer projects and consultancy.
• Our product strategy will focus on product leadership. We will outperform based on feature richness, scalability, and value-add extensions for managing large scale networks
• Our go to market will be through long tail resellers and systems integrators.
• We will pilot our horizontal technology in three verticals to seize market share in a specific market.
• We can fund our core development and innovation activities for the coming 12 months from our own revenue sources. No external funding is required.
• We managed to grow recurring revenue in 2018 significantly with exponential growth in the second half of the year. We consider this 1) a validation of our product-market fit and our ability to deliver and 2) a reason to be positive on the expectations for 2019 3) an affirmation that we can in one to two years drive profits from recurring software sales.
• Enabling our customers to be successful is our ticket to low-effort growth: because of the network effects of our products and services, we grow along with the successes of our customers. So next to product leadership, customer success needs to be an equally important strategic focus.
Our objectives have remained largely unchanged over the past year. We still offer a horizontal technology based on an open standard that can be applied in a plethora of niches. We do believe a more niche oriented sales approach would help bringing our product to market and generate more scale faster, for which we have chosen to strategically address three verticals. We have experience and leverage in these niches so we will start developing more targeted propositions and outreach.
The key innovative differentiators of our product leave 95% of the market behind us. Our customers can manage their device's life cycle with our product, extending the technical and economical life cycle of their sensor networks, hence reducing opex and extending investment depreciation term. They have a number of security configurations a customer can choose from, allowing for highly customised security per use case. And even end-to-end security, which is truly unique compared to our competitor’s hosted solutions which cannot, by definition, offer this.
We have been confirmed that our open source, collaborative approach is paying off. These are the activities by The Things Network, which evangelise a vision of collaborative effort and making technology accessible to the masses. The faster our community grows, the faster our paying customers grow. This means that we will emphasise on these activities, especially because those are generating revenue that we use to finance our core product innovations, which focus on a superior product. We have also been confirmed in our approach of scaling through third party channels from cloud providers, who can push our software as a service in their platforms and marketplaces.
We will focus on long-tail value-add resellers and systems integrators. We are convinced we can generate big opportunities through our enabling technology. Hence the biggest impact is expected in the creation of business opportunities for those resellers. In our communities we can pinpoint the most active companies, who are all developing LoRaWAN capabilities, be it on application development, device development, services, etc. They make the best reseller channels.
The key innovative differentiators of our product leave 95% of the market behind us. Our customers can manage their device's life cycle with our product, extending the technical and economical life cycle of their sensor networks, hence reducing opex and extending investment depreciation term. They have a number of security configurations a customer can choose from, allowing for highly customised security per use case. And even end-to-end security, which is truly unique compared to our competitor’s hosted solutions which cannot, by definition, offer this.
We have been confirmed that our open source, collaborative approach is paying off. These are the activities by The Things Network, which evangelise a vision of collaborative effort and making technology accessible to the masses. The faster our community grows, the faster our paying customers grow. This means that we will emphasise on these activities, especially because those are generating revenue that we use to finance our core product innovations, which focus on a superior product. We have also been confirmed in our approach of scaling through third party channels from cloud providers, who can push our software as a service in their platforms and marketplaces.
We will focus on long-tail value-add resellers and systems integrators. We are convinced we can generate big opportunities through our enabling technology. Hence the biggest impact is expected in the creation of business opportunities for those resellers. In our communities we can pinpoint the most active companies, who are all developing LoRaWAN capabilities, be it on application development, device development, services, etc. They make the best reseller channels.