2020 STEX25 Accelerator Startups Day 1 - Startup Corporate Collaboration Panel Discussion, Session 1

MARCUS DAHLLOF: I think we're going to start with the same question that we asked to our attendees. What is the value that startups provide to corporates in your mind and why? If there is no volunteer, I'm going to volunteer Andy. Or, boss. Boaz, please go ahead.

BOAZ EFRONI ROTMAN: Sure, I think one of the things in large corporations, they're very busy with the main things that run their business. And that they don't want to take too many risks in doing that. Startups coming up with new innovative ideas.

They take their risk into implementing that and bringing it to market. And I think that's something that-- then the big corporation can use that as leverage because that saves them a lot of money in getting to market and get that innovation in door quicker for something that they would developed internally.

MARCUS DAHLLOF: So speed. Anyone else? Any other thoughts on that? Another way to look at it? Abhijit, please.

ABHIJIT GHOSH: Yeah, startups also think about problems in different ways because people are coming from different backgrounds. They think about problems in different ways that can be surprising to a corporate. For example, the way we approach the problem of how vision system should be used is very radical from the way vision systems are used today. So that new way of thinking is another thing that startups bring to a corporate entity.

MARCUS DAHLLOF: Anyone else? Andy, please.

ANDY WANG: So, my question, is actually falls in the same direction, but it's slightly just-- slightly more specific, which is that if you look at a lot of [INAUDIBLE] start ups here, the technology is really for the long-term benefit of corporations. And sometimes it's not something that just solved a problem immediately then be done with it. So how do enterprises look at-- how much effort they spend on trying out these type of solutions that has long-term benefit, that takes a while to really build their competitive advantage. I mean, and how much do they look at immediate solutions that solves problems ahead?

MARCUS DAHLLOF: One of the things I like to tell our corporate members, when they come to visit, is that they our search process, our open innovation process, allows them to cast a very wide net and capture solutions that might be on the periphery of where they're looking. So I think everyone has a little bit of a preconceived notion of what the solution might be or what technologies might be relevant. But then when you come to MIT and you send out your problem and your use cases to a community of 1900 startups that we have here, as part of the Startup Exchange, then you're likely to capture solutions or ideas that are in the periphery of what you're looking at. I think that's where a lot of great innovation can happen.

What about-- so let's switch gears a little bit. What about the challenges? So obviously startups and big companies are very different. And so sometimes they're issues that come up, in terms of working together. What are some of the challenges that you've uncovered, that you've been presented with, and how have you worked to overcome them? Boaz?

BOAZ EFRONI ROTMAN: I think as the business guide for the company, I think that the first challenge is to find the right people within the company you should talk to as a startup. And that challenge usually takes a lot of time and a lot of process and back and forth. And the worst case is if you fall on somebody that's not familiar with what's going on, and they push back and you missed the opportunity. So I think the best way, if it was possible for corporations, to have somebody that will be-- have a good understanding of the breadth of the company, of the technology of the requirement, that will be a focal point for startups to go in and from there to be channeled to the right contact person within the companies.

That the next thing is actually, once we have the right person, then diving in and moving in is at a much faster pace. You're talking to the right decision makers and you go you go down the line of talking to the engineers or the architects of the company that can encompass that. So some companies have it more, a lot of companies don't have that. And I see that as a huge limitation.

MARCUS DAHLLOF: Tom?

TOM BARAN: So I think one of the things that's an interesting challenge and also an opportunity, certainly for us, in talking with larger companies is to echo that. But it's basically the idea that sometimes the best integration point for us might be in a place where a company that we're talking to is not perhaps accustomed to integrating with a materials innovation company. So we're in an oddball position because we're offering enhanced materials, but we're selling essentially software. So it's sometimes-- on the one hand, we have to integrate with the packaging materials folks on the brands, but on the other hand, we have to integrate sometimes with marketing or with the people who are essentially taking a look at it software purchases.

So I think if I can provide one piece of feedback to the sponsor companies, it's to think in a open-minded way perhaps about crossing some of those membranes within your organization to make introductions across different departments, essentially. So, and we found that to be very beneficial for ourselves.

MARCUS DAHLLOF: Yeah. Yeah. Audience question here.

How do startups measure value as you work with different partners and you have different options? Sometimes these relationships can take a long time, sometimes they can move quickly. Do you judge them based on speed or something else? Boaz?

BOAZ EFRONI ROTMAN: I would say that depends on the position of the startup itself. Sometimes we are, as startups, we have a great idea but we want to customize it and have the right feature set and the right polishing of it to address the-- successfully addressed the customer needs. So at the early stage sometimes, even before you have the product, you would like to talk to potential customers to engage with them and understand some of their pin points that you might have missed with the technology that you have.

So that point, that's a great point to do that. So the measurement will be-- really depends on where you are in the process. It starts with getting information at the beginning, then it goes into getting into some proof of concept and field trials success that you make with them. Sometimes it's preproduction, field trial more deeper, and then actual get revenue by selling the products. But each phase of the company have a different criteria for success for us because it puts us in a different position of what we're seeking from the end customer.

MARCUS DAHLLOF: Following on that, do the startups help enterprises build a competitive edge in the market? What is your experience in this direction, and maybe there's a specific example you can bring up-- bring into your answer that you've been encountered over the last year? So meaning, any market feedback that has resulted from one of your relationships.

So maybe, Tom, you worked with the brewing company, produced these wonderful labels that had some advantages. How did how did that resonate with your customer? How did that position them in the market?

TOM BARAN: Sure thing. So one of the things that's interesting about the way that we deal with both brands, as well as the printing production shops, is that our direct customers are the people who do print production most commonly. So one of the things that we found is great about going to a print production shop. And this actually speaks to the question of, how do you provide value to startups as well?

But, from our perspective, if we can get one product produced at a print production site, that print production site often comes back to us and says, hey, this is really cool. We're making this brand new affect using the equipment we already made a purchase of, and it's no new cost to them, so they want to roll it out to additional brands and complementary markets. So I think there's a virtuous cycle that can certainly happen by engaging early with many of these types of companies.

MARCUS DAHLLOF: Andy, please.

ANDY WANG: One of the things I want to mention is that a lot of what we're seeing, particularly in the IOT, also has to do with the perception of the entire industry. This happened in our previous startup, this is happening in our current startup as well. So as technologists, you see some trained. You're like, OK, this is what the market needs in maybe a few years. But then nothing actually really happens in those a few years sometimes.

And then, one day, all of a sudden every company is doing this thing that you thought they were going to be doing at some point, and then the market just picks up. So I think, both from a company perspective and from a startup perspective, you've got to expect that and try to figure out how to work with that type of process.

MARCUS DAHLLOF: Got it. Got it. Yeah. Abhijit?

ABHIJIT GHOSH: Startups, by definition, will have to scale their business. So if we help a company do certain thing, and enterprise do a certain process or an improve some certain thing, we would like to scale it to other people in the industry too. So that is, by definition, the mission of a startup.

So building lasting, competitive advantage is probably not possible in that sense. But by early adopting startup technology an enterprise, can get significant competitive advantage in head start over their competition. And that's the key thing here is you don't have to wait for everybody in the industry to adopt the technology before you adopt it. So if you can adopt the technology early on, you can get a competitive advantage that way.

MARCUS DAHLLOF: Got it. What about if we flip this around a little bit and we ask ourselves the question, what are you doing to be a good partner? What can startups do to be good corporate partners? What advice would you give yourself, two years ago, or you'd give a friend that is starting a startup? Boaz, please?

BOAZ EFRONI ROTMAN: I think the important thing that I usually do, when I'm getting to a new startup, is understanding the customer decision process, or the customer technology absorption process. For example, in like diligence, we make chips that goes into a PCI card that goes into a rack of server, that makes a different company, that goes into a customized server by another company, that goes into the enterprise. So by understanding the flow of the decisions of who and where it is integrated, you're trying to intercept the right customer that will help you to go faster to market as an early startup, assuming you're not going to be fully matured with every possible side of your technology, by the time you go into full production. So you want to have something that is very good, very fast, and very vertically solution problem that you're solving at the right stage of the pipeline of the product.

MARCUS DAHLLOF: Got it. So I want to switch gears here again a little bit. And I'm seeing a lot more questions that are specific to each startup. So let's spend a few minutes on that. I think we have about five minutes of the panel left here.

So this one, the first one, is for Litelligence actually. How many customers does your company manage according to your GPU?

BOAZ EFRONI ROTMAN: I don't quite understand the question again.

MARCUS DAHLLOF: Yeah, let me-- let's find another one. Hold on a second here. All right, so Tom, this one's for you. Can you talk about the sustainability angle of your product?

TOM BARAN: That's a great question, and I'm glad that was asked because we didn't have enough time to get into it. So one of the things that's really interesting about the label production world is that there are a lot of very unsustainable practices that go into producing a label. So if you look at a shampoo bottle that has a little foil rim around the logo, what you're looking at is the amount of that foil that was deposited onto the label. But sometimes up to 98% of that foil stays on the roll. That roll gets rolled up, and then that gets just discarded.

Now, that metallic foil is actually a metallic foil on a polymer substrate, so it's very difficult to recycle that. And I think there are several-- I forget the exact number, but it was, I mean, tons and tons and tons of this industrial waste that's produced annually in a typical country, like maybe the UK, just because of the application of the metallic foil. In addition, there was post-consumer waste issues. Because what you're doing is you're laminating multiple dissimilar materials together.

And so the question is how do you separate that in the waste stream? And so essentially what we're doing, is we're saying, you know what? As opposed to using all these dissimilar materials, just use standard ink on the materials that you're already using, which have a much more robust method for doing recycling or disposal. And in that sense we're more sustainable because we're not using additional materials.

MARCUS DAHLLOF: Got it. OK, let's take another audience question here. This one's for Andy. Please talk a little bit about your cloud versus edge processing.

ANDY WANG: Sure, yeah. So first of all, sorry I'm didn't even see that question. There's so many questions flying off the screen, and I'm trying to scroll up and down, trying to find the ones that's for me. And sometimes it's a little hard, so I apologize if I didn't see them.

So for us, the biggest problem right now is-- this is more like a 30 minute presentation I need.

MARCUS DAHLLOF: You've got 30 seconds though.

ANDY WANG: OK, the biggest problem we saw of this basically, is stuff that happens at the edge. Increasingly, there's more edge computing at AI at the edge. And today, you have to use software development kits and stuff like that to individually develop stuff down there.

What we do is we take all that, and put it into a design software, which are rising in a public cloud or private cloud, and you can directly program everything there. And then we provide modules through the AIs and [INAUDIBLE] analytics, so you can drag and drop. So over time that solution side is going to grow.

It's going to become more powerful. And so customers can do the whole solution there, in a design software. We mostly solve the edge IoT problem, if that makes sense.

MARCUS DAHLLOF: Thank you. Boaz? So the question for you is going to be, what's the status of your chip?

BOAZ EFRONI ROTMAN: OK. Good question. We are-- I cannot disclose too much about it, but we're in a position of we're signing up customers for field trials, and we're looking forward, as I mentioned, to work with companies that have their on-prem solutions to go into a field trial and start evaluating the technology.

MARCUS DAHLLOF: Got it. So I think we're going to actually wrap up early here. Again, there's plenty of questions in the Q and A, as well as being posted in the chat. So feel free to address those. Tom, did you have a comment?

TOM BARAN: Well, I saw-- there was one question in the chat, which I can answer if we have extra time, but I mean I don't want to take up time if we don't have it.

MARCUS DAHLLOF: If it's a 30-second answer, then please go ahead.

TOM BARAN: It's a pretty fast answer. So the question was, how durable is it? So the thing to keep in mind with what we're doing is it's just ink on substrate.

So the people who are doing label production are very good at putting ink onto substrates in a durable way. And they're very bad-- I don't want to say very bad. It's much more of a challenge to do something like laminate a foil on top of that.

There were a bunch of British banknotes that were recently recalled because when you would crumple them up in your pocket, the ink would stay on the banknote, but the hologram on it would flake off. So you don't have that problem with what we're doing. So I just-- I wanted to respond to that very quickly.

MARCUS DAHLLOF: Great. Thanks everyone.