Technology That Matters, Brought to You by Corporate and Startup Teamwork
There are many impediments, as well as big opportunities, when creating viable wearable and sensor technology. Even major players are still in the early stage of learning about adoption factors, and few have created something significantly disruptive.
When building sensor technology for resource-constrained communities factors such as affordability, durability and low-power, are even more important to consider. However, when we find the right use case, the right partners, and a sustainable and scalable business model, wearables can create an opportunity to draw data and enable connectivity, which can then have a huge impact on the health and quality of life of millions of people.
Competitions such as the Wearables for Good Challenge allow the business community to experiment with different combinations of hardware and services in a low-risk environment and imagine how we can help shape the future. However, there are some barriers to entry to creating viable products and services for resource-constrained communities. These are as follows:
- Realistic distribution and business models
With limited retail and supply chain infrastructure in many emerging markets, it’s quite challenging for telecom and tech companies to get products into the hands of those who need it most.
- Lack of literacy
In those unique instances you can overcome the first barrier, lack of literacy may become a secondary barrier to usage if the product is too complex. Even if you plan to just distribute a mobile app, you have to remember that “feature phones” still dominate regions such as Sub-Saharan Africa (by the end of 2015, the GSMA estimates that only 17% of mobile connections in this region will be smartphones).
- Scaling solutions
Both of these barriers combined make it all the more challenging to scale effectively.
To work in this space, one must not be deterred by obstacles. Overcoming these barriers to create sustained and high-impact solutions can be achieved by combining the force of large corporations with passion and agility of startups. For example, Orange group’s digital healthcare division, called Orange Healthcare, has a strategy to encourage entrepreneurs to develop and deploy in Africa and the Middle East through application program interfaces – allowing access to Orange’s 106-million customers in the region. With programs like these, startups can get access to corporate resources to help them innovate and scale more effectively.
Once you have a sound distribution strategy in place, the task becomes finding a business model and price point to make the solution economically sustainable. Part of this equation is determining who is willing AND able to pay for your solution: end-users, health insurers, NGOs, governments, etc.? The design process absolutely needs to take all of these factors into account if you wish to produce a commercially viable product.
Then comes the hardest part: letting go.
An important skill you need to learn in the design pilot an prototyping phases is the ability to let go. I know this may sound odd coming from someone in a large global corporation, but it’s true. At Orange Silicon Valley, we try a lot of different proof-of-concept (POC) co-development projects with startups and large tech companies alike. Many of these POCs do a great job of demonstrating that a particular combination of technologies work well together to produce a desired benefit for the end-user – but they may never make it to market because of any number of factors (e.g. cost, market fit, competition, newer technologies, complexity, etc.), meaning that we have to move on to something else if we don’t see an obvious pivot. For startups, unfortunately, this may mean shutting down their company instead of raising yet another round of funding in the hope of finding that perfect use case.
When possible, our team always tries to line up the use case, market, internal/external business partners, and a plausible go-to-market strategy before moving forward with development of a POC. This way we have a general game plan to follow if things are successful (it’s also helpful for selling the project vision). If we can’t line up all the pieces, or find a business partner willing to take on the operational side of things for piloting or commercialization, we scrap the project and use the learnings to better inform our next project. Obviously, it doesn’t always work out this way, but it’s something to strive for. When addressing this in the context of the idea around wearables and sensor technology for good, there are not many concerns about using corporate partnerships to bring wearables to resource-constrained communities – if anything I think it’s a huge advantage. But many people are initially skeptical of the idea of bringing wearables to resource-constrained communities and those markets, especially if it involves corporate partnerships.
The skepticism towards these markets needs to change. Global corporations have enormous customer reach, infrastructure (in terms of both technology and supply chain), in-market experience, and the customer’s trust in many cases. Additionally, an increasing number of corporations have accelerator programs that are tasked with sourcing new technologies for pilots or further development, such as Orange Fab. Unconventional thinking and partnerships is what is needed in these scenarios.
Despite this desire, building these relationships and partnerships can prove to be difficult, especially for the nascent entrepreneur. When searching for business partners, especially corporations, I always recommend that entrepreneurs do an honest assessment of three things BEFORE engaging with the prospective partner: their assets, needs, and collateral.
“Assets” are anything unique that the entrepreneur/startup brings to the table that the prospective partner does not otherwise have access to. This can come not only in the form of intellectual property (IP), trade secrets, and outstanding co-founders, but also in industry insight, learnings from experiments, and connections to specific customer segments.
“Needs” are what the entrepreneur desires to receive from the partner – ideally, it’s something relatively unique to that partner. Many startups I meet with approach corporations looking for either funding (via internal investment funds) or distribution; however, they overlook a whole host of other benefits a partnership can bring, such as domain expertise and an understanding of what a large-scale enterprise sales cycle looks like.
“Collateral” is simply what the entrepreneur is willing to trade in return for what they need in the partnership. Again, I think too many opportunities are missed here. Perhaps the Shark Tank-effect has programmed young entrepreneurs to think solely in terms of the money/equity exchange (e.g. I think my startup is worth $xxx, therefore I will give you yy% ownership for $zz). Save that for the VCs. With corporate partners you should be getting creative (e.g. I know you have operations in Nigeria and we would really like to test the market there, if you help introduce us to business partners in the region we will share all of the information we gather via our first pilots with you). Remember, information and insight can be used as currency just as easily as cash – and many times, it can be even more valuable.
Finally, even with the best business models and partners in place, my biggest concern for the future of wearables in resource-constrained communities is not adoption rates or scalability, but rather startups seeing an opportunity to produce low quality products and services that require less regulatory approval than more developed regions such as North America or Europe. When, in reality, it should be viewed as a great opportunity to use all of the knowledge and technological know-how from the various business hubs throughout the world and apply those resources in regions where they can have enormous impact.
Likewise, my greatest hope is that we’re able to align incentives across all the players involved in bringing technology that matters to those who really need it the most. For wearables, when we find the right use case, the right partners, and a sustainable business model and distribution strategy, I think we’ll be poised to have a huge impact on the health and quality of life for millions of people. Competitions such as Wearables for Good allow the business community to experiment with different combinations of hardware and services in a low-risk environment and imagine how we can help shape the future and create possibilities to impact the lives of many people.