Thought Leaders in Internet of Things: Danny Yu, CEO of DainTree (Part 4)

Sramana Mitra: It takes time to fully deploy the solution. If you have one customer with 20 to 40 facilities, it takes time to get it fully deployed, right?

Danny Yu: Yes. The way this works with existing buildings is they typically want to do some type of an upgrade to the facility. You time yourself with capital budget around energy efficiency. If you do well and they like that, they will keep rolling it out. We have had one customer, in the grocery area, that went from talking through our channel partner in December 2013 to getting the first trial to a particular end customer of theirs. We did our trial in February 2914, and we received orders for 50 facilities about three months later. The roll-outs are happening and they are large. The market’s moving. It’s been proven, and it’s getting more and more valuable. Costs are actually coming down because using open standards means you get cost competition. We’re proving value every step of the way. It’s just getting that much harder for the customers to say no.

Another thing that is also relevant here in terms of the problem we’re solving is, there’re a couple of other things that are very important to see why people are putting these SMART systems in their buildings. One is what I’ll call revenue critical alerts. Let’s say you’re a bank and you have a sign that lights up at night to tell people that you’re open. We provide fault detection for the amount of power that goes away in a particular device that is supposed to be working. Suppose, lights are not working. Obviously, for areas like retail, it’s critical. That’s like operational uptime. We save energy in operations and we know when things are going to be potentially replaced ahead of time. Those are core to our solution. We want to look at the instigator in driving the decision. If you can help ensure business uptime, that’s an accelerant to why people find value in these types of systems. That’s really quite exciting about what technology can provide in a solution like ours.

Another import aspect is code compliance. Beyond the simple fact that you’re going to save energy and money, certain areas particularly are being aggressive in terms of their mandate of how efficient buildings need to become. There are new building codes. For example in California, there is a code that’s called California Title 24 mandating the types of energy saving measures that need to be implemented. Anyone who’s in California who’s doing new construction or has a certain amount of renovation to their facility trips the code and there are many codes associated with the applications that I talked about. If you’re going to save money, you’re going to have to do it anyway because of code compliance. You pick a platform that allows you to do all those things and also frankly, future-proof your facility.

Sramana Mitra: Is California where you’re seeing the maximum adoption?

Danny Yu: I’d say California is one of the top two regions. California and New England. In California, there’s just more awareness, codes, and high energy cost. New England also has high energy costs. Since the value is going up and costs are coming down, we’re geographically quite well dispersed.

Sramana Mitra: I would imagine in cold states, the HVAC is going to be more interesting as well because of the heating costs.

Danny Yu: I think the HVAC is really interesting. In fact, most thermostats, which is what’s commonly used to measure or keep things warm in winter, are not managed. You’re getting to two elements of HVAC, which are saving energy and making sure your occupants are comfortable. By having connectivity through thermostats, we address both because we can centrally manage when things go on and off.

Sramana Mitra: We have the habit of leaving the heater on and forgetting to turn it off before leaving.

Danny Yu: Exactly. When someone is very comfortable, they’ll go and try to mess around with the thermostat. Have you ever seen those plastic boxes with the lock around them on thermostats?

Sramana Mitra: No.

Danny Yu: This is a very interesting thing that’s going on. You have thermostats on the wall in a plastic box with a lock on it so that people don’t mess around with it. That’s because they’re subject to user error. These thermostats have been stranded. If you’re connected to that thermostat, you can then override and set policies. You can even say that even if someone touches the buttons, don’t respond to it. Now you can give some control but only the control you want to authorize.

This segment is part 4 in the series : Thought Leaders in Internet of Things: Danny Yu, CEO of DainTree
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