Thought Leaders in Internet of Things: Danny Yu, CEO of DainTree (Part 3)

Sramana Mitra: You are more of a service side?

Danny Yu: It was a network analysis product. By helping companies solve problems with networking, it gets us to understand the problem better because a test company has to understand the test cases. What effectively happened is we gathered all these expertise across all these different applications about what problems we need to solve at a system level to enable all these applications to work together. The company shifted to being the solutions platform company. The company then picked the lowest-hanging fruit of vertical application to go after, which was commercial lighting.

I think it’s worth clicking down on that one because there’s a number of trends that are going on in that space which allowed it to be the foundation application for our platform. If you want to look at lighting as an energy load within commercial buildings, it’s often 40% of the electrical use in a building. It’s a tremendous amount. Lighting control, which is just one of the applications of our solutions, provides up to 70% energy savings. That’s a low-hanging fruit and the penetration of lighting control in commercial buildings is less than 10%. It’s wide open. There’s nobody serving that market.

Sramana Mitra: Kleiner Perkins has an investment in that space.

Danny Yu: We know who that is. We compete with them. We’re differentiated from them. You’ve heard about that as an application. That means it’s wide open. It’s perfect for startups. There are going to be successes across the startup landscape. There’s no established player. The next thing to do on an Internet of Things framework is you have to go and actually put things in. Internet of Things is about end devices.

Another phenomenon that’s happening in lighting, which is serving as a technology wave that companies like DainTree can focus upon, is the transition to LED. If you’re familiar with highly energy efficient and are also inherently digital, you have all the lighting industry pushing LED-based solutions now to the market. The natural question for the customer is, “Great! How do I control it?” For these fixtures, companies need partners on the control piece. This goes back to our ecosystem. We have partnered with some of the leading lighting companies to have our technology embedded into their fixtures so that when they present a controlled solution to the end customer, the customer’s getting next generation light source technology but they’re also getting next generation control technology. That’s how our platform often gets introduced into the building.

Sramana Mitra: That’s part of your core go-to market, right.

Danny Yu: That’s our core go-to market and we’ve been extremely successful. We’ve served all these applications I mentioned to you earlier – commercial offices, industrial, and retail. Those are all large segments for us. We’ve surpassed 50 million square feet in terms of deployments across our customer base. That was part one. Part two is, now that we have the capability and have been selling the multi-application side for a year. Now that you’ve decided that you want to invest in control technology, open standards are very important because you want to keep adding to that platform. With our ability to add the open standards-based wireless thermostats and open standards-based plug load controllers, you now have a single platform that’s higher value. Frankly, it’s a roadmap for future proofing of facilities. That’s how you cut the entry strategy – that initial vertical application then the broadening within the customer base.

Sramana Mitra: How many customers do you have? These are large customers, right?

Danny Yu: The types of customers vary from a company that has three to 20 buildings to customers that have portfolios of 6,000 of which we rolled out in portions. At this point, we are over 50 million in terms of square feet. We have deployed it in well over 400 facilities with some rollouts under way.

Sramana Mitra: How many customers is that? 400 facilities is how many customers?

Danny Yu: I would say 50 to 75.

Sramana Mitra: How long has this product been in the market?

Danny Yu: We originally launched the lighting capability first in 2011. Then we announced the thermostat and plug load control last year.

This segment is part 3 in the series : Thought Leaders in Internet of Things: Danny Yu, CEO of DainTree
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