Smart lock maker Otto suspends operations

Otto showed the world its digital lock in August. Four months later, the company has suspended operations. Hardware is hard. It’s a cliche for a reason.

The company made the decision merely ahead of the holidays, a known fact that founder and CEO Sam Jadallah recently made public with a lengthy Medium post now pinned to the top of the startup’s site. The extended survey of the Bay Area company’s short life is punctuated with the pithy title, “So Close, ” a nod to the spitting distance the startup came to actually bringing a product to marketplace.

In a conversation over the weekend, Jadallah told TechCrunch that the company’s lock built it as far as the manufacturing process, and is currently sitting in a warehouse, unable to be sold by a hardware startup that is effectively no longer operating. How does a company get so close to the finishing line without being able to take that final step?

The executive lays much of that out in his own explainer — a post he holds a sort of cautionary narrative for the volatility of the Valley. The long and short of it is that the company was about to be acquired by someone with a lot more resources and experience in bringing a product to marketplace, only to have the rug apparently pulled out at the last minute.

“You’re not in charge of your own fate, and the margin for fault is a lot smaller, ” Jadallah told TechCrunch. “Building a really exciting hardware product needs a ton of resources, and is likely best inside of a bigger company. Frankly, that’s part of the reason I was aroused about the acquisition. I knew it would take us out of the cyclical venture capital marketplace and put us inside a company that knew how to make and ship products.”

The executive wouldn’t name the interested party during the course of its bellow, but Otto was almost certainly built hopeful by the recent acquisition of August Home by Assa Abloy, the world’s largest lock producer. The big players have no doubt that there’s plenty of room to grow in the space, and the connected home category presents no apparent signs of slowing. NPD reported a 43 percentage growth in smart home sales in 2017. Security is a big piece of that puzzle, but there’s still plenty to unlock on that front.

Otto thought it had discovered the key, though the company’s product garnered a fair quantity of pushback at launching. Sure, it followed in Nest’s footsteps and brought some former Apple employees on board for the creation of what is, by all accounts one nice looking doorway lock. But even in the age of the $1,000 iPhone, a $699 smart lock is a tough pill to swallow. If the smart lock is still searching for its mainstream moment, was a flagship-phone-priced device really going to be the product to put it over the edge?

Jadallah surely believed so, as apparently, did the unnamed company that came within days of acquiring Otto. And while the purchasers apparently never devoted a reason for their decision to pull out, the executive says that the product’s cost was never a concern.

“They knew about the price before the first meeting, and they are very smart people, ” he says. “This isn’t the story of an ambitious product that didn’t have a market. I was convinced that we had priced it the right way for the product, and we knew that the technology that we had innovated was something that we could use in different ways at other price point.”

In fact, he adds in a followup email, the acquiring company was apparently convinced that it could sell the product for even more in certain markets. Of course, that’s all a bit of a moot point now. While what remains of the company is attempting to figure out what to do with all of those smart locks currently populating a warehouse somewhere, there’s currently no one around to actually sell them.

The apparently imminent acquisition entailed the company had no plan B. “The life of the startup is a binary thing, ” Jadallah says. “To go from what could be an incredible high to crushing low in a matter of hours is what we do.”

Earlier this month, the company’s Facebook page was still promoting the product with winking reference to the new Star Wars film in a video that asked users to “Unlock the dark side.” Two weeks later, another startup has, for most intents and purposes, gone dark.

Make sure to visit: CapGeneration.com

Advertisements

Josh.ai raises $11 million for a premium home automation system with a smarter AI

One of the promises of voice-based calculating is the ability to attain home automation simpler something that major tech companies, including Amazon, Apple and Google, are now tackling with their own voice assistants and smart speakers. But their solutions are still somewhat clunky, both in terms of the software interface for configuring your smart home and the voice commands you use to take actions. Thats where the startup Josh.aicomes in.

The company has now created $11 million to design a better voice-controlled system for smart homes, and will afterward this year release its own hardware dedicated to this purpose.

Headquartered in Denver with offices in L.A ., Josh.ai is the product of serial entrepreneursAlex Capecelatro, CEO, and Tim Gill, CTO. The two previously worked together on a social recommendations app Yeti, which had begun its life as At The Pool, andwas sold back in 2015. Gill, who had previously founded and sold Quark( Quark XPress ), had joined Yeti as a technical advisor, and wrote a number of the algorithm being implemented in the app.

Following the sale of Yeti, the two teamed up again to work on a project in the smart home space something they were both interested in for personal reasons.

Gill, for example, had spent years developing his own home automation system his version of Mark Zuckerbergs Jarvis to run inside the large residential property he was building in Denver.

He was well underway in building the house and understanding what the competition looked likewhat the product offerings looked like, explainsCapecelatro. And he was pretty dissatisfied with what was out there.

Meanwhile, Capecelatro was also constructing a home for himself in L.A ., and running into the same problems.

I was just amazed that all of the big automation systems Crestron, Control4, and Savant they cost hundreds of thousands of dollars, and the[ user interface] looks like its from the 90 s, he says. It was weird that for a ton of money in my home where you want to have a delightful experience, the best offerings on the table merely werent that good.

The founders insured a need in the market for something that sits above mass market solutions, like Apples Home app, or Alexas smart home control, which focus more on tying together after-market devices, like security cameras, smart doorbells, or smart illuminates like Philips Hue.

They founded the startup Josh.ai in March 2015, and shipped the first product the following year.

The solution, as it exists today, includes a kit with a Mac mini and iPad, and software that runs the home. After plugging in the Mac, Josh.ai auto-discovers devices on the network. It can identify those from over 50 manufacturers. For example, it can control lighting and shades like those from Lutron, music systems like Sonos, dozens of brands of security cameras, Nest thermostats, Samsung smart TVs, and even more niche products like Global Cachs box for controlling IR devices( such as your not-so-smart TVs ).

The automatic speech recognition( AKA speech-to-text) portion of Josh.ais system is handled in the cloud, while Mac mini manages the natural language processing to know what your commands mean.

What builds Josh.ai unique “wasnt just” its software interface, but how users interact with the system. You speak to the voice deputy Josh to tell the home what to do.( You can also change its name if thats an issue, or even pick from a variety of male and female voices and accents .)

Josh, or the wake word youve chosen, precedes your command, which can be spoken use more natural language. The system is better than many when it comes to construing what you entail, by nature of its single-purpose focus on home automation.

For instance, you can tell Josh to turn it off , and it will know what it entails because it remembers what it had turned on before. Or you can say, its hot in here , and Josh will know how to adjust your thermostat.

It can also deep-link to streaming video content, so you can ask to watch Planet Earth, and Josh will turn on the TV, switch to the right input, launch Netflix, then start playing the show.

Josh.ai supports scenes, as well, allowing you to configure a number of devices to work together like suns, shades, music, fans, thermostats, and other switches. That route, you can say things like turn everything off , and Josh knows to shut down all the connected devices in the home.

Where the system gets really smart is in its ability to handle complex, compound commands entailing controlling multiple devices in one sentence.

You can say to Josh, play Simon and Garfunkel and turn on the suns , for example. Or, play Explosions in the sky in the kitchen, and play Simon and Garfunkel in the living room . Other systems could get tripped up by the and and the in the in the artists names, but Josh.ai understands when those terms are a transgres between two commands, and when theyre part of something else.

The current system which was largely designed for high-end homes is sold by professional integrators at around $10,000 and up, depending on the components involved. To date, the team has sold more than 50 and fewer than 100 installations.

Josh.ai can work over your Echo or Google Home, if you prefer, and includes interfaces for iOS, Android and the web. But the company is now preparing to launch its own, farfield mic answer in a new hardware device thats built specifically for use in the home.

While the new hardware will perform some basic virtual assistant kind chores telling you the climate, perhaps( the company isnt corroborating specific features at this time) the main focus will be on home automation.

Above: a tease of the new device

The hardware wont be a cylindrical shape like Echo or Google Home, but will be designed with an aesthetic appeal in mind.

It also wont be super cheap.

It will still be a premium product, but it will be a lot less than where the present product is. And the idea is this will enable our mass market rollout in probably a year to eighteen months , notesCapecelatro, speaking of his plan to keep bringing Josh.ais technology to ever larger audiences.

Josh.ai, a team of 15 soon to be 25, lately closed on$ 8 million in new funding, largely from the founders personal networks. The investors names arent being disclosed because theyre not institutional firms. To date, Josh.ai has raised $11 million, but has not yet added anyone to its board.

Make sure to visit: CapGeneration.com

Xiaomi puts the focus on India with plans to open 100 retail stores

Xiaomi isincreasing its office retail presence in China as bids to gain ground stolen by challengers in its homeland, and now itis inducing that very same push in its second largest market, India.

The Chinese company, which is valued at $45 billion, suffered a tough time last year as marketings growth slowed Xiaomi , notably, didnt go public with marketings figures for 2016 but India has been a bright place. It passed$ 1 billion in revenuefor the first time in the country last year, and it objective 2016 asIndias second largest selling smartphone maker behind only Samsung, according to analyst firm Canalys.

Now it is doubling down on the country by introducing its Mi Home stores, starting with a debut spaceinBengaluru which will open in only over a week. The scheme is to expand the initiative to reach 100 stores over the next two years, Xiaomis India head Manu Jainsaid in a tweet.

Jain told Economics Times that Xiaomi is aiming to stock all products offered in India but, in the off opportunity that it is out, customers will be able to pick up a code that allows them to buy their desired device online. The stores will also show off products from China before their local launching in India.

Initially, Xiaomi is somewhat constrained by Indian regulations onoverseas firms operating brick and mortar retails stores. That entails itsfirst stores will be run by a partner, although Xiaomi said it has applied for the relevant license to take over. Apple is among others that is in the same boat. The U.S. giant “re waiting for” permission to bringing the Apple Store to Indian clay, a move that would massively increase its marketings presence. While CEO Tim Cook has said that India-based marketings are growing at record levels, Appleis estimated to have shipped only 2.5 million iPhones tothe countrylast year. For comparison, it sold 50.8 million iPhones in the most recent quarter alone.

Make sure to visit: CapGeneration.com