Interview with Mr. Tero Aaltonen, CEO & Co-founder of Augumenta
‘Augumenta Drives Augmented Reality Application Development’
1) Please tell us your name and background.
My name is Tero and I’m the CEO and co-founder of Augumenta. Born and raised in Finland, I started my career as a SW engineer in mobile communications in late 90s and experienced the tremendous innovation taking place: the world had just switched from analog to digital communications, and 2G had been rolled out on markets. A big share of the protocol design, standardization, phone and network devices were made in Finland driven by Nokia, and I had a great opportunity to experience how this well-orchestrated ecosystem of suppliers produced some of the finest products of that time.
They say that life begins at the end of your comfort zone. By 2008, I had grown tired of my safe life in Finland; I had a nice career, a neat apartment etc., and could have continued my well-predictable life for years to come. But that just didn’t feel right anymore; I needed a fresh challenge. After some thinking, I came to a conclusion that if you want to change something, why not change as many things as you can at once, and see if you can handle it? And so I did: I sold most of my property (but kept my beloved guitars) and moved to Taiwan to start working for Scalado (a Swedish company making camera SW for mobile phones). This was not a major leap distance-wise only; I left engineering behind and moved to sales and business development to take Scalado’s business in APAC to the next level.
Four successful years later, APAC had become Scalado’s biggest market, and we had cemented our market position as the leading provider of mobile imaging SW. We were rockstars, and rockstars get fans. In our case, one of the fans was Nokia, and they got so excited that they decided to buy us. I was somewhat upset about this, because we were not done with our APAC domination yet, and there were great plans waiting to be executed but obviously never were. Joining Nokia didn’t feel like the right thing to do for me, and that’s how my startup life got started. This is the next challenge in my life: how to drive the company to maximum growth with the skills I’ve learned during my career.
2) Please tell us about your startup, how you founded it and are growing it.
Augumenta was founded in late 2012. Peter, my CTO and co-founder, had moved to Finland in late 90s to start his Ph.D. studies in the University of Oulu, and his research was focused on augmented reality. He’s truly one of the pioneers on this field, and his research findings and ideas were the base on which Augumenta was established. During his time in the academia, he worked a while in Japan as a visiting research, and during that time he met Damien who became our 3rd co-founder. I hired Peter into my team in 2007 when he had already finished his research and wanted to join the industry. The fact that each founder had worked side-by-side with another founder in the past helps keeping the founding team together, because we all meet face2face only 1-2 times a year.
The core idea of Augumenta was to develop gesture control solutions from smartglasses. It was clear that touchpads and voice control were not enough to build intuitive applications; something greater was needed. So, we started designing algorithms that are power efficient and tailored for resource-constrained devices, and packaged them into a user-friendly SDK that we started licensing. Back then there was still a lot of hype about the first version of Google Glass and its potential in consumer space, but soon it became obvious that we should focus solely on B2B markets where the demand for our solutions was clear. And that’s what we did.
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Exhibition in the tech event
3)What is your key technology? Please explain it.
Initially we just had a gesture-control SDK that was device agnostic and you could deploy it on any smartglass. The product was well-received on markets and we got good traction, but at the same time we noticed that a significant part of the market liked what you could do with the SDK, but didn’t want to do it themselves. In other words, instead of licensing the SDK and building apps themselves, they wanted us to make apps based on the SDK. By then we had talked to a huge number of potential customers and were able to identify certain use cases that were often requested from us.
In early 2018 we started developing the first off-the-shelf smartglass apps for industrial AR use cases. One-app-fits-all approach doesn’t really work, because each customer has their own customization needs, and we knew that unless addressed properly, we would get stuck in a never-ending customization business that would stop us from scaling up. We decided to create an easy-to-use tool that would allow customers to do most common tailoring tasks by themselves without having to rely on our engineering services. In Hannover Messe, we launched our AR application suite with the customization tool, and were immediately awarded as one of the finalists for Hermes Award, which is a prestigious nomination given annually to 5 companies who have potential to disrupt the industry. Some months later we won a Digital Factory Challenge. These two nominations were a clear signal that extending our product offering from SDK to SDK+apps was exactly what the markets wanted from us.
Going back to your question: the core of our technology is the SDK that enables intuitive gesture control on any smartglass out there. The apps built on top of the SDK, and the Augumenta Studio customization tool allow our customers to tailor and deploy AR in their businesses in a rapid and cost-efficient manner. What we really want to do is lower the entry barrier: getting your first AR pilot started should be a matter of days or weeks at most, not months like it has been in the past.
4. Where and who are your clients?
We have customers on each continent (except Antarctica), with the biggest ones coming from North America, Central Europe and Asia. In total we’re working with over 200 companies who are in different phases in deploying our solutions in their businesses; Siemens and Liquid Controls are the two public references I can mention in here. Any business who is digitalizing their operations is a potential customer to us; we help their workers to stay on top of things and assist them in daily operations with smartglasses and augmented reality.
Siemens factory workers are able to control CNC machines regardless of where they are in the factory with our AR control interfaces; airport operators who refuel planes have realtime visibility to critical fueling parameters. These are just a couple of examples of some very practical ways how our customers are improving their work practices.
5) How did you raise money?
The founders invested their own money to get things started; this is how the first employees were hired. We’ve closed two investment rounds with Finnish investors and are now working on the first big round. As the understanding of AR’s benefits grows and we have more and more customer success stories to share, raising money is obviously easier now than in the very beginning. We’re negotiating with several B2B focused VCs and corporate investors located in Central Europe, and will have some great news to share soon. We’re excited about the strategic knowledge and networks the new investors are bringing in!
6) You’re headquartered in Finland. How’s that different from running a startup e.g. in Silicon Valley?
First of all, cost structures are totally different. Our burn rate is a fraction of what it would cost to run a similar operation in the bay area. We have access to a well-educated talent pool at reasonable costs. You get your company started with smaller seed investments, but at the same time, local investors write smaller checks. Raising A-rounds and beyond is more difficult, because there are not that many big-scale VCs operating in Finland. This is changing, though, as Finnish startups such as Supercell have become world-famous and events like Slush bring investors to Finland from all around the world.
One thing that makes Finland special is government funding. Finland tax rates are relatively high, but the tax money is channelled back to the society in various ways, one of them being R&D grants for innovative companies. You cannot run a company on grants alone, but they are a nice boost to your product development efforts, assuming that your company is creating something truly new with global market potential. For Augumenta, these grants have made a big difference and we’ve been able to accelerate our pace and grow engineering teams with this equity-free funding.
There are similarities too: hiring is increasingly difficult. We operate in one of the high-tech hubs in Finland, and there’s fierce competition between companies to hire the best talent. Our advantage is the ability to offer job positions where you get to do things that haven’t been done before. At Augumenta you’re living and breathing the AR revolution every single day.
Another award for Augumenta SmartPanel: they won Nokia #DigitalFactory challenge! #5G +#smartglasses + #AR + #IoT = #productivity!#5gfwd #industry40 #IIoT
7) What is your vision?
We’ve reached technology leadership position on markets already; this is obviously something we aim to keep in the future. AR is revolutionizing industries today, and the same will happen in consumer space tomorrow. Smartglasses will evolve, become less cumbersome to wear, and finally reach the point where consumers start adopting them.
As a company, we will keep on growing, expand geographically by opening offices close to our customers, and keep on providing state-of-the-art solutions we’ve delivered since the beginning. When people think of AR, they should think “Augumenta can do that”.