IIoT Spotlight Podcast EP027a: Building Commercialization into an IoT Product - An Interview with BrightWolf's Peter BIourne
Peter Bourne is the CEO of BrightWolf, strategic advior for ProAxion Incorporated, and an Entrepreneur in Residence for Blackstone Entrepreneurs Network. Prior to Bright Wolf, he spent 15 years in Director, CEO, COO, EVP and GM roles at both public and private companies, from early stage through revenue to profitability and exits.
Peter’s career covers a breadth of industries experiencing digital transformation, spanning all company operations including P&L, sales and marketing, and R&D. He has spent 20 years in CEO, COO, EVP and GM roles at both public and private companies, helping to commercialize new technologies, and developing companies and products for success.
Bright Wolf has almost a decade of experience as a system integration and technology partner for Fortune 1000 industrial equipment providers seeking digital transformation through adaptable connected product solutions. Bright Wolf's pre-built components, open system architecture, and expertise with industrial controls, protocols, and embedded systems enable rapid delivery of flexible IoT products and services that generate business outcomes for our customers.
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Welcome back to the Industrial IoT spotlight. I'm joined today by Peter Bourne. Peter is the CEO of Bright Wolf. It is an interesting company -- they are an enterprise software company that also does very deep system integration support for their customers. they get very involved in the business, not just on the technology side of the IoT solutions. Peter is also the strategic advisor for ProAxion Incorporated, as well as an Entrepreneur in Residence for Blackstone Entrepreneurs Network. And Peter you have a really deep background in in a range of technology companies. Peter thanks so much for taking the time to speak with us today.
Thank you it's great to be here.
Before we really dig into your work with Bright Wolf, give us a bit of background into some of the companies you've worked with before, and some of the problems you've addressed, and how you ended up founding rivals or become a CEO.
I've been, since my very first company out of college, an early stage inventor and entrepreneur my entire career arc with the inception of several years working for an acquired company, has been in the early to mid stage technology and really sort of commercializing technology came from a technology family.
My dad was a software engineer, before that was cool, and so I understand how that part of it works. But my focus really is on product market fit and on establishing commercial traction. So I've done five to ten times across telecom and enterprise over 30 plus years at this point.
I see before you became the CEO of Bright Wolf, you were brought on as a strategic adviser. How did you end up in this role and what really attracted you to this company and made you want to throw your chips into this particular company?
That's a common pattern for me.
I'm an inventor by some standards, but in a very early stage of the company there are people who have an idea. For me to get involved, there needs to be a commercialization track, as I mentioned, that often takes several years and so I get involved with the companies in an Advisory Board capacity. Usually I do this three or four companies at a time, and help them from that seed mature and find a market where they have potential that worked out quite well with Bright Wolf.
When I started at Bright Wolf, there were just the two founders and I started working with them and helped them for a couple of years until we were north of a million dollar run rate, and had some substantial presence in the Fortune 1000 base, which is where I prefer to operate. At that point, they said, “Well look, we're really good at a lot of things, but running and scaling companies is not really one of them. So would you like to come and continue the work you've been doing but with a more official seat at the table?”. I was thrilled.
Are the founders still deeply involved in the company?
Absolutely. Patrick Dempsey and James Branigan. James is our CTO and Patrick runs all of our delivery services organization.
So tell us a bit more about what you guys do. You mentioned that enterprise software tends to be 20 to 40 percent service oriented, but often not by design but by necessity. However, in your case, it really does seem to be by design. So how did you develop this into the service orientation as a company?
Actually it's a great question, a private equity friend of mine refers to that as the “enterprise software mess”. So Bright Wolf started out by solving some problems that James and Patrick know how to solve, which are around connected systems. In the beginning there wasn't such a thing as IoT, or at least it wasn't being call that, it was more about sort of M2M or those kinds of words were being used. The value of any enterprise system is in the data, and there is no sort of common ground as to how the data is collected, stored, managed, analyzed, etc. So in effect, every data oriented enterprise project does require some services in order to be effective. Since the data is where the value is, it's an activity well worth undertaking.
Bright Wolf, like all software companies, wants to use as much of a common infrastructure as possible. It's not even fun for the employees, let alone for their clients to have a consulting shop repeatedly reinventing infrastructure blocks and bricks. There are in the IoT space, as we move from project to project, from customer to customer, we find that there's somewhere between 70 and maybe 80 percent commonality at this point, between how the IoT systems need to look. But that 20 percent or 30 percent difference in the systems is not necessarily a bad thing. In fact, our customers want differentiation in the offerings that they are creating and taking to the market, and they don't want to just sign up for somebody else's SaaS and have a more cookie cutter approach to their IoT offerings. If you're buying something like SalesForce, you don't really want that necessarily with a bunch of engineers customizing that for your particular environment. It's a product and you want to buy a product and you want to be able to configure it more than customize it. When you're building a connected product system that's yours and that you're going to take that to your customers, you do want that customized, you want to differentiate it, both in terms of trivial things like look and feel, but also in terms of how it integrates with your enterprise and how it integrates with your customers’ enterprises.
So we embrace the services part of it; it is what helps our customers differentiate themselves from their competitors. The reason software companies all want more software revenue is because the multiples are better on that.
We are privately held and entirely focused on customer satisfaction. At this point we have no outside shareholders to answer to who want better returns on their invested capital, and so that gives us the freedom to make sure that customer satisfaction is our top priority.
Who exactly will you be interfacing with that are your clients’ clients? You mentioned Fortune 1000 companies. It sounds to me like you're getting involved fairly early in the decision process because you're also playing an advisory role. Would you be talking primarily to the business leaders or is the I.T. department driving a lot of the decisions they are faced with? What does it look like when you typically started the appointments?
Great question. That answer has had a journey to it as IoT has developed and matured in the world.
Initially, five years ago, most of our primary engagements were with engineering department. This is lined up with the fact that at that time the vast majority of IoT projects were “build it and they will come” mentality. So you know very leading edge and Geoffrey Moore Crossing the Chasm, so it's super early adopters, less charitably a lot of those turned out to be science projects.
As IoT matured and as an industry, and Bright Wolf has been a leader in this as well, we've pushed towards business outcomes as the primary driver, our main interface with our customers has shifted. The primary decision maker and buyer inside our customers at this point is a line of business owner; it can be a product manager of a VP or GM of a division. In fact, oftentimes, the CEO of these major companies, billion dollar plus companies decide: “look we just need to connect it as part of our digital transformation strategy, we need a connected product solution that we can bring to the market”.
So today, it's primarily the line of business. That said, I.T. has been becoming more prominent, becoming a more active participant at the table, and been quite useful in that I.T. is migrating as well from running servers in a closet somewhere to actually participating and delivering business outcomes. We're increasingly seeing I.T. as a partner in the IoT delivery cycle.
When do you get involved in? Is it typically that your customers come to you and say we want to build something, we know what we want to build, we've got a well identified solution environment, and we need help doing this efficiently? Or are you talking to companies about problems that they have but they don't have kind of an eye on a feasible solution, and then really walking them through alternatives and then arriving at it as a potential solution?
The majority of our customers come to us at the point where they've already tried something, and there's a spectrum of things they might have tried to made or tried to build themselves and realize that that is, at least at the infrastructure level, far more challenging than they had thought. Even with wonderful things that you can that you can access in the public cloud these days for helping you build things, it's still a complex architecture of data management problem underneath. So like I said the majority of our customers actually come to us having tried one, sometimes two, other ways and come to the conclusion that that's not working for them because they experience some kind of pain.
However, I'd say maybe a third of our customers come to us quite early in the process and say, “let's sit down and talk about the business outcomes, and what we can do, and how we can put something together quickly to test our hypothetical value proposition to our customers”. I did the early science project stage five years ago when people could spend billions literally before they were even ready to try something at the customer. That's clearly not the right way to go about it; we've seen a nice switch to favoring agility, getting something done quickly that that is super focused, and taking that out with a customer base. We work with about a third of our customers on that basis. A surprising number of people have tried something already to build an IoT system and just quietly either given up, or failed, or gotten frustrated.
I was talking to a friend about their companies 20 million dollar health care app that was quietly killed because it just didn't do the job. That's a lot of that's a lot of money to invest in something and be high risk. But I think companies are realizing this. There's ways to de-risk some of this development and startups or smaller companies tend to be better suited to it than larger companies.
This is where our IP services balance comes back into play as well, because we have the IP, the product, and the reference system, we can do something in the order of weeks for most people, and get it up and running and ready for customer pilot and that allows them to you know fail fast and learn quickly without investing heavily. Hopefully those days of getting 20 million dollars on a project that goes nowhere coming to an end. But I don't know that I'm too optimistic there.
I was reading about the new generation of fighter jets – apparently it is roughly a trillion dollar R&D effort that's way behind target and not really producing something that that's that the military wants.
So classic case of scope creep everybody just kept piling requirements on until nothing.
Yeah a good employment rates make good jobs right.
Well it's interesting that you are very service oriented but you also have your own technology. How do you play with companies like ThingWorx, GE Predix, or other platforms that are either providing some kind of data management service or analytics? Are they competitors whose technologies you involve when it makes sense? How do you position yourself in the market relative to these other companies?
The systems that we build always integrate with other peoples’ something -- either in a simple case is data centric systems like ERP and CRM, or when it relates to IoT platforms, our integration points are Amazon AWS, Microsoft Azure, and Google Cloud platform specifically to PTC ThingWorx and GE Predix.
Ostensibly you would say we compete with these companies. In fact, ThingWorx obviously has a very prominent presence in the IoT marketplace. The approach that they have to provide a SaaS that customers can use, works in cases where the companies don't really want to be software and data centric in the long term. In that case we're not the best fit, something like ThingWorx is a great idea for those companies. We see many of those folks turn around several number of years later, and say they are going to take the next step in their digital transformation and migrate to something where they have more control over the system. But in the early stages you can get something running with ThingWorx and if that's all you need to happen, it's an answer that works just fine. So on the one hand we compete, but on the other hand it's just a different approach and in those cases we're not the best answer for you.