Looking At Field Service Through Google Glass

This post was originally featured in Field Technologies Online.

Why do enterprise customers of capital equipment demand guaranteed uptime? Because the capital equipment is mission critical to these organizations' revenue streams; when the capital equipment isn’t working, the organization is bleeding money and literally dying. Worse, nonfunctional equipment can put peoples' safety at risk (e.g. patient safety in hospitals when diagnostic machines are down). So when mission-critical equipment isn't working, businesses cannot function correctly. Executives quickly (and rightly) grow frustrated and money is burned. In other words, time-to-resolution (TTR) is critical in field service.

Therefore, buyers of capital equipment spend extraordinary amounts of capital to purchase service contracts that ensure maximum uptime. In turn, equipment manufacturers spend extraordinary amounts of capital to satisfy service level agreements (SLAs) to guarantee that uptime. These SLAs are supported by highly trained, specialized support teams who either fly to--or are located near--the customer's capital equipment for one simple reason: if things break, someone needs to be on site fast.

What if they didn't have to be on site? What if the customer could be supported remotely by a centrally located expert? Google Glass and other smart glasses are making this a reality.

Why Glass? Why not mobile?

For mobile, hands-on workers, smartphones and tablets promised a new paradigm in information access, process control, and remote support. To a certain degree, these devices have delivered. From an information perspective, workers equipped with mobile devices are better equipped than ever before. But smartphones and tablets suffer from one critical problem: they obstruct the worker's process. All the functionality in the world is somewhat less helpful to a worker if they're constantly interrupting their work to glance at, tap, and swipe on their tablet. Most notably, using video for remote collaboration is somewhat less useful if the tech must hold a phone in front of their workspace, occupying one hand and obstructing their view.

Glass, then, is the natural solution to this problem. It brings all the capability of the smartphone to the field, without the obstructions. Glass is voice activated, lightweight, and stays out of the field of view. Most importantly of all, the front facing camera means that a Glass-wearer can share their point of view with anyone, while maintaining their focus and the use of their hands. Every pair of hands in the field now has access to the expertise of the entire organization, in real time.

Perhaps more interestingly, this model can be extended directly to the customer. Particular for field service and repair of capital equipment, this has powerful effects: dramatically improved time to resolution, and lower cost to provide the service.

An Example: Diagnostics in Action

Acme corporation manufactures MRIs for use in hospitals. Pines Hospital in Smithville has an MRI from Acme. It runs about 12 hours per day and generates a total revenue for the hospital of $225,000 each day (or $15k/hour). Last Friday at 8:30AM, the MRI broke at Pines Hospital. It took 3 hours and 40 minutes before an Acme service technician could arrive and fix it. During that 3 hours and 45 minutes, Pines hospital lost $15,000 * 3.67 = $55,000.

Why did it take so long to fix the MRI? Because it took three hours for the nearest ACME support representative to make it from his home in Houston to Smithville. Upon arriving, the field service technician opened the back panel on the MRI, reset the device, re-installed the system settings, and ran a few tests to ensure the MRI was correctly connected back to all of the ancillary imaging and scheduling system. The diagnostic and repair process took just 20 minutes.

Enter Glass: The Next Generation of Field Service

Meanwhile, in an alternate universe, Acme had equipped their technicians with Glass.

In this alternate universe, things occurred differently when the MRI went down. Instead of calling on a telephone, the local Pines Hospital radiology technician put on a pair of Glass and initiated a video call. In seconds, the radiology technician was showing the ACME technical representative exactly what he was seeing and hearing as he walked around the MRI. With guidance from the remote Acme technician, the radiology technician fixed the MRI machine in 40 minutes. Although it took the radiology technician twice as long to complete the actual repair, there was no time lost in transport or logistics. In this alternate universe, Pines hospital only lost $15,000 * .67 = $10,000.

In other words, remote service workflows, powered by Glass, drove material savings for Pines hospital! Plus, the shorter overall downtime kept the hospital running smoothly: patients received diagnoses on time, staff went home on time, and schedules weren't pushed out.

From Example To Reality

This alternate universe is becoming reality! Already, industry leaders are adopting Glass to enhance their field service organizations--equipping both technicians and customers. At Pristine, we’re pioneering this reality, building software for Glass to power new field service workflows based on the "Wearable Worker.” Our customers are lowering costs, shortening time to resolution, and bringing ever more positive experiences to their customers. That’s the next generation of field service in action. Drop us a line to learn more.

The Entrepreneur Hustle

This post was originally featured on Forbes.

We live in incredible times. Young, inexperienced, naive founders without any connections or experience can raise millions of dollars from angel investors without a product, plan, revenue, users, or clients. My company Pristine is a testament to that fact – we recently followed the seed round described below with a $5.4 million Series A.

When we first started in May of 2013, my co-founder Patrick and I thought we knew what raising money meant. After all, we’d read about hundreds of financings on TechCrunch. It seemed like 20-something founding teams could get funded to build just about anything in Silicon Valley. VCs couldn’t find enough 20-somethings to quit their jobs and change the world.

We didn’t have a clue.

Through dumb luck, my blogging connected us with an anesthesiologist who ended up investing our first $100,000 in June of 2013. In the ensuing months, we raised hundreds of thousands of dollars in $25,000 and $50,000 increments from smart and dumb money without a demo, let alone clients or revenue. In retrospect, I can’t believe we raised when and how we did. We had nothing and we were entering an awful market — health care is 10 years behind in terms of technology. Why would investors think that physicians would be the first adopt Google Glass?

So how did a 23-year-old and 21-year-old in this space do it? In short, we hustled. Specifically:

Blogging

My New Year’s resolution for 2013 was to blog three times per week, every week, for the entire year. I succeeded in keeping my pledge, writing about everything I found interesting — human computer interaction on PCs, the strengths and weaknesses of Google Glass, why Macbook Pros are amazing, healthcare policy, macroeconomic changes in the healthcare landscape and more. Blogging led to a number of strangers emailing me, some of whom ended up funding Pristine to the tune of $250,000 and helped us find some of our first clients. One of those strangers was a physician at UC Irvine, who became our first client.

AngelList

This is an obvious choice, but one that I can’t stress enough. There are angels that scavenge AngelList just looking to invest capital. We ended up raising about $150,000 from cold intros via AngelList. We did however make one big mistake — we incorporated as a Texas C-corp instead of Delaware, which made us ineligible for AngelList’s syndicates.

Other Crowdfunding Sites

We were promiscuous fundraisers. We signed up for as many crowdfunding portals as we could find. RockThePost, HealthFundr, AngelMD, MicroVentures and others. Some of these portals didn’t drive any investment, but those that did drove an additional $350,000 in investment and led to paying clients. Although each portal may consume several hours’ worth of time, it was worth it to pursue every one. Founders, don’t hesitate to flirt with everyone.

Shameless Begging

Young, naive entrepreneurs aren’t selfish enough. Successful people who like to help entrepreneurs often ask how they can help, but entrepreneurs are too shy to directly ask for money. I wasn’t, and it worked. Whenever someone asked me how they could help, I would always ask, “Do you know any angel investors that you think might be interested in our space?” That question alone generated over $200,000 in investment.

…And a Few Less Successful Strategies

We also did a few foolish things. For instance, never again will I spend capital attending a startup pitch contest. We spent over $25,000 attending and winning a major pitch competition. What did we get? Nothing, except a temporary ego boost. If there’s a local pitch contest that you can participate in without spending any capital, you should attend to practice your pitch and network. But don’t spend a dime.

We also wasted an enormous amount of time meeting with VCs while we were at the seed stage. VCs will not fund first-time entrepreneurs at the seed stage, period. They receive too many pitches from seasoned executives to invest in an unproven team and will always wait until you demonstrate real traction.

But the most dangerous mistake of all was allowing an angel — we’ll call him Bob — to get actively involved in the business by taking a board seat. Bob was a first-time angel investor who led a syndicate of his friends to invest $300,000. A few weeks after investing, he got cold feet and demanded all of the syndicate’s money back. He had no legal basis for doing so, but threatened us with lawsuits. We sent the money back, but it was a serious morale kill, and a massive time and money suck (lawyers are expensive).

Moral of the story: Be cautious about allowing angels, especially first-time angels, to get involved in your business. Use them for advice, use them for their connections, and take their money, but be wary of anything else.

For first-time entrepreneurs, the fundraising process is confusing. There are no magic tricks, but there are some pitfalls that can be avoided. So long as you are incredibly passionate and have a business that could theoretically work, you can succeed. Let the fear of missing payroll coerce you into approaching strangers in person and on the Internet to shamelessly ask for money. If necessity is the mother of all invention, then fear of death is the mother of the entrepreneur hustle.

Pristine Raises $5.4M!

I speak for our entire team when I say that we’re incredibly excited about this milestone, and we’re ready to put this new financing to work. In service of that mission, we’re very glad to be working with our lead investors at S3 Ventures here in Austin to capitalize on our early success, expand our team, continue building our groundbreaking products, and grow our business in healthcare and beyond.

If you’re an avid reader of the Pristine story, you know that the last 18 months or so have been a whirlwind for us. Not so long ago, the notion of Google Glass in healthcare seemed fanciful to many. Now, that very notion is seen as a potential game-changer in healthcare delivery. I can’t thank our team enough for everything they’ve sacrificed to make this happen.

Mirroring Glass’s growth, Pristine too has come a long way in the last year and a half, as a company. We’ve gone from our first pilot to dozens of clients, from just Patrick and I to a great (and growing) team of 15, and (in true startup form) from my living room to a real office (pictures coming soon)!

As we open the next chapter of the Pristine story, I’d like to take this opportunity to thank all of you who have helped us along the way. We couldn’t have done it without you!

Aligning Incentives Across Disparate P&Ls

My company sells solutions that typically span multiple avenues of care. We’ve encountered a unique problem: incentives to improve care coordination rarely align when disparate P&Ls accrue to different players across the continuum of care. In other words, split P&Ls pose a destructive risk to care coordination and ultimately outcomes.

How does this play out in the real world?

Ambulances

Most health systems do not own or operate their own ambulances (Atlantic Health System and NS-LIJ being notable exceptions). Instead, ambulances are typically run by local governments or private companies. Why is this a problem? Many of the most critically ill patients arrive to hospitals via ambulance. Many of these patients are are in time-critical conditions. Ambulances should have the best tools to help save those patients and improve outcomes and suffering. All of the care that ambulances provide should be coordinated with the receiving hospital.

However, ambulances, especially publicly-operated ambulances, run on extremely tight margins; they can’t afford to invest in many new technologies. Hospitals won’t invest in tools for ambulances – even for at-risk patients – since hospitals won’t actually control the deployment of the technology to ensure they impact outcomes for at-risk patients.

But what if hospitals owned the ambulances that fed the hospitals? In this model, as hospitals move towards risk-based care-delivery models, incentives will be aligned to deploy mobile technologies into ambulances to improve time-to-care, diagnostics, and even triage patients to avoid hospitalizations entirely. Specifically, what if every ambulance was equipped with a mobile X ray, CT, EKG, ultrasound, and a suite of standard diagnostic tools (blood pressure, thermometer, stethoscope, etc? Upon arriving at a non-emergent patient’s home, the paramedics could locally diagnose and triage the patient with a virtual physician’s input and avoid non-essential ER admissions.

But that can only happen if incentives – specifically P&Ls – are aligned across the continuum of care.

Outsourced physician Management Services (e.g., EmCare)

Many hospitals contract with physician groups to staff service lines in the hospital. Although these groups provide real value – e.g., more flexible hours and operational processes – than employed physicians these groups also break up how P&Ls are accrued.

For example, many anesthesiologists align as a group to contract with hospitals. Within their practice, these MDs may find a new automated anesthesia monitor that enables more effective management of residents and CRNAs across multiple ORs. In turn, anesthesiologists should be able to extend the MD:mid-level ratio, drive improvement in patient safety, and make more money. But, concerns about damage, theft, and losing the hospital contract render these same anesthesiologists unlikely to ever buy the equipment themselves. Hospitals will also be reluctant to invest since they won’t accrue the financial benefits of improved labor productivity since the financial benefits accrue to the anesthesiologist group, not the hospital.

But Modularization Works In Other Industries

Indeed, most value-chain centric industries are highly modular. Each layer of the value chain can independently optimize itself and control how it interacts with the layers of the value chain above and below it. A few examples:

In the movie value chain, movie production studios don’t own and operate theaters; theaters are independent

In the retail value chain, retailers usually don’t act as distributors, and distributors don’t usually act as producers

With the exception of Apple (who by no means control the entire value chain), most of the computing value chain is modular; retailers like Best Buy have no hand in chipset design, chipset manufacturing, OEM design, OEM manufacturing, operating systems, Internet infrastructure, internet service providers, or cloud services.

Modularization In Healthcare Delivery: Can it work?

Healthcare delivery is not a linear value chain. Each player in the healthcare delivery system doesn’t build incremental, linear value on top of its suppliers. Rather, healthcare delivery involves the coordination of a breadth of disparate resources to A) diagnose, B) treat, and, C) manage chronic conditions / maintain wellness (these are the three different businesses that Clayton Christensen astutely observes in his excellent book, The Innovator’s Prescription).

Healthcare could perhaps be modularized if a certain set of providers acted to diagnose a patient, then handed off the patient to another set of providers for treatment, who in turn would transfer the patient to another set of providers whose job it was to manage ongoing chronic care. However, this arrangement is only tenable if: 1) the boundaries between these three different businesses are clear and distinct, and 2) the providers in each have a high degree of confidence in the “output” from their “suppliers” (e.g., an accurate diagnosis).

What are your thoughts? Have you seen other scenarios where disparate P&Ls lead to mis-aligned incentives? Have you seen risk-based payment models that successfully bridge disparate P&Ls?

Is The Future Of Smart Clothing Modular or Integrated?

OMSignal recently raised $10M to build sensors into smart clothes. Sensoria recently raised $5M in pursuit of the same mission, albeit using different tactics. Meanwhile, Apple hired the former CEO of Burberry, Angela Ahrendts, to lead its retail efforts.

And Google is pushing Android Wear in a major way, with significant adoption and uptake by OEMs.

There’re two distinct approaches that are evolving in the smart clothing space. OMSignal, Sensoria, and Apple are taking a full-stack, vertical approach. OMSignal and Sensoria are building sensors into clothing and selling their own clothes directly to consumers. Although Apple hasn’t announced anything to compete with OMSignal or Sensoria, it’s clear they’re heading into the smart clothing space in traditional Apple fashion with the launch of Health, the impending launch of the iWatch, and the hiring of Angela Ahrendts.

Google, on the other hand, is licensing Android Wear to OEM vendors in traditional Google fashion: by providing the operating system and relevant Google Services to OEMs who can customize and configure and compete on retail and marketing. Although Google is yet to announce partnerships with any more traditional clothing vendors, it’s inevitable that they’ll license Android Wear to more traditional fashion brands that want to produce smart, sensor-laden clothing.

Apple’s vertically-integrated model is powerful because it allows Apple to pioneer new markets that require novel implementations utilizing intertwined software and hardware. Pioneering a new factor is especially difficult when dealing with separate hardware and software vendors and all of the associated challenges: disparate P&Ls, different visions, and unaligned managerial mandates. However, once the new form factor is understood, modular hardware and software companies can quickly optimize each component to drive down costs and create new choices for consumers. This approached has been successfully played out in the PC, smartphone, and tablet form factors.

Apple’s model is not well-suited to being the market leader in terms of raw volume. Indeed, Apple optimizes towards the high end, not the masses and this strategy has served them well. But it will be interesting to see how they, along with other vertically integrated smart-clothing vendors, approach the clothing market. Fashion is already an established industry that is predicated on variety, choice, and personalization; these traits are the antithesis of the Apple model. There’s no way that 20% or even 10% of the population will wear t- shirts, polos, tank tops, dresses, business clothes, etc., (which I’ll collectively call the “t-shirt market”) made by a single company. No one company can so single-handedly dominate the t-shirt market. People simply desire too many choices for that to happen.

OMSignal and Sensoria don’t need to worry about this problem as much as Apple since they’re targeting niche use cases in fitness and health. However, as they scale and set their sites on the mass consumer market, they will need to figure out a strategy to drive massive personalization. Apple, given its scale and brand, will need to address the personalization problem in the t- shirt market before they enter it.

The t-shirt market is going to be exciting to watch over the coming decades. There are enormous opportunities to be had. Let the best companies win!

Feel free to a drop a comment with how you think the market will play out. Will the startups open up their sensors to 3rd party clothing companies? Will Apple? How will Google counteract?