XYZ Interactive was ahead of the game as a provider of 3D gesture recognition and touchless control technology when it started back in 2002. Now, its low cost, low power technology delivering unique and natural touchless control experiences to users is high in demand! This technology is used to identify the absolute x, y, and z position of an object in space, as well as its orientation with roll, pitch, and yaw, making it desirable to infinite markets. XYZ enables compelling use cases such as touchless turning of pages on an eBook by simply waving your hand; it made precise scrolling through menus, book covers, text, graphics and panning/zooming through maps and photos is now possible without touching buttons or the screen! XYZ Interactive is one of the 12 startups selected to pitch at the International Startup Festival.
Morgane Suel: Can you tell me a bit about what inspired XYZ Interactive and how it got started?
XYZ Interactive: XYZ was inspired by our belief that as the systems around us have become more complex, the need for precise information about the location of objects, especially human hands and their intent, would become more valuable. Developing a technology that delivered this information at a cost that could put our sensors into ALL consumer products, embedded in devices, materials and buildings, was a compelling vision.
The company started back in the 90′s when I met my co-founder, Andrew Lohbihler, an engineer who was working at Nortel at the time. Initially, he was interested in using location-based technology in the context of e911 – specifically, he was looking at the possibility of using software changes to the base-stations in order to locate cell phones. Andrew asked me to help evaluate the business potential of the technology, and that evolved into a discussion about the growing need for micro-location (millimeters of accuracy at meters of range). And this discussion eventually led to the creation of XYZ Interactive.
MS: What was your biggest challenge getting started?
XYZ: Our biggest challenge is that we’ve been “ahead of the curve.” When we officially started in 2002, people had trouble grasping the future need for our technology. We were looking at use cases ranging from Computer Assisted Surgery to docking in space. When people asked what the mass-market use case was, we replied “you could use it for immersive gaming.” Huh? What is that? Then the Wii came along and we could at least say, “it’s like the Wii, but different in these ways…” Now the Guiness Book of World Record’s fastest selling consumer electronics device, Microsoft’s Kinect system, is capturing mindshare and market share of the touchless and gesture control market.
MS: What advice would you give startups in regards to this challenge?
XYZ: My advice would be to build demos and prototypes, and damn good mockups, and visuals. These things stick in people’s minds.
MS: How did you come up with the technology?
XYZ: Andrew had some RF experience, so we started using radio transmitters and receivers. It wasn’t until about four years ago that we stumbled onto the current incarnation of our technology when we were investigating a hybrid system of RF and IR. I said, “Wow, with this cost profile (IR), we can get into consumer electronics, not just low volume, high margin medical and military applications.”
MS: The 3D and gesture positioning domains are quickly developing with technological advancements. What are you doing to keep XYZ Interactive up to date?
XYZ: Our Intellectual Property covers the entire EM spectrum, so it can be adapted to other wavelengths for more precise requirements in the future. We are looking to license our technology and continue our focus on pushing the envelope.
MS: Which industries do you see XYZ Interactive really taking a role in? Do you have any early successes?
XYZ: We currently have paying customers in both the Automotive and Toy industries. The Automotive industry has been thinking about augmenting the driver and passenger experience with touchless controls for much longer than most other verticals. Our technology provides better reliability than mechanical switches, as well as offering additional functionality that improves safety and convenience. As for the Toy industry, we have had traction in this area because our technology is so inexpensive, while at the same time it enables new interactions and game play. Personally, I believe that our technology is very well suited to mobile devices. We have a VERY low power profile – imagine turning the pages on an eReader or Tablet simply by waving your hand or flicking your thumb, all without draining your battery. That’s what we can provide.
MS: What’s the competition like and how are you differentiating yourselves?
XYZ: This will be a HUGE market, so understanding our strengths is essential. And we know that positioning matters. If your use-case can afford the additional cost and power requirements, some of the camera-based technologies that are emerging are VERY good and accurate, providing much more positional data points than with our technology we are looking to license today. We believe that there are many more use-cases and opportunities for simple positioning and gestures that don’t need this level of information, and that our technology is uniquely positioned to serve this larger market.
MS: What’s it like being a mostly hardware company during a software boom?
XYZ: It’s tough, honestly. Sales cycles are longer, and investors are fewer. If we were a Social-Mobile-Cloud-Location-Gamification company, chances are we would already have funding – and we would know in 90 days if we were going to live or die. What makes it tougher is that we really are essentially a software company, but we do get painted with the hardware brush. Of course, there is some fairness to the categorization, since we sell our software to OEMs that build hardware.
MS: Can you share your biggest mistake or what you would do differently if you were to start the company today with what you now know?
XYZ: Sure: (i) sexier demos sooner, (ii) more video, less text, and (iii) ask for more money sooner.
MS: How do you embody this year’s Startup Festival theme, “startups that matter”?
XYZ: 3D sensors will soon surround us all. We have a disruptive technology that provides more for less and will do well in the emerging ecosystem. Invest in us now, and profit from this inevitable future.
MS: What are you looking to get out of the Startup Festival (investors, users, customers etc.)?
XYZ: We’re always looking for customers, and also investors who can bring us closer to customers.
MS: Where do you see XYZ Interactive in 3 years?
XYZ: With happy investors, a bigger team with both a near and far-term focus, and cash-flow positive with our technology in products in market. We have a consumer facing domain name “GestureSense” that, combined with some co-branding, should further accelerate our customer acquisition. Maybe even a household name? Not that that is important to us, of course.
Morgane Suel, @morgansuel
Born and raised in Silicon Valley, now pursuing a Medical Anthropology degree at McGill. Currently working on several startup projects, including The International Startup Festival.