Category: Vantage Point

Setting the Tone for Growth

Read Time: 13 minutes

The team at Nolinor

How giving up control will allow your company to grow

Nolinor is a Quebec-based charter airline that started operations in 1997, providing air transport services to hunting and fishing outfitters, eventually receiving permission to also provide its own aircraft maintenance. In 2004, the Prud’Homme family trust became majority shareholder and the company has been expanding rapidly since, first growing its fleet of Convair 580 aircraft and more recently acquiring a fleet of B737 aircraft. Then in 2005 came an opportunity to move operations from Montréal–Dorval International Airport to larger facilities at Montréal–Mirabel International Airport north of the city, which proved to be a milestone for the company’s growth. Shortly after, in 2006, the company was named one of the best-run enterprises in the province of Quebec by the National Bank of Canada. More recently, the company purchased a hangar at Aeroport Montréal Saint-Hubert/Longueuil and is the official carrier for the Montreal Alouettes football team. My interview is with Marco Prud’homme, Vice-President and shareholder of Nolinor.

Q:  You have a big story to tell, for a relatively young company. What’s next for you?

The vision that we had for the company has remained the same. We are listening to the customers’ needs, so we don’t have a long planning process or vision or strategy that we would need to change each year anyway. The way we envision growing the business is by listening to our customers’ needs and the need in the market and trying to address these. In that way we won’t have any aircraft stuck on the ground for long periods of time. So far, this has been pretty much the key to our success. We’re not romantics in the aviation field. We’re not here to prove a point. We’re not here to have a statue at the airport. We’re just here to listen to the customer and make sure that we find a solution that matches their needs, at a price point that is fair.

It took a few years to figure out exactly what we were doing. I mean, we were working really hard and doing a bunch of stuff, and at one point in time we had to sit down and ask, “Okay, the team is growing; why are we having success while other people are failing? What’s the difference?” We had to think about it and try to figure out exactly what was the key thing that we were doing differently from other people.

“We’re not romantics in the aviation field. We’re not here to prove a point.
We’re just here to listen to the customer and make sure that we find a solution that matches their needs,
at a price point that is fair”

Q:  So, I guess what you’re saying is, being self-aware is a key element of success for a management team.

Yes. Even if you work seven days a week, at one point you have to sit down and think a bit, try to understand what works, what’s not working, and so on. It’s not only for the management, but for anybody at a company. When we started at Nolinor, there were about 25 employees. We’re now over 275 and for sure, we cannot take everyone by the hand and explain to them in detail what they must do every day. You must put in place a culture – a way of doing things, or a way of dealing with issues. This gives leverage and empowers employees so that they can solve problems. Yes, sometimes people make mistakes, and other times they overachieve in what they set out to do. But, as long as the average is positive, people will learn from their mistakes and the company will grow.

Q:  This acceptance of failure is really part of setting yourself up for success, isn’t it? Would you say that acceptance of this at the management or leadership level is quite important?

I think it’s a game-changer in the sense that, if you’re trying to micromanage everybody inside the company, your growth will get stuck. There are only so many hours in a day and hours you can track, and there’s just no way you can micromanage everyone and everything. For many years, in an earlier business venture my family was involved in before Nolinor, we had placed a lot of importance on controlling every single decision in the company. We arrived at Nolinor with this mentality, but we soon discovered that this approach would not work. We needed a new approach – one that would give us more free time to think about how we can grow the business and acquire new customers, enter new markets, and initiate new projects. You cannot micromanage every single employee, otherwise you’re paying people for nothing.

Q:  Did this realization come from experience, or was it from talking with other businesspeople who had tried different approaches?

To be honest, it came from an issue. I left the company in 2008 for a few years, at a time when the company was stuck. My father [Nolinor President Jacques Prud’homme] could not keep up with being involved in every single decision, so he had to hire more people and he had to trust them – he found out on his own what I was trying to tell him for a long time. When I came back in 2013, I came to a completely different company. There was no intention on my part or his to go back to how we used to do things, between 1999 and 2007. I guess sometimes you learn from good experiences; sometimes you learn from bad experiences. For us, this situation created more potential for growth.

Q:  What you are describing is really a change in management style, in leadership style, that I’m seeing in younger companies that are growing very rapidly. We call that style agile, for lack of a better term, but it’s completely contrary to the traditional management approach that you’re taught in business school – the command-and-control type of approach to management that’s been instilled in society since the industrial age. I think it’s very relevant in this day of more complexity and rapid change. Would you say you’re riding the wave of that new trend in management?

I’m not sure we’re riding any trends. I guess what we’re doing right now is part of our personal business culture that we grew. My father started in aviation on his own – he was only 21 at the time. He didn’t have any formal management experience; his background of knowledge was that of a bush pilot. So, every single dollar he earned was through trial and error. Those things take time and I learned a lot from him. But I have a more academic background and so we did clash when we were trying to push new ideas.

Right now, we’ve been able to find a rhythm under which I would say that neither of those two extremes are better. Even when you manage in a very academic way, it doesn’t work. It has to be a mix of both, and it has to be a mix of trusting people who have the competency to actually deliver and keep following those people who need more guidance and who you need to grow. And, it all comes back to trying new things, and I guess my father was not always open to that. Two years ago, we hired a consulting firm to give us a hand in one area of the company. That required a very different mindset, because we used to close the door to any outside help. That was the first try, and we hit a home run on the first try. When you have those small successes, it changes your view of how you see things, and you’re more open to new experiences.

Q:  How would you describe the culture of Nolinor? Obviously, you and your father have developed a certain approach – how has that further permeated throughout the organization? How do employees embrace your central philosophy?

It’s not easy. I would say that there’s not a day that is the same. There’s no big plan for how we’re going to achieve our objectives. Once a situation comes up, before we react or do something crazy, we try to figure out exactly how we should do it and what would be the best course to take, and how can we create synergy with other stuff that we’ve put in place. It’s very hard and very much case by case.

There’s no clear-cut way of doing it, but I guess with an open mind, and the reality of it is that there are so many hours in a day. You don’t really have a choice but to test your folks with new challenges and then just trust them to deliver, and touch base with them from time to time to see what they’ve done and what works and what doesn’t work.

Q:  So, do you have teams within Nolinor that are formed spontaneously to deal with certain issues as they come up? Are they self-organizing, or how would you characterize the approach?

Because we’re in the aviation business we have this structure that we must follow, to meet Transport Canada regulations and all that. But that covers only the operation. It doesn’t cover managing change. It doesn’t cover managing growth. It doesn’t cover managing R&D. It’s a very specific task-oriented structure, so flights can leave on time, and that everything works properly and safely. But that’s only half the game.

The other aspect is trying to improve and grow the company, so for this there’s no real structure. It’s more like when there’s some new topic, or new project on the table, we have a look at who can deliver on that, and we trust that person to first get all the information she or he can gather on the subject. Then they give us their feedback, and we come up with a solution. We empower them to move forward, and we do the follow-up after that. It’s all a question of who’s best to do the job, not just who’s in the structure, who’s supposed to do it. So it’s very different. So the structure is there for regulatory purposes, but for anything else we try to figure out who’s the best person on the team to do it.

We used to have a lot of meetings. We don’t do that anymore, since these were not giving any results. We now have a structure where everybody works in different cells, and those cells are not really structured. They’re very flexible in the way they organize work. Most of the time we don’t have any timetable either, since every time you fix a deadline, there’s a surprise. When you have a very linear approach, something can happen that will throw you off. The way we look at it is that we know we are going to reach our goal. The date we’re going to reach it is not very important. It just puts extra stress on everybody, and it’s not a good way of going about it. We’re more into flow. Case in point, we started a project about a year ago and it started one way. However, during the process we found other opportunities, and we took a different approach that ultimately gave us results.

We therefore also never announce anything in advance. We announce only what we are able to close, what we are able to realize, and in that way, we only celebrate success. When we look at our competitors, they are eager to share what they’re working on. That’s not the way we work. We give a lot of information on what we accomplish, and don’t share much on what we’re working on.

Q:  So, you’re quite opportunistic in your approach, scanning for opportunities and then gauge whether you can make a difference?

I would say that for an important project to get closed, and delivered, there might be between 10 to 20 other projects that we’ll just cancel along the way. Opportunities come and go, and you have to make the right call at the right time. Sometimes timing is everything.

I’ll give you a past example, which is quite funny in retrospect. We were considering equipping our aircraft with iPads so that people could view movies. At one point in time, having an iPad was something rare, and when they came out we looked at that possibility. Today, it’s a no brainer that this project would have failed. Everybody has an iPad or a smartphone device on which to watch a movie. So, sometimes it’s like, we look at a project that seems interesting, but at some point, upon closer inspection and reflection somebody will raise their hand and say, “Well, there might be an easier way,” or “Do we really need to do that? What’s the ROI on that?” and “Why are we doing this? Did we fall in love with this idea, or do our customers really need that?”

We’ve put in place a system that encourages every passenger to give us feedback on the flight they’ve taken. It’s a very simple process, and we’re able to gather a bunch of information that we didn’t have before. And, with this information we can go back to our customer and say, “Oh, by the way, your passengers on this particular charter flight do not appreciate this feature, or the departure time,” or so on. We’re able to give that feedback to the customer so that a contract that may have started out in a certain way, will end up being improved with an easy solution that works, I would say, 80% of the time. And, we get this information for almost nothing – from our passengers.

It’s all a question of giving the tools to the right people, trusting them to find the right path, and not being romantic about your own ideas. This also means that if the president or I have a concept, or an idea, and once we put it on the table it’s very important to understand that we don’t own that idea anymore. If somebody comes and destroys it, or changes it, or modifies it, or finds something better, it’s very important that you don’t take it personally, because once it’s out in the open – inside the company – it’s for everyone to improve it and ownership no longer rests with any specific person. That gives a lot more leverage for people to take risks, I think.

“It’s all a question of giving the tools to the right people, trusting them to find the right path,
and not being romantic about your own ideas. This also means that [if you have an idea] and once [you]
put it on the table, it’s very important to understand that [you] don’t own that idea anymore”

Q:  So, would you say that it’s a completely open, and transparent work environment you have created that encourages creativity and ideas?

Yeah, but it’s not always easy since the natural reflex is to intervene and decide. However, if you’re able to take the time, and I guess, sleep over it, and then come back the following morning, you’ll have a more clear view on it. Everybody has the same goal – we all want Nolinor to thrive and be a success. How to achieve that can be viewed differently by other people. So, you must sit back and relax, and say, “Well, that’s completely different from what we had in mind, but it’s not a bad idea, and it’s actually cheaper, and it’s actually better,” and so on. Because if every time you cut someone off or find a way to just destroy what they’ve worked on, nobody will want to jump in and do something new. You have to give people the right feedback, so they can thrive.

Q:  It’s counter intuitive, isn’t it? Give up control to gain more control in terms of where you are going as a company.

Yeah, and this is true not only in the aviation field, but in many other fields. Sometimes you meet people, and they micromanage their team so much that you kind of wonder why they’re paying their employees a significant salary when, at the end of the day, they don’t allow them to make any decisions. If your management team or your team leaders can’t make any decisions, then you don’t really have a need for them. Their job then becomes more about managing email.

For myself, I try to send as little email as possible. I prefer to have a one-on-one chat with someone and help solve an issue quickly. I guess, if you’re sending an email for someone to confirm or share information, that’s okay. But if you’re sending an email to solve a problem, then you’re only creating a bigger problem. You need to talk with people. People do not send me any long emails. I don’t read them. I have given that scope to everybody, that if they send me an email after 9 o’clock, or if they send me an email that is more than a couple of lines long, I won’t read it. So, they don’t waste time writing long emails. If they have something to say, the door is always open, and they can just sit down, and we can talk about it, solve the issue, and move on. Because, otherwise you’re just managing email. The purpose of email was never to take up 100% of your waking hours while at work. It’s a tool, not a job.

Q:  As Nolinor grows, how do you avoid what has been called the bureaucracy trap, in that procedures are created, and systems, and so forth, to keep everyone kind of moving in a certain direction?

Well the one thing that has happened over the last few years is that we have someone inside the company who had the great idea to create an information system under which almost the entire the operation is now managed. We share all information, i.e. schedules, travel, employee profiles, flight schedules, airport information – everything is within that system that was built in-house. We have two people working full-time on upgrading the system with new features. It has cost a lot of money so far, but it has saved way more, and has made it possible for us to reduce the amount of paperwork, and bureaucracy inside Nolinor by a factor of maybe five. The system has taken a lot of time to build and now we just keep improving it. Our mindset is now more into connecting with our customer. This system is now part of our customer service, and our customer receives real-time information about their flight. That’s something that’s not been done before by any other carrier that we know of. I’m not talking about only basic information – I mean very important information. We share a lot of information with our customers. We have created a need for them and it’s automated, so we don’t have somebody sending emails to customers like we used to do in the old days.

Q:  Then, the trends that we’re seeing – more and more digitalization, automation, the use of AI – are you staying in tune with this?

We try to. If you have some spare time, you must go outside your business and see what new opportunities exist and learn about new ways of doing things. I purposely don’t attend any of our industry trade shows. I’m always into stuff that is not related to aviation, because that’s the only way to find other opportunities or ways of doing things that are not present in our own industry. You can’t just simply copy what everybody else is doing; you need to do things that nobody is doing.

Many of our management travels the world, attending different events, getting training, or learning new skills and tools. Sometimes you look at the budget and say, “Ooh, why are we spending so much money on that?” It’s not like we expect an employee to come back with a great idea every time we send them somewhere. But maybe they’ll meet someone and that someone might call him six months after with an opportunity, and so it’s very hard to figure out the ROI on that. Every time we have something that works really well, and we go back down the line to track down its origin, it comes back to somebody who was in touch and learned about something new.

We also share a lot of books. I like reading a lot, every time I read a good book – it could be on management, or marketing, or something completely different – I tend to share it and encourage others to read and share it with somebody else.

Q:  You are creating a learning environment and connecting on the edge, if you will, which is where innovation really happens. It doesn’t happen in your own little world. It happens on the exterior of your world.

That’s right, so you have to be open to that. You have to have an interest in learning and trying new stuff. I’m not interested in being aware of the new type of oil that’s going to go inside an aircraft. For me, that has zero value. It really comes down to how we manage things, how we grow customers, how we get more visibility on the Internet, how we treat people, how we train and grow our people. Those are the issues that, for me, are more complex and more interesting than what is going to be the next type of aircraft we’re going to buy. Because basically, we’re not buying aircraft to fulfil our own personal dream. We’re buying aircraft to be able to provide a service our customers want and need.

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From Drones Beware to Flight Aware with Unifly

Read Time: 12 minutes

Marc Kegelaers, CEO, Unifly – www.unifly.aero

How one company is raising the level of awareness in the airspace

As more and more drones take to the sky, and ambitions for drone delivery services and beyond-visual-line-of-sight (BVLOS) operations, the airspace will become increasingly congested. Concerns over hazards to commercial manned aviation are well-founded with calls for regulation. At the same time,  regulators are cautioned not to introduce rules that will run roughshod over an emerging industry full of potential. A solution is needed to inform drone operators where they can and cannot fly, and allow for the safe integration of drones into the airspace – a solution called UTM, or unmanned aircraft system (UAS) traffic management.

In this installment of the Vantage Point interview series on innovation in aviation, I speak with Marc Kegelaers, CEO of Unifly, an award-winning software company that has developed such a solution – a platform for the safe integration of drones into the airspace.

Q:  How did you initially come across the technology and the application of the technology that’s now Unifly?

My background is in aviation. I’m a flight instructor, and for 10 years I ran a flight school that trained professional pilots. While there, I started a department to train pilots for aircraft without pilots, i.e. drones. That was bringing in some publicity for the school, and at an exhibition in Asia, I came across a few young guys – air traffic controllers and a scientist – who had this idea for a traffic management system for drones. They already had a good prototype, which apparently had won some international prizes. They wanted to create a company and asked if I was prepared to be their CEO. I thought, “Well, this is a good idea!” I looked at the technology, what they were doing, and their plans and ambitions. That was in July three years ago, when I decided to join in as a CEO and shareholder. The company was started a month later, and two months after I started to work full time for Unifly. I had to unwind my function as CEO of the flight academy, so I handed that over to a successor, then started to work on the Unifly initiative full-time in October 2015.

Q:  We are experiencing a renaissance of innovation – digitalization, artificial intelligence, autonomization,…. How do you see Unifly within this broader picture of innovation and what’s going on outside of your immediate area of play?

I’d like to think that we are a ground-breaking company. We are very innovative. If you look at what is happening in the world, there’s a fourth Industrial Revolution going on whereby many activities will be driven by robotics and artificial intelligence. We are very much a part of that.

One of the key challenges that exists today is that you have this drone technology which is advancing at a very high pace – and everyone knows that drone technology and robotics are going to be very important – but specifically with drones, they are coming into a world where there is already a lot of traffic. Drones will have to comply with the regulations and rules of the aviation, so it remains safe.

The challenge we have, and I think the entire industry has, is that on one hand you have the world of aviation, which is very safety-driven, but air traffic controllers and pilots have never had to deal with drone operators. On the other hand, you have drone operators who have never been aware of the regulations and the rules that exist in aviation that make it very safe, who now want to have access to the airspace. So we have two different worlds: one relatively conservative world driven by safety, and another world which is innovative and moving very fast, not fully aware of all of the safety rules. Marrying those two totally different worlds, that’s the big challenge. But it’s now happening in aviation, and I’m sure that will happen everywhere in the world.

Look at all the challenges that are now present in the world of autonomous cars, for instance. The technology exists for cars to be driven autonomously, but how do you mix the traffic of autonomous cars with the traffic of non-autonomous cars? That’s the big challenge. In the world of aviation, we are addressing this challenge.

Q:  How do you bridge those two worlds? Does it require a change in mindset that the more traditional industries have adopted over time, or do you see the innovators having to adopt a different mindset?

It’s both. Every traditional industry has its way of doing things, which work fine. The aviation industry is very safety-minded, with good ATM (air traffic management) systems and so on and so forth, and that works fine. Now with new technology, there’s this mindset that needs to change.

Two years ago, I was at a big conference where you had CEOs of large ATM organizations, and questions were asked of the audience. One of the questions was, “Do you think technology will change the nature of your industry within the next 20 years?” I was baffled to hear one-third of the audience say, “No, we don’t think that technology will change the nature of our industry.” That, to me, says that within those classical industries, there’s still a mindset among people who do not see that there’s a lot of technology out there that can actually help them become better and automate more processes. And not only in the aviation industry – I think in many traditional industries that’s the case.

Q:  Indeed, we’ve seen the same in the car industry, until Elon Musk came along and introduced the concept of the electronic car and things started to change. Even going back to telecommunications, you had the postal, telegraph, and telephone service (or PTT) – monopoly service providers that the public was not at all happy with for the level of service and the cost. I think, only when that industry was deregulated, have we seen the kind of things that we now have, our smartphones and so forth. Do you see that kind of institutional deregulation having to take place to make real change happen in aviation? Particularly, I’m thinking about ATM and the interfacing between ATM and UTM

It will take place. What is happening is that we, as a company, are creating the technology to provide highly automated air traffic management for large amounts of autonomous devices. That’s what we’re doing. That’s where we’re going with our technology. Once you’ve done that with large numbers of autonomous drones flying in very difficult airspace, low level airspace, it doesn’t take a rocket scientist to understand that you could actually take that technology and start using it for traditional manned aviation. My guess, and I think this will happen, is that the technology we’re building now will gradually – not overnight, but gradually – find its way into the management of manned aviation.

The technology we’re using is vested in Internet technology, which makes a UTM system much more affordable and accessible than an ATM system. The technological change that happened in the telecommunications industry about 30 years ago is starting to happen in the world of aviation. The transformation will be a bit slower than what happened in telecommunications because of the safety aspect. You must be very careful that you do not innovate as rapidly as in the telecommunications industry, because you still have manned aviation transporting large numbers of people in the air. You cannot afford to have accidents. In the telecommunications industry, if you lose a data packet, well, you lose a packet. There’s no harm there. The software will say, “Oh, I lost a packet,” and it will send a new packet. In manned aviation, you cannot lose an airplane. That’s why the transition will be a bit slower, but it will come for sure.

Q:  When we look at the softer side of things – the people element – I would hazard to guess that the way Unifly is organized and how you do things is quite different from a traditional ATM technology company or an air navigation service provider. Aside from the technology, it’s also about people and how we work to get things done. I’m thinking particularly in terms of a more agile approach to software development that’s now permeating to other areas of the business. Do you see change taking place in that area as well?

Yes. To ask me purely from the perspective of the man/machine interface and the world of air traffic management, the user interfaces all assume that the person that is manning the systems has had years of training and is an ATM professional. That means it can be very complex, because the person has been trained.

Now in the world of UTM, you are interfacing with a world of people that have no knowledge, or very limited knowledge, of aviation and air traffic management. Still, you want to give them the same information as is now being used in the world of manned aviation, but in a very, very user-friendly manner. That’s one of the big transformations we are making happen.

Also, in the ATM industry or the aviation industry in general, it is expected that the number of flights will double between now and 2030. Already today we’re seeing record numbers of flights flying through the airspace, which puts a strain on the entire ATM system, because all the procedures in the world of air traffic management are manual procedures and involve people talking to people. The growth of manned aviation will require much more automation than is currently the case, and we’re building the foundation for this with UTM. So, it’s interesting times ahead.

From a development point of view, we use agile software methodology, the same methodologies as are used in developing Internet-type applications. In very short turnaround times, we use a Spring Methodology that enables us to be very quick and still have very high quality.

Q:  So, when you’ve signed up with a new client, such as an ANSP, what would be the average turnaround time to provide them with the necessary tools to start managing, or having some oversight over drones in the airspace?

From a technology point of view, not very much. The fastest we’ve done this is about six weeks. The challenge really is with the organization itself. One of the challenges that an ANSP or CAA (civil aviation authority) has is the processing of flight plans for flight approvals. There is a flight plan system that is used in manned aviation, and it involves a manual process – your flight plan gets looked at by someone, and that someone approves it. That’s based on a certain number of flights per day, per week, and so on.

Now with drones, what we’ve seen initially is that the ANSPs and the CAAs have wanted to use their existing processes of flight approvals and apply that to drones as well. But, guess what? They did not anticipate that the number of requests for drone operations would be much, much, much higher than the number for manned aviation. So, what we are providing are the tools to automate a lot of the processes within an ANSP and a CAA. However, the organization has to accept it and processes have to be created or modified so that they can work with these new tools. The delays we see, or the length of time it takes to implement our software, is not technology-related, and we already have quite a bit of technology available. It’s about presenting the technology to the client, having them work with the technology, and for their organization to define internal processes to make sure that they can use the technology as often as possible. That’s the challenge we have. Typically, we work with an ANSP, and they use our systems for a while in tests and trials – not to test and trial the technology itself, because it works – but to test and trial their internal procedures, to decide who will do what and who will have what responsibility, and how to manage the different users of the system.

Q:  Would you say that it’s then a bit of a journey for the two partners – Unifly and the client – towards solutions that are needed as part of an iterative process? In other words, there is a tendency within traditional businesses to want to buy a complete system or a complete solution as opposed to pursuing a more agile methodology of iterative testing and development. Is this mindset something you’re up against with some of the more traditional organizations you deal with?

No, in fact what we have is a complete system. But, implementing a complete system is a big, big task and we’ve created a methodology to implement the system in phases. The first phase is always, get the public informed about aviation rules and regulations, and where a drone operator can and cannot fly. That’s something that can be turned around very, very quickly. That’s usually the first phase.

The next phase is getting people to issue flight plans. We build function after function so that ultimately you get a full-blown system, possibly after a year or a year-and-a-half. The initial implementations can already be available after a few weeks. So, our experience is in fact that the ANSPs tend to want to work in a phased approach where they say, “Okay, in phase one we want to do this, then in phase two we want to do this.” The only problem with such an approach is that sometimes – as we’ve seen in other industries that have taken this approach – you can end up with piecemeal solutions. For example, just for providing information to operators they use one vendor, for tracking they use another vendor, and then for other functions, other vendors. So, they end up using isolated solutions for individual problems without thinking of the bigger picture. This usually means we have to convince an ANSP to think of the bigger picture and make sure all of the problems they want to solve are addressed in an integrated fashion rather than having a series of piecemeal solutions.

Q:  So, it’s really about the partnership relationship you build with your clients that is quite important. Having that trust there, I think would be a key issue for evolving the solutions that may need to be built. Would that be a true statement?

Yes, that’s very much a true statement. The entire process of implementing a complete UTM system with an ANSP is quite intense. Luckily we now have experience with several customers. We also are involved right now in several research programs in Europe that deal with UTM. We are seen as a company that knows about drone traffic management. We know about manned aviation because that’s the world we came from. So, we are seen by large organizations – ANSPs and CAAs – as a valuable partner that can actually bring a lot of value and knowhow to the table, helping them to tackle this quite complex UTM problem.

Q:  You’re not the only game in town, of course. There are other UTM providers. Do you see potentially, not necessarily a monopoly service provider model develop, but more of a competitive landscape where you have different systems within a certain geographic region – much like you have with the mobile phone networks where you’ve got a federation of systems able to interface with each other? Do you see that kind of a model develop eventually?

Ultimately, that will be the model, but it will take some time. The system and technology that we have developed takes that in mind. There will be in an area in a country, in a region, where there will be multiple UTM systems. So, we’ll be able to say, “Okay, I want to be a customer of A or B or C.” There will be different levels of service or different services that people can buy from different UTM service providers. Specifically, in the United States that is the model that has been chosen from day one. In Europe and other parts of the world, it’s first and foremost the ANSP that wants to make sure aviation safety is guaranteed, so they take the initiative. But ultimately, there will be a time when multiple UTM service providers will exist in a country. However, there will always be some level of oversight provided by the national aviation authority.

We must remember that the aviation authorities have the responsibility for ensuring the safety of the airspace. This responsibility does not just go away with the advent of drones. On the contrary, they now have an additional problem that they need to solve. Some ANSPs have taken the view that the only thing they want is to ensure everyone has a same exact aeronautical data, and that the ANSP does the coordination with manned aviation and all drone operator interfacing would be done by the UTM service provider. Other ANSPs have said “no” to this from the beginning, and that they want to do all of the interfacing with the drone operators as well.

Q:  It’s been an interesting ride so far, but I’m sure there have been some real challenges along the way. What are some of the lessons learned that have resulted in a different approach than originally thought?

So far, the trajectory has been quite unique in the sense that what we set out to do from the beginning, we are still thinking of doing that. One of the biggest lessons we’ve had is that initially when we started the company, we wanted to build, first of all, a product for the drone users to do planning and so on so forth, but we saw very quickly that that was not the best approach.

The best approach was that first and foremost we have to have a good, solid backbone that will be able to process large amounts of information, and be able to process that information in real time as the system for mission critical applications. Once you have that and you’ve created that as an open platform, then you start adding user interfaces. That’s something we learned after a few months. It’s having that very solid backbone – that open platform – that made us quite successful.

The other thing that we’ve learned is – listen to the customer, listen very carefully to what he wants because he’s very clever. We also learned that as a ground-breaking company – a very innovative company – you must be an evangelist. This is new technology and we’re probably the first to build a lot of experience in UTM. I think one of the roles that we have as a company is to say, “Okay, the management of drones is a very complex thing to do, but these are the ways to do it.”

Q:  You continue to get a lot of interest, I suspect, from other entrepreneurs, but also from venture capital. How does that aspect of the business look for you?

Yes, we get a lot of press, and a lot of interest from potential customers. We literally have contacts all over the world. We get contacted by VCs quite a bit who would like to invest in our company, and by universities and such, who invite me to speak about what we do, how to create an innovative company, and how we get the message out to potential customers all over the world.

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The Building Blocks for Smart Airports

Read Time: 10 minutes

Grant Furlane, CEO of LocoMobi

How license plate recognition (LPR) technology and the Cloud will improve efficiency and provide better passenger services at airports

This week’s interview is with Grant Furlane, CEO of LocoMobi. Grant has over 35 years of experience as an entrepreneur in the technology sector, specializing in the parking, transportation, cloud computing and network security industries. He has been involved in over 600 million dollars of technology investments and was contracted to lead several initiatives for large public IT companies. He aggressively built three transportation technology companies that established the vanguard for tracking and monitoring vehicle movement, and developed and sold integrated control systems for major airports, hospitals and parking lot management companies.

Q: How did you get started and what got you going?

I’ve never really worked for anybody. I came right into being an entrepreneur from day one. But what got me into infrastructure – believe it or not, this is about 25-30 years ago now – is that I felt we were in trouble. At that time, I was really intrigued with the world of transportation, congestion, and how we were going to deal with the problems I’d already seen in places in Europe. I had co-founded the World Symposium of Intelligent Transportation Systems (ITS) in my late 20s, early 30s and there were three of us involved then. I think that forum has now grown to a membership of about 10,000 strong.

At that time, it was my feeling that to be more efficient in the transportation sector, we had to find ways to be more efficient in moving cars and people. And so, during the first 20-25 years of my career I developed companies that revolved around being more efficient in moving cars and parking cars, which is now leading me into an area that I have always had a passion for – how to manage the transportation infrastructure.

The problem was not that it couldn’t be done, but that the technology just did not exist to form the needed communications infrastructure. As it is still today, if you want to go from one building to another, you’ve got to go into a parking garage and take a ticket or use an ID card. If you want to go to yet another building, you will need yet another ID card because it could have a different building owner, and a different parking garage operator. If you go onto a toll highway, you need yet another pass. When you get on public transit, you need another pass….

Alternatively, if I could find a token as a unique identifier that you could pass around, then you wouldn’t need multiple passes. So, 20-25 years ago the only token available that could be moved around was a license plate. The problem was that the technology to get read rates high enough to make this plausible did not exist. So, for years and years I worked on different algorithms to improve performance – both in terms of speed and accuracy of license plate recognition (LPR.)

Then more recently, the cloud came about which allows a plate to be recognized anywhere, anytime, in real time. Both technologies had to work together for this to really work. And that is, scan a number plate – the unique identifier – and move it around via the cloud.

While I had been developing all the hardware, there was no enterprise hardware that could connect to the cloud directly. So, I designed and built it all – the payment terminals, the payment kiosks, etc., so that we could have an integrated solution. At the same time a fellow named Barney Pell, who is one of the most innovative people in the world, was working on a mobile way for people to pay for transportation and he started with parking as well. However, he was not getting any traction. He had heard about me and got in touch. I looked at his business plan, and said “the software is good but you will need to pivot to a different plan to hit the expected numbers” So, I helped him design some technology that would work with his software and we went out and patented the thing we called Card Kit and Gate Kit, which essentially allowed a cellular phone to find your location, and then when you pay, open the door or a gate.

We now started to see revenue, but it wasn’t very big. So, Barney then convinced me to merge and we formed what is now LocoMobi. A month later in May 2014 we went to the TiE50, which is Silicon Valley’s premier annual awards show for early stage technology startups, and we won. This followed with 2nd place in the “Smart Building” International Startup Competition in Nantong, China. This confirmed that we had leading edge technology as a startup, and so we went out to implement, not forgetting that my goal had always been to be in parking, transit and tolling – anything to do with managing people and transit, cars, trucks, toll highways, and parking. As we’ve become successful on the parking side, landing two huge contracts with Park ‘N Fly and WallyPark for airport parking, we were offered a tender that no one else could do, which was for the Chicago Skyway Toll Bridge – a 7.8-mile-long toll road built in 1958 that connects the Indiana Toll Road to the Dan Ryan Expressway on Chicago’s South Side. This launched us into tolling one year earlier than planned. And, we have now launched transit applications just a month ago.

Q: What got you interested in the airport scene?

I’ve always felt that the airport environment was a distinct and different market all on its own, because it has so many moving pieces. Airports are becoming smart cities themselves. Although I could tackle the airport environment for parking, I felt this was too limiting. An airport is very big in retail, it’s very big in customer service, it very big in parking, and it’s very big in so many other things like media and advertising. I’ve been holding back because I want to offer an integrated solution that makes sense for an airport to want to invest. And so, we’ve set out to build upon what we already have as infrastructure, so that we can manage not just parking, but ground-side and air-side transportation.

And there is security, which also can be managed with the same infrastructure. We’ve come from reading license plates to smart plates, for which we use artificial intelligence – machine learning – so, why can’t we go further? And so, we started a new company called Quest Intelligent Technologies that is one of the first companies out with machine vision technology – or artificial vision or vision intelligence – that provides automatic imaging-based inspection and analysis. This involves using cameras and giving them intelligence to see more than we can see with our eyes. By seeing the constant flow of people and/or cars we are able to see differences or anomalies that allows it to be predictable.

The technology is now at a level that we can see so intensively into something that it can actually layer itself into hard matter. For example, the vision intelligence cameras that we’re testing now can get about seven layers into your clothing. So, let’s pretend a guy walked into the airport in today’s world and had a gun. We would catch that as soon as he walked into the airport. Forget the security screening areas. You can’t afford to do that with all the people milling around. You need to catch the suspect right upon entry. So, this is using CCTV and vision intelligence. It allows us to see things and predict things. In addition to that, I can cover the entire ground side. Why is that car circling over and over? Why is that FedEx truck there for three hours when it’s supposed to be there only three minutes? With all this different information, you can manage the ground side traffic movements.

And, of course the parking is obvious – it’s what we do now. For example, what happens to my car when I drop it off at the valet service? Does it actually get to the garage? We make sure it does. As soon as we take a picture of the plate, we are watching for that car to enter the garage. We can make sure no one’s switching cars and doing things they shouldn’t be doing. Again, all this data is hosted and shared in the cloud.

Likewise, on the airside we can track assets. Why are there three planes in this area on the tarmac? Why is this delivery truck where it shouldn’t be? We can do this since from quite a distance we can read serial numbers, and we can even visualize differences associated with the asset. Like, why are there three people on that cart when there should only be one? With vision intelligence and machine learning, the possibilities are endless in creating what we can call a smart airport, just like the smart city concept. With the smart city, data are collected from citizens and devices using sensors integrated with real-time monitoring systems, that are then processed and analyzed. The information and knowledge gathered are then used to tackle inefficiency, and enhance safety and security. Technology and digitalization has allowed this to become a reality. It’s a great story.

Q: What are some of the bigger challenges that you’re facing in implementing this vision?

For a person like me who’s always working on the edge, the biggest challenge I have is in introducing change. People are very, very nervous about making changes. And airports have probably been the hardest. Most feel secure when everything is hardwired throughout the airport. Cloud computing as an IT paradigm is still not readily accepted, while for most businesses if you don’t go to the cloud, you’re probably not going to be in business for long. There’s been a real challenge at the middle management level and in the IT departments to accept where everything’s going. By going to the cloud, in many cases, you can eliminate half the IT department. Making such a move can make the operation twice as efficient. The return’s immediate as far as the investment is concerned. And the results for the operation are even better. Now you’re getting real time information and the ability to predict stuff. However, because it can be such a complicated presentation, we really need to get to the right people to show them what the technology can do for them. Then again, five years ago I couldn’t convince people to use LPR for parking management. Now it’s the standard in every single request for proposal (RFP.) People thought I was crazy at the time!

Q: The RFP process – it’s one of those things you come up against when you’re dealing with government organizations, which airports are for the most part. What’s been your experience with this procurement culture?

It’s primitive. Let me tell you why. You have people who have all this infrastructure already built in the airport, and they’re afraid to move away from it. So, when it comes to procurement, they end up asking leading edge technology companies to move backwards! They will ask vendors for a certain technology because that’s what they have. And they have relationships with the people who put that in. But here’s the biggest problem. And we all see this all the time. Typically, in order to bid on an RFP, you must reference up to five installations that have been running for five years, etc. Well, this means that you will have legacy technology. It’s like saying, “If you have anything new and innovative, you can’t bid it.” I come across this time and time again. The innovative companies that can provide most value in terms of new concepts and technologies are simply not given the opportunity to enter the market, because of this old-style procurement practice of very prescriptive RFPs.

Q: How have you been able to get around that? Would partnerships or joint ventures with established companies be a way forward for you?

Absolutely. Our approach has been to go out and talk to innovative owners; people who have money in the game. When you are a startup or inventor, you need partners not just customers who are prepared to work the good and the bad with you. Because there are tough times when you’re developing technology. Whether it be Bill Gates of Microsoft, or Steve Job of Apple, or Henry Ford, it doesn’t matter. You are going to fail and gain, fail and gain. But when you have partners who believe you can get to the goal line, it makes all the difference. So, we said, “Okay, let’s go after innovative clients – clients who would listen.” And, we also decided to pick up a couple of big ones.

So, the first one I went after was Park ‘N Fly in Canada. Why? Well, I knew who they were, they knew me, and they were bought by CKI, one of the biggest infrastructure funds in the world. As a result, it didn’t take much more than three weeks to convince them to go with LPR, automated payment, mobile transactions, everything, and all cloud-based. So, we probably concluded one of the biggest parking contracts ever, in short time, covering every major city in the country.

Now that we had a reference from seven city airports, we went south and did the same thing with a company called Wally Park that is actually bigger than Park ‘N Fly and we got 21 locations in the US. Technology acceptance is usually the biggest challenge, but suddenly we were gaining traction and the reaction I was getting was, “We get it, Grant. We’re prepared to take the risk.” What got us there quicker than most startups is that we got validation. We won the TiE50 for having one of the best technologies in the world. Then a week later, we won the Smart City competition in China. So, that was the route we took. Further, we created probably the most incredible board there is of any small company, and we brought in people from the industry. That gets you business and that’s what you have to do as a startup. Today – only two and a half years later and now with 40 employees – when I’m bidding for a contract, I have prime, platinum references.

We are still called a startup, but we don’t operate like one. We grew much quicker. We hit profitability near the end of our second year. It’s a much different company today. And all my other companies operate the exact same models – they all have one thing in common. They all can manage on my infrastructure.

Q: What would be your top three bits of advice you would have for any future entrepreneur?

The biggest one – and I’m going to write a book on it – is the word ‘Entrepreneur’. Don’t use it lightly. Entrepreneur doesn’t mean raising a bunch of money and spending it. You have to live it. You have to sacrifice. You really need to feel it, and have the passion, and that’s what a lot of people lack.

An entrepreneur is not a guy who goes and buys a Mac’s Milk or a 7-11. That’s a small business owner. An entrepreneur is a guy who has an idea, and literally will do what he has to do to make it a reality. When I met my wife, I was living in a campground, by choice. I had no money and I wanted to develop my first idea. I wasn’t trying to raise money so I could buy a $3 million-dollar house. That’s not an entrepreneur.

The second thing I’d tell everybody – and this very important – failure is not an option, because there’s no such thing. People will ridicule you and say, “He’s crazy.” You don’t fail. You experience. Everything you do, you build upon. And if you keep the focus, if you truly do it, I mean really keep the focus, you’ll get there. But then it goes back to what is a real entrepreneur? It’s a guy who won’t give up. He’ll be the last guy standing in the plant. He’ll be the guy at home working because he had to lay everyone off. If you don’t give up, there’s no such thing as failure. Most people don’t realize that 99 percent of the companies that fail didn’t realize how close they were to success. They just gave up. Unbelievably, they were almost there. But, that last one percent is the killer for all of us. I’ve never felt I had to give up, ever. There’s always a way.

And the last point is the most important. Be prepared to pivot. I don’t care how good you think your idea is. Don’t stick to it just because you think it’s great, and it has to happen. Don’t be afraid to pivot. Some of the greatest companies in the world started out with one thing, but found another opportunity through it and pivoted, and subsequently were very successful.

Intelligent Solutions for Superior Airport Performance

Read Time: 5 minutes

Christian Onselaere, CEO of ADB SAFEGATE

Helping airports handle more air traffic with their existing infrastructure

This interview – conducted jointly with Momberger Airport Information newsletter – is with Christian Onselaere, CEO of ADB SAFEGATE, a leading provider of intelligent solutions that deliver superior airport performance. The firm provides integrated solutions for the airfield, gate and tower, to improve an airport’s capacity, safety, and efficiency, which requires the involvement of multiple stakeholders – the airport, ANSP, airlines, aircraft handlers, and others – to create a collaborative decision-making platform. In May 2017, The Carlyle Group bought ADB SAFEGATE from PAI Partners, which had previously bought ADB from Montagu and then supported ADB to acquire Safegate International and to form ADB SAFEGATE.

Q: What sets you apart from other solutions providers in this space?

We see ourselves more than ever as an integrator of end to end solutions with a clear focus to optimize the processes at an airport and thus increase the airport’s efficiency considerably. This efficiency has a direct impact on airport and airline operations whether by decreasing turn -around time, increasing the number of slots or cutting down on processes that do not add any value. Airports often do not have the physical or financial means to just expand, re-design or redo parts of the airport. Airports need to operate smarter, by moving away from the siloed systems and toward solutions that work across all key operations across the airport. What sets us apart is that we have built up an impressive resume through our turnkey projects where we have gained wide experience, not only with our own solutions, but also with leading third party solutions covering the tower, gate, airfield and services. Unlike some other vendors on the market, we have a long history of developing innovative solutions in collaboration with our customers, this strongly decreases our dependency on third party suppliers and allows us to have a tight control of all the elements influencing our customers’ operations. Our company is a big player in the aviation market, but at the same time, small enough to give our customers that personal care they need, supported by a very broad range of competences that we have built up with our teams.

Q: Would you say that China, and Asia more generally, is where most of the future business will come from?

China is indeed an important market for us, it has taken us a few years to crack the code but I can now proudly say that more and more airports are selecting ADB SAFEGATE as a key supplier. We were the leading supplier in China already for our advanced visual docking guidance systems (A-VDGS) and apron management solution with over 1000 A-VDGS sold and installed guaranteeing increased safety on the apron.  Our airfield lighting solutions are now being implemented at the country’s leading international airports, like recently with the New Beijing Airport. So, yes, China is a key market where we are now successfully expanding our presence, but let’s not forget that there is so much more happening, whether in the rest of Asia where we see a lot of movement on key markets like Japan, Indonesia, Thailand, Malaysia and Australia, or the Middle East or Latin America. The Middle East is really ADB SAFEGATE’s home region, after our historic strongholds in Europe and the US. In the Middle East we see a lot of similarities like we see in Latin America. Important projects that need more than the pure product approach, where we are supporting customers by analyzing how they can improve operations and support them with our global experience managing complex turnkey projects.

Q: What challenges do you face to orchestrate solutions that will work for all, stakeholders? Who is the ultimate customer?

The ultimate customer is always the end customer, the traveler who is only looking to one thing, making sure his trip runs smooth and on schedule, without any hassle or issues. When we unite the necessary stakeholders around the table, their focus is to improve the overall efficiency of the airport and the traveler experience. I agree that many airports still suffer from silo thinking, but I also see a strong will at all airports, airlines, ANSP’s etc… to better collaborate to see the big picture and find solutions that will lead to that improved airport efficiency. In this exercise, we need to have all involved – whether airport management, airlines operations, airfield operations, the ATC or the terminal manager – focused on one clear picture of what the ideal airport looks like and the steps we can each take to contribute to getting there, often in phases depending on priorities and investment capacity.

Q:  How important is involvement of the safety regulator (e.g. the CAA) in the solutions that ADB SAFEGATE may be able to implement?

We involve all key stakeholders when revisiting the airport’s performance and seeing how we can further improve. In the case of Lahore, the CAA played an instrumental role. We would have never been able to increase capacity, or even accommodate diversions from neighboring airports, if it were not for the support of the Pakistani CAA. In Lahore ADB SAFEGATE worked closely together with the airport and Pakistan’s Civil Aviation Authorities to increase airport performance and upgrade capacity to beat the challenging foggy winter climate. We integrated a complete system from the runway to the tower and we were able to radically improve the airport’s availability or ‘weatherproofing’ it as we say.

Q: What new innovations or product upgrades do you have in development?

We have prepared a very interesting set of new innovations, all related to increasing the airport’s efficiency to the fullest. Highlights from ADB SAFEGATE include:

  • The launch of an enhanced Safedock visual docking guidance system which integrates docking, gate and apron control, surveillance and monitoring systems to improve the efficiency and accuracy of aircraft gate arrival, turnaround and departure. Our new system also helps to enhance apron situational awareness and safety and is built on the experience and expertise of ADB SAFEGATE, which has supplied more than 7,000 docking systems worldwide.
  • Our leading LED technology, which is deployed across airfields globally with more than 1.2 m LED fixtures installed. ADB SAFEGATE has supplied two-thirds of the LED systems at more than 700 airports, showing how airports everywhere have switched to this energy efficient lighting technology. ADB SAFEGATE offers the only full LED portfolio of lights and visual aids proven to deliver energy and other cost savings adding up to millions of euros annually.
  • The new Pushback Support Tool that simplifies air traffic control (ATC) workloads and enhances airport safety and efficiency. The tool automatically suggests the optimum aircraft pushback routine, monitors the pushback procedure and warns ATC of potential conflicts with other aircraft or vehicles in the apron area.
  • Also new is A-Lytics, a data analysis solution that provides airport managers with new insight into how well operations are running. The system reveals operational performance related to the airfield, tower and gate, such as aircraft docking times and on-time turnaround performance for departure. Airport managers can now more easily see and fully understand what is happening, how they can improve efficiency and what solutions can be implemented to increase the airport’s performance.
Q: Will the recent change in ownership see a change in direction or focus?

New ownership will not affect our strategy, our approach in the market or our Mission, Vision or Values. We will continue to realize the goals set forward as part of our strategic focus, e.g. build for the future with Airport Performance Solutions, remain a leading innovator in our industry, provide excellent service, create an inspiring working environment and accelerate wherever possible with targeted strategic mergers and acquisitions. More than ever, we want to be the key integrator of choice for airports, maximizing traffic throughput and minimizing the time aircraft spend on the ground while maintaining the highest safety. We support our customers by integrating airfield, gate and tower systems, enabling all parts of an airport to work together as one to increase airport performance, from approach to departure. Our new owner fully supports our company’s strategy. This doesn’t mean that nothing will change. Changes will focus on reinforcing any shortfalls and on creating even greater potential.

Aviation – An Industry Ripe for Disruption

Read Time: 11 minutes

How a technology company is revolutionizing aviation efficiency through better data management

This week’s Vantage Point interview is with Ian Painter of Snowflake Software, an award-winning provider of cloud and on-premise software solutions for the aviation industry, which he co-founded with Eddie Curtis in 2001. Its Laminar Data Platform is the world’s first commercial software platform dedicated to fusing, cleaning and organizing the world’s aviation data and making it available in real time. Ian and Eddie had been working for Ordnance Survey of the UK for several years before they decided to go off on your own to start Snowflake Software.

Q:  What got you started and what was the problem you were trying to solve?

So, it’s quite an interesting story really. My whole career’s been involved in data management, and at Ordnance Survey – the UK’s national mapping agency, which is the equivalent of the US Geological Survey – Eddie and I led a flagship program called OS MasterMap, which provides highly-detailed geographic data of anything bigger than 20 centimeters on the ground. So that’s a database with nearly a billion features in it. At the time, we built the largest spatial database in the world.

When the program was delivered in 2001 we resigned from our jobs to set up Snowflake, but the interesting part of the story is we actually resigned on September 11, 2001 which was quite a monumental day to start your own business. I mean, in the morning everybody was gossiping in the office that Eddie and I had resigned, and then in the afternoon the actual realization of what had happened in the Twin Towers brought everything down to a big bump. My boss at the time instantly said, “Well, the industry is going to collapse,” and it did. The IT industry in the UK pretty much collapsed within about three or four days. The consulting day rates and everything just tumbled.

But we decided to push on. We were very niche, focused on managing map data in big spatial databases. It was really the first time people were considering maps as data that could be analyzed and queried to get business insight from. This was a substantial change from when digital maps were just and efficient way to print paper maps. This is very similar to aviation, where you have a huge amount of aeronautical data, the sole purpose of which is to print a paper AIP (Aeronautical Information Publication), or a paper chart. Aviation hadn’t yet taken that journey, moving from products or paper publications to actual data sets – and aviation is still in the midst of that transition.

When we started we were very focused on local government in the UK – nothing to do with aviation. It was all about managing spatial data and databases and we created our first software product on the back of the work we’d done at Ordnance Survey. The idea was that anybody who knew something about databases could use our software product to manage spatial data and anybody who knew something about spatial data could use databases to manage it.

So, it was like trying to glue those two fields together that previously had been very separate. We were trying to bring spatial information closer to mainstream IT standards, rather than spatial information needing its own types of databases and its own type of software, which at the time they called “GIS,” geographical information systems. We were just saying, “You’ve got all these things like an object-relational database management system as developed by Oracle, and they have started introducing location-based data types, so why would you need something special? People don’t think that a string or a number type is special, so why should spatial data be special?” We were trying to produce a product that would simplify and commoditize spatial data and make it easy for people to manage.

And, we had a reasonable go at that. I mean, Snowflake started in 2001 and for the first 11 years we were 15 people doing around 1.5 million in turnover. It was doing okay for a business, but it wasn’t really growing; we were adding about one or two people a year.

Then we got to the stage where FAA and Eurocontrol were looking to introduce more standardization, the whole idea being how we could bring more mainstream technologies and non-industry players into the industry to try and expand the supply base and create more efficiencies. When you come from the outside and look at the air traffic management (ATM) industry, it’s incredibly proprietary. And it’s got a very, very narrow supply base.

So we applied and worked in some research programs where FAA and Eurocontrol were actively looking for players who weren’t currently in the aviation space, to work with a whole load of new standards they were planning. And we were able to – at the time – take our technology from the UK local government space, and within four or five days adapt it to work with some of the new aeronautical standards.

Once we did that and found how easy it was – mainly because FAA and Eurocontrol were taking the step to try and make things simpler and more mainstream – we started to think, “The aviation industry is incredibly proprietary. It’s very monopolistic. It’s very ripe to be disrupted. It has a huge amount of inefficiencies, and it’s very behind the technology curve.” And so, we were looking at that, thinking “It’s a global market, and growing. And, it’s much better funded than UK local government, which is getting budget cuts year on year.” There was much more of an opportunity to make a big difference, both from a financial perspective, but also from a societal need to drive efficiency and drive down environmental impact – all these things, by applying what is basically mainstream IT best practice. And so, we saw that opportunity and then jumped into it. And that’s how we got into the aviation space.

Q:  What was the early success story in terms of getting your “foot in the door” in the aviation industry?

We started doing bits of research for Eurocontrol, building prototypes for the new standards. And, then the SESAR Joint Undertaking created a competition called “SWIM Masterclass.” So, we approached NATS saying that we would like to work with them on this. At the time, they had an idea for extended arrivals management, which was an idea of creating an open interface on top of the Heathrow AMAN System and then sharing that data in a standard way to adjacent ATC centers (dubbed the XMAN project.)

To get a foot in the door, we offered to do that work for free. I think it cost us about 60,000 pounds to build the prototype, and NATS provided some subject-matter experts to help us. We built it and ended up winning the SWIM Masterclass for the first year. We had been up against some big players, we came out of left field and nobody really knew us at that time, so to win the prestigious award was amazing. We were very grateful to NATS for providing the idea, but they were also amazed at the speed with which we turned that around. We built in about five to six weeks.

The difference was that we did it in an Agile way, employing Agile SCRUM methodology to software development. NATS had never worked like that before. The idea was that we would be dropping what we call ‘thin slices’ of the system to them every two weeks, in a very transparent manner. We did three sprints, and were dropping the live system to them pretty much on a daily basis. This idea of continuous deployment and continuous integration is considered mainstream among software developers like Facebook and Google and all them use all the time.

In this scenario of developing the prototype, for which we won the award, we then went straight into a production pilot with a major UK Airline involved. We managed to get that pilot running pretty quickly, within a couple of months, and almost within another couple of months of it running, the airlines that were involved said, “Look, we’re making really good fuel savings here. You’re making a big difference to us. We want this to go to production.”

So, NATS went through an internal business case and gave us the go-ahead for the production system to build. And, about six months later we deployed that into their CTC (Corporate and Technical Center), which is their production environment. So, we’d gone from research idea to production deployment in a span of nine months. From an industry perspective, this was just unheard of.

And then, the XMAN project won a whole lot of awards and got media attention, because anybody’s who’s flown into London just hates going round and round in circles in the traffic stacks. I think we saved five million pounds of fuel for the airlines in the first year, which are a huge fuel savings.

The whole experience showed that you could do things very quickly, just by the simple means of taking an old legacy system and wrapping it in a modern interface, enabling other airspace users to get insight into the data that previously only NATS had. By getting that insight, the adjacent ATC centers could now make simple decisions to slow down a flight, knowing that – if it were to carry on at its current speed – it will be put into a holding stack when it would enter UK airspace. So, if you slow it down earlier, it burns less fuel and it’s much better from a safety perspective. Also, from a passenger experience, it’s a much smoother flight and a lot less frustrating. And then from an airline’s perspective, they save a load of money on fuel.

From there we started really growing as a business, building smaller production systems for other ANSPs. We have been trying to move up the value chain, so to speak, each system at a time, but that was the first one.

Q:  The ATM industry is beholden to proprietary systems. Do you see that changing, now that people see the realm of opportunity?

I can definitely see that changing from when we got into the industry some four years ago. You now see several forward-thinking ANSPs such as the UAE’s GCAA, NATS, US FAA, Skyguide, DFS of Germany, Airservices Australia, and Airways New Zealand trying to open the industry up, particularly around initiatives such as SWIM (System Wide Information Management), which is mainly where we focus our business. That’s all about trying to standardize the way that data is moved from system to system and organization to organization.

As soon as you start having those open interfaces, it provides an opportunity for someone like ourselves or any new player to come into the industry. Whereas previously, because the industry was based on things like AMHS (Aeronautical Message Handling System) or AFTN (Aeronautical Fixed Telecommunication Network) for the exchange of digital data, which is a completely proprietary network technology, you had to have a physical metal box to get access to the data, which costs several thousands of pounds.

So, there’s been a natural barrier in the aviation – in the ATM space – that stops smaller or newer players from coming into the industry. For ourselves, we came in and focused on the newer parts of the industry that was much closer mainstream IT technology. So, this was standards, web services, XML, open interfaces, and the NextGen view of the world. That enabled us to start building prototypes, get quick results, and impress customers. It enabled us to build a business around a “new world view” if you’d like, the new more-open ATM space.

I think what is surprising is that we expected the industry to move towards that new world a lot faster, because you can see the savings that are possible by just buying off the shelf software used in other industries. Suddenly, for the first time you can buy something from a non-aviation provider and get a lot of economies of scale. This transition is definitely accelerating at quite a pace now, but I think we were expecting it to open up a lot quicker.

Q:  What are some of the changes that need to happen, in your opinion, in terms of the current supply base? How do you see the market evolve?

What surprises me is how narrow the supply base is. I mean the supply base is tiny. But, I think that’s definitely changing. Certainly, from our perspective, coming in with new ideas and not having any legacy is in some ways to our advantage because we can just jump straight into the new. I think that has enabled us to grow significantly in the last three years.

Q:  What does that mean for procurement practices, which can be quite cumbersome? Do you see changes there?

That’s a really good discussion point. There are two things I think: there’s the practices of procurement; and then there’s the practices of implementation – the systems engineering process that exists over the life-cycle of the safety critical or semi-safety critical systems.

When you talk about the procurement side, because the industry has been incredibly proprietary, it favors these big, monolithic boxes, whereas in most modern industries there’s a much more collaborative relationship with the supplier. It’s less arm’s length and a lot of more Agile.  Currently most RFPs in the industry are fixed-price and Waterfall contracts that define thousands of requirements upfront and only deliver the business benefit at the end when all those requirements are complete.  Given the complexity of the problems in the industry, no customer truly understands the problem in enough detail to make this successful, so more often than not the supplier has to absorb the risk of the requirements being wrong and potentially make a loss on the project. This traditional type of procurement results in a very narrow supplier base who build a different “black box” for every customer with millions of pounds of services work.

Changing the procurement practices of the industry requires a change in mindset. It’s a case of “we’ve always done it this way, so we’ll continue that way,” which actually causes a major problem for the industry, as it just permeates more black boxes that cost millions to build, tens of thousands of pounds to change and more than six months to deploy that change. So, I think we’ll see a lot of change from a technology perspective but unless the procurement and system engineering processes change around it, it’s going to hold the industry back from realizing the benefits.

Q:  What advice would you have for future entrepreneurs entering into the aviation industry?

We’ve found that it’s best to start up a business with a domain expert. Domain expertise is huge. We’re four years in and now we’re very different because we have a pilot, and an ex-air traffic controller on staff. We’ve now hired domain people, but it took us a long time to learn the domain. Technology-wise, you know there are some really interesting problems here and they’re actually really complicated. But lots of people can solve problems. Not knowing the domain it was hard, because when you come across customers they talk like everybody knows what it’s like to be an air traffic controller or a tower operator. They talk in almost a cryptic language. And if you don’t talk in that language and understand the operational domain itself, you are going to struggle. I think it took us three years to get really, really, really into the detail of understanding the operational domain. So, that certainly held us back in the beginning.

I think you also must be realistic that the larger players are going to continue to dominate the industry. There are some larger players out there that are changing and are trying to bring in change, and you must be able to work with them and respect what they bring to the table. So, certainly getting some good relationships with the big system integrators is key as well.

We are relentless at trying to change things. So now there’s getting quite a few vocal ANSPs out there trying to change the industry, and trying to commoditize it, so it’s important I think to just keep pushing on. There are different ways of doing it; you don’t have to keep doing it the same way. You know, you can do things differently and still achieve the same safety output, the same data quality that’s needed, you can still do that and trying to bring more mainstream practices or more modern practices into the industry will be a good thing for everybody. So I think that’s a key thing. You’ve got to be relentless at, for us that’s our edge, is that we’re trying to be different in the way that we deliver operational systems.

Q:  What are your future plans; what’s the next step in your journey?

We won a flagship system with the GCAA in the UAE called SWIM Gateway, which will be a key piece of regional infrastructure for the Middle East. It’ll bring together the three main carriers of the Middle East with six airports and several other key stakeholders to create an information exchange hub.

That’s keeping us busy right now. From there we’re starting to get more involved in linking airports and airlines and ANSPs together. Previously, we had been focused on ANSPs only, and we’re starting to get good traction in that market right now. But it’s very important, we think, to start bringing in A-CDM by linking airports to ANSPs and airlines to airports. So, we’re expanding our core business out by trying to link those three together.

From a research perspective, we’re very interested in the data analytics side of things. There are a lot of people doing that, but it’s interesting because we’re working a lot on harmonizing multiple sources of data from lots of different organizations into one source. Because the industry has been very siloed, once you have the harmonization standards you can start bringing data together and running analytics on the data. That’s never been done before. And, it can start solving some problems in a reasonably straightforward manner, using analytics tools. So, we’ve been doing quite a bit of research into that side of things.

We’re also considering a different kind of business model where we embed our technology into a partner’s, rather than solely doing direct business. So that’s something we’re experimenting with as well. There’s lots of change and lots of growth to deal with, and we’re now actively seeking investment. That’s a big change in view of the fact that we’ve grown organically, with Eddie and me still being the major shareholders. So, that’s going to change for us, but to carry on growing we need external funding to keep pushing on.

Travel Industry Adoption of Digital Wallets is Ready for Take-off

Read Time: 7 minutes

How one company is helping to turn the smartphone into a digital engagement tool

This week’s Vantage Point interview is with Andrew Phillips, Director and Founder of Flon Solutions  –  a start-up based in Lausanne, Switzerland founded in 2012. Flon Solutions provides everything to turn smartphone digital wallets into customer engagement and marketing tools.

Q:   You started in telecommunications, and then decided to go off on your own. What was driving you in this and what was your vision?

I’m an electronics engineer by training and worked many years for a large European telecom operator, Orange. It was part of France Télécom Group (now renamed as Orange), which has operations across many countries in Europe and Africa. I had several project management roles and increasingly reported into head office functions – including the IT & Networks and Devices divisions.

These days the most popular smartphones are iPhone or Android, but a few years ago there was a much larger portfolio. Orange was buying and reselling €5+ Billion devices to their customers each year. This was a portfolio of around 130 devices that largely changed every quarter. So, picking the right device for the right customer segment, making sure that you’re giving them something to maximize their customer experience, was really important.

I worked with a team to analyze the specifications, features and pricing options for all upcoming devices from various manufacturers and match them to the right customers and assist in quarterly purchasing decisions for each country and segment. That was quite a challenging job. So, when I decided to leave Orange to start my own venture, I applied these data analysis experiences to customer engagement.

Then in 2012, Apple announced a new digital wallet application originally called Passbook. I thought “this looks nifty” and realized it was a great way to follow your customers’ behavior when interacting with your organization or brand.

In the airline industry, Passbook became quite popular – especially for e-boarding passes. Most airlines around the world now support digital wallets as a convenient, secure and standard way to present boarding passes to their passengers. They’re quick and easy to use at the boarding gate.

Passbook has since been renamed Apple Wallet and clone applications are available for Android. It’s also great for things other than boarding passes – coupons, event tickets, gift cards, loyalty programs and more.

So, Flon Solutions provides everything to create and manage digital wallet programs for customers and staff. We make it really easy to set up, distribute, and control these programs, and then measure how effective they are.

Q:   What’s it like switching from a corporate environment to now being an entrepreneur and running your own show?

It’s certainly very different from working in a very large company like Orange. You have to wear every hat there is, instead of expecting that someone else is managing sales or finance and you can just concentrate on technology or R&D. Now everything’s up to you and you quickly realize that sales is the most important thing.

There are a number of companies building products and services around digital wallets – though the market is still relatively small. In some cases, an existing IT department or contractor builds a custom implementation. For example, an airline usually already has a large contract with a service provider to manage their bookings, ticketing, billing and so on. And, they will usually engage the same team to add the digital wallet boarding pass functionality to their systems.

Other companies are specifically focused on digital wallet marketing. Some concentrate on the mobile payments side of digital wallets, such as Apple Pay. Others are more engaged with the consumer loyalty side – coupons, loyalty cards, events ticketing, and so on.

We often help our clients to understand the great advantages of using digital wallets to engage with customers or staff. In the airline industry, the use case for boarding passes is well known, but not always for other applications.

A key advantage is that you don’t need to build, maintain and distribute your own mobile App. Digital wallets already have everything you need to easily engage with your audience. To create a really engaging application for your customers linked to back-end web services and databases can easily cost $100+ K of development work.

Then, you have to promote your application in App stores that are already filled with over two million apps – both for iPhone or Android. So, you need to continuously push and maintain your app. Today, most people have stopped installing apps. In fact, 65% of smartphone users now install on average zero apps per month. Instead, they just use a few communication apps like Facebook, Instagram and WhatsApp.

So, we think a better way to go is to use all the powerful features in a platform that’s already installed on every iPhone – and something similar can be installed with one-click for Android users. It’s ready and waiting for any type of engagement program you might be interested in – loyalty programs, membership cards, coupons, events and more.

The nice thing is that the user has a consistent interface. They get a Pass that’s fully interactive, always up-to-date, works in multiple languages, has built-in geolocation or beacon alerts and push messaging. And, colors and logos are easily customized to your brand.

Most airline passengers are enrolled in frequent flier programs. However, many don’t really know how many points they’ve got on their card, what they’ve got to do to get to the next level, when their points might expire, or these sorts of things. This is because they usually have a static account and get occasional updates by post or email. With a digital wallet pass, everything is immediately available and always up-to-date.

Q:   What verticals or market segments have the most potential for adoption of the solutions you’re promoting?

Airlines already have a well-established understanding of digital wallets for boarding passes. They’re not always using it for loyalty programs. These tend to have their own mobile apps that have been developed separately and, consequently, as a customer you end up needing to use several different apps for the same airline.

If you fly regularly, you may even have several airline company apps on your smartphone – all with a different interface. This is difficult to remember and cumbersome for customers to use. So, consolidating these onto the same platform that the passenger is already familiar with for boarding passes is a better way to increase engagement while lowering marketing, development and maintenance costs.

Airports have different requirements. They’d like to provide benefits to their airport shopping retailers to make it easy for customers to find special offers or be encouraged to return, as we have done with our successful points-based loyalty program called StatusPass.

Airports have different requirements. They’d like to provide benefits to their airport shopping retailers to make it easy for customers to find special offers that may only be available at the airport, and be encouraged to return.

We also work with Swiss Tourism (and we’re currently reaching out to similar organizations across Europe), with products such as interactive digital coupon books or competitions for travelers – encouraging them to visit different places, events, attractions or hotels in a touristic region.

There are many opportunities in the travel and tourism industry that really work well with digital wallets. For airlines, because most travelers are already familiar with digital boarding passes, there’s a lot more that they can do.

For HR management, we have other products designed for staff, such as interactive ID badges. These digital cards help to confirm identity, but also provide easy access to work schedules and secure time-clocking. This is especially useful for staff that don’t usually sit at a desk and have access to an intranet. Instead, it’s easier to access everything they need during their workday via a smartphone.

And again, to develop and customize a mobile application for each division of an organization would be very expensive. Instead, we can easily assemble the right information all in one place for each team using a digital wallet pass. Our product – TeamPass – makes it super easy to set up and distribute the right information to different groups across an organization. You can easily interface with other systems – such as payroll or scheduling – putting everything in one place.

Q:   This is all part of the trend of digital engagement – whether it’s peer-to-peer or within groups – which is really taking off. Would you say that we’re still at the beginning of this innovation adoption curve?

Airlines have already adopted digital wallet technology for many years – for boarding passes and so on. Some have used the same features for other functions, in other verticals of the travel industry. Some hotels and car rental agencies are also using digital wallet programs for booking vouchers and special offers. Over 50% of travelers are familiar with digital wallets.

On the other hand, general consumer adoption of digital wallets and mobile payments is low, but it is increasing. In North America, over the last few years new mobile payment options like Apple Pay and Android Pay have been launched and are slowly gaining popularity. So this makes the digital wallet a great place for a brand or organization to have a presence. If a user is opening their wallet app multiple times a day to access a stored credit or debit card, and at the same time your logo is right next to that card, then they’re receiving brand reminders every day.

Q:   How do you stay ahead of the technology changes that may come?

In fact, things don’t really change that fast, in terms of the mass adoption of new technologies. It’s often a little bit frustrating when you build something and think, “Wow, this is going to be really great and everyone’s going to love this!” and it then takes longer to catch on than you had expected. It takes a long time to change consumer behavior for certain things. You also must make sure the people in charge of marketing or loyalty programs understand the benefits and are willing to try things out. Of course, hundreds of different ideas pop up all the time, and there are a lot of trials going on that sometimes bring good results and sometimes not. But, it certainly takes quite a bit of effort to get a large group of users to change their behavior to adopt a new technology.

Q:   What is your biggest lesson learned and what advice would you have for future entrepreneurs?

People talk about this famous “product/market fit” concept to ensure that you build something that the market really needs. It sounds like an obvious concept, but it’s really, really hard to get this right. There are a lot of adjustments and changes and pivots that you end up going through along the way before you really build something that a lot of customers are going to want. Then you need to figure out how to scale your business to meet the demand. It sounds like a simple concept, but it’s very hard to get right. It’s easy to spend a lot of time being a kind of consultancy firm, working on different projects for different clients. To push that into compelling, scalable products takes a lot more work.

Meeting a Medical Need with Speed

Read Time: 10 minutes

Will Hetzler, Co-Founder and COO – Zipline International Inc.

How one company is pioneering delivery drone services in Africa

More than two billion people lack adequate access to essential medical products, often due to challenging terrain or gaps in infrastructure. Over 2.9 million children under age five die every year due to a lack of access to vaccines and essential medicines. Up to 150,000 pregnancy-related deaths could be avoided each year if mothers had reliable access to safe blood. These are the sad truths that Zipline set out to address by rapidly delivering lifesaving medical products directly where they are needed. In this interview I speak with Will Hetzler, Co-Founder and COO of Zipline, who I first met in Rwanda during the AviationAfrica Conference we were both speaking at earlier this year (see my blog post of February 24, 2017.)

Q: What caused you to start Zipline? And what’s your vision for the company going forward?

To take a step back, Peter Thiel has an oft-quoted remark, where he said, “We wanted flying cars; instead we got 140 characters.” For me, that is an expression of frustration at the unfulfilled potential of technology, but it’s also an allusion to technology’s incredible potential to improve the world, if investments and efforts are properly directed. Over the past century, the aviation industry has been a great example of that potential. The world has become tremendously more connected, thanks largely to a wide range of technological advances. What the internet did for the free flow of information, aviation has done for the movement of people and cargo.

But over the past couple of decades, the rate of progress has seemed to slow for aviation. As the industry matured, we’re now at a point where we have a lot of what Clayton Christensen describes as “sustaining innovation,” and few, if any, breakout products or transformational changes. That has led to a feeling of stagnation. Aviation technologies aren’t progressing as fast as they once did, which is all the more costly because aviation is a critical enabler of so many other industries. A lack of progress doesn’t just hold back the aviation industry; it slows the development of the global economy. Getting back to a time of rapid innovation and growth in aviation technologies is something that really excites me. One of the reasons why I wanted to found Zipline was my belief that transformational change is possible for aviation today, that drones will be the source of multiple disruptive innovations in the coming years, and that these developments have the potential to dramatically change the world for the better.

One interesting observation is that we’re now at a point where, with over 1,000 airlines serving something like 5,000 airports around the world, it can be quicker and easier to move supplies between major cities on opposite sides of the world, than it is to move supplies from a major city out to a rural part of the same region. That counter-intuitive reality leads to all kinds of challenges in supply chains. Businesses and communities that exist in rural areas are too hard to supply and serve. Zipline is working to solve this problem, and will likely transform logistics in the process.

Zipline’s vision is a future where any critical supplies can be instantly delivered on demand anywhere in the world. At best, that level of access only exists in a few major cities today, and seems unimaginable for the vast majority of the world’s population. This lack of access leads to all kinds of hidden costs and, in many cases, tragic human stories. We decided to start with health logistics, because that was the sector with the greatest human need. Zipline wants everyone, even those living in the most rural communities, to have reliable access to essential medicines and health products. If a heath facility doesn’t have a product needed to treat a patient, Zipline can deliver it in time for the facility to provide the best available standard of care.

Q: How reliant is that vision on the evolution of technology? Right now, you’re doing fixed-wing delivery by way of parachuting the product down to the site where it’s needed. As the technology evolves, how will that influence the concept you’re delivering on with Zipline?

While efforts to develop unmanned aircraft are almost as old as aviation, it’s still very early days for what we now think of as commercial drone technology. Several people and companies recently claimed that a flight demonstration or some other milestone represents a Kitty Hawk type moment for commercial drones. While I question the grandiosity of those comparisons, I do think it’s representative of how nascent this technology is.

Over the coming years, we’re going to see very rapid development. Generally speaking, the rate of technological progress is compounding, and investments made by one industry have often yielded serendipitous returns in unrelated areas. Recent investments in the consumer electronics industry are a great example of this. Since the introduction of the first iPhone 10 years ago, the growth of smartphones has led to the development of processors, sensors, and other ICs that are radically smaller, lighter, and more affordable. This in turn has enabled new uses for these technologies. Many potential applications of robotics and other autonomous technologies that were once impractical due to the cost of the hardware are now the focus of exciting technological development. Investments that today are being made by industries as varied as automotive and communications will continue to unlock similar possibilities. This trend has the potential to greatly benefit aviation, and especially commercial drones. Zipline is working to anticipate and leverage these developments as we build the best critical inventory logistics solution in the world.

Zipline’s engineering team has achieved a lot, and we already have one of the most reliable, highest performing drone systems in the world. However, Zipline aspires to do a lot more, and some key challenges remain. One of the biggest limits on performance characteristics like range and payload capacity is the density of your energy storage. Due to the cost and operating advantages offered by electric power relative to combustion engines, small drones will almost certainly be all electric, which means batteries. So battery energy density is the big constraint, and improvements in this area have come very slowly. Zipline uses a lithium-ion battery chemistry similar to that used in most electric cars. Tesla is probably the company that has invested the most effort in evaluating the technical and commercial potential of different battery chemistries. According to Tesla, lithium-ion battery chemistries are the most promising, and will likely be limited to around 5% annual improvement in energy density for the foreseeable future. Which is to say that we probably won’t have any breakthrough changes in the energy density of commercially available batteries for the next three to five years.

Assuming that is true, we’ll see moderate improvements to key performance characteristics like range and payload capacity, which will come both from incremental improvements to the energy density of batteries and design improvements to the drone itself, including refinements to aerodynamic efficiency and weight reduction. But, generally speaking, some of the applications for bigger payloads that could be very exciting, like transporting a full pallet load of inventory rather than just a package, require either a breakthrough in battery chemistry or better hybrid power systems.

Q: You’re a California-based company, and you’ve made a very deliberate move to introduce this service, Zipline, in Africa in Rwanda. Tell us about what the genesis of that was and how you see the concept you’ve now introduced in Africa, introduced perhaps in other regions of the world and perhaps even back in the U.S. or Europe?

We felt strongly that we wanted Zipline to realize our vision of on-demand critical inventory logistics first for healthcare, because that was the sector with the greatest human need. And a similar logic guided our decision to launch in a developing country. We asked, “Where is the need greatest?” Every country in the world has challenges with transportation infrastructure. Logistics for critical supplies that need to be transported across relatively long distances in areas with low network density is challenging even for the wealthiest governments and companies. Yet these problems are most acute in rural parts of developing countries. So we decided to start by looking there.

Rwanda is a relatively small, developing country with very hilly terrain. Like most tropical countries, Rwanda has two types of seasons: wet and dry. During wet season there are very heavy rains, which can lead to flooding, wash out infrastructure, and make ground transportation slow and difficult. This is generally true for rural parts of developing countries where most roads are unpaved, and wet season can transform roads into impassable mud pits. Zipline has the perfect solution to these problems. Instead of struggling through hundreds of kilometers of muddy roads, you can fly over all these challenges of infrastructure and terrain to quickly deliver critical supplies.

What allowed Zipline to launch quickly in Rwanda was the combination of high need with the right mindset. Rwanda’s challenges with infrastructure and terrain meant that the health sector needed more efficient and reliable delivery of essential medicines and health products. Meanwhile, the Rwandan Government is technologically progressive and willing to make strategic investments in innovation. Lastly, the Rwanda Civil Aviation Authority was willing to take a pragmatic, performance-based approach to introducing commercial drones into their airspace, and was willing to work with Zipline to mitigate any attendant risks so that we could deliver a lifesaving service.

Q: As you say, there are other regions of the world, even in Canada’s Far North, where communities have access problems and are in need of medical services. In this case, I suppose not all those ideal situations, as you just mentioned them, existed. Would you say that the regulatory framework in North America is perhaps burdensome, and more difficult to navigate?

If you look at the regulatory regimes in the U.S., Canada, or Western Europe, “burdensome” would seem to be an understatement. But to be fair, civil aviation regulation is burdensome around the world, and this is at least partially out of necessity. That’s as true in Africa as it is in North America.

Two key things distinguish Rwanda from the U.S. One is that as a much smaller country with a less complex airspace and lower air traffic density, some of the considerations that really complicate the introduction of autonomous, beyond visual line-of-sight commercial drone operations in the U.S. just don’t exist in Rwanda. Secondly, since the country is still developing, and has the infrastructure and access challenges that I mentioned, the relative benefit of Zipline’s service is greater. With some notable exceptions, infrastructure in much of the U.S. is at least adequate as is access to healthcare. That is less true in Rwanda. In short, the risk to the airspace is less while the potential both for human health and economic benefits is greater. Even absent all the other bureaucratic differences, which I won’t get into, the risk-benefit calculation makes for a quicker and easier path to launch in Rwanda than it would in a place like the U.S.

Q: Just to get back to how you got started, you’re a Harvard graduate, and then went on to Oliver Wyman for a couple of years as a consultant. And now, of course, running a business. How has that transition been for you, and what have been some of the biggest challenges and biggest successes you’ve experienced?

One of the biggest challenges for any founder is figuring out who are going to be your co-founders, if you have them, and if not, who will be your early team. For Zipline, I am very grateful to have two incredible co-founders. Keller Rinaudo, who is our CEO, was my roommate at Harvard. Keenan Wyrobek, who leads our product and engineering teams, is a brilliant, world-class roboticist and is someone who Keller and I are extremely fortunate to have met as we were starting our journey with Zipline.

Another challenge is convincing investors to take a risk on your team. When we were first raising money for Zipline, a lot of investors thought that we were crazy. However, Zipline has been fortunate to receive support from a world-class set of investors. Sequoia Capital led our Series A, and about a year ago we closed a Series B that was led by Visionnaire Ventures and Andreesen Horowitz.

As for me, certainly the transition from aviation consulting to a startup had its challenges. Many skills that I learned in consulting helped me. As a consultant, you have to be able to move very quickly, because when you show up at a client, they want you to create value right away. So you have to learn the landscape, identify opportunities, and get to work very quickly. That’s all the more true of a startup, and it’s something for which my experience with Oliver Wyman prepared me.

In other ways though, a startup is a completely different beast. One thing that I strongly believe is that there’s no substitute for firsthand knowledge of your customer. It’s essential to make big early investments in understanding what your customers’ needs and problems are. When we were in Zipline’s hypothesis-validation stage, Keller and I traveled around different developing regions, experiencing firsthand the problems that our potential customers encountered, and then working to fully understand the root causes of these problems. This was important both to ensure that Zipline built a solution that actually addressed our customers’ needs, but also to understand the parts of the problem that we couldn’t solve, and be confident that Zipline could succeed in spite of these gaps.

We spent about four months on customer research. I traveled throughout southern and eastern Africa. In each country that I visited, I would go first to the lowest level of the health system. That typically meant a small dispensary or health post in a very remote, rural community. There, I would talk to the health workers to understand how reliable was their access to essential medicines and health products, and when they didn’t have everything they needed, why that had happened. I would then trace those stories back up through the supply chain, going to the district and then regional levels, talking to medical officers and health logisticians, all the way back to the central level. At the central level, I would also talk to supporting organizations like U.N. agencies and bilateral donors, trying to gather data from all of the different stakeholders in the health system.

We learned a lot through this process, which proved invaluable to the development of Zipline’s health logistics service. We also developed an extensive network. When it came time for us to begin marketing Zipline’s services, we were able to reach back out to the people who we met and say, “We heard the problems that you told us about. Now we have something that we think can help. Let’s talk about how to get this launched in your country.”

Q: What is the next step in your journey and what are your future plans?

Ultimately, service range, payload capacity, and value for money are what our customers care about. Zipline is obsessed with making improvements on all of these metrics. On the business side, we need to continue growing the service, both by expanding the scope of products that we deliver, and by launching additional countries. It’s likely Zipline will launch our second country in late Q4 of this year, or early Q1 of next year. Increasing the scale of our logistics network will be a big part of what drives down the marginal cost of Zipline’s services. On the technical side, Zipline will be introducing a new generation of our drone, which will have substantial performance improvements. We’re really excited about what the next 6 to 12 months will bring.

Q: What advice would you have for future entrepreneurs, and startups, as you’ve experienced it now?

Don’t waste your time. To state the obvious, any startup is a big risk. The statistics on new business ventures that fail is no secret. But it’s important to bear in mind that not only is a startup a risk for you as a founder, it’s also a risk for your early employees; it’s a risk for your investors; it’s a risk for your suppliers; it’s a risk for your customers. Because of that, it’s important that you have a vision that justifies those risks. Ensure that your product or service offers a big enough improvement over the status quo that it’s all worth it.

Coming full circle to Peter Thiel’s quote, there are so many really important problems that exist in the world and that need smart people to work on them. For me at least, it seemed important to work on something that had the potential to fix “a dent in the universe” rather than just “140 characters.”

From Entrepreneur to Technology Innovator

Read Time: 12 minutes

Alex Sauriol, Co-Founder & CTO and Moodie Cheikh, Co-Founder & CEO – Searidge Technologies

Raising the level of performance in air traffic management

In this installment, I interview Alex Sauriol, Co-Founder and Chief Technology Officer at Searidge Technologies. Searidge is a leading technology innovator providing remote tower and surface optimization services and solutions to airports and air navigation service providers (ANSPs) worldwide.

Q: What drove you and Moodie to do what you started with Searidge, and what was your vision at the time?

When we started the company – around 2004 – Moodie and I were neighbors and we were both working in technology. I was doing software development, and Moodie was in consulting services in the IT space. We were just coming off the tech boom, and we both wanted to start a company that we could build into a successful business. For me, there were a few things that were driving this. One, I’ve always been entrepreneurial. It’s always been about seeing a problem and fixing it. But, I think in this case I do remember us saying that if we make the jump from a stable income to a very unstable income – even a negative income in some cases – is it worth doing? Obviously, there’s the potential payoff if the company is successful, but also is the problem interesting? Is it worth solving? Because if the possibility exists that you’re going to fail, at least fail doing something that’s really interesting and has the potential to have a huge impact on an industry.

Around that time, we had about three or four different ideas, and they weren’t all related to aviation. We were heavily into peer-to-peer networking at that point. There were some different technologies that I was personally interested in, and I did see some interesting work being done around computer vision, what was then sort of a precursor to artificial intelligence (AI).

Because of the contacts we had with NAV CANADA and some of the work we were doing, aviation seemed to me like a field of opportunity…. In air traffic control specifically, there wasn’t a system that I could see that couldn’t be upgraded, in some cases significantly, with newer technology or newer methods or newer practices of development. I just thought there was a massive opportunity there – globally. The global nature of the opportunity really intrigued Moodie, as he personally was interested in creating an international company that had the potential for widespread impact.

With just the right amount of innocence and naivety that we both had, we didn’t know that you couldn’t do that or you needed wealth to do that…. We just set about bringing in some really smart and interesting former air traffic controllers from NAV CANADA and we created an advisory board, and just did pure R&D brainstorming from their point of view as in, “what are some of the challenges that you feel technology can help with?” A few opportunities were identified in that early meeting. Eventually, we narrowed in on one particular one, which was around the airport surface, and that’s what we did, and that’s what we’ve spent the next 12 plus years now doing.

Q: It sounds from what you are saying that the real challenge was in getting people to look at a situation in a different way. It’s a culture change that is required, isn’t it?

Absolutely. A lot of people talk about safety being paramount and that new concepts take a long time to introduce because of safety. I don’t think that’s true at all. When you look at banking, the sort of risk management that people involved in banking technology have to deal with is very similar. In aviation, the technology advances that are happening in aircraft today are a lot more advanced than what’s happening on the ground in air traffic control. There definitely is a challenge in fielding new technology, but I believe it has much more to do with the challenges in running a 24/7/365 operation. Banks close for weekends, aircraft get pulled for maintenance, but ATC never really goes offline and that makes introducing new technology challenging. For example, if you’re going to put something new in front of a controller, you’ve got a fairly limited amount of time, from the time that you train them on a new method or technology, to the time that they have to start using it operationally. Training time has an expiration date on it, that says if they don’t use it operationally you’ve got to train them again. So, you end up in a situation where everybody’s got to be trained very, very quickly or where the change that you make to what they are doing is so incremental that it can cap with a very minor change to their procedure.

There are interesting challenges like that, and that’s not just from the controller perspective, but also from the maintenance folks and technologists, and in some cases the management. It’s a peculiar challenge, and a lot of people who look at air traffic control from the outside will say, “that’s old and there’s a way better way of doing that today.” Well, yes, but we still haven’t solved how do we get the whole world to jump at the same time. The challenge with ADS-B[1] implementation…. We’re in year 20 of that now? It’s not because we don’t have smart people, and it’s not because we don’t know that there’s a better way of doing things. It’s just that we’ve all got to jump at the same time. You’ve got to get aircraft to equip. You’ve got to get people on the ground to receive. And, what’s the impact on procedures. So, there are always going to be challenges there.

Q: Aviation is an extremely complex system of systems, with a lot of elements to it, a lot of stakeholders, and it sounds like this risk averse culture has been your biggest obstacle. Have there been other obstacles?

Lots of industries are risk averse. Medical is risk averse, but there’s a really well-defined path to how to certify a medical device for use in a hospital. I think there’s an insularity that exists within certain areas of aviation where people become experts just because they’ve been around for a while…. a certain culture develops and it’s very hard for new ideas to get accepted. There can be a tendency toward hubris where “I know everything there is to know, and because I’ve been told I’m an expert, I’m not going to let any new ideas in.”

The other big thing is interoperability. Standards in air traffic control are not where I think they need to be. Take an example, when you talk about a complex system of systems, that’s the internet. Yet, somehow, we have this incredible innovation, and here you and I are talking. I’m using a Google phone; I have no idea what you’re using, and it just doesn’t matter to me. We’re able to communicate, and it’s because of interoperability and open standards.

In air traffic control, when you look at almost any ground-based system, you’ll typically come across some big barriers in trying to communicate with that system or interact with it or get data from it or push data to it. You’re unlikely to find a standard, globally-accepted way of doing it. If you do, it may not adhere to an international standard. And, there may be confidentiality issues, which is silly. If I am a radar manufacturer and I have an interface control document and I write “confidential” on it, that somehow the format of the radar data is a trade secret worth protecting… in 2017.

A lot of companies have made a lot of money over a long period of time by having these proprietary interfaces. That means that if you bought something from me and you want to connect my system to that other system to gain some sort of integration benefit, you have to call me up and get my secret code to figure out how to do that. If it’s only money, that would be one thing, but it’s all that additional pain of getting the vendors to work together… Take an example of runway lights at airports. Runway lights are typically purchased and installed by the airport. Obviously, they’re connected to air traffic control and operated by air traffic control, but they’re maintained by the airport. There are plenty of standards dealing with the lights themselves, but not in how they should connect to other systems. So, if we want to provide some relatively simple automation function – say, automatically adjust light intensity based on weather – we will need to somehow connect the weather system and lighting system together. In an “internet of things”/Web 2.0 world, this kind of ‘integration’ will take a developer a few days. The airport version of this story could take years depending on the lighting and weather systems involved, who owns them, who the manufacturers are and how cooperative everyone is willing to be.

The reason I bring this up is that for ATM to evolve, whether that’s through Aireon and space-based ADS-B, AI, automated lighting, dynamic airport maps for pilots, connected ATC … we must talk more about interoperability and open standards. If ever there was an industry that could really benefit from open standards, I think air traffic control is it. In fact, it’s going to become even more important because of concerns over hacking and related cyber security measures.

It feels a bit like the pre-internet era when we went from analog to digital in telecommunications. The plumbing is built. The systems are there. Now the digital foundation is laid out within ATC. We still have some structural issues to deal with around cyber security, how we should approach standards, how we should approach the life-cycle management of systems, and things like that. However, all future value that we’ll derive is going to come from the combination of data and systems. It’s not going to be from one system that’s going to come in and displace everything. It’s incredibly difficult to displace a system that’s being used. Even if it’s 20+ years old, everybody knows how to use it, everybody knows its foibles, and it’s really the least or lowest risk thing to keep that humming.

Q: With the ATM industry being as complex as it is, would you say that it is a candidate for further automation?

Absolutely. When you look at an automation example, say the “brake to vacate” concept where you can feed weather and runway condition from the ANSP or airport to the aircraft on which high speed turn-off is optimal, the aircraft lands and the correct amount of braking will be applied to achieve the most efficient outcome. That’s a great example of automation that can improve performance, and I don’t know where those trials are at, but that’s the thinking. All that automation relies on interconnectivity of systems. As this interconnectivity improves, I think we will enter a golden era of innovation and automation.

Q: What are your biggest lessons learned, and how has this influenced the vision for the future?

I think with lessons learned…. It’s a funny thing to say, but I don’t look backwards that often. I remember once describing entrepreneurship as running as fast as you can through a dark forest being chased from imaginary wolves…. So, from that perspective it’s a pretty simple lesson – keep running. However, in terms of conscious shifts I’ve made over the last 20 years – I now value unity and cohesion over anything else. It’s like, we’re on this little boat, and we started with two or three men. You can afford to get the direction wrong because you can alter the course but at the end of the day, if you’re not all rowing in the same direction things will fall apart in a way that can’t be put together again.

In practical terms this means that when I’m sitting in a meeting and there’s a divergence of opinion, do I want to be right or do I want to be united? Sometimes that’s the choice. More than once, I think that striving for unity as a general principle has been the best way to go. There is a lot of hard graft in the early years. You are leaning into the wind. You’ve got a lot of people calling you outright crazy. So, if you’re not united, it quickly can fall apart.

The other thing is, if you have persistence … if you have staying power, and a commitment to what you set out to do … I think eventually you’ll get there. The lesson I have out of that is, make sure you commit to the right thing. If you’re prepared to be successful no matter what you do, then make sure you do what you want to be successful in.

I feel lucky that I kind of fell into this field and still to this day Moodie and I care a lot about the industry we are in, the people, the dramas, the opportunities and it’s all very interesting. Aviation affects a lot of people. To the extent that we are successful, it’s very rewarding.

Today, Searidge is owned 50% by NAV CANADA and the other 50% by NATS. This is something that’s completely new for the industry where you’ve got two ANSPs that have converged on a small technology company. What’s the model for that and where’s the book that says this is how you should set up the governance and this is how you should position yourself in the marketplace. So, that’s interesting and challenging, in a positive way, where we all get to think about what is the business model for that, because I don’t know of an obvious example. If you look at the ANSPs in question, you’ve got NAV CANADA and NATS that are in fairly interesting positions themselves as privatized entities and fairly unique in terms of what they bring to the table and how they can complement each other. There’s all kinds of ways the relationship can go that we’re excited about.

And, on the technology side, with interoperability being key, I think this is where we’re entering a really interesting era. There’s the element of automation, but I think also of integration and the controller experience. If you think about AI, I think a lot of the early benefit is going to be in improving the user experience, and in our case a user might be the technologist or an air traffic controller or a supervisor.

For us, it’s about raising the overall level of performance. What tends to happen in air traffic control – in service situations – is you try to have a level of service that is within a range of your best performer and the newest controller who just joined the team. And, to maintain a level of performance you should stay within that range. Where I think AI is going to have an early impact is in raising that performance so that everybody is at the same level as the best performer.

It’s like in the last 10 years, most of us became really good at spelling. It’s not because we do spelling bees and exercises on the weekend. it’s because we have technology now that makes it difficult to send an email with misspelt words. Where we see a lot of opportunity is in performance management, specifically around safety. One of the areas we’re actively exploring, is whether there is a completely new way of imagining safety automation technology.

We have an ability now to look at big data and we’ve got access to a whole bunch of different ways of analyzing that data, in some cases in real time. So, could you – for example, based on the last two years of movement data at an airport – determine the likelihood of there being a runway incursion when a certain set of variables are in play? This happening in real time gives a supervisor the opportunity to say “wait, the conditions are ripe for a loss of separation” or an incident over in that sector, and can I do something about it before it happens? That could be a dramatic improvement to how things are done today, and that’s incredibly exciting.

Improving the basic safety performance is the goal, and when we look at a technology release, it doesn’t matter what we’re doing, it always must have a net improvement to safety and then, whatever else you may be trying to do. I think AI is a huge open field for that and we’re really excited about that. Of course, with the access to the operations staff we now have, we’re incredibly enthusiastic about that.

Q: Do you see technology firms like Searidge having a stronger role to play in the future of ATM, where there’s a power shift in the value chain, if you will, from the ANSP that has the plumbing, but doesn’t necessarily have the innovative drive to try new technologies and come up with some new solutions?

It’s an interesting way of framing it. ANSPs are not technology companies; there aren’t a lot of CTOs in our business and there aren’t many CEOs who have a technology background. I think it does highlight an interesting idea that innovation is going to come from the outside and not necessarily from the inside out. It’s an interesting problem too because even if an ANSP hires the best CTO it can find, and that person doesn’t really understand the business, it’s going to be a real challenge for him or her to move the ball forward in technology.

It took Moodie and I the better part of the last 12 years to understand the business, and we’ve just gone through almost a full technology cycle when you think about it. During the early days, we had documentation saying that there shall never be video in a control tower, whereas the situation today it’s almost a given that every ANSP at some point will be shifting to using some form of video and sensor to provide surface location information independently. That took 10 years, and we’ve learned a lot in that cycle in terms of what works and what doesn’t work. My hope is that the next cycle is going to be a lot shorter.

Q: How do you stay in front of it all in terms of changes that may come? How do you stay ahead of the curve?

I’m lucky that we have a really diverse team. We embrace diversity, and I don’t mean that in any kind of political sense. I mean this in the sense that Searidge has about 50 people who speak 23 different languages, come from a multitude of geographies and educational backgrounds, and have a variety of age ranges. So, we have this incredible diversity of thought within the company. For the longest time, I did not have an office; I kind of refused to move into an office. We have an open office concept – just to listen and hear the diversity of opinion and experiences. It’s how you can pick up on new trends and ideas.

It’s easy for us sometimes to rule out a technology and say that’s interesting, but it’s not going to have an impact…. However, some of the trends are impossible to miss. I don’t think I’m a visionary by saying AI’s going to have a huge impact. I think that one is easy to see. Same with drones, for example. That’s another easy one to recognize and there’s huge value there, and it’s another wave that really is impossible to miss. Interoperability and the impact of cyber security might be a little more subtle, but it will underpin much of the next big innovation cycle and in that respect, it’s a very exciting time to be working in this industry.

It will indeed be interesting to see what the next 5 years will bring…. Watch this space!

Entrepreneurs: Don’t fall in love with your technology

Read Time: 10 minutes

Eric Bergeron, Founder – Optosecurity and Founder & CEO – FlyScan

Fall in love with your customers to solve a need. The rest will come naturally

Ever been stuck in a long line-up at airport security and wondered how it could be sped up? Eric Bergeron did, and so founded Optosecurity in 2003, which provides the world’s first and most deployed remote screening and centralized image processing solution that helps airports reduce costs, increase throughput, and enhance security. Optosecurity has recently been acquired by Vanderlande Industries, the global market leader in logistics process automation for airports, express delivery and warehousing.  Twelve years later, Eric was at it again with FlyScan, which provides automated, airborne leak detection services for the oil and gas pipeline industry. In recent years this sector has been at the forefront of political, environmental and economic debates due to highly publicized pipeline spills, which have made future pipeline project proposals contentious. Monitoring pipelines and detecting leaks quickly (even underground) can prevent these from becoming major environmental disasters.

Q:   What drives you? What’s your vision?

I’m one of those rare breeds. I’m an engineer, but I’m not an engineer in the typical sense that most engineers are; conservative people, who look at data only. I’m more entrepreneurial, driven by gut feeling; an engineer by training, but first and foremost, I’m a business guy. When I did my engineering studies in the 90’s, I already knew I was going to be a businessman, not a researcher or an engineer in a big company. I preferred to learn engineering at school, and then learn financial mathematics after, rather than the other way around where you do a business degree and then people try to explain to you quantum physics and you’re clueless. I preferred to do the hard part first, and then the easier part… when you’ve done nuclear physics, financial math is a joke after that.

I love technology. There needs to be a high content of technology in the business. That’s what excites me. That being said, I’m a very versatile person. The first 12 years of my life I was in telecommunications, the second 12 years of my life I was in airport security with Optosecurity, and now I’m entering the pipeline integrity phase of my career with FlyScan. So, this is the third phase of my career, right now.

Q:   Is there a common thread between those different phases?

A common thread is solving a need. Solving a problem in the industry, and doing it with a high-tech solution that nobody else has done before. I like to be a pioneer. I like to be a first mover, even though it typically means receiving all the arrows and daggers in the back. But still, I like to be at the front. I like to be at the leading edge of technology and business model. I like new technology, and I like new business models.

Q:   How do you find out what are some of the pain points or problems that need solving – that’s the essence of entrepreneurship, isn’t it?

Yes, the first time I did it was with Opto, which was more like a gut feeling – “let’s try that”. I think there was something, because it was like a year or two after 9/11, so security screening was a problem. I spoke to some people at the airport here in Quebec City and I saw that at the checkpoint they had no software to help detect a threat. So, my gut feeling was that, “hey, there’s something to be done here”. That was after I was introduced to the research center at INO in Quebec City, the National Optics Institute. I said, “Okay, you have a solution to recognize objects at high speed. They don’t have this at the airport security checkpoint, so I’m sure there’s something to do here.” It is very much like that for most entrepreneurs; like many, I’m sure I have ADHD, an impulsive personality, and gut feeling driven, so I said, “Okay, let’s do this.”

The second time around, I was much more disciplined. Maybe because of all the pain and the difficulty we had at Opto, which ended up successful, but it was rough. It was a rough ride at times. So the second time around, I met again with INO and they offered me a series of technologies, and I said, “This time around I will document first, if there’s a real need….. Not be an engineer who falls in love with technology, and that there must be something to do with it.”

This time I did it the other way around. So, when INO showed me a list of technologies the second time around they had just finished a project for an airborne sensor to detect oil pipeline leaks. So, before I really started FlyScan, I hired a consultant to do some research because I had money. I also went down to Houston, and met with CEO’s and VP’s of pipeline operators to document whether there was a real need. “Is this something that you would like to buy? Is this something that you need? And if you need it, do you already have it? Or, if you don’t have it, will you buy it?” The last question I asked them was, “do you care? Or, do you think it’s irrelevant? And finally, if you think you would never buy it, let me know right now, and I will move on to something else.”

So, the second time around I had a gut feeling, but I took the time and spent the money to validate if there was a real business need and I talked to the business decision-makers,…. for whom technology doesn’t matter; what matters is the end result. I asked them, “Do you have that? And if you don’t have that, will you buy it?” So that’s what I did the second time around.

Q:   This is the second startup for you – what are some of the key challenges to running a startup?

The first one, of course, is to find your purpose. So, what is your purpose? When you start a company, you start a company for a reason, not just because it’s cool. So, you must find a need that you wish to fulfill, the solution that you need to bring, for which there is no solution out there. Then you need to validate that, and once it’s validated, then you need to execute on building it, and selling it. What I found out is that technology is always cool. The hard thing is never the technology. The hard thing is raising the money, and then selling it. Sales is always the most difficult thing to do. The technology, if you mix talent and money together, it will work eventually. The hardest thing is to convince a customer that it’s worth taking money out of their pocket. When you start, you need to validate the market, talk to customers, and then put in place a financial plan to execute. So, where we are right now; we validated the market, we validated the technology, then I found the money, and now we are in the building phase, and we start the first test flights early next year.

At Opto, it was more like a technology push. My gut feeling was that the market would buy it if we built it. We built it, and the first solution was weapon detection – so gun detection in luggage – and we found out that it was more a nice to have, than a must have. Then we did liquid detection, and we found out that this was driven more by regulations, so airports didn’t really want to buy it. They would buy it if the regulator told them to buy it. We found out the hard way, and that this was a hard way to earn a living. Then we developed a remote screening product to save money for the airport, to increase the throughput, reduce the operating expenses, reduce the capital expenses, and we found out that this was what they wanted to buy, because it saved them money.

So, at my first company, it was a hard lesson learned – start with the business case, start with the money part, and then technology was secondary. The most important thing was solving the business need of the customer. More than, “Hey, I’m engineer, this is cool. Let’s build it and somebody will buy it.” And…. it always takes more time than you expect to sell anything. So, for the sales cycle, you must have a good padding, financially wise, to survive the long sales cycle. Especially in the airport market.

The second lesson learned is that it’s all about people, so hiring is extremely important. You must be sure to hire the right people. The biggest mistakes I’ve made have been in hiring either too many people too fast, and then hiring the wrong people. I also hired great people, and they are still with Opto. Over the years now, the most valuable lessons I learned were mostly related to human resources. It’s never been the technology so much…. hiring is extremely important. Firing is also extremely important. You must fire people quickly if you have any doubts.

I’m a big fan of this now – psychological testing and profiling – and it’s mandatory for hiring at FlyScan, because you want to have, as a team, people who are complimentary. You absolutely don’t want to hire people who are like you because then you will crash and burn. I’m the intuitive, impulsive type, and the last thing I need is a CFO who is intuitive and impulsive. I need somebody who is methodical, logical, like a Vulcan in Star Trek. That’s what I need to compliment me. If I’m a sales-driven guy – an outside-looking guy – I meet with customers and I meet with partners. Then, I need somebody who’s going to run the show in-house, and will manage the timelines, the projects.

So, as far as the steps, step zero there’s always the technical skill. But step one is the psychological complementarity of the team, in terms of style. You need a complimentary team, and then you need people with whom you will have fun. If you hire somebody who’s very aggressive and negative, it’s going to fail. If you hire somebody who’s controlling and he wants to take your job, it’s going to fail. You need to hire people who are complimentary to you in terms of skillset, in terms of style, and in terms of personality.

Q:   What do you see as being some of the biggest challenges in the aviation sector, when it comes to introduction and adoption of new technology?

Well, there are many factors. First of all, it’s a great industry. I love that industry and I’m still happy to be at Opto as a board member, because I like to follow what’s going on there, and there are great people in that industry. But there’s a big difference between North America and Europe. What works in Europe, will not necessarily work in North America. It’s changing now. You see today that airlines are aligned with airports, and airports and airlines are aligned with TSA, so I think we’re getting there. In the 90’s through to the late 2000’s there was a disconnect between the business drivers of the various stakeholders, as compared to Europe where these were much more aligned.

In Europe, the airports are privatized and business-, or profit-driven. They’re responsible for security and therefore they want to control the cost of security. So, if you come to them with a solution that saves them opex and capex, increases the throughput, increases retail revenue, they will love that. Because there’s an alignment of interests from the airport financial need, with the passenger need, with the airline need, and the security cost. In North America, in the recent past, there was a disconnect in business model between the security of the airport, and the needs of the airline, and the airport. For agencies in charge of checkpoint security, their goal was to find the bad guys, not to facilitate commerce at the airport. The airports did not control anything with regards to security technology at the checkpoint, not did the airlines – it was a nationalized approach. Today, I think the situation in North America is changing for the better.

Q:   Turning to FlyScan, drone technology is developing very fast and rapidly. Do you see that as the next step in terms of evolution of the product offering?

I think that drones are only a means to an end. They are not an end in themselves. What matters to the customer, once again, is that they don’t care about the technology, they care about the end result. They care if you can solve their business needs, so in the case of a pipeline, they want to find out if there’s a leak. They will not care if the leak detection is provided with a drone or a helicopter, or a satellite, or a guy walking on the line. It’s outcome based. They want to find the leak, and they want it to be fast and cheap. Then it becomes a question of, well how do you implement the delivery to make it fast and cheap? Drones, I think, are getting there, but I think that drones are cool for a short range punctual inspection. But, because of current regulations they are not there yet for long range, autonomous inspection. What would make sense at FlyScan is to install our device under a drone, you enter the GPS coordinates of the pipeline, tell it to go for three hours, and fly back, or go for four hours and land, and tomorrow do the rest of the segment.

It would make sense, but today regulations in Canada and the US will not authorize us to fly long distance at low altitude at high speed. Because our sensors are in the hundreds of kilograms, flying something at 100 meters altitude at over 100 km per hour, just think about the amount of kinetic energy in that flying object. No regulator will authorize a flight with no humans on board. So, I think the technology is not there yet to have the collision avoidance, and the regulation especially, is not there yet, even if there was collision avoidance software. The regulations would take years to authorize what makes sense business wise.

It’s very much an evolving thing, so that’s why we’re starting with helicopters, and then we move to fixed wing aircraft, and one day we’ll move to drones. But, it’s one step at a time. What matters is the sensor picking up leaks and whether it’s on a helicopter or a drone, this is secondary. Customers will care about the price, but they will not care about the delivery method.

Q:   What advice would you have for future entrepreneurs? You spoke to some of this already, but if you had the same opportunities, would you do it again?

Well, if I knew, I would do it again – yes! But, right from the start I would start with a remote screening solution to save money for the airport. That would have saved ten years and $30 million of venture capital. My advice would be; don’t fall in love with your technology. Of course, you must be excited about your technology; how good it is, how you will beat everybody else with it, but don’t fall in love with it. Fall in love with your customers and fall in love with your business model, and then the rest will come naturally. That’s the first advice. My second advice is; take your time to hire, and when you hire somebody, you must be bullet proof certain that this is a great person, and the minute you have any doubt; fire them! So, ask yourself, would I trust this guy with my life? And, if the answer is no, don’t hire them.

As a concluding point of the interview, I could not help but reflect that I had heard this time and again from entrepreneurs who’ve done startups. For a startup, having the right team is extremely important, even more so than financing, since individual team members play a crucial role in turning vision into reality. Make sure you have a group of competent and complementary team players.