How NOT To Build a Startup: Ned Hill, CEO of Position Imaging (Part 5)

Ned Hill: We’re building a platform that not only could deliver packages for residents and buildings but also send notifications to these residents. We needed to flesh it out before we released it. I took my time. I’m thankful we did. It’s the best system in the world for package management. Working on the platform is also the basis for many other applications like pick-up and drop-off. In New York, you can’t drop it unattended.

Sramana Mitra: How much money went into funding your 12 years of technology development with no revenue?

Ned Hill: About $10 million.

Sramana Mitra: You had investors who were willing to give you $10 million and wait 10 to 12 years before any revenue came in?

Ned Hill: There was one pivot that the company made. In addition to computer vision, we had successfully created this incredible radio tracking technology. The original application was to go after image-guided surgery. It’s a half a billion market. I’m not going to run into the same track that I did with Secure Technologies and become a lifestyle company selling it at a very small margin.

We looked at other spaces. We partnered with Disney. We did a development program with Disney to add augmented reality (AR) to some of the games that they were doing. They would use a tablet to track their view and have an AR program going on. We could also make it life-size. The reality for that was it wasn’t a new game. It was on their cruise ships and Disney World. Last time I checked, there are not millions of cruise ships and Disney Worlds around.

We were kicking around trying to figure out where to exploit this technology. We partnered with Stanley Black and Decker to do a visualization platform for home contractors so that home contractors could show you what your kitchen looks like. We considered doing that, but that was a heavy lift.

Then we agreed to work with Sony to put this on the Sony PlayStation. We started that project with them. The problem was I had to go to Tokyo to meet with the television and gaming teams. When we demonstrated this technology for them in California, the Vice President of R&D admitted to me that, in the previous year, the advanced research team at Sony tried to do radio tracking technology. Four months later, my head engineer showed up at their office and demonstrated it to them. I had to meet them in Tokyo because they still couldn’t believe that we had done that. We agreed to put this on the Sony PlayStation.

I’m glad you’re pushing on this, because it’s an important story to tell. We started working with them. Very quickly, I realized that this was going to be a partnership that would fail. The camera guys at Sony were threatened by us. The advanced research team at Tokyo was threatened by us and lost face. It was like pushing a rope. It just wasn’t the right partnership.

At one point, we were ahead of the curve. I demoed this to Apple. Brad, who became my head of advanced technology, was Steve Jobs’ advanced technology guy. He walked me up to my car and said, “I think you guys are 10 years too early.” It was like a punch to the gut. He was right. What that drove me to do was take a hard look at this technology that we had and think if this is the right thing to start with. Are we too far ahead in the game?

We realized that we could apply computer vision to package management for trucks and really improve efficiency. I built out a use case for that. Very quietly, I hired a computer vision engineer and it took us a year or two to develop the basis for this new computer vision platform. We demoed it to my investors. I told them I’m pivoting the company. We had worked with Disney. We had worked with other companies. The demos were unbelievable. It just wasn’t the right time.

Sramana Mitra: How much time has passed in this process?

Ned Hill: We kicked the tires with Sony, Disney, and Stanley for about a couple of years before pivoting.

Sramana Mitra: What years?

Ned Hill: Probably 2008 to 2010.

This segment is part 5 in the series : How NOT To Build a Startup: Ned Hill, CEO of Position Imaging
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