Bootstrapping Using Services From Houston: Identity Automation CEO James Litton (Part 3)

Sramana Mitra: The fact that you decided to go in this direction, does this have anything to do with your background in facilities management?

James Litton: No. The decision to go down this path was multi-faceted. I had known Troy since the Coca Cola days. We had stayed connected. Troy had really grown up around identity management. In fact, the project that I had him working on for me, whenever I was at Coke, was an identity management project. It was helping to move us from one computing platform, which was a NetWare platform, over to a Microsoft platform.

Troy stuck with that in his career. He was bored with what he was doing at Veritas, which is why he decided to leave and start Identity Automation helping Novell in their implementation. We saw this opportunity in the market. We thought, “We could actually turn that into a real revenue generating business.” >>>

Bootstrapping Using Services From Houston: Identity Automation CEO James Litton (Part 2)

Sramana Mitra: You quit this job in 1990 and did something else?

James Litton: I then went to work for Continental Airlines where I moved into a Systems Analyst role. This gave me experience with a very large enterprise organisation. I was in their credit management group and helped them manage their IT infrastructure. I did that until 1991. I then went and worked for Bisys Loans and Services, which is another company in the mortgage industry.

There, I took on a full IT leadership role. I became the IT Manager and the Principal Systems Engineer. I was wearing multiple hats. I ran most of the infrastructure. These early years were incidentally quite critical because, from my perspective, having a hands-on role and really understanding the technology is important. At Bisys, it involved starting these IT organisations from scratch. I was at Bisys until 1993. >>>

Bootstrapping an IoT Company from North Carolina: Bob Witter, CEO of Device Solutions (Part 5)

Sramana Mitra: This is very risky business though – trying to act venture capitalist in startups and building their products against sweat equity. That’s, business-wise, quite a risky move.

Bob Witter: It’s a lot of fun. We have never had any investment dollars, so the risk is our own. We’ve taken a different approach than, perhaps, a lot of big businesses take today. When our Board of Directors sits around the table, our interest is in keeping people employed before profit. Certainly, we need to, at least, break even to make that happen, and we’ve been fortunate enough to do that over the years. In 2009, we had a little trouble. We asked our employees to go to a four-day work week and take a 20% cut in pay. Myself and my founder went without salary for six months in 2009.

Sramana Mitra: That’s during the recession.
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Bootstrapping Using Services From Houston: Identity Automation CEO James Litton (Part 1)

If you haven’t already, please study our Bootstrapping Course and Investor Introductions page. 

James has built an identity management software company from Houston and now wants to go upmarket.

Sramana Mitra: Let’s start at the very beginning of your journey. Where are you from? Where were you born, raised, and in what kind of circumstances?

James Litton: I am a native Houstonian. I’m a rare breed. I was born and raised in Houston. In terms of circumstances, I think I’m your quintessential American middle-class family.

Sramana Mitra: What did you do for schooling?

James Litton: Of course, once I got through my primary and secondary education, I took a number of college courses, but I’m a graduate of the School of Hard Knocks. I entered into the workforce fairly early when I was about 19. I was working on, what ultimately ended up being my path, information technology. I took on a significant interest in information technology from the very early days. >>>

Bootstrapping an IoT Company from North Carolina: Bob Witter, CEO of Device Solutions (Part 4)

Sramana Mitra: What does it mean when you say they distribute? Do they distribute your component or do they distribute the fully-integrated solution of these gas cylinders that have self-monitoring and  self-updating capacity?

Bob Witter: When we started, we were only a device provider. We helped them find the resources to build out the solution and that was the backend. They already had some sensor devices that they were using. We helped them find some sources to build their own. At that point in time, we were just supplying devices.

Today, we have moved to a model where we provide the whole ecosystem. We are in discussions with them so they don’t have to worry about things like subscription activations and support. We are giving them the opportunity to make us the scapegoat if something goes wrong. We are trying to go back and talk to some of our customers who, in the past, thought of us as an equipment provider, and pull them into the family for the whole ecosystem. >>>

Bootstrapping an IoT Company from North Carolina: Bob Witter, CEO of Device Solutions (Part 3)

Sramana Mitra: When did you hit upon this as a key go-to-market strategy for sourcing projects and being brought into projects?

Bob Witter: It was specific to these vendors. These are the relationships that we started to build in the first couple of years of our operation. We knew a lot of these vendors through our experience in the cellular business. We cold-called on them a lot and asked them if they had opportunities come in to them looking for design teams to build their devices. We hit them up every month and say, “Anything new?”

Sramana Mitra: So very early on, you figured out that these component vendors would be good sources of leads for you in terms of new projects?

Bob Witter: That’s right.

Sramana Mitra: What was the ramp of the business? You said you started in 2003. You’ve now been in business for more than 12 years.
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Bootstrapping an IoT Company from North Carolina: Bob Witter, CEO of Device Solutions (Part 2)

Sramana Mitra: Can we double-click down on what exactly happened in the first  couple of years? It sounds like you started with a hypothesis and that didn’t get any traction in the market. You had to pivot. How did you figure out what to pivot to? What happened? What struck the cord?

Bob Witter: We stuck with our core expertise, which was RF design. We just shifted a little bit. Instead of helping people get their own designs through the certification process, we actually started helping people design. It was just a matter of a lot of cold-calling and actually seeing where it went to a large extent. Where it kept going and where people really wanted help was on the design side.

Sramana Mitra: What kinds of customers were looking for this help?
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Bootstrapping an IoT Company from North Carolina: Bob Witter, CEO of Device Solutions (Part 1)

If you haven’t already, please study our Bootstrapping Course and Investor Introductions page. 

North Carolina, at one point, had a large concentration of cellular technology companies. Today, some of that talent has come together around IoT.

Sramana Mitra: Let’s start at the very beginning of your journey. Where are you from? Where were you born, raised, and in what kind of circumstances?

Bob Witter: I was born in Springville, New York. It’s in the western part of New York. I grew up in central New York. I went to school at State University of New York and graduated in 1981 with degrees in Computer Science and Mathematics. I started my career in Rochester with Eastman Kodak company in the medical products division that was brand new at that time. I learned a great deal about how to do medical products that has certainly served me well even today at Device Solutions. >>>