Solving the First Mile Problem in Industrial IoT — Why We Invested in Crosser
Today we are proud to announce that 42CAP has joined the investment round into Stockholm-based Crosser, together with Spintop and Industrifonden, one of the biggest VC funds in the Nordics. Crosser offers the best streaming analytics solution for industrial IoT and is what we feel, one of the most exciting companies coming out of Sweden.
We wanted to share a few thoughts on why we fell in love with Crosser’s solution and of course its team and finally decided to join the company on its journey for the future. Being one of the biggest emerging markets, we have closely followed the topic of Industrial IoT in the last year and finally found conviction with our first move into this space now.
Living on the Edge
Industry is getting an update to version 4.0 and while big brands are showcasing the factory of the future, lights-out-manufacturing is not expected to replace the existing infrastructure in the next couple of years.
First things first: Edge computing is a method of optimizing cloud computing systems by performing data processing at the edge of the network, near the source of the data.
With the industrial IoT space further evolving most players in the market have recognized that edge computing is an integral part of the value chain. Yet, use cases in practice are often limited due to costly bandwidth-intensity which leads to either performance challenges or makes real-life applications uneconomical. Nevertheless, not all data needs to be sent to the cloud or core data center, which makes it imperative to have data aggregation and processing capabilities deployed at the source of data generation, as an aid to rapid decision making using near-real-time analytics.
Running the First Mile of Industrial IoT
Many people will argue that the last mile of a marathon is the hardest. You have come such a long way and still need to bring it over the finish line. We are convinced that the first mile is at least as tough, getting off the ground and creating a fundamental basis for great performance.
While many applications in the market are focused on advanced use cases, running AI and Deep Learning on industrial data, the main challenge on the production floor starts way earlier in the IoT value chain: Data Collection. This is where Crosser tackles the problem, solving the first mile challenge, climbing up the ladder rather than the other way around.
Crosser enables companies to access the machines’ raw data, clean it, sort it and only send low volumes of relevant processed data into the cloud, therefore allowing for a cost-efficient and easy way to intelligently collect data from all assets. Furthermore, they support different Machine Learning frameworks to run on the edge, allowing companies to use their proprietary Artificial Intelligence solutions — BYOAI (Bring your own AI).
The connected multi-tenant cloud platform includes Crosser’s “Flow Studio”, a graphical drag-and-drop interface to configure the edge applications and automatically deploy them as groups of end nodes.
The capability to graphically connect prebuilt software modules helps, in particular, the management and maintenance of analytics applications, given that they tend to undergo frequent changes. This is a major advantage for business users, empowering them to run agile analytics applications without on-site IT staff, driving rapid adoption in the market.
Crosser’s dashboard gives live status insights to all your nodes, historical data for trend analysis and sends notifications to steer your attention. Furthermore, it gives the opportunity to deploy new and updated software in a controlled way and allows for auto roll-back if updates fail.
Crosser’s business model is highly scalable comprising a fixed yearly SaaS fee for the Cloud plus a fee per deployed Edge Node. This enables customers to start out with single use cases and further extend to new applications over time, scaling the pricing depending on actual usage. This business model provides full flexibility on the size of the customer, as well as the industry vertical. As mentioned in our investment thesis, we do not shy away from Enterprise Sales but rather embrace the challenge and strongly believe in the opportunity.
Although being still in the early days of its journey Crosser was named Gartner Cool Vendor 2018 in IoT Edge Computing, thanks to its unique and powerful approach towards the industry. This allowed them to win big brand names in different verticals, such as Valmet, the global leader in developing and supplying technologies and services for the ulp, paper and energy industries. Valmet runs the Crosser solution for collecting and pre-processing machine data and the secure integration and movement of data to the cloud.
The single most important factor for us, after falling in love with the product, is an experienced and passionate founding team. And we could not wish for more with Crosser.
Martin, CEO and co-founder, is an experienced entrepreneur who has already successfully built and scaled companies internationally. Ulf, the second founder and in charge of R&D, is the brain behind Crosser’s real-time engine and has an extensive background in advanced enterprise integration and development. Johan, the third founder and CMO, has 15 years of experience working with marketing in all possible types of projects and companies on the founder as well as the corporate side. Finally, Göran is complementing the team as its CTO with 20 years of experience in leading technology teams with focus on the architecture of the end-to-end solution.
We know that Crosser is steering into a challenging industry, but after meeting the team in person, we are fully convinced that their combined experience and knowledge will be the winning factor for the journey ahead.
Crosser is solving the most pressing challenge at the very bottom of the data hierarchy pyramid and therefore acts as the so necessarily needed enabler for the whole Industrial IoT space. It fits perfectly into our investment thesis and has the opportunity to occupy a key position within every IoT stack. Although still in its early days the team behind Crosser has already achieved to build a great product and proved its market need with happy customers. We are proud and happy to accompany Crosser in these exciting days and are looking forward to the journey ahead.