Al Fares and Celitech — Cohort 13 Founder Spotlight
Al Fares, Founder and CEO of Celitech, aims to provide affordable and on-demand wireless connectivity to all. In this week’s founder spotlight, Al explains the concept behind eSIM and Celitech’s role in disrupting the traditional data plan for mobile devices.
Can you begin by explaining what an eSIM is to someone who is totally unfamiliar?
eSIM is a feature in new devices that allows the digital activation of connectivity. Instead of using a physical SIM card, you’ll be able to scan a QR code to activate a wireless plan.
eSIM is definitely DIY, unlike a SIM card. If you just went to the shop, bought the phone with the SIM card, why would you know about how to change the SIM card? With the eSIM QR code, even baby boomers (who pre-COVID didn’t have much knowledge around QR codes) are familiar with them because they use it for payment, vaccination proof, and at restaurants.
What is the personal inspiration behind Celitech?
I come from a modest background. I struggled to get a good education and the internet was definitely a big enabler in my career. I remember when I had to sit for my SAT… back then it was dial-up and basic internet. Because of the internet, I managed to get test samples and apply to top schools, get admitted, and look for scholarships. It has a personal connection to me because I believe the internet is a gateway to opportunity — especially now. Everything is online, we socialize, shop, and work remotely, so the why for me is being able to build a business that has a positive human impact. And this human impact is about giving better opportunity to people. Obviously, we’re starting with travelers but eventually this can grow to include people in general across the globe.
What are the uses of eSIM within and outside of travel?
Within travel, it’s to help you save big on roaming. You can always use roaming but it’s crazy expensive. eSIM helps you connect to local networks and save 80–90% of your roaming fees. Beyond travel, the ultimate change we’re trying to drive is how people access and acquire wireless. eSIM is digitizing the last mile of connectivity. Historically speaking, wireless has been distributed using brick and mortar shops. You go to the shop, buy a plan, buy a phone, and that makes the customer acquisition cost of wireless $500-$700.
With eSIM, we’ll be able to drive that customer acquisition cost down to zero and share the savings with the consumer. And the time-saving and convenience are extra benefits to consumers. Ultimately, what we’re doing can help the internet become more affordable because we’re digitizing the way it’s distributed while making it more “on-demand”.
Another aspect is the current classical way of accessing networks is done using a monthly subscription which is mostly tied to some sort of a contract. Now with eSIM we can make it completely on-demand. We have many new use cases, for example: you have an iPad, but you don’t want to buy a plan for your iPad because it is mostly on wifi at home. But if you go on a road trip, you want to get a couple of hours or a couple of days’ access. These are the use cases that will eventually disrupt the way we consume wireless and make it more accessible. More and more consumer devices can connect nowadays: smart watches, smartphones, tablets, voice assistants, etc. We’re not going to enable all these devices by keeping the classical way of connectivity or people are only going to use them on wifi at home. So this is something we can ultimately enable using eSIM.
Can you talk about your experience as an entrepreneur?
I studied electrical engineering and when I finished my degree, I did my first telecom digitization project. I worked for National Instruments (NI), US; we digitized the way you test the quality of service of networks. Back in the days of GSM/3G, we used to have big vans that go around cities to test the quality of service and the coverage of networks. I lead a team of five engineers and built an algorithm that runs on a laptop with an antenna that provides the same role as these multimillion dollar vans. Back then, I didn’t have any business experience, it was all technical and I didn’t see opportunity in that. But eventually the algorithm became a product of National Instruments and I published two papers about that, one of them at a top IEEE conference in Japan. That gave me the first experience into what’s going on in this field.
After receiving my MBA, I co-founded my first company, Acsys, an IoT company providing a programmable mechatronic lock that doesn’t require power. Our main clients at Acsys were telecom companies because we helped them secure and manage their sites. Acsys (based out of Hong Kong), managed to scale to 60 countries. Because they were my clients, I understood their problems and issues operationally so I could see where the industry was lagging as well, why we need to change a lot, and why it’s a good business opportunity to change the way we consume connectivity, especially with regards to travel.
Do you think Celitech will continue operations in Hawaii?
We just hired our first sales and marketing associate in Hawaii. I found a very interesting market here: Of Hawaii’s annual travelers, 35% or 3.5 million are international. The total spending of tourism in-state is around $20 billion but almost half of it comes from that 35% because international travelers tend to spend more. The majority of these international travelers are coming from two locations, Japan and Canada, and these two sets of travelers have high roaming fees if they want to connect in Hawaii. So we found an interesting opportunity where we can help these travelers connect and enjoy better travel experiences, and conveniently do it through hotels or travel companies.
Hotels offering products online can bundle eSIMs with whatever they’re offering and get their travelers connected. It’s going to be an extra ancillary service that hotels can offer. Hotels used to sell you all these attractions and promotions at the front desk, but this is disrupted with COVID and everything being online now. If the hotel sells you the connectivity they can better share digital offerings around whatever they used to have at the front desk. Hotels here are a strategic market, and the beauty of Hawaii is all these hotels are concentrated in one place.
How else are you advertising eSIMs?
We have an anchor agreement with Expedia Group among other leading brands. We just signed JTB, the leading travel company in Japan. We’re trying to use their marketing muscles to bring awareness to eSIMs because they have the brand and the reach. We help them with material by building content around eSIMs — ebooks, travel use cases, etc.
What is one thing you are excited about living in Hawaii?
I am big on green energy and the change we need to make in our habits to help the environment. In our business, I always say we’re helping by disrupting SIM cards and saving their plastic waste. We’re environmentally friendly because we’re digital. I learned something interesting recently, that cows are now producing more greenhouse gases than cars! Literally 15% of all greenhouse gases are now produced by cows. I had been eating poke every day for the past four weeks, which made me realize, I can live without red meat. I made this decision to give up red meat to be able to help the environment while living healthier. Poke is really healthy. I was concerned at the beginning because I’d never eaten it that frequently before. But it’s healthy even though it’s raw, especially if you switch/mix between tuna and salmon which has lower mercury levels. It helps.
[Poke and eSIMs on repeat]
To learn more about Celitech, visit: www.celitech.com
