If we can transform data into information, we will have a rational society: interview with Alicia Asin

Internet of Things is a buzzword you cannot escape. You can’t even open a (smart) fridge anymore without being drowned in new connected devices, news of investors pouring money into IoT startups, and Kickstarter campaigns for Bluetooth or Wi-Fi enabled objects.

And in all this deluge of information it’s still likely you haven’t heard of one the most important companies in IoT. Libelium is not a media darling. You also won’t see them in portfolios of VC powerhouses. And they run their business from a Spanish city of Saragossa instead of a downtown San Francisco office. But Libelium’s Waspmote sensors are the backbone of hundreds of industrial deployments and Cooking Hacks is the go-to directory for IoT developers.

I sat down with Alicia Asin, Libelium’s co-founder and CEO to discuss the future of Internet of Things. We also talked about how the reality of connected world will change society, from theimpact on democracy to security and privacy threats. Enjoy!

Alicia Asin, CEO and co-founder of Libelium

Wojtek Borowicz: I would like to hear more about the story behind Libelium. It’s not typical for a startup. You’re one of key, global players in IoT but you’re not a VC darling. You don’t get featured on TechCrunch every other week. So, what is your story?

Alicia Asin: It’s a story of bootstrapping. We started in 2006, right after graduating. From the very beginning we wanted to do something viable and we focused on revenue. Positive cashflow was our obsession. Because of that we started with Cooking Hacks. It made it possible to finance Libelium and acquire capital for R&D that enabled us to build the Waspmote sensor network. It has also given us the legacy of working closely with makers and universities. Tech companies often treat raising money as an end in itself, while it’s just means to an end, to get you where you want to go.

So you have never raised VC money?

No.

And you entered the market in 2006. Barely anyone recognized the term IoT back then. 10 years later, it’s one of the biggest buzzwords in tech. How has the landscape changed in those years?

10 years ago, people were talking about wireless sensor networks. WSN was the word, nobody was talking about IoT or smart cities yet. Many things have changed since then. First of all, people are getting excited. And we’ve also seen market education. It shows it’s a proven market. For example, in the early days of smart cities it was about deploying as many sensors as possible, the cheaper the better. Right now you talk to a municipality and they ask: what about the calibration? What about the range? How does it interfere with urban environment? These are the right questions to ask.

I’ve also seen a rising interest in interoperability and ecosystems. Ecosystem is the most repeated word after IoT in all the conversations, wherever we go.

Would you call IoT a mature market, then?

I would call it an emerging market. If you look at the most promising startups, nobody is making tens of millions of dollars with IoT products yet. You only hear about this kind of revenue from the big companies and they’re just allocating existing revenue under the IoT label. Everything is yet to come.

I hate to say this, because all the analysts say it, but I believe this is the year for IoT. We’ve been here for 10 years. Sales cycles are getting short and for the first time we’re not talking to IT, or R&D, or innovation people. We’re talking directly with business development, backed by C-level executives.

So the conversation about IoT has moved from hackers and developers to the decision makers?

Yes.

That’s interesting, because in the mainstream IoT is still often associated with gadgets and wearables. Libelium has always had much more industrial focus, though. Why is that?

When we started, the market was industrial. It’s been like that with every technology. It first entered enterprise and then became a consumer product. Think about cell phones that were first used by business people. Or about personal computers. You didn’t have a personal computer for yourself until all the companies started using them.

The problem with IoT is that we’re living in exponential times and we’re seeing these two ways overlapping. And now there’s the problem of hype. When you go to the late majority they’re still listening to the things about connected fridge or that stupid egg thing from Quirky. And they say: you know, I think you’re talking about toys. And you’re trying to bring toys into industrial environment.

Do you personally use any consumer IoT gadgets, like Nest or SmartThings?

Not yet but I’m researching smart door locks. I also want to try smart lighting in my house. These are going to be my first.

Libelium is a global company, though many companies who claim that actually mean being US-centric. Where does the money flow in industrial IoT?

The reason why many companies are US-centric is they’re located in the US which is a huge market that can absorb all your resources. That’s natural. In our case, we’re selling in 115 countries and we’re still identifying the main markets. Right now it’s North America and Western Europe. APAC has not been in this group before, but in 2016 it’s going to be a main market for us so that gives you a very good idea of the geography of IoT.

Waspmote starter kit

Libelium’s platform is suited for several use cases, but your particular focus seems to be smart cities. Why?

We’re focusing on smart cities and agriculture, which so far have been the most dynamic verticals for us. And also verticals where we have the most expertise, so that’s natural. Also, smart cities require products with a similar approach to Libelium’s. When we design a product, we always think about interoperability. We aim to connect any sensor, using any communication protocol, to any cloud service. That’s why we’re an ecosystem company.

This is interesting for cities because they shouldn’t be hijacked by technical companies. A city should be able to change their cloud service provider after five years if they’re not happy. If a wireless technology they’re using is not working, they should be able to switch. Once you’ve installed the infrastructure and spent all the capital it’s very unlikely you’re going to replace the devices.

Instead, if you have your installation and can change to a different protocol, you have all your options open. It’s the same with cloud services. When we say we’re integrated with different cloud platforms, we really mean that you can just configure your gateways in our GUI and start sending data. And if you’re not happy after six months or a year, you can just deactivate it and activate another one. This is especially needed in smart city environment and that’s why our solution fits so well there.

And do you think we can start thinking about cities as platforms? Will cities of the future have their APIs and SDKs?

I would love to see that! Properly used, IoT can help foster democracy in cities. Data would bring more rational decisions and clarity. And if all data would be open, citizens could check progress of their cities. But going beyond, if cities are generating data and publishing it in an open format, startups could use it to create new services. It’s similar to the Green Button Initiative with energy in the US that allows companies to develop apps to advise you on power consumption. That could be extended to a whole city.

So what are the examples of some truly smart cities?

Santander was very, very early in the smart city landscape and they were pioneers.In 2011 they were the largest smart city. Malaga and Barcelona are also doing a good job. Barcelona has developed their own cloud platform and that’s more than a technical thing. It means that the municipality is taking a holistic approach to smart cities. The former mayor of Barcelona did splendid work on that.

Mobility initiatives in San Francisco are really well designed, too. And the planning of the city of Singapore, the way they are approaching the whole smart nation concept is amazing. They are not massively deploying any sensors yet, but everything I’ve read about their approach seems absolutely right.

Singapore. Photo: Oli Mohd

What about the risks of making cities smart and connected? It’s hard not to imagine dread scenarios: every year we hear about companies losing billions of dollars to hackers but hacking whole cities would be much more devastating to the society. Aren’t you afraid of that?

Of course I’m afraid. Everything that involves any new system is at risk of being hacked. That’s reality and nobody can be so naive to think it’s not gonna happen. Of course there will be attacks, somewhere, somehow. But we need to think about the benefits.

We have cameras in our cell phones. We’re even using them to speak to each other right now. We’re having a real conversation without being in the same place and that’s great. On the other hand, if that camera is hacked, it can be used to spy on me. That’s a risk and it may happen but benefits compensate that.

And where’s privacy in all that? At one of the conferences you claimed that convenience trumps privacy. Don’t you think it’s a dangerous attitude towards technology?

I think behavior is changing. There’s a big fuss about privacy in technology but we have Smart TVs with 80 pages of privacy policy that absolutely no one reads. But that Smart TV could be listening to everything you’re saying. And… so what? I have nothing to hide, I’m not Angela Merkel, I’m not Obama.

People are looking for so much exposure by saying absolutely everything on Facebook, Twitter, or Instagram. Tech manufacturers have said well, if they don’t care, maybe we can make a business out of it.

Are there any other social consequences of the rise of smart cities, beyond the trade-offs including security and privacy?

If we’re data-driven, we will have a more rational society and more rational companies. If we can transform data into information, which is the biggest challenge, then we will be more cost-effective, more productive, and we’ll save the environment. To get that done the soonest barrier to overcome is interoperability. We still see new connectivity standards, new sensor devices, new cloud platforms. Big players are realizing this is not going to be dominated by a single company. So we need to cooperate.

That fragmentation is driving customers and end users to say even putting together a proof a concept is too expensive and difficult. That’s why at Libelium we’re creating the IoT Marketplace. It’s a place where we aim to become the Amazon of IoT by making fully integrated solutions available for proof of concept. So far we have 17 kits and aim to have more than 100 by the next year.

The last question is less related to Libelium. You’re one of few female founders in tech. What would be your advice to encourage women to become entrepreneurs?

First of all, go to a university and pick a scientific degree. I’m a computer science engineer and to be a CEO, a C-level or VP-level executive in a tech company, you need to be an engineer. Even if you don’t have much experience in coding you need to know how this industry works. These positions are for engineers and some people still think they’re for business school graduates. Of course you need to go to business school and get your MBA but first you need to be an engineer. You also need to be ready to fight very, very hard. It’s not gonna be easy.

Make sure to recommend this post if you liked it! And follow Estimote channel for more interviews in the coming weeks.