SANJIT BISWAS PHYS CAL OPERAT ONS

The First Frontier For Digital Transformation

WORDS BY PAUL ESHERWOOD

here are some very compelling examples of established markets being transformed by a single innovator. Think about what Amazon did for shopping, what Netflix did for movies and, in the b2b space, what ServiceNow is doing for backoffice workflows. The IoT industry is more than 40 years old, but until recently most companies that strapped a device to a physical asset got little more than some binary data with almost zero value. Samsara, a new entrant to the enterprise tech space, is poised to change that.

Although most enterprise applications can trace their roots back to materials planning software and the need to support manufacturing operations, the overwhelming majority of investment and development in enterprise tech has been geared towards white-collar workers in back-office environments.

Billions of dollars have been pumped into transport network that has hundreds of moving parts spread across countless geographies?

It is the physical component of the enterprise where there is the most potential for technology to have an impact.

Add to this the current macroeconomics of supply chain disruption, soaring energy costs and a concerted effort to drive sustainability and it becomes clear that for organizations in all but a few industries, it is the physical component of the enterprise where there is the most potential for technology to have an impact.

One tech vendor that has seized the budding opportunity for this underserved market is Samsara – a relatively new company that floated on the NYSE in December 2021, just six years after its inception. It raised more than $800m in the IPO and was valued well above its high estimate at nearly $12bn. Trading under the appropriate ciencies; in an invoicing procedure or in a global three issues.”

Background

Sanjit Biswas is an academic and an engineer by trade. He founded his first business straight out of MIT and later sold it for more than a billion dollars to Cisco . That company, Meraki , designed and built the original concept of WiFi (before it was called WiFi) and popularized a ‘Free the Net’ movement in San Francisco which delivered access to the internet for citizens and businesses. Today, Cisco Meraki is used globally by the world’s biggest organizations for resilient and secure cloud-enabled networks.

After selling up and taking a short hiatus from work it wasn’t long before Biswas went back to the drawing board and started to look for inspira- life isn’t for them. What inspires a billionaire to go back to the drawing board and start over? What lessons can be carried forward from previous experiences? And what pillars do you build a new company around when you have a blank canvas to start from?

“We have the capability to make physical operations more efficient, safer and sustainable.”

Samsara has grown rapidly from a start-up to a public company with a huge valuation in a very short space of time. There are some sharp lessons in the market for any new entrant to consider and designing the blueprint for an enduring brand is very different today than it would have been 20 or even ten years ago. Founders who wish to build a applications the technology could have. I’m an engineer at my core and I love the idea of solving problems and using whatever knowledge and expertise I gained along the way to basically try to have some impact – that’s what motivates me.”

The topic of motivation is always one that I am keen to explore whenever I meet an exceptionally wealthy individual who decides that beach company – look at the likes of Oracle and SAP –they are 40 or 50 years old and see the impact they have on the world today. We invest and plan for a longer term future so we can have the same kind of impact in years to come. These are all things we took away from our previous journey. And now we have thousands of people focused on a single mission built around these fundamentals.”

I’ve heard the same story several times before but not often with the same level of quiet conviction. Biswas is an understated man, untypical of a tech CEO and that makes a refreshing change. I often think that it’s very easy to be undone by your own success when building a fast-growing business – there have been plenty of examples over the years – but that’s not a concern with Biswas and Samsara. His considered nature and thoughtful responses leave me feeling that the story is authentic and the future is bright.

IoT market and customers

Before we get into the Samsara playbook it’s important to make a distinction between the application of its solutions and the chequered history of the IoT industry. First off, some of this isn’t new stuff – ever since Coca-Cola put a sensor on a vending machine in 1982, we have found more and more homes for smart sensors to collect data. The principle of putting IoT devices on physical assets is a mature concept and estimates range from 10 billion to as many as 35 billion such gadgets are currently in use. That figure is projected to rise to as many as 75 billion by 2025 but the plain fact is that no one really knows exactly how many are in circulation – and that is inherently the problem.

By far the biggest criticism of the IoT industry by the early adopters of connected technology was they simply collected too much unusable information. Millions of tiny gizmos were strapped to lorries, elevators, cranes and diggers – even coffee machines – and they all collected binary data that was largely geared towards identifying breakdowns. Whilst knowing if or when an asset was likely to fail did deliver some benefit, the reality was that most machines are pretty robust and the quantity of data collected just to prevent the odd breakdown simply didn’t justify the tsunami of superfluous information. Worse still, all that inordinate data sat in a silo which was disconnected from the broader enterprise. As a result, millions of IoT devices have been switched off or lie redundant – not because they couldn’t collect data, but because the organizations collecting it didn’t have the tools or resources to interpret and act on it.

“You can think about IoT from ten years ago like a huge bucket of Lego bricks with no instructions. They had the potential to be built into something special but you had to be a sophisticated engineer to piece it together. Customers who first used IoT devices didn’t have the time or resources to assemble everything into a useable form. That’s where Samsara is able to step in and provide these applications on a platform where customers can just plugin and get the visibility they need.”

Whilst some of the hardware is the same, it is the way that it is connected through the Samsara Connected Operations Cloud that changes the game completely. Encompassing video-based safety features powered by AI, vehicle telematics, equipment monitoring, site visibility, infrastructure workflows and an app that has a developer community – the Samsara Connected Operations Cloud delivers a holistic platform that can conceivably connect, monitor and optimize virtually any physical asset or process. Samsara has taken a collection of existing technologies and packaged them into a compelling cloud-enabled solution. But it wasn’t always that way, Biswas told me candidly.

“We deployed our first beta product for a cheese-making company in the hope that we could help prevent their fridges from breaking down. But it turned out our hypothesis was wrong – the fridges never broke down. Then we worked with that customer to understand what the weakest point in their supply chain was and discovered there was a far better way for us to use our technology.”

That customer now deploys Samsara technology across its fleet of chilled distribution trailers, it uses wireless sensors to give real-time data when cargo doors are opened, it utilizes vehicle and asset IoT gateways to provide to-the-minute GPS data and benefits from smart tools to predict when failures may occur and then uses the same intelligent technology to automatically backfill routes that have been disrupted.

“One of our core values is that we build for the long term…like embedding customer success in everything that we do, around building our culture and creating an environment for teamwork and collaboration.”

Another company that has seen huge benefit from Samsara technology is Dohrn, a US warehouse and logistics company that epitomizes the sweet spot for this solution. Remember my earlier comment about a straight line to ROI? Dohrn saved $500,000 in year one by optimizing fuel efficiency and a further $200,000 on cellular data charges by adopting Samsara’s built in WiFi. That’s the kind of immediate return that is very rare when investing in enterprise tech.

Conclusion

The IoT industry has promised much and delivered very little for several decades. There has been a real sense of a solution for a problem that didn’t really exist – or at least it was only part of a solution for a problem that hadn’t been fully realized. Whilst the concept of connecting assets in physical operations has always had merit, it wasn’t until these disjointed touch points could be harmonized in a single ready-to-go platform that any value could be realized from the data.

Samsara’s proposition follows a path that many other very successful enterprises have adopted. It’s not usually the inventors that change the world, it’s the people who know how to put the invention to use that leave a lasting impression. If you think about the most successful global brands – they didn’t invent their markets, they took an established concept and made it better. In a similar fashion, Samsara has collected up some incoherent tech that has been kicked around for decades, augmented it with their own cloud platform and harmonized it into a solution that is fit for modern commerce. Instead of selling the hardware, the platform and the applications as separate commodities, Samsara is able to bring an end-toend solution to the market that has some really interesting use cases and delivers the holy grail for enterprise tech vendors – visible ROI. Biswas’ timing is brilliant – if not also a little fortuitous – as global economics are demanding that organizations change how they operate, especially in low margin, energy sapping industries. The emphasis is on how we move things around the world in an efficient, safe and sustainable way and Samsara has a solution that makes investment into optimizing these processes very compelling.

It’s no surprise to see several ex-ServiceNow people in the Samsara fold. While the two propositions are very different there are similarities in the respective missions. ServiceNow has tackled the way that work flows across a back office, connecting disparate systems and providing a canvas to coalesce previously disjointed data points. If Samsara can emulate half the success that ServiceNow has enjoyed with a mission to do the same for physical operations, there will be a bright future ahead for this unique company.