Vecna’s Deliberate Approach to The Market

Theobald describes Vecna’s marketing strategy as being a “Fast follower” model – meaning that they were patiently waiting for the market to be “ready for robots.” They previously confined their marketing efforts mostly to selected pilots.

They were already working on their Next gen. – mobile robot for warehouse type applications. However, they only announced their full-fledged market entry in April of this year. Theobald points out that they have just recently hired their first salesperson for the robot business, after having been in the field for 22 years.

Today, he describes the customer attitudes in general as, “We need robots.” Theobald observes that some of the robotics companies that approached the market more quickly and aggressively may not only have lost money, but also hurt their own images and reputations. In a new field, such as robotics, customers expect complete reliability and can hold it against a supplier if anything goes wrong.

Favorable Market Conditions for Robotics

Barriers to adoption have largely receded today. Theobald points out that only a few years ago broadband wireless was not accepted in many industrial settings. Now broadband is widely available and the existence of wireless infrastructure makes it easier to bring in robots.

Appetite for robotics “skyrocketing,” he states. A confluence of three positive factors has occurred: a) People have come to “like robots,” b) The economy has been improving, c) There is global competitive pressure on most businesses. As a result, he concludes, enthusiastically, “Appetite for robots is skyrocketing.”

Vecna Business Breakdown

Vecna’s business has previously been broken down into three primary areas:

Patient Solutions:
An information business, not based on robots, that provides software and systems for helping healthcare providers with tasks such as patient scheduling and billing and provides patients with a personal healthcare portal.

Logistics:
Supplying robots for material handling and other functions around warehouses and product fulfillment centers and other facilities. These range from devices that can lift, carry or drag workloads weighing thousands of pounds to those that are optimized for picking out and carrying smaller types of packages or other articles.

VGo:
Telepresence: Acquired by Vecna in 2015, this is a business based on robotic telepresence that has been aimed largely at healthcare and education-related applications. In a typical situation, a child who is ill can “attend” classes via the VGo robot and interact with teachers and schoolmates, from a distance, via a laptop or other device. In one pilot, Dartmouth’s football team had a VGo on the sidelines to allow a distant doctor to examine any player who might have incurred a concussion.

Reorganizing for Growth

Theobald explains that these businesses have now been organized as three independent vertical entities. This has been done, in large part, because the market entry strategies and issues for each can vary widely. It also enables Vecna to seek outside financing, for the first time, independently for the entities. It is currently seeking financing for the Logistics business.

Theobald also states that the business is expanding and that the company intends to form two more independent verticals, one aimed at Transportation and the other in Agriculture.

Keys to Future Expansion

Theobald emphasizes that Vecna has over a 20-year background in robotics. He states that, “Robotics is hard.” It involves complex dynamic situations and, in a sense, as he puts it, is the “pinnacle of technology.”

However, the fact that a robot works reliably, and even if people “like it” or think it is “cool” is only part of the process of achieving business success. At least two other factors must be considered: One is cost; the other is usefulness.

Theobald addresses both of these issues head-on. He states that they are seeking to drive down cost of goods sold for all their robotics products. With respect to the VGo telepresence robots, he believes there could be a major consumer market opportunity. However, it will probably involve driving the price down from the current $4,000. He believes this can be done, based on achieving adequate volume.

The “24/7” Robot

Regarding usefulness, he acknowledges that if a robot is very limited in its capabilities, it is less likely to prove itself in, in a business setting. As for consumers, it is more likely they will tire of using the device. He cites robot vacuum cleaners, which, he says, are only used on an ongoing basis – after the novelty wears off – by about one in five purchasers.

One of Vecna’s objectives, he states, is a “24/7” robot. This obviously involves increasing the types of uses for a single robot. In the case of the VGo devices, he explains that the company is working on extending capabilities of a robot that’s current main use might be in helping an elderly patient.

In addition to its normal telepresence function – checking on the patient from time to time, and being the patient’s portal to contact with others – it could also be equipped with capabilities to provide more complete in-home care: for example, monitoring the patient’s medication and exercise schedule and informing a caregiver if there is a deviation. Also it could be endowed with capability to provide security for the patient.

Our Take

We’ve had a very positive attitude towards the robotics area. Inevitably, any discussion with a robotics company leads to some of the issues about the arguments over not only the potential Good of robots, but also the supposed Bad and Ugly they represent in some people’s minds.

Theobald regards robotics historically as simply one more step in the human race’s innate ability to use technology to better the life of humanity. As he points out, this has been going on since the time of the cave men/women.

He understands the issues regarding the steps towards acceptance of new technologies. He emphasizes, very strongly, how much effort Vecna has put in to ensuring that its robots can be trusted to work safely in close association with people. The underlying rationale for robots, as he sees it, is to improve the ability of people to get things done and to reduce the stress of very mundane but difficult work.

He emphasizes the difficulties inherent in getting machines to recognize objects and react properly based on context. He labels this, “the most universally underestimated challenge in robotics.” He points out that a Vecna robot can be shut down, from outside, if it begins to engage in potentially dangerous behavior.

Theobald’s advice is probably very valuable for those pursuing the development of autonomous vehicles, another area that we are very interested in. Making machines that behave according to plan, in more confined situations – which is what robots must do – provides a lot of very interesting and instructive thoughts for those who intend to put massive machines out on the roads, trusting them to behave.

Visit their website: www.vecna.com