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#3 Startup Stories | with CEO of Instrument Works – Shane Cox

Shane and the team at Instrument-Works have identified a great niche and are offering hardware and software to their customers leveraging the Internet of Things (IoT). There is a still a lot of challenges for them to overcome in their existing markets, including educating them on how to purchase software, but there is an immense opportunity for them to address if they can execute. Exciting times ahead at Instrument Works!

Please check out the video here

For those that prefer to read there is also full transcript below but here are the highlights;

What is your elevator pitch?

Instrument Works is a mobile first data acquisition and control platform. We specifically target industry and researchers particularly in universities. So our products range of hardware instruments and sensors that measure things like pressure and temperature. We have a software component that control the hardware

When did you first realise this is a problem that needed to be solved?

I’m a mechanical engineer. I worked as a researcher about 10 years. software was a problem that I lived with every day. we’re using devices and instruments like 20 years old and difficult to get better out of them. so it like well, nobody else is going to solve it, why don’t we try and solve it ourselves.

Can you tell us more about your sales story? People, process, technology

Effectively and we’re at the moment targeting pretty much only universities. We identified them as our first user base we want to build up primarily because they are good at adopting new technology. It’s the area where I have a strong background and then it’s very easy conversation to have.

Now we identify potential candidates for the products, usually by the universities websites which are great. They give everybody access to all of the academics contact details. we started mostly with the people we knew and they worked out, people they knew, and then people they knew. So we’re expanding that way and working with people that know people that we’ve already sold to. we find it that much easier to sell to somebody, if you somebody that has already bought our product, rather than somebody that never heard of this before.

What is your biggest revenue generation challenge?

We’re still trying to figure out the researches of the industry that are very happy to pay for hardware, understand how to pay for hardware. They less understand how to pay for software subscription services. The way funding cycles go are difficult. So when we have those software conversation, they tend to get really difficult. But at the end of the day, in a lot of cases, the value is really in the software. We’re trying to change that mindset. It’s going to be a real challenge for us.


Full Transcription

Andy: Hi everybody. My name is Andy Farquharson and welcome to startup stories, the series of interviews with B2B startup founders, talking about their biggest challenge and it’s my favorite topic as well in sales. I’m very very fortunate to be joined by Shane Cox, CEO of Instrument Works. Welcome Shane.

Shane:  Thanks Andy.

Andy: We like to start with one key question for B2B sales. If you could please give us your elevator pitch.

Shane:  Cool. Instrument Works is a mobile first data acquisition and control platform. We specifically target industry and researchers particularly in universities. So our products range of hardware instruments and sensors that measure things like pressure and temperature. We have a software component that control the hardware

Andy: So there is hardware and software components for sale, sometimes.

Shane:  Sometimes, yes.

Andy: When did you first realise this is a problem that needed to be solved?

Shane:  I’m a mechanical engineer. I worked as a researcher about 10 years. Software was a problem that I lived with every day. We’re using devices and instruments like 20 years old and difficult to get better out of them. So it was well, nobody else is going to solve it, why don’t we try and solve it ourselves.

Andy: That’s really cool. So it came out of your personal frustration.

Shane: Yeah very much so.

Andy: We all can find the best ideas. Your current revenue generation and sales model, could you just talk us through a bit about what that looks like in terms of people, process and technology?

Shane:  Effectively and we’re at the moment targeting pretty much only universities. We kind of identified them as our first user base we want to build up primarily because they are good at adopting new technology. It’s the area where I have a strong background and then it’s very easy conversation to have. Now we identify potential candidates for the products, usually by the web universities are great. They give everybody access to all of the academics contact details.

Andy: So literally you can go through and troll their websites.

Shane: Yeah. So we started mostly with the people we knew and they worked out, people they knew, and then people they knew. So we’re expanding that way and working with people that know people that we’ve already sold to. We find it that much easier to sell to somebody, if you somebody that has already bought our product, rather than somebody that never heard of this before.

Andy: So you really need that personal connection to get that social proof.

Shane:  Yes very much. Yeah they do. Most of the time I want to see who’s using our product. These academics are very competitive. If somebody else’s got the cool new product, then they want it too and so we use that kind of relationship to kind of build up our customers.

Andy: Building that natural motivation through conversation. Awesome. Are you just there having this conversation?

Shane: Yeah, for the most part, it’s me and other guy that we work with. It’s a little bit on the phone, a little bit out in person. In Sydney we go and knock on doors of university researchers. We’re actually based at university, so knocking on those doors is quite easy. But we sell products mostly in Australia at this point. So it’s fairly easy.

Andy: Mostly in Australia. So have some?

Shane:  We sell some products in UK; we’ve got some stuff going out to Spain this week. Some of those have found us randomly via Twitter. And some of those are from ex-colleagues that know what I’ve been doing while I’ve been in Australia, now using overseas.

Andy: You mentioned that they found you via Twitter which is incredibly.

Shane: It’s totally random. Something popped up in their feed, they followed it, had a look and found us. But they’re still using it. So it works.

Andy: Yeah that’s awesome. When you’re playing in the IOT space, there can be a lot of bugs and does that help or hinders?

Shane:  It hasn’t really translated for us in particular. I think if we’re playing in the home automation or health and fitness spaces, it would. But in science and research, the whole IOT buzz hasn’t really translated through to those guys yet.

Andy: I feel like they’ve probably got some of the most gain from adopting and making their professional laws lot easier.

Shane: Yeah very much. For the researchers and academics in particular, data is there life. What they do is collect and analyze data. And IT provides a really massive highly fundamental shift in the way they do that. It’s a slow industry to move which is good and bad.

Andy: Obviously bad, they’re slow to adopt the technology. But why good?

Shane:  Because everybody else in the industry the companies that we’re competing against are moving really fast. so if we can move faster then I think the customers are willing to move faster than the instrument manufacturers that are moving more slowly, simply because they are bit reluctant to I guess change some of their existing products in order to build out new products.

Andy: What’s the biggest challenge for you when it comes to identifying customers in universities?

Shane: One challenge is that it’s the one-to-one sales. At the moment we’re doing a lot of one-to-one sales. So they are not scalable. What we really like is how our customers define product online and do it all themselves. But we need more validation for that to happen. So the more people that using our product, the more validation that other users can see that where it’s being used. We think that will help. Researchers and the area scientific instruments that tends to be a number of large manufacturers and distributors and people like that brand name recognition. So not having that can be problematic. People tend to just buy the same brand they always bought. So you got to give them a good reason to change.

Andy: It’s a market segment with lots of distributors and channels. Have you tried engaging those guys as a way to take your product to market at scale?

Shane: The thing we’re trying at the moment. We’ve recently signed up as a distributor in Australia that has a network of about 40 other resellers. And we’re just building product to then supply to them in the next month or so. So we’re hoping that that will change the dynamics a little bit. All of these researchers that have got relationships with existing potential customers and we’re hoping that really does change things. In the short term change the way we sell one-to-one to a lot of customers because we’re really trying to build a network of advocates within industry. And to do that cialis generique it’s not really something I think a reseller can do for you, you have to go out and do it yourself.

Andy: That’s one of the things I hear regularly from people, they’re concerned about their network. How are you planning to equip these distributors with the tools to be able to go on and offer to their customers? The resellers we’re lining up, they already sell similar products into similar networks. So it’s not a huge deviation from what we’re doing. We’re working with the distributor to develop kind of arranged marketing material, online training guides, some user support. But really we want to try and be hands of as possible. So we really want to say, here’s the support website, here’s the online videos, here’s some collateral for you. Come and see if you need anything else and see how that goes effectively.

Andy: Awesome. Going back a little bit prior to the channel diversion we went on, we talked about trying to enable an online fulfillment. For me it’s still seems huge value in going after that sort of enterprise B2B style sales, like looking for large opportunities. I mean in your existing customers, you having any traction in facing to other departments of the university?

Shane: Yeah, we talked a little bit before about the hardware and the software side of things. Universities are unique. There’s a bunch of different levels at which you can talk to that have purchasing power. And from a hardware perspective it’s really at the lower end user, researcher, academic that we want to talk to sell our product. But from the software end, universities also enable their entire campus to buy subscription services to software and then push out all of their researches. And that’s kind of where we want to head with the software side of things. So rather than doing these one-to-one sales, if we can engage at the university IT level and then they subscribe to the service, they can then push it out to their whole network of researchers. As that gets pushed down, we then get hardware sales backup through the network. So ideally that’s how it’ll happen.

Andy: It sounds like we’ve got a couple of really exciting challenges going on at the moment which is obviously going to keep you very much on your toes.

Shane: Very much. We’re still trying to figure out the researches of the industry that are very happy to pay for hardware, understand how to pay for hardware. They less understand how to pay for software subscription services. The way funding cycles go are difficult. So when we have those software conversation, they tend to get really difficult. But at the end of the day, in a lot of cases, the value is really in the software. We’re trying to change that mindset. It’s going to be a real challenge for us.

Andy: Absolutely. They can have lending back on the strong customer advocates to [inaudible 14:54].

Shane: Yeah very much so.

Andy: Ok Shane, thank you so much for your time and sharing your story. If people want to learn more about Instrument Works, where would they go?

Shane:  Our website is:  www. instrument-works.com.

Twitter: instrumentwork

Andy: I’m glad you’re there. thank you very much for your time and look forward to speaking to you soon.

Shane: Thanks Andy.

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