Monday, August 21, 2006
Interview with Martin Payne, SkyeTek
For our company profile today, we talked with Martin Payne, who is VP of Marketing and Strategy at Westminster, Colorado-based SkyeTek (www.skyetek.com). SkyeTek develops systems based on RFID technology, and is backed by Appian Ventures, Sequel Venture Partners, and Palomar Ventures.
Techrockies: Tell us a bit about SkyeTek and how you fit into the RFID space?
Martin Payne: SkyeTek was founded back in 2000 as a services company by Sean Loving. Sean's background is that he graduated from the University of Illinois in Electrical Engineering 14-15 years ago, and immediately went into RFID. He went and worked for Motorola for a couple of years, and had a couple of other stings in RFID--he has been an RFID engineer for a period of time that is longer than most people think RFID has been in existence. Sean was one of the very early pioneers in the industry, and has been working on automotive identification, animal tagging, and things of that nature. He moved out to Boulder, and fast forward to 2000, founded a RFID services company. He was developing reader technology for companies on a project basis, and after a few projects, figured out that there was a common thread across all of these projects. If he could come up with some horizontal reader technology, he figure out that he couple apply it to any project that came across his desk. No matter how custom a job the customer thought a project was, there was always this core piece. On that premise, he moved the firm from a services to product-based company a couple of years ago. Right around 2003, we became product focused. Our intent was to create a company to develop and deliver that IP.
Techrockies: Tell us a bit about your funding?
Martin Payne: Our series A was raised back in the 2004 timeframe, which carried us until 2005, when a Series B round was raised. In that period, early 2005, Rob Balgley was recruited by Sean and our Series A investors -- Appian Ventures--brought Rob on board for CEO. Rob was on board for six to nine months, then we raised our Series B last October.
Techrockies: Who was in that Series B?
Martin Payne: Appian continued their investment, re-upped with additional investment, and also brought Sequel Ventures and Palomar into the syndicate. Palomar is out of Santa Monica, California. Sequel is out of Boulder. Between the three firms, they manage approximately $1B in funds.
Techrockies: What kinds of applications are you targeting with your RFID technology--is it for a specific industry or vertical?
Martin Payne: There is definitely a specific use. Back a couple of years ago, there was a mandate from Walmart and the Department of Defense to use RFID, which was a blessing and a curse for us. The blessing is that it put RFID on the map, the curse is that the brand equity of RFID became associated around supply chain applications. SkyeTek definitely is a RFID company, and we have an RFID reader that can be used with any open-architected, non-proprietary tag. However, our application is on the other side of the supply chain. Most supply chain applications require a big, powerful, high performance, and rather large and fairly expensive reader. They are large and expensive, because the application dictates that--they do very well in what they are designed for, which is to sit on top of a dock door and read pallet and pallet of stuff coming through a doorway. What we actually do, is we design RFID readers in embedded applications, for example, in a doctor's phone to allow him to check blood types before a transfusion. If an RFID reader has to go into a phone, it must be very different from a reader that goes on a dock door and has to read RFID from 20 to 30 feet. With a phone, you just need to read from 4 inches away. Obviously, it's quite small, to fit into existing phones, has to be inexpensive, and can't generate hit. These are the kinds of embedded RFID applications which SkyeTek is focused on, not the supply chain.
Techrockies: Have you launched your product yet?
Martin Payne: Absolutely. We have about seven or so dominant applications that we see over and over again. Those are patient safety--the first example I gave you; consumables authentication--say, if an inkjet manufacturer wanted to use only a certain kind of ink with a printer; contactless payment, for example, the Exxon Mobile SpeedPass--instead of swiping your credit card magstripe. We also provide systems for anti-counterfeiting, for example, making sure that counterfeit drugs are not introduced into the channel. Finally, we also sell into smart shelves and mobile inventory management.
Techrockies: Do you sell your own hardware or do manufacturers design in your products?
Martin Payne: We're a pure OEM play, we do not sell finished products. We sell technology into someone else's product. For example, in blood type matching there is a handheld communication device used by hospitals. The manufacturers of those devices embed our very small RFID reader module into their design. We sell you a module--which is about the size of a postage stamp or half the size of a business card, either way very small. The other interesting thing about our product is we're software based. We use the software processor already in an OEM's product, and add a couple more parts to enable RFID with our software intelligence.
Techrockies: How many people are working there now?
Martin Payne: We have 37 people working here now, up from about a dozen at the end of last year. We actually scaled the company post-funding, and added quite a few engineers and also lots of sales and marketing.
Techrockies: What's next for the company?
Martin Payne: What's next for the company is taking RFID reader technology and taking the data the technology acquires and making sense of it. Data collected by a reader at is just ones and zeros, which just happened to be captured by an RFID reader. What makes those ones and zeros powerful, is the ability to connect that data to the corporate network or the internet. That's where information really gains relevancy. Where we're going with this, is we are going to build on top of our software architecture, and bring connectivity between the RFID world and IP.