BC Business
Companies can develop great technology but have trouble finding a market for it. Sometimes this is just a case of developing a product for which there is no demand – all too common among entrepreneurs – but it can also be a case of technology that’s ahead of the marketplace, in which case it can be a long, hard road to profitability. But when the market finally does catch up to the technology, look out.
Cryptolex Trust Systems Inc., a Vancouver company that married security technology with biometrics to provide personal identity management, laboured for most of the decade to penetrate markets for its identity authentication software. When that stalled in the face of competition from large security advisers in 2007, the company morphed into Mobio Identity Systems Inc., which took on the consumer market with software that provided online identity protection for users of e-commerce sites. (Disclosure: I helped write their business plan.) But the process required biometric scanning of a thumbprint, and many potential users didn’t want to bother.
Mobio searched for a simpler solution as technological change accelerated. When the Apple iPhone hit the market and launched a mobile-computer revolution, it found what it had been looking for. Two-dimensional QR (quick response) codes that contain information readable by computerized scanners had been in use for some time, particularly in Japan, where QR readers are more common. But they only really began to show up in quantity in North America in 2009, when applications were developed for the iPhone that enabled the smart phone to use QR bar codes – those square mazes that are popping up everywhere – for purchasing.
QR codes are similar to bar codes that contain price information on products in supermarkets and are scanned at the checkout counter, but they contain far more information. With a QR-code-enabled smart phone, a user scans a QR code via the phone’s camera. The information is then relayed to the phone’s computer and enables certain actions: going to a website, for example.
With its authentication technology, Mobio can ensure transactions through QR codes are more secure, increasing the likelihood that consumers will want to use them. The company rapidly developed a payment and identity management system that enables secure interaction between organizations and individuals. As it began probing various areas that were likely to need this technology, Mobio was introduced to a football team that baldly stated that its biggest problem was long lineups slowing down beer and food sales. As a result, last year Mobio enabled fans of the NFL Jacksonville Jaguars to buy beer and food at their seats by scanning into their iPhones a QR code contained on a flyer. The food is delivered to them at their seats.
With that proof, the company rapidly snared other clients for its point-of-sale system. It is now rolling it out to several national retail operations in Canada and the U.S. It is also talking to several other sports teams about similar services.
• Know your own business. Mobio’s core technology provides secure interaction on the Internet. By understanding what it does best, the company could find an appropriate use for it.
• Find your opportunity. Once it realized how its technology would work well with the new QR code system, Mobio was able to shop it around to organizations that needed it.
• Stick with it. If a market doesn’t validate your product, you have to look for another. Mobio kept looking until a market that fit appeared.