ThingMagic’s Rollercoaster Journey—From the Internet of Things to the Calculus of Reality
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to put RFID tags on apparel like jeans and underwear starting this month, to help track inventory more efficiently. Some observers are calling this a “comeback” for RFID, because these kinds of retail applications were hyped in 2004-2005 but failed to materialize in a big way. (ThingMagic had worked with Wal-Mart and other retailers on using RFID to increase supply-chain efficiency, but ultimately these deals fizzled in part because of economics and consumer privacy issues.)
But meanwhile, other uses of the technology have emerged. The new Disney Family Cancer Center in Burbank, CA, is using RFID badges and readers to help keep track of patients and customize its treatment rooms in real-time by tapping into room temperature, lighting, and nurse call systems. Greenville Hospital in South Carolina is using tags and readers to keep an eye on surgical tools in operating rooms. The Florida State Attorney’s office uses RFID to track case files. Ford and DeWalt use tags and readers to help customers track tools in the back of pickup trucks. Car rental companies use RFID readers to check in returned vehicles. And the MIT Media Lab and other places are experimenting with RFID to create smart, personalized computer interfaces for visitors logging in. All of these are ThingMagic customers.
So although the latest Wal-Mart news is good for RFID companies—as far as I know, Wal-Mart hasn’t said whose technology it’s using—ThingMagic has learned not to put all its eggs in one retail basket. “We got burned pretty early by the supply chain stuff,” Maguire says. Pappu adds, “In some sense we created it. We were out there beating the drum. It took much longer, and it happened in different ways. We placed a very big bet. Before that, we were profitable and required no venture capital. We went in and raised VC to support that. That didn’t pan out. But fortunately we were able to learn from it.”
Back in the days when ThingMagic was focused on supply chains, 80 percent of its revenue came from its top two customers, Pappu says. Now the company is much more diversified across other areas, such as building RFID reader modules for a wide range of customers, and consulting. What’s more, he says, 35 to 45 percent of its sales come from overseas. In terms of revenues, Pappu says, they “grew last year compared to the prior year, by a tiny amount. Things are going much better this year than that. People have turned the corner. In our quarterly revenue projections, you can see when the collapse began, and when it started to turn around.”
And more broadly, looking back over its 10 years, ThingMagic has reinvented itself … Next Page »