Orbotix Rolls Out Next-Gen Sphero, Considers Possible New Directions

8/14/13Follow @MichaelXBD

The ball, reinvented, has itself been reinvented—and that means changes could be on the horizon for Orbotix, the Boulder, CO, startup that took the ball and put a robot inside it.

Orbotix this morning launched Sphero 2.0, the next generation of the Sphero robotic ball that’s controlled by iOS and Android smartphones and tablets. Sphero is completely self-propelled, and users can drive it through obstacle courses, play augmented reality games, or program it to do tricks or travel in patterns.

The new Sphero features improved hardware and firmware, and Orbotix has given a major facelift to the interface for the app that drives Sphero, according to Orbotix co-founder and chief software architect Adam Wilson.

The hardware improvements are in addition to the strides Orbotix made over the past year in developing augmented reality games for Sphero. Its two mobile games in that category, Sharky the Beaver and The Rolling Dead, blend Sphero’s ability to navigate in the real world with games and characters in the digital world.

About three years have passed since Orbotix began working on Sphero, and the company realized it had greater potential.

The original Sphero “was really great, but we thought there could be more,” Wilson said.

But now with the rollout of Sphero 2.0, Orbotix might have pushed Sphero as far as it can go, according to Wilson.

“It’s kind of our finale with Sphero,” he said.

Faster and Smarter

What new spheres (so to speak) might the company investigate next? Before addressing that and how Orbotix reached this point, a bit more about the new product.

The new Sphero will be about twice as fast as its predecessor, clocking in at seven feet per second. It can distinguish the type of surface it’s on, so it can keep a consistent speed when it rolls from thick carpeting to a hardwood floor, for example.

The LED lights inside the new Sphero also are brighter, and it comes with ramps for jumps. Users also can buy accessories, like a “nubby cover” that improves traction.

For the launch, Orbotix has created a promotional video that’s almost as amped up as the trailer for a Hollywood movie.

Orbotix also has made Sphero smarter—or at least smart enough to teach new users and challenge power users. In its out-of-the-box state, some of Sphero’s capabilities, like the ability to drive at full speed, are locked down. As new users master the ball—in other words, stop crashing into walls and furniture—those restrictions will be lifted.

“As you play with Sphero, you level it up,” Wilson said. “The hope is it progressively will teach you a lot of the other tricks.” Sphero’s sophisticated enough that the most advanced users would be able to do what Wilson likened to the ollies and flip tricks performed by skateboarders.

The apps that control Sphero also have been upgraded, with an emphasis on making the device more engaging.

“The user interface is changing pretty dramatically to create more of a personality for Sphero,” Wilson said. “There’s going to be a huge change in the way you interact with Sphero.”

The hope is that the new interface will make it appealing for a younger market segment. The ball has received very good reviews in the tech press, but Orbotix would like to broaden its appeal beyond tech-savvy adults, Wilson said.

Sphero 2.0 will cost $129.99, the same as the original version. The original Sphero will be available for a reduced price of $109.99, Wilson said.

Orbotix is taking pre-orders now on the Sphero website, and retail partners like Brookstone will start selling it Aug. 31. The Apple Store will sell a special edition with clear plastic that allows users to see into Sphero’s gears, motor, and other components. That will be available in September.

Building a Ball and Building a Company

More than 100,000 Spheros have been sold, Wilson said, and that’s come despite production problems in the past.

Sphero’s white plastic shell and cute logo hide the fact it’s a very sophisticated robot that’s about the size of a baseball. It is packed with an accelerometer, antenna, battery, circuit board, gyroscope, LED light, motor, and more inside a durable plastic shell that can survive being hurled against a wall or immersed in water.

That presented engineering, manufacturing, and distribution challenges. Finding the right manufacturers in China was a problem early on, and Orbotix had trouble keeping up with demand.

“Last year, the good news was we sold everything we made. The bad news was we sold everything we made as fast as we could make it,” Orbotix CEO Paul Berberian said. That meant expediting delivery by air, which cut into Orbotix’ bottom line.

Sharky

Now, Orbotix won’t be playing catch up, Berberian said when I visited the company’s headquarters in May. At the time, Orbotix was putting the finishing touches on The Rolling Dead, and early versions of Sphero 2.0 were being tested around the office and in the building’s underground parking lot.

The company also had just closed a $4 million Series D equity round (Orbotix has raised a total of $15 million) that allowed it to stock up on inventory over the summer. So it should be able to keep up with holiday orders, Berberian said.

The big push toward the all-important holiday season was on, and that meant expanding Sphero’s market beyond early adopters.

“Those who are looking for cool stuff like this have already seen it, or may have seen it and not purchased it yet. Now we have to deliver on the bigger picture,” Berberian said.

Enthusiastic reviews in the tech press, a savvy social media campaign, and an amazing bit of guerrilla marketing that got President Barack Obama to test drive Sphero during a 2012 campaign stop helped build the company’s momentum. It all culminated in Wilson and Bernstein landing a spot on Inc. Magazine’s 30 under 30 list earlier this year.

But now Orbotix knows it needs to get the attention of average consumers and the wider media.

“You have to start going out and telling the story to the average Joe about why they want a Sphero. That early hype and momentum will take you so far, and then you have to make the transition and start building a real business around it,” Berberian said.

Internally, Orbotix has had to grow up a bit. In 2010, when it emerged from Techstars, it was a small startup. Wilson and Ian Bernstein, who is the chief technology officer, had founded the company (then known as GearBox) just before being admitted to the startup accelerator.

That’s where they connected with Berberian, the Techstars entrepreneur in residence that year. Prior to Techstars, Berberian had founded Raindance Communications, a Colorado-based web and voice conferencing company. As CEO, Berberian took Raindance public. It was acquired by the West Corp. for a price reported to be between $110 million and $160 million.

Since Techstars, Orbotix has added a marketing director who worked for Parrot AR, which makes a quadricopter, and a sales consultant who has worked with Apple, Slingbox, and other consumer electronics companies. Berberian said working with experienced staffers and consultants has put the company “through charm school” and taught it how to work with retailers.

Everything looks to be coming together, Wilson said in an interview yesterday.

“We’re cranking along, unless we totally flop for Christmas, which I can’t see happening,” Wilson said.

Beyond the Ball

With the launch of Sphero 2.0, Wilson said there’s a bit of a feeling within Orbotix that it has pushed its product and the concept to their limits, at least in terms of the hardware. The next step for the company might be to develop something new.

“We love Sphero and the robotic ball, but there are other things to do with the technology,” Wilson said.

Wilson didn’t go into much detail, but said the robotics inside the ball, the software that controls it, and its ability to do advanced augmented reality could make the leap to additional consumer electronics or beyond.

The software developer kit for Sphero will let third-party developers continue to develop games around Sphero and expand on its capability for augmented reality, and apps and games for Sphero should keep improving.

“When we started we wanted to create this really cool experience around a physical device. When we built Sphero, and we didn’t initially plan for it, it turned out Sphero was a device where we really bridged the gap between the physical world and the digital world for gaming,” Bernstein said in May.

“I look at Sphero sort of like this Atari for the new generation of gaming,” Bernstein said then. “We’re at the beginning stages of something really cool in the world of gaming.”

But with the work that’s gone into the hardware for Sphero 2.0, the vision is expanding, Wilson said yesterday.

“Our technology is extremely deep. That could be missed by people who only see us as a gadget-maker,” Wilson said. “Putting (parts of) our system in any robot will make it better.”

To a degree, Bernstein and Wilson have been here before. When they got into Techstars in 2010, they didn’t really have a clear vision of where they were headed.

“It was two really, really smart guys working on something robotics-related,” said Brad Feld, managing director of the Foundry Group venture capital firm and a member of the selection committee that year. “They really had no idea what they [would be] doing, there wasn’t a business thing they were trying to do, or even a product. It was just ‘Hey, we’re cool, smart software and hardware hackers, we know robotics, and we’re really excited about doing something neat.”

When they met with Feld at the start of Techstars, they had three product ideas, which included an electronic door lock and what would become Sphero. The lock looked to be the product with the biggest market opportunity and the clearest way forward from a technical standpoint.

As for the smartphone-controlled robotic ball idea, it wasn’t quite clear how it would work or who would want it. But it only took a little prodding to see that was what Wilson and Bernstein had their heart set on.

“‘It’s an incredibly hard problem, if we do it well it could be amazing, there are so many different things we could do with it. Some could be stupid, some could be great, some we haven’t even thought about yet,’” Feld recalled them saying. “What Adam was showing at that point was just obsession.”

Feld soon became a member of Orbotix’s board of directors, and Foundry Group is a major investor.

Bernstein said they came up with the idea for Sphero during a late night brainstorming session during the first week of Techstars. The starting point was doing “something neat” and ambitious with robots.

“We wanted to change the way people interact with physical devices and create an amazing experience around that,” Bernstein said.

They rejected several ideas, like remote controlled cars and planes, before thinking about a ball.

“We liked the ball because it was a blank slate. There were just so many different things you could do with it,” Wilson said. “I’d say within that night, we came up with the idea for augmented reality…and the idea for the apps kept coming and coming.”

But finding the vision might have been the easiest part. Since that night the company has had to master hardware and software development, mass manufacturing, retail marketing, and the other challenges of creating and growing a startup.

“From our point of view, I didn’t think we had any idea how hard it would be to get there,” Wilson said.

All of that work reinventing the ball means that with its next products, Orbotix shouldn’t have to reinvent the wheel, Wilson said Tuesday.

Michael Davidson is the editor of Xconomy Boulder/Denver. Contact him at mdavidson@xconomy.com. Follow @MichaelXBD

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