June 08, 2020

An Interview with Eric Klein

1 hour 18 minutes

Welcome Eric Klein of Lemnos Labs!

Eric is interested in technologies that have moved outside simply the "benefit of the iPhone" (which past guest Chris Anderson talks about)

This includes things like batteries and ESCs, prevalent in robotics. LIDAR has also dropped in price in orders of magnitude.

Venture capital (VC) really started in Silicon Valley with the chip industry

There are two opposing forces in VC:

Excited about the future, so they want to invest in things like rockets and robotics

Venture capital needs returns and doesn't like risks

In hardware companies it's extra tough, since the 1st 15 employees might need to have 10 disciplines

"I need a hardware company to carry a 4x multiple"

Dealing with low volumes is tough for any hardware business, but extra tough when asked for that multiple and possibly selling into a consumer marketplace.

Eric's background is consumer hardware, working at Apple in his early days.

Lemnos started at 30% consumer, but is now down to 5%. How does it shift from 30 to 5% over time?

Eric asks himself, "What new solutions will be opened up in 1-5 years?"

3 or 4 years ago they looked at the lowered cost of components and how this impacted applied robotics

Venn diagrams

"Shooting in front of the duck"

Transition from internal combustion engine (ICE) to electric infrastructure

This includes direct things like renewables (solar, wind), but also energy banking and storage.

One company Lemnos backs is called Electriphi, which schedules power charging for things like electric bus fleets.

2nd order effects

Another company Lemnos is invested in that is doing robotics is Path Robotics. There are over 200K welding positions and the average age of welders are 50+. Eric visited a performance muffler place in Cleveland, where they were interested in using assisting robots.

AI is actually reinforcement learning, not true AI.

What else is on the list of Venn diagrams?

Eric is also interested in aircraft and transport. There is increasing in "thinking", "sensing", and "communications", so that leads to more focused autonomy for aircraft.

Elroy Air is another portfolio company that helps villages in Alaska to get supplies.

Eric is a personal investor (not through Lemnos) in Zipline. They started in Africa, no roads to get medical supplies to a village.

Marble is an autonomous sidewalk delivery robot, but it has run into regulation problems. Now Marble is helping create rules in places they deploy to with localized governments.

"The future is already here — it's just not very evenly distributed." ~ William Gibson

College campus might be a decent place to deploy autonomous sidewalk vehicles. Starship did university deliveries.

There is also potential market space for moving WIP between builds for manufacturing.

Former guest Greg Charvat works at Humatics on indoor robots doing position finding without GPS>

How does Eric consider pitches for funding?

"The thing you didn't study is storytelling"

Eric was an intern in 1990 at Apple and lauded Steve Jobs' ability to tell the story of technology.

Hardware company requires 3 or 4 components

Hardware

Software

Business

Storytelling

Eric will want to see a team of 2-3. The reason he usually says no to an investment is because the team wasn't there.

Chris asked where to seek out the sales-focused person?

At uni, you head over to the business building

Career development

Chris recommends meeting new people via a site called LunchClub.ai (the link here is Chris' personal link and will get non-monetary "credit" for using it, but feel free to just go to the site and sign up on your own)

Kipp Bradford

Eric reminds people about the importance of networking

Dishcraft is another portfolio company looking to take robotics to the restaurant dishwashing industry.

Migrant labor peaked in the US in 2010

Pay rates are similar as Sous Chef (Chris was surprised by this)

Linda (the founder) looked at the problem and asked about automation

Restaurants think about plate counts

They can wash dishes as a service, akin to a diaper service or a linen service

"You can put anything in front of an aas"

The seed round is for proving market fit and reducing technical risk

Approached by entrepreneur about how they might solve a problem for the business model

Eric's podcast for Lemnos is called "Into the Forge" and has 3 seasons available. He wants to capture stories of the variety of backgrounds of entrepreneurs. "Going to MIT is not necessary"

How else does Eric recommend to meet people and network?

Going to conferences like Supercon

Hardware Happy Hour

Feed of all the virtual hardware stuff

Using meetups as a way to troubleshoot

Reach out to Eric directly:

[email protected]

@sircoolio on Twitter

Image courtesy of ARM video of Eric speaking

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By The Amp Hour (Chris Gammell and David L Jones)

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