In Mountain View, we meet co-founder & Evangelist of Eyefi, Ziv Gillat. He shares his story how he co-founded this startup and how the current business model works, as well as some advice for young entrepreneurs.

The transcription of the interview is included below.

INTRODUCTION

Martin: Today we are in Mountain View at the office of Eyefi with Ziv. Ziv, who are you and what do you do?

Ziv: Thanks for having m! I am one of the co-founders and I run in Business Development and I also evangelize and started the company about 8 years ago.

Martin: And what did you do before you started this company?

Ziv: So before we started, I was doing high-tech. So we’re four founders, I used to be an engineer, actually all of us used to be engineers. Here at Eyefi two of us are in business, two of us are engineering. I was at Apple a few times and then several startups before Eyefi and then Eyefi is my first founding company. And I have done one more since Eyefi in background and so I would say top 7 rate startups.

Martin: Great. An engineer turned to business developer, how rare is that?

Ziv: So I knew that… Okay, so my two co-founders are way better than me in engineering. So I knew that they are so much better than me, I can just let them do the really really hard stuff and I can do the marketing, sales, business development. So as we started we agreed that they would do the hard core stuff, the really really heavy stuff and they are just way better and over the years we both migrated to marketing sales and biz development. But even before Eyefi I went more into management and marketing and so it worked out.

Martin: How did you come up with the founding idea of Eyefi?

Ziv: For Eyefi? We start having kids and we are here in the west coast, my parents are in the east coast. We were struggling with the new lack of sleep and everything else and so how do you actually share photos if you are busy you actually can share photos, and my parents were in the East Coast we are here in the west coast. We got the guilt trip non-stop of where are your first kids photos. And it’s not hard to share, it’s a chore. So usually you put chores off; laundery, cooking, dishes, usually you are okay doing them but you put them off. So getting the photos out of a camera to a computer is the same thing, it’s a chore. So taking a photo is easy, taking a video is easy, it’s just a click and everything else that comes afterwards is a chore. So we wanted to change to photo industry. We wanted to show, ‘Hey, we can actually use these cameras which are really fun to use, but how do you actually get the content out of then and share it as close to the moment as possible’. So we started with a different idea, we then morphed that idea EyeFi card and that was our launch.

Martin: Great.

BUSINESS MODEL

Martin: Let’s talk briefly about the current business model for Eyefi, how does it work?

Ziv: So you put the card into your camera, you takes pictures, the card becomes a wifi hotspot, it then is being seen by your phone or your tablet or anything that’s around you, that connects to it and the magic just happens. So all you do is take pictures because the card is a wifi hotspot, the phone connects to it automatically and everything happens. It goes to the phone or tablet and from there it goes to our cloud or any other cloud. So its super simple, you buy the card at retail and immediately as you get it, you can start to use it and immediately start to share photos from the moment of capture.

Martin: How can I manage as a customer where the photos will go?

Ziv: So they go to our app, from our app it goes to anywhere you want, normally; Photo Roll, iOS, Gallery on Android, and then from there if you have Dropbox watching your Gallery or Photo roll, it goes to drop box, Google photo plus, Google plus, Facebook, anything that you want to, they already have a new device that works. We have the popular intents as well so you can from within our app go to Facebook, Twitter, Flicker, anything that is already installed on the phone, as well as we can go to a computer so from a computer it goes to anywhere you want to. You are really on your own with whatever you are already used to, the main difference is the photo that you captured on your phone can come from a camera versus from the crappy camera that built in the phone.

Martin: Right, understood. How is the distribution strategy working? So what type of distribution partners are you using and why did you choose this kind of distribution strategy?

Ziv : Sure, we sell at every major retail. We sell globally, today we have 85% coverage globally. So we sell at every major retail, so Best Buy would sell here in the US for example, Amazon online is selling us, B&H, Adorama. So the top photo retailers as well as CE, Consumer Electronics. In Europe we are at MediaMarkt, Saturn, every major retail in Europe, so western Europe, so Germany France, UK, Italy, Spain, everywhere in major retail as well as everything online, same in Asia, Asia pacific. We’re not yet in all of China but we’re launched in China and we are pretty much everywhere in Asia Pacific, Middle East and South Africa. We sell into distribution and then they turn around and sell it into retail but we are the ones that go out and sign retail.

Martin: So the end customer pays X amount of euro for a card and gets what?

Ziv: So you walk into a store, say MediaMarkt in Germany and you pay 41 Euros or 62 Euros or 82 Euros for 8 gig, 16 gig, 32 gig card. You then leave the store and you get the app from the app store and then there is code that is in the Eyefi card packaging that you enter into the app. Once you do that you are done. After 3 months, we then ask you if you want to actually pay for our cloud, if you pay for our cloud, awesome. For 45 Euros we give you infinite storage, in the US it’s 50 dollars in Europe 45, so you get infinite storage for your photos. If you don’t pay for the cloud, no problem, it still goes to your mobile device, but it stays there it doesn’t sync across devices, that’s it. So the cloud gives you sync across devices, across platforms, across device and infinite storage.

Martin: And how much does it cost from a monthly perspective?

Ziv: Its 50 dollar per year or 45 Euros per year for infinite storage.

Martin: Okay Geat.

CORPORATE STRATEGY

Martin: Let’s talk about the corporate strategy. So what distinguishes you from all of your competitors?

Ziv: We used to not have any competitors for about, so we’re 8 years old, for about 7 or 6 years we had no competitors. This is patented, it’s not patent pending, its patented. So for a while we had zero competitors. If you talk about competitors in terms of wifi and cameras, there was wifi and cameras even before we started Eyefi. So in 05’, 06’, Canon, Kodak, Nikon had wifi built in. But the camera guys are really good at building cameras, they don’t know how to do cloud and services and wifi really really well. We cannot build cameras but we can do clouds, services and software really really well. So the competitors today, we have two competitors out of Asia, they don’t have our distribution, they don’t have a global reach and our way of doing this is super automatic. So we believe that as you capture photos, it should go from the camera to the phone automatically. The competitors, basically you have to sign into the card from your phone from a web browser, choose the photos that you want to download and then download those. We believe that’s a lot of work. So in terms of competition, I would say the base competition force is not the wifi cards or the wifi cameras is the smartphone that people are using now and not the cameras. That’s why we have the cloud, so it can use your camera or your smart phone, either way, if you pay for our cloud, we’ re okay.

Martin: Okay great.

ADVICE TO ENTREPRENEURS

Martin: I mean you have several years of experience as an entrepreneurs. What type of advice can you give other young entrepreneurs when they are thinking about starting a company?

Ziv: It’s very tough. I think that being an entrepreneur is a disease. The reason that I say that it’s a disease is that it is really really hard and then you keep doing it andyou keep goong forth and you keep doingit over and over again. So that’s why it’s super super tough and we are crazy and we just keep doing it again. So let me just start with that.

In terms of advice, it has to be a passion, if it’s not a passion, you are never going to succeed, because so many things will go against you, it will go wrong, that it wasn’t a passion you will quit after the first year. Typically businesses takes 7 years to exit, people think that they are going to start a business and flip it within a year or two, that happens sometimes, that is very very rare. Most of them fail and the ones that do succeed, takes 7 years to exit plus, actually it takes even more. We’re 8 plus years old and we still haven’t had the exit yet but we have tons of customers, tons of revenue and so the curve is awesome but we have not had an exit yet, so it takes a lot of work.

Martin: Okay great and what advice can you give when somebody thinks about developing a hardware product? Because I mean this is a mix between hardware and software product that you’re providing and he’s thinking about a hardware product and wants to define the go-to market strategy.

Ziv: Sure. I would say don’t focus on the hardware, focus on the software and focus on services first. The hardware is just a way to get it, it’s a conduit. We’ve always since day one said we are not doing hardware only, we are building services, we have had the cloud since day one. 8 years ago it was called the server, now it’s called the cloud, so really really important. People who focus on hardware, focusing on hardware first, they then build bad software, we had that as well. We had the card selling retail for 6 years then I would say our software was really not that great. Because we focused on the hardware, we made the hardware really really amazing and we had amazing camera relationships, integrations, we have camera from across all the cameras but our software wasn’t really good. We then took a step back, took away many of the features, simplified it, now it has way less features so in Europe for example Mobi is our only selling product, we don’t have the pro, the pro has tons of features, hard to set up. Mobi sells everywhere, easy to set up, less features. So focus on the software first. When you can figure out the software and the services and you figure out the experience then start building the hardware.

Martin: And when you are trying to make partnerships with companies like MediaMarkt etc, and your very early in your start up process, how do you convince them?

Ziv: So usually they come to us. So if you’re cool, they come to you. If you’re not cool, you go to them and then it’s really hard. But if you have a really cool product—see the problem is retail is it has a very very limited shell space, online retail is very different. Amazon takes anybody because they have no physical space. Physical goods are really really hard to sell into retail so you really have to have a unique value prop and if you do, they actually come to you. For the ones that are smaller you can actually have a sales person that’s really amazing, they already have the relationship with the buyer and they can approach them. If you have enough margin in a product, if it’s enough value prop, they agree to it. But if you are one more, let’s say you make a mouse, if you are one more mouse, they won’t take you necessarily because they already have they preferred three or four vendors. But if you’re unique, they will take you.

Martin: Okay, great Ziv, thank you very much for your time.

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