Winnipeg company moves into smart home market

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This article was published 15/3/2017 (1248 days ago), so information in it may no longer be current.

A young Winnipeg company is wading into the multibillion-dollar luxury smart home market, which already includes big-time players such as Google and Amazon, with a do-it-yourself system that is already turning heads.

Two years after taking a prototype to the Consumer Electronics Show in Las Vegas, Salman Qureshi and his two founding partners at Umbrela Smart Inc. hunkered down and worked out the kinks so that Umbrela is now taking pre-orders with manufacturing queued up to start in a couple of months.

"It's been a roller-coaster of a ride and a busy two years," Qureshi said. "There has been lots of ups and downs but it's been a great journey for us."

Their market-ready product features a wall monitor that anyone can install over top of any normal light switch that will control many of the electrical switches in the home as well as provide video and motion sensor security, play music and do many other things.

The sleekly designed Umbrela unit contains a wide angle HD video camera, light and motion sensors, temperature and humidity sensors, high-fidelity speakers that are easily controlled and easily customizable. And rather than compromise security and suck up precious bandwidth, Umbrela moves data through the home's electrical system. (It can also be connected to the home's router making remote, online connection also possible.)

Regardless of the elegance of their technology and its low cost — starting from as low as $300 to $3,000-plus — Qureshi knows it will not be easy breaking into the market.

"We know we have our work cut out for us, but we're already getting good responses from the local companies that we've talked to," he said. "Because of the way the product works, it's great for retro-fit applications. Anyone can buy it and put it in an existing home without re-wiring or complicated programming."

Qureshi and his partners, Filipe Fernandes and Ryan Ramchandar, are all veteran mechanical, electrical and computer engineers from Winnipeg who bootstrapped the business to the point where they were able to raise more than $400,000 last year. Now they have de-risked the technology to the point where it's ready for another round of financing to help with the market push.

Jeff Ryzner, the CEO of North Forge Technology Exchange, knows a thing or two about what a start-up needs to succeed — and he's a big fan of Umbrela.

"I love this company," Ryzner said. "I think it is a winner."

Among other things, it does not require the consumer to also be an electrical or computer expert to use it.

"And once you have it installed it looks like you are an electrical genius and an IT genius," Ryzner said. "It is remarkable what they have done. They've got that smart home convenience down to the level of the average consumer."

Umbrela plans to enter the market via homebuilders and electrical product suppliers and eventually would like to see it on the shelves of the home supply retailers alongside other more common home improvement products such as flooring tiles or kitchen cabinets.

Bruce Balliet, the head of business development at TriWest Construction, said homebuilders like it because not only does Umbrela not require specially designed wiring configuration, it can also be upgraded when the inevitable new technology arrives.

"These guys are smart," Balliet said. "If you bought an existing piece of property that was not wired-up for home automation, you don’t need to redo it."

Three years ago, when Google paid $3.2 billion for a company called Nest, the general public might not have been too familiar with the smart home market.

Now it's a multibillion market with more than 100 million installations in the United States. But some industry analysts say growth has slowed a little now that the early adapters have all installed their systems.

Blake Kozak, who follows the sector for IHS Consulting out of Denver, said it is an incredibly fragmented market with more than 400 different players.

He worries that Umbrela's decision to not depend on WiFi may make it less attractive because its technology might not work with other smart home devices. But he applauds the comprehensive service offering and the ease of use.

"They are ticking off many of the boxes that people are going to want in terms of flexibility," Kozak said.

He also points out that while it is a good strategy as a start-up to sell the system without any monthly fees attached, that's something that may hurt the company in five or 10 years.

"They will need to find some sort of recurring revenue model," he said.

Meanwhile, he said the industry as a whole needs to come up with some compelling reason to own this type of home automation technology for it to continue growing.

Last year, Telus commissioned a study that wishfully suggested that smart home devices are on their way to becoming as prevalent as smartphones and tablets.

The study found 63 per cent of people predicted they will own at least one smart home device — including a smart TV -— by 2018, with half of those predicting they will own three or more. More than half of them said they would be willing to spend up to $5,000.

With a bunch of new features already in development, Qureshi believes Umbrela will be able to keep making consumers look like geniuses.

martin.cash@freepress.mb.ca