Changing tack: How U of T startup Nymi found an unexpected, but lucrative niche
Nymi, a University of Toronto startup, made a big splash five years ago when it first unveiled a wristband that uses people's heartbeats to wirelessly log them into iPhones, iPads and other devices – no passwords needed.
There was just one problem.
“For a person to not just buy it, but wear it all day, it would have to – out of the box – work immediately with everything they owned,” says Karl Martin, a U of T alumnus who is Nymi’s CEO and co-founder.
While that might be possible for a consumer electronics giant like Apple, selling everything from watches to computers, Martin and his team soon realized it was a significant hill to climb for their startup. So they turned their attention to business customers and soon stumbled upon a potentially vast market as unexpected as it was underserved: Big Pharma – and regulated industrial environments, more broadly.
Martin says pharmaceutical manufacturers need to track what their employees are doing on the production line at all times. It’s not so much an issue of security, he says, as it is a need to create an audit trail for regulators in case something goes wrong.
“You have workers who are entering passwords 100 times per shift,” Martin says. “A worker on a production line literally gets a pop-up every few minutes and has to enter a password.”
Not surprisingly, such frequent interruptions make it difficult to get much work done, translating into lost profits. Hence, Nymi’s revamped sales pitch for the Nymi Band positions it as a way to boost productivity without compromising security.
It’s a message that seems to be resonating. Martin says Nymi has spent the past couple years conducting pilot projects with most of the world’s top 20 pharmaceutical companies, spanning Europe, North America and Asia. Armed with $15 million in additional financing raised last spring, the company is now getting ready to roll out its updated wristband solution.
“We’re going full deployment this year,” Martin says.
It’s been a long road for Martin and his team. He initially incorporated the company in 2011 with co-founder and fellow U of T researcher Foteini Agrafioti, who is now the chief science officer at Royal Bank. Then called Bionym, the original goal was simply to license technology that used people’s unique heartbeat signatures as an always-on biometric identifier.
But a trip through U of T’s Creative Destruction Lab accelerator, affiliated with U of T’s Rotman School of Management, convinced Martin and Agrafioti to think bigger by developing their own hardware. The Nymi Band was born.
Was it a mistake to launch the Nymi Band as a consumer product? Far from it, Martin says. Rather, focusing on consumers allowed Nymi to establish a “friendly, positive relationship with the product” – important for something you expect people, be it consumers or employees, to wear in place of jewelry or a wristwatch.
“You have to build something people want to use – not something that’s imposed on them.”
Martin’s search for the right business model isn’t unusual for entrepreneurs seeking to capitalize on a novel research innovation. Many are breaking new ground and don’t have the luxury of simply building on an idea that’s already been tested by a competitor.
The upside, Martin says, is that when you finally get a hit, you tend to hit big.
“People think you came out of nowhere,” he says, “and there’s barriers for others following because the approach you took was non-obvious – so now you’re way ahead of the game.”
Martin says the direction he received from CDL, then in its first year of operation, was invaluable to Nymi’s development. The startup also received guidance from Kurtis Scissons, the entrepreneurship manager at U of T’s innovations and partnership office and a co-director of the UTEST accelerator.
Martin also credits the startup’s decision to remain in Toronto for its continued success, citing an abundance of talent and a growing network of incubators and accelerators to help startups succeed.
“In the old days, the saying was go to [Silicon] Valley to get the capital, but now investors come here,” he says.
“If you’re checking the pulse the last few years, there’s real a buzz – there’s serious companies being built here and serial entrepreneurs who are investing back into the ecosystem.
“I can’t think of a better place.”