Ultraleap: In touching distance
A year ago, Bristol startup Ultrahaptics acquired Leap Motion, a pioneer in camera sensing technology. In the time since then, the acquisition has come into its own with the sensing technology providing a key touchless technology in the Covid-19 pandemic.
“Being the touchless company in a world that needs to be touchless is a great place to be,” said CEO Steve Cliffe (above left, with co-founder and CTO Tom Carter). The hand tracking technology from Leap Motion in San Francisco was key. “Acquisitions are always challenging, there’s different cultures, bosses who are no longer bosses and we’ve got through all of that.”
“The employees of Leap Motion had control and didn’t want to be acquired by a large company, they wanted to merge with a company like ours to make the technology ubiquitous so that’s what this was about. It made a lot of sense for us and for the shareholders that were left,” he said. “They were an incredible engineering team so we’ve brought commercial experience to it and focused on products we can commercialise. We are now delivering products and signed an agreement with Qualcomm.”
“We’ve had a few bumps along the way but its gone incredibly well. We acquired the team of 12 in San Francisco, which is now up to 1 5 in R&D and 21 in platforms so there’s a total of 38 and the vast majority have been in Bristol and some of the machine learning R&D.”
“We haven’t had a problem recruiting. We’ve got everybody we needed. Since lockdown we’ve hired 25 people in machine learning C++, all in Bristol with 6 or 7 scattered around Europe and the UK but the rest are in Bristol, all of them are waiting to come here.”
The pandemic lockdowns have presented challenges for the growing company. “We built the office around the kitchen and when we extended we doubled the size of the kitchen and that’s how we kept everyone together as we grew,” said Cliffe. “Now the daily stand up meetings are on Zoom so people do get a lot of interaction with their teams but you lose the social interaction and being able to fix things straight away, so there are some very much some downsides,” he said.
“But I am absolutely amazed by how they have performed – productivity is up across the board, we are delivering faster than expected. People are at home and the day has been extended but we’ve tried to stop that as we don’t want everyone burning out by Christmas, so we have zoom yoga, talks on financial and mental well being. We are closed on a Friday so people can go do different things.”
“Remember, we’ve got 25 people who have never been to the office and its trying to get them part of the culture of who we are,” he said. “The flip side is we have had 23 people coming into the offices to use the kit on a strict rota, and that’s worked well and they are heroes
Before lockdown, the company had a massive travel and subsistence bill – last month the total expenses were £48.
“We were expecting 500 percent growth this year, we are only going to deliver 300 percent as a result of the closure of automotive and interactive advertising in cinemas and shopping malls,” he said. “In automotive, every engineering team we were working on got furloughed in March. That’s all about haptics but got hit hard. We are seeing green shoots and certain companies moving forward at pace and long term it’s not going to hit us, we’re in design projects over three years or so.”
“With interactive digital signage, the pilots have been hit as places are closed, but the other market, the touchless kiosk has gone absolutely bonkers. Fro example the Immigration machines at Vancouver airport have gone touchless – that’s all point rather than touch and that pilot has gone well and we expect to rollout very quickly.”
There is a huge market here. “It’s every fast food restaurant on the planet, every rail station, our sales pipeline in Mar to Sep sent up by $115m just in touchless. It’s a two step thing – the initial responses are to retrofit everything and you can’t retrofit the haptics as they don’t have the processing power but you can put a camera on the top of the screen and effectively it becomes the mouse.
It will take two to three years for the full integration with the haptics, though, he says. “It’s a matter of making the experience better. When you press you are looking for a visual queue – if you push and feel the button you get a faster throughput of people so there’s economics behind it,” he said.
Then there is the Qualcomm deal for virtual reality and augmented reality (AR/VR), where market researchers predict shipments of 80m units a year by 2024.
“We’ve been working with Qualcomm for 15 months and we’ve put everything preloaded on the XR2 processor, especially they have access to every customer on the planet, I’m extremely pleased with how that’s gone. Qualcomm has developed the VR reference design with six cameras on it and hand tracking, and this is going to lead to more as they do a lot of things that we can help with in automotive and communications, and there’s AR coming as well,” he said.
Despite the launch of a touchless development kit with a camera module, the company remains focussed on licensing and software rather than hardware.
“We are very much an IP company licensing software,” said Cliffe. “We have had to make some camera modules and we’ll give away the Gerber files if we have to, we are making them at Sony in South Wales and if someone wants to buy them direct we are more than happy.”
There’s more work to do in tracking and more in haptics, he says, and that will need more funding.
“We knew we were going out for another round after the Series C – its bigger than we planned as we’ve acquired a company in California so we have those salaries to support, and rents in San Francisco are absolutely crazy,” he said.
“We are going to be raising north of $50m and we have full support from existing shareholders – we took a big slice of the Future fund in June with £5m and £5m from Mayfair, so we got £10.1m and we have cash to the second half of next year. This is the last round so we are making sure we have the right investors and one or two strategic investors,” he said.
All of this is aimed at a stock market flotation rather than being bought by a company such as Qualcomm.
“To be ubiquitous in the market we need independence and we are focussed in going public in two to three years time. Our revenues now are quite lumpy, and this needs to be predictable,” he said. “I’d love to do it in London [rather than the Nasdaq in the US] as we have all the risk registers and financial controls in place, but it’s too early for us.”
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