As investors and corporations pour millions of dollars into connected-home devices, tech companies have no shortage of ideas—from smart thermostats and home security systems to data-collecting toothbrushes and a refrigerator that sends alerts when the milk is almost out.
But while most of these “Internet of things” products are aimed at young tech-savvy adults or parents with kids, Milwaukee-based OnKol is hoping to tackle a different market: aging parents and their children.
“The adoption rates for new technology in the elderly is terrible, and it always has been,” says OnKol CEO Erich Jacobs.
His elderly mother, for example, complained when family members replaced her television remote with a new one from a different brand, even though all the buttons were in the same place. And although some seniors carry smartphones these days, they might only use the devices to make calls or send the occasional text message, Jacobs says.
Safe to say, they’re probably not tweeting or posting photos of their dinner on Instagram.
OnKol (pronounced “on call”) is hoping to overcome that generation gap with a box-shaped device, smaller than a typical desktop printer, that connects to virtually any Bluetooth-enabled product, tying many home and health-monitoring devices together.
OnKol thinks the device is simple enough for grandma or grandpa to use without frustration, yet sophisticated enough to provide family members with just the right amount of information they need to feel peace of mind.
“Our number one goal is we don’t want to impose change on grandma,” Jacobs says.
That balance will be crucial if OnKol is going to have a chance of succeeding. The market for hardware startups catering to the elderly will likely get more crowded in the next few years, particularly as smartphones become more ubiquitous for all generations, says Micah Rosenbloom of seed fund Founder Collective, which has invested in several Internet of things startups.
The startups that will likely win in this emerging market, Rosenbloom says, will make products that are intuitive and easy for seniors to use—and cool enough to make a young San Francisco techie jealous of grandpa’s new gadget.
“Design and ease of use and aesthetics are right up there with business model and other aspects of evaluating a product or a company,” Rosenbloom says.
To help make a slick, visually appealing device, OnKol turned to Allenton, WI-based product design company Brooks Stevens, known for designing the Oscar Mayer “Wienermobile,” the Miller Brewing corporate logo, and the front fender for the 1949 Harley-Davidson Hydraglide.
OnKol says seniors can set up its base station right out of the box with minimal guidance, even if family members live far away and have to walk mom or dad through the steps over the phone. Meanwhile, the more tech-savvy relatives can go online and configure the type of information they want the OnKol device to send them, how often they want to receive updates, and whether they want updates in an e-mail, text message, or some other format.
So what can the OnKol system do? First, the base station can collect and share data from third-party health devices like glucose meters, blood pressure cuffs, and heart-rate monitors. Users can program the device to remind them to take medications with an announcement through the base station’s speakers, and it can notify family members if the senior misses a dosage.
If a smoke alarm or carbon monoxide detector goes off, the OnKol device can send out text messages or e-mails. Wireless motion sensors can tell whether someone is getting up more frequently than normal in the middle of the night. The system also has a caller identification function to keep family members apprised of who is calling their relatives, helping them screen for telemarketers, known scammers, and other unwanted callers.
In addition, the OnKol system comes with an electronic pendant that has a button for emergencies and can be worn like a watch. This is similar to Life Alert devices, but with a key difference. While Life Alert automatically sends a distress signal to a call center that can then alert emergency responders, OnKol’s pendant will first notify designated family members. Users can set the device to alert an emergency call center or call an ambulance if a family member doesn’t respond within a certain time.
That’s important, OnKol says, because sometimes the emergency doesn’t require paramedics, and a 911 call can end up being expensive if they break down the front door. OnKol co-founder Marc Cayle, who previously ran three Milwaukee-area franchises of in-home senior healthcare provider Comfort Keepers, encountered elderly patients who had fallen and lay on the floor for more than a day. They held an emergency alert device in their hand, but didn’t press the button because they didn’t want to make a fuss, he says.
“If an ambulance arrives and the door is locked, they’re going to kick the door down; they have to, actually,” Jacobs says. “The elderly know this, and they’re basically like, ‘We’re not going to create a ruckus. I’m not dead; I’ve just fallen down.’”
OnKol isn’t the only company that has created technology for remotely monitoring seniors. Others in the market include Lively and BeClose, which also offer wireless activity sensors and wearable alert devices. And GrandCare Systems, based in nearby West Bend, WI, offers a system that works with various Bluetooth devices and handles many of the same tasks that OnKol does. GrandCare sells a base device for $699, plus a $50 monthly subscription fee.
OnKol, which just recently began marketing its device, will start selling the system next year for a much cheaper price: $299 for the base station and pendant, plus a $29 monthly fee. OnKol plans to begin selling its device on its website and through electronics stores, cellular carriers, and home healthcare organizations. Eventually, it hopes to strike deals with other companies that would use OnKol’s technology but sell products under their own brand names, Jacobs says.
OnKol raised $2.4 million from Milwaukee-based Capital Midwest Fund to develop its system. The startup is trying to raise another $1 million this year from local investors to allow it to begin production, Capital Midwest general partner Dan Einhorn says. After the product hits shelves next year, OnKol will try to raise a “much larger round” from investors nationwide, Einhorn says.
“We want to raise enough money to get enough runway to get initial sales out, get the product in customers’ hands, show a product that works,” Einhorn says. “We believe that’s going to expand the valuation of the company.”
OnKol plans to market the device as a tool for families to “stay connected,” rather than an Internet of things gadget, Jacobs says. “The idea is this is not a medical device, it’s not an emergency device—it’s a family communications device,” he says.
On the technology side, OnKol has made several decisions to boost its chances in the market. The company’s base device connects to the Internet via a cellular signal, not WiFi, which means seniors don’t have to deal with WiFi routers. Meanwhile, cellular carriers get an opportunity to capture revenue from a demographic they have largely struggled to reach, Jacobs says. (The $29 monthly fee will cover the wireless data plan.)
User data gets sent directly from the OnKol base station to family members’ devices, and the company won’t store any data on its servers unless a customer requests it. That’s a positive for families, but an even bigger plus for potential manufacturing partners: not having the data flow through OnKol’s cloud software removes a “tremendous liability” and worries about the privacy of health information, Jacobs says.
“The likelihood of a data breach, at least being our problem, is extremely low, unless someone can figure out a way to hack into thousands of these devices at once,” Jacobs says.
The company was founded in February 2013, after Capital Midwest agreed to invest. Jacobs, a Wisconsin native and experienced technology executive living in the Boston area, was brought on to run the company as a condition of Capital Midwest’s investment. His resume includes executive roles with Insight (NASDAQ: NSIT) and Level 3 Communications (NYSE: LVLT), as well as running tech incubator Rebar Foundry in Norwood, MA, which involved serving as interim CEO for the startups.
“I really liked what the team was doing when we were doing the due diligence, but it was clear there was a need at the top for someone with experience,” Einhorn says. “This company clearly had a really good idea, but it needed someone to take it to the next level.”
Jacobs still lives in Boston with his family and flies to Milwaukee during the week to work on OnKol, which operates in downtown co-working space 96square.
It’s easier to get a hardware startup off the ground now than it was five or 10 years ago, Rosenbloom says, thanks to more widely available 3D printers that can quickly build a prototype and increased early-stage financing options, like crowdfunding campaigns. But hardware is still more difficult than software companies.
“Hardware companies have the word ‘hard’ in them for a reason,” says Rosenbloom, who started two such companies. “It’s not just bits and bytes; it’s atoms.”
Smart device companies also need to continuously churn out timely and useful software updates, he adds: “Most of the stuff today, hardware is really a delivery vehicle, but it’s the software they’re delivering.”
It’s easy to see why OnKol might be better off operating in Boston or Silicon Valley, which have larger concentrations of Internet of things startups and more funding options. But Einhorn says he is committed to keeping OnKol in Wisconsin. “I have no plans to move this company,” Einhorn says. “Our fund is really committed to the Midwest.”
And Jacobs thinks Milwaukee has the ingredients for a successful Internet of things ecosystem, including a solid talent pool and the presence of high-tech manufacturers like Rockwell Automation (NYSE: ROK) and Johnson Controls (NYSE: JCI).
“My take on it is, if Milwaukee isn’t a major player in the Internet of things space, shame on it,” Jacobs says.
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