CHAPTER 7: TECNOLATINAS PROFILES
A Good Case for Investing in Gadget Innovation in Latin America
Industry: Consumer Electronics, Travel, Hardware & Software
Country: USA / Argentina
CEO: Diego Saez-Gil
HQ: Mountain View, California, USA
Offices: Buenos Aires, Argentina
The Internet of Things is the next big thing. With millions of devices connected among each other through Machine to Machine connections over the Internet, it promises to deliver all sorts of futuristic solutions to everyday problems through smart homes, autonomous cars, and all kinds of gadgets connected to our bodies, and even our pets. And that is just the beginning. And BlueSmart knows that. Funded by Thomas Pierucci and Diego Saez-Gil in 2013, and complemented by industrial designer Alexander Verlini, aerospace engineer Martin Diz, and operations expert Brian Chen, this company is surfing the IoT wave with products that use sensors and industrial design to meet the needs of today’s travellers.
The company’s first product is BlueSmart Smart, the world’s first smart suitcase, released in October 2014 on the crowdfunding platform Indiegogo. BlueSmart looked for support from that site’s investor community offering pre-orders of the product in exchange. The campaign was so successful, it obtained contributions from more than 8,500 people in 109 countries.
Aside from this Indiegogo funding, BlueSmart also received added angel investment from YCombinator, Semil Shah, NXTP Labs and MTS Fund, totalling $ 2.2 million for the first phase of product development.
The product, a smart suitcase that is connected with the user’s cell-phone, allows passengers to lock and unlock their baggage, avoiding the use of a lock and key (yet keeping TSA certification, which means no broken locks). Additionally, the system allows people to keep constant track of the bag via GPS, so should it get lost, finding it can be fairly easy. And that’s not it! In case the bag is forced open, it will send an alert message to its owner, so that he or she can check out its contents upon arrival at his or her destination. But there’s more, the suitcase also has a digital scale incorporated in it that warns the traveller when the bag is overweight, so that the passenger can decide whether to take it on board as carry on, or to check it in, as determined by the rules of the airline he or she is travelling in.
This product was clearly made with the user in mind, as it incorporates all kinds of extra alerts and features that help people avoid common mistakes and mishappenings while travelling. For instance, if a passenger forgot the bag on an airliner, or somewhere along his or her way, the app will instantly push a notification on his or her smartphone, informing that the bag has been left behind. At the same time, it records the traveller’s itinerary, and uses push notifications to send reminders about it. And for long layovers and flights on airplanes with no power ports, it also includes big battery that allows passengers to refill their phones, tablets and laptop batteries even as they are stored inside of the bag, or while they are using them at the airport.
Such an innovative and feature rich product will most certainly be a success among frequent flyers, who this way can reduce the fear of having their bag become one of the 24.1 million suitcases lost in airports or misplaced by the airlines each year; or one of the many more that suffer abuse either from the authorities seeking suspicious materials, or from malicious airport workers who steal from bags that are improperly sealed before loading them into the airplane. So it is no wonder BlueSmart’s suitcases have received high punctuations from various travel publications and from users themselves.
As the company started selling the product on select location at the base price of USD$450, it showed the existence of public interest in it, and a viable business model. This meant it was able to raise a new round of funding on its A series. This time for the tender amount of USD$11.5 million. Among others, the investors include industry leaders such as Daniel Curran, and Marcos Galperin, as well as renown VCs and hedge funds like Fairhaven Capital Partners, Fenox Venture Capital, Flight VC Penchina, Funders Club, Gil Penchina, Pejman Mar Ventures, Semil Shah, Western Technology Investment, Yunqi Partners, Cota Capital and the Amadeus IT Group.
With these fresh resources available, BlueSmart started to really market the bag, making it available on Amazon, and on the MOMA store in New York, as a part of this innovative museum’s 2016 “Remarkable products collection”, as well as on stores specializing in suitcases and articles for travellers.
But while it’s product is unique today, the people behind BlueSmart acknowledge this may not always be the case (no pun intended), as competitors may adopt some of these innovations themselves. For that reason, the company announced in December 2015 it would open a Technology Development Center in Buenos Aires, where it plans to create new features and new technologies that would allow it to stay ahead of the trend and develop new amazing features and keep leading the smart-suitcase market. A market that is just getting started.
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