19 Oct, 2014, 0547 hrs IST
By: Jyoti Pande Lavakare
First came the sleek, fashionable, inclusive and wearable technology with a cause:
Lechal, the innovative, bluetooth-enabled haptic shoe (haptic technology recreates the sense of touch via vibrations).
Then came even greater innovation: in thinking through and deciding upon the actual process of manufacturing that tech-embedded shoe — right here in India — using differently-abled people. When both product and process innovation become so integrated in the overall philosophy of the company that you can't separate one from the other — it's about inclusion as much as about profit — it truly becomes the coolest thing.
But let's begin from the beginning. At an elementary level, Lechal shoes appear to intersect the worlds of sci-fi and magic — with a bit of James Bond thrown in. If you wear these shoes, you can never get lost — even if you're blind.
And while they're doing their job liberating you from ever having to read a map, look at a screen or ask for directions, they're also telling you the distance to your destination, the number of steps you've walked, biked or run, calories you've burnt, fitness levels and other metrics.
Additionally, they can track activities, set customised fitness targets, workout sessions and milestones and motivate you via audio or screen, transferring all this data seamlessly to your smartphone. And because they're on your feet, they're more accurate than other wearable technology that offers similar information.
Lechal came into being for a noble cause — to help the visually challenged navigate with Google maps through the use of haptics and digital mapping. And although it has since become more inclusive — to include those who are not visually challenged — Lechal's original intention remains priority.
Lechal (a rough translation from Hindi would be "take me along") signals the wearer through vibrations, the intensity and duration of which vary to correlate with the distance to an upcoming turn. So, it will vibrate longer the closer you are to your turn. The intensity can be pre-set to custom requirements. It also syncs up with smartphones through an app to provide a variety of other navigational metrics and fitness information.
Innovated in India
Here's how it works: the insoles are embedded with removable sensors powered by two rechargeable lithium polymer batteries which sync with mobile apps like Google maps. Directions are relayed through haptic feedback through vibrations either in the left or the right shoe.
Now let's get to the innovative thought in the manufacturing process. When Lechal pre-orders opened in February, its founding team of Krispian Lawrence and Anirudh Sharma was still focused mainly on fine-tuning their innovative product and hadn't got around to thinking through the manufacturing process.
At that time, they had 12 different manufacturers and suppliers in China who were manufacturing and assembling the shoe according to their specifications.
"Our initial product only said 'innovated in India'," Lawrence said in a phone interview from Secunderabad, where he has just leased a factory to locate his manufacturing unit. That itself is laudable, as India and China are usually seen as backend sweatshops rather than centres of innovation.
But it was only after they'd tinkered around, fine-tuned and refined the final version of their product that they turned their attention to the manufacturing process.
By this time, they already had 40,000 online pre-orders — which translate into immediate revenues of roughly $6 million at a price point of $150 per pair. For the two co-founders, who set up Ducere Technologies, built the prototype in 2011 and raised $2 million as seed capital, the innovation had just begun.
Last month, they concluded negotiations to lease a turnkey factory for the start-up to begin its own manufacturing right here in India, a timely alignment with Prime Minister Narendra Modi's 'Make In India' exhortation.
"It (the factory) is around 25 km from Secunderabad," says Lawrence, and they will soon begin the process of modifying it with wheelchair access and other disability aids so that they can hire as many differently-abled people as possible.
Lawrence and Sharma's business plan plays to the strengths of the differently-abled on a large scale — on the assembly line, on the factory floor and in quality control.
There's a sound rationale to these hirings: after all, who can do a repetitive job requiring high focus and precision better than someone on the autism spectrum; and which person's touch would be more sensitive in testing for quality than one who cannot see?
Add to this the social and financial benefits of including a previously non-productive demographic into the workforce along with the dignity of earning their own living, and the decision becomes priceless.
A Fashion Company
Ducere plans to take advantage of its existing relationship with the LV Prasad Eye Institute, Hyderabad, which has validated Lechal as a life-altering product for the visually challenged — and will tap into its 1.8 million registered patients in the initial stage of hiring.
It is also tying up with non-profits and eye institutes in Australia, New Zealand, South Africa, the UK and the US to sell the shoes at a subsidised price.
"We have already reached out to several organisations. They will help us to understand the special needs that we need to address and incorporate into our factory," says Sonia Benjamin, general manager, communications and business development at Ducere. Many international organisations are also interested, and Ducere will first pull in the assembly piece of the manufacturing component from China, and will begin by hiring 20 visually-challenged workers, before installing the machinery and hiring more.
The idea of including the differently-abled into their workforce on a sustainable and profitable basis has been part of their early vision. The two entrepreneurs have identified the challenges of using workers with special needs. "There are no big safety issues in manufacturing and assembling shoes.
We will work with a fleet of companies that provide cab services to call centres so that we can get our workforce with special needs picked and dropped from their homes," says Lawrence. "Every cab will have a supervisor."
They're also very clear that they're not doing anyone any favours. "We are very much a for-profit company — but with the philosophy of inclusion, design and manufacturing in India. We want to build a model that is sustainable," says Lawrence.
Lawrence studied engineering from University of Michigan, Ann Arbor, specialising in wireless communications and signals processing before moving to the Silicon Valley, California to work as a patent prosecutor.
A friend introduced him to Anirudh Sharma, and the two hit it off immediately. By 2011, they had created their first Lechal prototype and have several more wearable technology products in the pipeline, which they are working on in stealth mode. Sharma has just completed his masters from the Massachusetts Institute of Technology.
The company declined to discuss future products, but said that they would all be in the wearable technology space — and that Ducere is positioning itself as a fashion company.
According to Lawrence, wearable technology is just a fad. "Wearable technology isn't going to exist. Fashion is. We're a fashion company - we're not in the business of building gadgets," he says.
Ducere has 50 employees, and they are on a sharp growth phase. A group of unnamed high networth individuals provided the initial $2 million that was used for product development.
"Now, we need money for sales and marketing," says Benjamin. "We are on a hiring spree," she adds. Depending on finding the right fit "by the end of 2014, we should be up to 100 employees". This doesn't include the workers in the factory; the company will begin with 20 this year, going up in proportion to the volume of demand for the footwear.
The company is looking for additional funding for its growth plans, but is going to be very picky about where it accepts funding from.
Expects Brisk Sales
Lawrence discloses that Ducere is looking to raise $5 million by December and, perhaps, another $5 million later. He will resort to a combination of debt-based and equity funding by leveraging the company's order book. But first, they will go back to their existing investors to see if they can keep the equity limited to those who have already invested. "These people already believe in what we're doing. We want people on board who have been on this journey before. We want to get the money from the right people," says Lawrence. He is in talks "with some good VCs," he says.
Ducere expects to get its own cash flows going from confirmed orders by June 2015. "Right now, we're mobilizing all our resources now for the manufacturing process," explains Lawrence. The first Lechal shoe will roll out in February 2015.
Benjamin confirms that the designer shoe won't just sell online; the company will be setting up extensive sales and distribution channels through brick-and-mortar stores and tie-ups with existing retail outlets, whether they are sports and fitness stores or fashion footwear stores.
"We have a very clear pricing strategy and we will hold that firm throughout, whether it's an Amazon, Flipkart or online sales from overseas. We want people to understand what Lechal is. We want to tailor the retail experience. We're using this quarter to finalise our distribution agreements with retailers," says Benjamin.
The only people who will get this sleek piece of wearable-technology at discounted rates will be the visually-challenged. "We will provide it to them at a 30% to 60% subsidy initially, until our volumes of full price sales rise. Then we can increase the discount," says Benjamin.
"India is the blind capital of the world," adds Lawrence, and even trying to integrate that demographic into the mainstream is an ambitious aim. But for buyers to know that a portion of the price they pay for this design accessory is going to subsidise the shoe of someone who is visuallychallenged should itself be motivating.
With the insoles priced at $149.99 a pair, and the shoes marginally higher, they aren't cheap and some buyers will need an extra nudge. But given that it's a global product — the team has received a fair bit of international interest, mainly from Japan, Europe, the US and the UK — the company expects sales to take off very quickly.
"With this footwear, one can belong to any country as soon as you land there. It will be so liberating to walk, run or bike without looking at a screen," says Lawrence. He estimates sales of around 1,00,000 by December 2015, a conservative estimate, he reckons. But what about copycat products?
There are bound to be those, admits Lawrence, but his experience as a patent prosecutor in California has helped him get 24 utility and design patents internationally. Meanwhile, their quality, guarantees, early-mover advantage, online and phone tech support as well as innovative manufacturing plan should be enough protection for now.
(The writer is an independent columnist)