Tether Technologies founder Randy Neely’s entrepreneurial spark occurred more than a decade ago when a security company he managed lost the master keys for a high-rise office building in Seattle. Neely not only looked for the keys, but more importantly for a technological solution so building keys wouldn’t be lost again. He couldn’t find anything on the market, so he came up with his own idea
The two-year-old Seattle company’s electronic key tether consists of two battery-powered units — a belt attachment that clips onto the user’s belt, and a key unit that holds a ring of keys. If the user walks away from the keys, each unit activates alarms (a chirping sound from the belt and a LED strobe light from the key unit). The alarms are activated when the separation exceeds about 10 yards.
In addition to Neely, Tether is led by supply chain veteran Dennis Hammonds and former OfficeSpace.com CEO John Suryan, who joined the company as CEO after hearing a presentation at the angel investment network The Keiretsu Forum. We caught up with Neely, who is officially launching the company this week, for the latest installment of Startup Spotlight.
Explain what you do so our parents can understand it: “Never lose a set of master keys again.”
Inspiration hit us when: “Fifteen years ago, my security firm … was responsible for providing security services to a million square foot high-rise in Seattle. When a building security officer misplaced a set of master keys, they ended up with an $80,000 bill to re-key the entire building, weeks of lost time spent looking for the keys, and eroded trust and credibility. The keys in question were eventually found after the building was re-keyed — on top of a vending machine. I tried to find a product that would make sure this never happened again, but everything was a reactive — or ‘after the fact’ — solution. Biometric key control solutions, electronic key boxes, and behavioral policies all aim to control key check-in and check-out and can alert managers when keys are not returned on time. The problem: none of those options prevent the loss of valuable keys.”
VC, Angel or Bootstrap: “We’ve used a combination of bootstrap and angel. The company has spent just under $400,000 to date. That is an amazingly small sum of money to bring to market such an electronically sophisticated device.”
Our ‘secret sauce’ is: “The electronic key tether device is deceptively simple and at the same time technically sophisticated. When people hear what it does, they are often surprised that nothing like this existed before.”
The smartest move we’ve made so far: “Bringing John Suryan on board full-time to help navigate the funding landscape and bring the EKT to market.”
The biggest mistake we’ve made so far: “Simply learning along the way – everything from product development to product funding was a learning experience.”
Would you rather have Gates, Jobs, Zuckerberg or Bezos in your corner: “Wow, all amazing innovators. Today, I would want Jeff Bezos in my corner. His philosophy on innovation and the pioneering culture he’s fostered at Amazon.com is all about the company and its employees being inventors. This is a culture that John and I also want to cultivate and encourage at Tether Technologies. After being named Business Person of the year, Bezos recently said, “patience is required if you’re going to invent.” Looking back I’d say that is an understatement. But he is absolutely right; you have to be willing to fail and to try different things to be successful.”
Our world domination strategy starts when: “When building and security managers hear the EKT story. Schools, hospitals, law enforcement, airports, casinos, hospitality and more — they all use master keys and at one time or another, they have all felt the panic and pain from losing them. Those managers immediately recognize the problem we solve and appreciate the peace of mind that comes with a pre-emptive key loss solution.”
Rivals should fear us because: “They can’t stop key loss in the first place and their product offerings cost thousands more. EKT is incredibly cost effective for any-sized company, and can easily be added to existing key control protocols.”
We are truly unique because: “Nobody else prevents keys from being lost. Other products can alert you when keys are lost or misplaced, but preventing that loss in the first place is what makes us truly unique.”
The biggest hurdle we’ve overcome is: “Raising the money to move from prototype to production. The company was stuck in first gear for almost a year, as I tried to raise $1 million to build 10,000 units, while at the same time working as president of Northwest Protective Services. Then, four months ago, two significant events took place. John came on board as a full-time CEO and the funding goal was changed to $250,000 — enough to build 2,000 units. Forty-five days later and with $200,000 in the bank, we shifted into second gear, issuing POs for our initial production run of 2,000 units. Third gear is now days away as the initial set of units will come off our outsourced production line in Ballard in December.”
What’s the one piece of advice you’d give to other entrepreneurs just starting out: “Don’t give up. Don’t get discouraged. Talk to people you know about your idea (after they’ve signed a non-disclosure agreement) and solicit feedback. Know the Law of Attraction – it’s real.”