At StartMIT, Students Gain Advice for Building a Successful Startup
“The purpose of a business should be to solve real problems for real customers,” says MIT Professor Hari Balakrishnan, cofounder of Cambridge Mobile Telematics.
Emily Makowski | School of Engineering
February 8, 2019
Technology encourages the growth of startups, but starting and running a business requires skills beyond what a student might learn in the classroom. Enter StartMIT, an annual Independent Activities Period course that focuses on entrepreneurship and aims to make students aware of the process of turning ideas into companies.
StartMIT began in the Department of Electrical Engineering and Computer Science (EECS) as Start6 in 2014, and it has since gone Institute-wide. This year, the program ran Jan. 7-23 and featured 60 guest speakers representing a wide spectrum of innovation leadership, from Jinane Abounadi, executive director of the MIT Sandbox Innovation Fund; to Hari Balakrishnan, a professor in EECS and cofounder of Cambridge Mobile Telematics; to Megan Smith ’86, SM ’88, cofounder and CEO of Shift7 and former chief technology officer of the United States.
Balakrishnan was part of a panel called “From a MIT research project to a startup,” moderated by EECS Professor Saman Amarsinghe. Joining Balakrishnan were two faculty colleagues, Michael Stonebraker and Silvio Micali, both winners of the A.M. Turing Award — which is considered by many to be the “Nobel Prize of computing.” Along with being members of the EECS faculty, all three have another shared interest, Balakrishnan says: “All of our companies came out of research done at MIT.”
During the panel, Balakrishnan’s message to students was that a company’s main priority is to solve problems for customers. “Engineers and researchers believe it’s all about technology, and then you go to a company and the business people tell you it’s all about the product. But what it really is all about is solutions for customers, and the purpose of a business should be to solve real problems for real customers,” he says.
Balakrishnan cofounded Cambridge Mobile Telematics in 2010 along with Sam Madden (another EECS entrepreneur) and Bill Powers. The company’s goal is to make the world’s roads safer, which is done through sensors on smartphones and other devices that the company designs.
The company sprouted from Balakrishnan’s previous research on driving. From 2005 to 2010, he and Madden worked on a mobile sensing system they developed at MIT called CarTel. It was one of the first research projects that attached mobile sensors to vehicles. “We focused a lot on transportation applications and the project had a lot of academic successes,” says Balakrishnan. One of their first big successes was the Pothole Patrol, a project in which sensors attached to several Boston-area taxis helped researchers monitor road conditions, detect potholes, and determine which roads were in need of repair.
Cambridge Mobile Telematics is focused on making roads safer by measuring driving quality, and combining that with incentives to help drivers improve. One device produced by the company is a small square tag that attaches to a car’s windshield. It contains sensors like accelerometers that, when combined with the sensors on smartphones, can be used to study people’s driving habits. These devices are sold mainly to insurance companies, which often give customer rewards, discounts, and offer other incentives for measuring driving quality. “We have a very good way to score people’s driving that is very predictive of their crash risk, which allows insurance companies to use our data to improve how they price insurance,” says Balakrishnan. The products are used by insurance companies in 23 countries to monitor the vehicles of millions of drivers.
Not only do the sensors help insurance companies determine price points, they also make drivers more conscious of their habits when they’re behind the wheel, which reduces distracted driving and improves safety. One study showed that the company’s product reduced a driver’s phone distraction by about 35 percent on average within 30 days.
The company now generates tens of millions of dollars in annual revenue. During their early phases, the company was financed largely with customer revenues. However, this past December, Cambridge Mobile Telematics secured a $500 million investment from SoftBank Vision Fund. This investment will allow the company to further expand.
Balakrishnan and others at Cambridge Mobile Telematics are starting to look at monitoring autonomous vehicles, a topic that he says students at the StartMIT panel were extremely interested in. “In the future, insurance is going to be a function of observability, of third parties such as Cambridge Mobile Telematics observing the data and then using that information to assess the quality of the machine learning in self-driving vehicles,” he says.
Balakrishnan says that while there is a strong focus on computing and artificial intelligence at MIT, students are also interested in technology’s wider societal applications. “We happen to be using some exciting technology, but certainly [at the panel] there was excitement from students who do want to make an impact on society, and I think that’s quite an important aspect of the culture at MIT,” he says.
Reprinted with permission of MIT News.
Image: Lillie Paquette/School of Engineering