COMMENTARY | COLUMNISTS | PHIL BAKER

Sensing a success

Sensor technology promises to be one of the most exciting new developments of this decade. Tiny sensors are being created that can measure and transmit everything from the moisture level of a grape in a vineyard to the age of a can of soup on a supermarket shelf.

Intel (Nasdaq: INTC) is even conducting research on placing sensors in the homes of the elderly to detect sudden activity shifts that could indicate health problems.

A local Del Mar company, Procuro (www.procuro.com), has developed a solution using sensors that may revolutionize how businesses monitor the status of their computer systems.

Business computing systems consist of an assortment of hardware and software such as computers, firewalls, networks, routers, disc drives, operating systems, software applications and more. To maintain continuous reliable operation, these elements need to be monitored around the clock to know when a failure occurs so that corrective action can be taken, typically by the IT administrator.

The kinds of problems that occur include losing a connection, a hard disk crash, a failed circuit board, viruses, overheating and software crashes.

All of this equipment is put together into a huge system with a network operating system (NOC) consisting of a computer and several displays to monitor the state of all of all the components. Numerous displays are needed because of the disparate type of equipment being followed. While they all provide similar functions, it's confusing and costly to have so many monitors. It's much like the displays a guard in a building may have at his desk to monitor the different exits and alarms, but far more complex.

Procuro has developed a software replacement for all this NOC hardware. Software sensors monitor each of the critical functions on the network; when something out of the ordinary occurs a notification shows up on a single computer, PDA or even on a cell phone.

The idea for this software NOC came to co-founders Vince Gordon and Bernard Lee while watching Vince's daughter using instant messenger, the software people used to send messages to each other. Instant messaging has a buddy list separated into groups of family, business and friends. When anyone on this list goes online, his presence is shown on the buddy list. The Procuro product interface, called PIMM (personal information management monitor) works in much the same way.

It replaces the complexity of multiple user interfaces and monitors, multiple log-ins, etc., using just a single icon that sits in the icon tray of a computer. The color of the icon determines the state of health of all the resources being monitored, whether there are a few or hundreds. The numerous activities being monitored are listed like the buddies. When something falls out of the norm, it "comes online," changing the icon to red.

Not only can this technique be used for keeping an eye on the network's overall operations, but it can also be used for monitoring a vast array of items such as the gasoline level in a storage tank. If the gas level falls below a preset level, it triggers a call to send a fuel truck. Physical sensors already exist for most digital devices and have a common interface, so Procuro is able to capture data from nearly any piece of equipment and convert it to XML, the industry standard for sending data over the Internet.

One customer who owns a group of Taco Bells received complaints about long waiting times at the drive-in window of one its outlets. Since there were already digital security cameras in place, Procuro developed a software sensor that uses data from the security cameras to monitor the times between a customer's ordering, paying and picking up the order. Now when the times at any of the dozens of restaurants exceed a certain duration, management is notified. This is management by exception, where no news is good news.

Procuro software runs on Windows 98 and above, and will soon be running on Microsoft's smart phones and Pocket PCs.

Procuro has an interesting history in which failure to get venture funding actually benefited the company. When Gordon began searching for funding in 2001, Sept. 11 struck. With investments impossible to get, he and Lee changed the company's business model from hiring a sales force to using distributors that were already selling the hardware NOCs. The distributors had the customers, but were making small margins selling hardware. Viewing them as allies instead of competitors, Procuro offered them its product, giving them 60 percent of the revenues while it kept 40 percent.

Business has been growing ever since. Procuro has 10 distributors and several hundred customers and is expecting to grow to 100 distributors with several thousand customers this year. The company is currently cash flow positive with a total of two (that's not a typo) employees. Patents are pending for its technology.

The company has just raised a second $500,000 from private investors, adding to the first $500,000 investment from Gordon's savings. Procuro is a great example of turning the lack of VC funding into an advantage. I sense we will hear more from this two-man company operating from a garage in Del Mar.


Baker has developed and marketed consumer and computer products for Polaroid, Apple, Seiko and others. He is the holder of 30 patents and was named San Diego's Ernst & Young Consumer Products Entrepreneur of the Year in 2000. He can be reached at phil.baker@sddt.com.

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