One year ends, another begins, meaning it’s time to reflect on the past twelve months and to define what we may see in the year ahead.
2018 Year in Review
For Element, 2018 will be remembered as the year we achieved a number of key milestones in our development as a company:
In January we announced our Series A totaling $19.5 million raised from the venture capital arms of Honeywell, ABB, Schneider Electric, GE and Mitsui and financial sponsor Blue Bear Capital along with current investors including Kleiner Perkins Green Growth Fund--a fun way to start the new year.
Our team began the transition from a small, product-oriented team to a more complete management and delivery team required to scale our business and meet increasing customer demands. I’m particularly pleased that we’re able to attract and retain A-level talent across the board who are excited to work on solving real-world problems.
We successfully launched our first customers into production including a super major oil and gas producer for whom we’re delivering fast, measurable ROI. Comments from customer NPS surveys include: “Unique capability helping us deploy and scale digital systems quickly,” and “Element’s value is delivering trusted data from source to consumer so that we can reduce the amount of unplanned outages and deferrals, and maximize margin.” The results of our first ever Net Promoter Score survey are especially encouraging with a score of 50 (considered very high) which I chalk up to excellent delivery by our Forward Deployed Engineering team’s working on-site at customers and to the thoughtful product design and hard work by our engineering team.
On the partner front we continue to be pleased with the increasingly strategic nature of our relationships with both Microsoft and OSIsoft with whom we announced the AF Accelerator offering that dramatically speeds time to analytics, increasing return on data collected. We finished 2018 working on a number of other partnerships that we’ll announce early in 2019. A partner ecosystem is important for our customers’ success and we’re pleased to be expanding ours.
On the humble bragging front we were pleased that Gartner named Element a Cool Vendor in IoT Analytics, and for a second year, JMP Securities named us to its Efficient 50 list of private companies driving innovation and efficiency across the energy and industrial sectors.
Importantly, 2018 saw our continued progress building a company culture aligned with our values: People Centric Experiences, Simplicity, Humility, Honest Growth, Experiential Diversity and a Scientific Approach. This is about “how” we want to be as a company. We focus on these values in our daily work. We also work to serve our broader communities through activities like assembling care packages for Lava Mae San Francisco or packing meals for the elderly at the Houston Food Bank. We also promote industry engagement whether it’s delivering papers at engineering conferences or hosting technical meetups at our office to make our team and community better.
One year ago we provided a 2018 outlook with a hope, an expectation and a prediction. Let’s see how we did and also look forward to 2019:
Our Hope for 2018: Less talking and more doing as industrials increasingly deploy solutions into production and dial down IIoT experimentation. 2018 showed signs of progress as companies began to deploy more advanced analytics into production, but let’s face it these companies don’t move with a sense of desperate energy, which is prudent given the criticality of their operations. Breaking the cycle of proof of concepts and deploying IIoT solutions into production will finally pick up steam in 2019.
Our Expectation for 2018: A year when “cloud vs edge” debates evolve into “cloud and edge” integration strategies. This was certainly met, both among the companies Element works with and generally in the market. It’s no longer either/or but and/and. This is good progress for the industry as a whole. Let’s scratch this one off the list for 2019.
Our Prediction for 2018: Operational Digital Twins will emerge as table stakes for doing industrial analytics at scale. Our prediction that Operational Digital Twins will emerge as table stakes for analytics at scale saw real progress in 2018. Digital Twins have finally moved beyond marketing hype and are now being seriously considered and implemented by OEMs, Owner-Operators. Technology analysts like LNS Research and Gartner (who named Digital Twins among its Top 10 Strategic Technology Trends for 2019) are actively covering the emerging market for Digital Twins assessing twin types, use cases, functions and expected evolution. Digital Twins that enable operational analytics (CBM, predictive maintenance etc) will accelerate in 2019 as the foundation for advanced analytics and with greater emphasis on how Operational Twins can be used to share data between equipment owners/operators and OEMs.
2019 will be the year that AI will begin to be adopted at an enterprise level among industrial companies
In addition to growth in digital transformation initiatives among industrials and the continued advance of Operational Digital Twins, we have made one new prediction for 2019: 2019 will be the year that AI will begin to be adopted at an enterprise level among industrial companies, meaning AI use cases will be applied across multiple plant sites by owner operators, and covering multiple use cases. Early signs of progress include Google utilizing AI from its Deepmind business to deploy adaptive control in data centers to reduce energy consumption. Imagine what deploying similar capabilities could look like in any number of other industries? For this to happen requires owners/operators to grow comfortable with augmenting human control with AI, not necessarily takingthe human out of the loop, but helping the operator achieve vastly improved control science over critical operations. This is a long, multi-decade march that will begin in earnest this year. This is a sweet spot for Element, because if you want to deploy AI you need a lot of data, and that data must be trustworthy.