Dacuda Story | swissnex San Francisco Magazine | Issue 1 | 2012 by swissnex San Francisco

A NEW GRASP ON SCANNING

THE LSM-100 SCANNER MOUSE WAS USED TO CREATE ALL BACKGROUND IMAGES FOR THIS STORY.

It’s something nearly every desktop computer has: a mouse. And it’s something almost everyone needs from time to time: a scanner. NOW THE TWO COME IN ONE HANDY DEVICE. On February 2, 2012, an audience in San Francisco was among the first to put a brand new data input gizmo to work. Its debut happened weeks earlier at the Consumer Electronics Show in Las Vegas, when electronics juggernaut LG and Swiss startup Dacuda introduced the LSM-100 Scanner Mouse to the US. The lucky early adopters of February joined the “Scan What You Can” competition at swissnex San Francisco and vied for a chance to take one home. The event showcased the device’s swift, maneuverable interface linking the digital and printed realms, and how it now integrates with popular cloud applications including Dropbox, Expensify, Evernote, and others. Dacuda’s patented SLAM Scan® technology combines principles of robotics with computer vision to accomplish its feat. The scanner’s camera captures a video stream of overlapping images as the user swipes the mouse over business cards, graphs, books, maps, even fabric. Dacuda’s software then stitches the pictures together by detecting and aligning corresponding points in real-time and optimizing the final result. What makes the mouse so incredibly valuable, aside from eighty-sixing the clunky scanner hogging all your desk space, is that the captured images are instantly editable in Word, Excel, and other popular applications. That also means that they can be shared with a single click on social networks or by email. Since Dacuda developed the scanning mouse and secured LG as a launch partner, several hundred thousand units have shipped, winning over users in more than 118 countries and recognizing text and tables instantly in over 190 languages. Software for Windows and Mac gives the mouse broad appeal, and Dacuda has received accolades for its success. The company earned the Swiss innovation prize in 2010, the Swiss Economic Award in high tech and biotech in 2011 (one of most important prizes in Switzerland), and it made the cut for the 2012 Red Herring Global 100 list of the best tech startups worldwide. “Dacuda has a mashup of two technologies and it’s easy for consumers to understand what it is,” remarks Ulf Claesson, of the Swiss Commission for Technology and Innovation (CTI), which provides support for early stage Swiss startups. “That makes it accessible to consumers and to consumer electronics companies who get it, too. They know it will be relatively easy to bring that kind of product to market. The other interesting factor about Dacuda’s technology is what it can do with other devices. From my perspective, this is only the start.”

“ I see a lot of companies and sometimes there is a great team and an average idea. Sometimes there is a great idea and an average team. I THINK WITH DACUDA, WE SAW THAT BOTH WERE GREAT.”

Dacuda’s founding team met in an entrepreneurship class towards the end of 2007 at the Swiss Federal Institute of Technology in Zurich (ETH Zurich). Alexander Ilic, Michael Born, Erik Fonseka, and Martin Zahnert had the idea for the scanning mouse but not much else. They worked for a year using their own funds to build the first demo, which consisted of a wooden box with a CD-size footprint, inside which they mounted an off-the-shelf webcam. This early prototype proved that their real-time image stitching technique—their secret sauce—worked. With that crude little box, they went in search of funding and officially founded the company in early 2009. It wasn’t long before Ilic reached out to swissnex San Francisco. Ilic studied computer science and computer linguistics in college at TU Munich in Germany before enrolling in a cross disciplinary Ph.D. program between ETH Zurich and MIT. He spent one full year at MIT as part of the Entrepreneurship Lab Program at the Sloan School of Management. It was there that he became aware of the swissnex network and its outpost in Cambridge, Massachusetts. When he returned to Switzerland and started Dacuda, he got in touch with swissnex San Francisco’s Birgit Coleman, the organization’s startup services leader at the time and a resource for finding contacts in the Bay Area. In 2010, Ilic thought of swissnex San Francisco again because of a new startup accelerator program being offered there: the US Market Entry CAMP. The CAMP is a joint initiative between the swissnex offices in Boston and San Francisco, and CTI. Only companies with or working toward a CTI label, attained through active coaching by the Swiss startup promotion agency, can apply. Of those that apply, only the companies deemed ready are accepted and receive a stipend for expenses, a workspace for three months, and access to swissnex’s support, contacts, and expertise. Ulf Claesson, who advises Dacuda through the CTI program and is a co-creator of the CAMP, felt the company was ready. Dacuda was accepted and in November 2010 became the very first startup to camp out at swissnex San Francisco. “I see a lot of companies and sometimes there is a great team and an average idea. Sometimes there is a great idea and an average team. I think with Dacuda, we saw that both were great,” Claesson says. “It was clear that Dacuda’s technology was mature enough, that they needed partners, and it was clear where those partners were—Silicon Valley.”

“ IF YOU’RE THERE, IT’S EASY TO CONNECT.”

Dacuda CEO Alex Ilic wears a gentle smile, a crisp shirt, and neatly combed hair. He says of the CAMP, “It gave us the chance to get to the US faster. Before that, it’d be one week of activity, then silence for two months. We realized that when you show up and have a great meeting but then are gone again, you get out of your partners’ sight and they lose interest. The CAMP really gave us the opportunity to stay close with potential customers and work on a more local basis. There isn’t an international flight connected to a yes or no. You can organize meetings here a lot easier than if you have to plan two weeks ahead from afar.” Two of the partnerships (with Expensify and Evernote) that came to fruition in 2012 during the scanning competition also had roots way back to the days when Dacuda was a CAMPer. “There were random situations that led to cool things,” Ilic remembers about working in the swissnex office. “One time, Luca Rigazio from Panasonic was there to visit Gioia [Deucher, who now heads the swissnex startup services with Coleman], and since I was sitting at the desk in back she introduced us. The next day I had a meeting at their office in Cupertino. This contact wouldn’t have happened if I was in Switzerland. If you’re there, it’s easy to connect. That’s one of the most important things.” Arguably Dacuda’s most important milestone so far is the deal it snagged with LG. After getting contacts rolling with a number of electronics companies thanks to time in the Silicon Valley area, Dacuda fielded multiple offers to license its novel technology. “At the end of the day, LG made the cut because its people were looking for a chance to bring the world’s first product to market,” Ilic says. “This isn’t something that happens every day.” Ilic explains that LG was one of the last meetings they had over an eight-month period during which they screened the top 20 consumer electronics brands out there. The Korean company saw the opportunity, they were fast, and they made a good offer. Even after the first meeting, with nothing in ink, LG impressed Dacuda by going out and conducting a full-scale market research study. They surveyed thousands of people and figured out what it would take to ramp up production on a demo. LG won the exclusive rights to be Dacuda’s launch partner and producer of the world’s first scanning mouse. The product made it to market in early 2012 and is available today at major retailers including Amazon and Fry’s. And Dacuda is now opening up the market to other vendors.

“ THIS ISN’T SOMETHING THAT HAPPENS EVERY DAY.”

Alex Ilic, Dacuda CEO

So you have a scanning mouse. Now what? Connect it to other useful products, of course. To easily access personal data any time and from any device, digital citizens are increasingly using applications that store their information in the cloud. Forty-five million people use Dropbox for sharing and storing files, for example. Evernote’s 25 million users store their digital notes with that service. Expensify lets close to a million people create online expense reports “that don’t suck,” according to the company. Digitizing information quickly and easily, however, has been problematic. Enter the scanning mouse. Dacuda approached these and other cloud services about integrating their shareability and accessibility with Dacuda’s scanning prowess, and the conversations paid off. At the swissnex event in February 2012, Dacuda’s partnerships with Evernote, Dropbox, Expensify, Lemon, and NewSoft officially debuted. Moreover, attendees got to try out how the mouse brings tangible content online in an editable format—and fast. The young, tech-savvy crowd was anxious to get their hands on the device and begin experimenting. David Barrett, Founder and CEO of Expensify, represented his company at the swissnex event. “I can see Dacuda moving its technology out of mice and into other devices. That’s what’s brilliant about their plan. It doesn’t require a lot of fancy hardware. It really works with anything with a camera. It’s really clever technology that focuses on fast and nimble software.” To show off that speedy and flexible appeal over a traditional desktop scanner, Dacuda created a friendly little competition for the event: whoever scanned a twisting, turning racetrack (with a cheese reward at the end) the fastest, won. Victorious contestants like Christian Prada received their very own scanning mouse as well as other prizes such as a year’s membership to Evernote. “You have to imagine that while you move, the mouse software is stitching the images together like a mosaic,” Prada says. “If you want to know how I won, I noticed that basically the software was a lot faster than the rendering on the screen. Other people were watching the screen. I did it in a couple of seconds by watching what I was scanning.” The event highlighted how, with the scanning mouse, the entire notion of what scanning is shifts. “Before Dacuda, scanning usually took time and was never fun,” Alex Ilic says. “We showed it can be fun and you can do cool things with it.” Scanning off the page for example. There are no size restrictions to what you can scan with the mouse. Objects or images don’t have to be perfectly flat or fit on a rigid tray.

Dacuda’s goal is to enable users to instantly edit and share the things they see in front of them with the devices they actually use. The mouse is perfect for those who work on laptops or desktops, but what about the huge group of mobile users and people interacting with computers in their living rooms? Dacuda is paying attention. “Everywhere there’s a computer and a camera, we’re looking,” Ilic says. If Dacuda is successful, we can soon imagine scanners in our smartphones and embedded in gaming devices, tablets, TVs, and remote controls. We may never have to transcribe text from documents again. We’ll be capturing street art, maybe, or patterns in nature using the electronic objects in our pockets and bringing these scenes into our digital worlds to riff on, augment, and enhance. It all seems so plausible, it’s as if the technology was always there—or should have been. It slips right in. Did Dacuda scan our brains to find out exactly what we were waiting for?