RESEARCH TRIANGLE PARK – Serial entrepreneur and investor Scot Wingo is applying lessons learned from years of experience in building ecommerce services firm ChannelAdvisor into a successful public company at mobile car maintenance startup Spiffy. From car washes on demand to oil changes and other services in five metro areas to, as of Wednesday, a new sensor offering designed to help vehicle owners find out for themselves what’s going on with their cars.
Spiffy Blue is a Bluetooth-enabled sensor device that serves as an on-board diagnostics tool that provides customers with data through a mobile app. Selling for less than $50, Spiffy Blue plugs into the on-board diagnostics port, or OBD-II, of vehicles manufactured since 1996.
Spiffy Blue app
So in two moves, Wingo has:
- Taken Spiffy into the national player via sales through Amazon and eBay – two firms he worked closely with during his ChannelAdvisor tenure.
- Turned Spiffy from on-demand physical services at a few locations to software-delivered data and analytics, opening up future opportunities to help customers in more ways that oil and a wash
In doing so, Wingo has stretched Spiffy in ways other entrepreneurs might fear, just wouldn’t do, or executed in such a way that he believes won’t put the company’s future at risk.
How many entrepreneurs grow too fast, too early and burn through all their cash or burn out their team?
How many firms have steered away from anything to do with hardware? Yet like Raleigh-based Republic Wireless, which has launched its own designed and built mobile warning device (not a smartphone; no scree, either), Wingo and his team decided to invest money and intellectual capital to build the sensor it’s now selling.
The Skinny talked with Wingo about all the thought processes that went into the concept of a sensor service, the importance of listening to customers, responding to their demands, and managing the risk.
Our Q&A:
- This pushes the envelope far beyond the original focus of Spiffy – are you comfortable with that?
Yes! Part of my startup playbook is to get some customers, make them happy and then try and do more for them. Our customers love our services because it makes car maintenance and ownership less of hassle. So we are always asking ourselves what else could we do to add value to our customers? Spiffy Blue is a natural outcropping of that.
As you know, at ChannelAdvisor, we had a front row seat to Amazon’s ascension and the biggest lesson I learned from watching them is they truly put the customer first and innovate around the customer. That is our north star at Spiffy as well – regardless of where it takes us.
- Where did the idea came from? How was it nurtured and developed?
As you know in 2017 we started offering oil change and that is quite popular. Customers then started asking, can you do x, y, z for me?
We also know from our customers they are so busy that they frequently forget to take care of their car (I’m guilty of this). So we started a program where whenever we wash a car, our technicians record your next oil change, your inspection date, check your tires, etc and then we alert you in the app.
This was quite popular so we started to think that it would be great if we could get even more data. Talking to customers, one of the biggest source of frustration with modern cars is they are quite ‘opaque’. The biggest example is the dreaded check engine light. When that comes on, you know your day is pretty much ruined. But what’s frustrating is it could be something minor or it could be something major.
Putting all that together, we started exploring what else we could do around this ‘make your car more transparent’ and ended up with Spiffy Blue.
- This takes you into hardware/device sales and all that entails. Why are you doing this? How do you deal with inventory, management?
Fortunately, as you know in my past life I have a lot of ecommerce experience, so we are leveraging everything there. We’re not selling Spiffy Blue in physical stores at this point, but instead starting on-line by partnering with Amazon, eBay and Walmart.com.
There’s a very entrepreneurial online merchant, virtual exchanges that I know from ChannelAdvisor that is helping us out with this.
- How long was the idea under development? Who had the original idea? Were you skeptical?
I outlined the general idea that led us here above. We’ve been working on this over 8 months.
I was definitely skeptical because you read all these articles about self-driving vehicles and connected car, so we tried to get to the information we need through that, but you realize the average car on the road is [over] 8 years old and these connected car capabilities are very new and frequently require customers to pay extra, so we realized we had to go the Obd-2 sensor route.
I was worried our customers wouldn’t understand it, but in our tests, it’s relatively easy to find the port and install the sensor, then you can just leave it there and now you have continuous feedback about your car.
It’s kind of like a fitness tracker for your vehicle.
- Did you have to put together a team to design and create the device? Who is responsible for ensuring that it stays up to date and is providing accurate information?
Fortunately, our CTO, Ryan Eade, went to NCSU school of design so he’s got a three-way balance between software, hardware and industrial design, so he actually got to use some capabilities we hadn’t tapped into yet on Blue. So our existing team was able to knock this out.
- How does Spiffy make money beyond the actual cost of the device? Any spiffs from mechanics or car dealerships?
For now, the device is the main economic driver. As we see how people use Spiffy blue, we have a ton of ideas on how we can help them.
A logical extension we are thinking about is: “Ok you are telling my vehicle needs x/y/z” – what next?
- Have you already had talks with any big partners? I can see Advance or some other chain wanting to “own” this.
Not yet, we have been head’s down developing the product to get it to launch. We are talking to most of the OEMs (car manufacturers) about their connected car initiatives and over a 10-20 yr timeline,
I think the device won’t be needed and we can leverage data straight out of the car, but that’s a long way out.
Spiffy Blue sensor
- Is the device patented? How do you protect the IP/concept?
No, it’s an open specification for the OBD2 port. I’ve always believed that execution tends to win vs. over focusing on IP protection.
The way we will win is making car ownership easier and more transparent for customers and innovating around that – always with the customer’s needs first.
For example, we are not the first company out with an OBD2 device – but if you look they all target mechanics and hobbyists. Nobody has cracked the code on how the average person that just wants their car to get them from point A to point B reliably at the lowest cost possible can use this technology and we think we can do that, because we know that customer really really well.
- How did you select a manufacturer?
