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AR’s Comeback Kid – With Blippar CEO Faisal Galaria

· Blippar,AR,Skype,Spotify,The Boss Interview

*Podcast available via Spotify (here), Apple Podcasts (here), and more (search The Harbinger VC Podcast)

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Faisal Galaria is CEO of Blippar, a pioneer in augmented reality (AR). Now Blippar has a roller coaster of a story… the one-time unicorn raised $100m+ in venture funding but struggled to find a sustainable business model, burned through its cash and entered bankruptcy proceedings, before returning as a new business based on its drag-and-drop AR content creation tool (think WordPress for AR). Faisal joins to guide Blippar’s relaunch and set it on a sustainable growth track, leveraging experiences from his time scaling Skype as an early executive, and Spotify as SVP of International. Faisal shares with us what Blippar is working on these days, key drivers for AR adoption (from COVID-19 to 5G), what developments he sees in the AR/VR space, as well as examples of what Blippar is working on with clients, including with key clients in China and Asian markets.

Edited by Louisa Xu and Henry Gao;

Link to SoundCloud (here), also available via Apple Podcasts, Google Play, etc.

[Editor's note: this interview has been edited and condensed for clarity. The opinions expressed in this article are Faisal’s own and do not reflect the views of Blippar]


Faisal’s Journey

Faisal, you’ve had some very formative experiences across consulting, Skype, Spotify before Blippar. Could you share more about your story?

Faisal: So I joined Blippar just under a year ago, but I started my career almost 25 years ago. Actually, I never thought I would be in business or in the digital world. I went through school and university thinking I was going to be an athlete. I used to run 400 meters quite competitively. The 400 meters is a sprint discipline and I think what’s really interesting is the 7 or 8 years that I was running competitively has impacted the way I work. It has honed my competitive spirit or tendencies, and you can see it reflected in a way at the companies I’ve worked at. At Skype, Kayak, and Spotify, I had “sprints” in all of those. Then I also need an “off season” to recuperate afterwards.

I was really lucky to join Skype as an early employee from Ofcom, which is the UK’s telecom media regulator. I was lucky to meet Niklas Zenströmm who was the founder of Skype whilst I was a regulator. I jumped from being a gatekeeper to be a poacher. That started a fifteen, sixteen-year career in scaling technology companies, including Skype, Kayak, and Spotify, and I am really excited about being the CEO of Blippar.

Thanks for sharing that, Faisal. It’s funny you should mention running 400 meters because I used to do that in high school and part of college. It’s certainly a sprint, but unlike the 100 or 200 where you just sprint all out, 400 requires some speed endurance as well. It’s a rather painful race… I understand your analogy. One more thing before we dive into your work at Blippar, when you were at Spotify, you were SVP of international and you spent quite some time in China and Asia. Could you share a bit more about that?

Faisal: I’d be happy to. In the early days of Skype we were very fortunate to have investments from Li Ka-Shing, the very prominent investor through the Horizon Ventures Fund. As a consequence of that, we decided to investigate working with, the portal, and investigate building Skype in China out of Beijing, which we did. One of the things that made Skype unique is that it’s built on a peer-to-peer network. When we started, although we had a commercial joint venture that was built upon the investments that Horizon’s made, one of the biggest problems we had to figure out was the infrastructure. Because for a peer-to-peer network to work, you need to have some peers there in the first place. Part of what I worked on with some senior technologists there was how to build a super node network and to start the peer-to-peer network in China working with Horizons and One of the things people may not know about Skype is that when we were acquired by eBay, about 25% of the userbase worldwide came from China, so that was an important part of our growth story.

I didn’t know that. And this was in the 2000s right?

Faisal: That’s right. I joined Skype in 2003, the year we went from being a minimum viable product to being a service that people could download and use. I was spending time in Beijing in 2004 and early 2005.

Interesting. We will spend a bit more time getting your perspective on how things will change in China, and we will talk more about Blippar and some of the work you’re doing. I also mentioned that your work with Skype and Spotify, which are essentially European unicorns, and also getting to China relatively early still at the beginning of this tech boom built on internet and the like. So you’re at the forefront of this trend of multiple countries and markets. It’s very fascinating.

Faisal: It was obvious to us, even back fifteen years ago, that both the size of the market and also the appetite for people in all parts of the world, particularly in economies where they are adopting technologies quickly and skipping some of the steps perhaps from fixed broadband to fixed mobile. We knew how quickly these markets were developing and becoming real technology powerhouses. We saw that happen with Skype in the early 2000s, and it has accelerated over the last 15 years.


What is Augmented Reality?

Now you’re running Blippar, which has been in the forefront of AR for much of the 2010s. It is a company that’s close to my heart. I worked at Blippar for a couple years in the mid 2010s. I spent time in New York and China with Blippar in their core product team. Blippar is a very interesting story, Faisal. I’m sure some of our listeners of the podcast probably have heard of them, as well as the ups and downs throughout the 2010s, raising a lot of money, developing excellent technology, having some good products in some cases, although burning quite a lot of cash in other cases. I won’t go through the full history here, but would love to hear the story of how you came across Blippar, why you decided to join, and how things are going.

Faisal: I think you’ve put your finger on it. Blippar was the pioneer of AR when it first got started back in 2011 building AR experiences and activations on 2.5G networks and the very first generations of smartphones. All credit to the team from a technology standpoint to make that happen. I got to know Blippar while I was in Spotify and we were launching Spotify in the United States. The way you would get early access to Spotify was through scanning a can of Coca-Cola, who was our sponsorship and commercial partner. When you scan the can with your mobile phone using Blippar, you will be able to get a code to unlock early access to Spotify. That’s when I first came across Blippar, at around 2011, 2012.

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(Source: Blippar)

I’ve kept an eye on the business ever since, but it really was far, far too early. The eco-system that is now evident and fast moving towards the business and the whole AR space. Now you have 5G spectacles and some big US companies like Google integrating AR into mobile search, and TikTok, Snapchat increasingly use AR as part of their social networks. These simply weren’t there seven or eight years ago. It now feels like the market is running towards AR really quickly. When the opportunity came up to take Blippar, which got into administration in 2018, the timing seemed right and the opportunity felt like it was too good to miss.

Could you help us better understand AR? Most of us have heard of AR and VR at this point. A lot of people have tried VR games and 360 videos. For AR, could you give us a couple examples or use cases to help us understand what’s starting to work more today that wasn’t working before?

Faisal: I think it’s really simple. In terms of what we have today that we didn’t before, we now have faster bandwidth and phones have faster and better processing power on their devices. An example of using augmented reality is to hold your phone in front of you and seeing a car in your driveway or on the street, being able to walk around that car as if it was really there, being able to change the color of the car, change the tires, open the door, look around inside the car. Another one might be in the sphere of e-commerce. Traditionally, e-commerce is very flat and two dimensional. It hasn’t really changed in the past 15 years. But when you can actually look at a product, whether that is a pair of sneakers, a jacket, or a hand bag, and see it in 3D from different angles using your mobile phone. That’s augmented reality.

The use cases can be across marketing and advertising, and increasingly we see use cases across e-commerce, education, learning and development, which is showing engineers how to fix something without the component actually being broken. One of the use cases that I’m most excited about is in the field of healthcare. For example, holding up your phone in front of your arm if you’re diabetic and need to regularly inject yourself. If you can see the veins superimposed on your arm, you’re more likely to be able to inject yourself properly. Across military, engineering, healthcare, and e-commerce, what we’re describing is a new experiential computing platform that’s much more intuitive than using a laptop or a smartphone.

So it sounds like most users would need to use smartphones as a means of accessing AR content. How important is it to shift to smart glasses or other products where you don’t need to access that experience through your smartphone or be handsfree?

Faisal: I think that clearly is the end state where consistent augmented reality environment surrounds you and you can interact with it all the time. In the meantime, there are 4 billion mobile phones around the world that have either the Android or Apple already downloaded AR kit and AR core. Which means that augmented reality is already a technology that is very widely available globally and ready to be used. Blippar works with both of these tech stacks as a content creation platform. AR spectacles and wearables might be the future. There’s a definite use case already that applies to every single cellphone in the world.


What does Blippar Do?

I’m trying to get a sense of how Blippar’s position is different now as opposed to before. As I recall from when I was there, it invested heavily in technology. It was building the underlying computer vision technology and augmented reality engine. It actually sounds comparable to AR kit, except it was Blippar that was building that, plus working with clients to come up with solutions for advertising that were generating revenue. Today, what is Blippar building? What is Blippar’s business model?

Faisal: So you were there when AR was just getting started. Blippar had to build every part of the eco-system itself. As you said, what early Blippar was doing was machine learning, deep learning object recognition, and computer vision, which are now being done by some of our partners, whether that’s Apple or Android. This means that now we can really focus on the technology and IP that we’ve been creating over the last decade, which is Blippbuilder. Blippbuilder is our content creating and authoring tool. It is a drag-and-drop simple user interface what allows anyone, from art students to agencies and brands, to simply drag and drop and create AR experiences that work using Android and Apple smartphones. The heart of what we do now is this content creation tool, which is a SaaS platform. It is used by agencies and brands and enterprises.

On top of that, we do have a small, more R&D heavy studio. What that studio does is custom work that really pushes the boundaries of R&D and technology in the AR space, to deliver really exciting and novel AR experiences. It’s like a Formula 1 team. The team experiments and puts things on the track, which we then learn from developer and integrate back into the Blippbuilder platform, which is available to anyone who uses the SaaS platform.

Is there still a team that builds customized AR solutions for clients? Or do they primarily use Blippbuilder to build their own experiences?

Faisal: That’s the studio I just mentioned. The Blippbuilder platform is primarily for agencies and brands. If they want to build their own AR experiences, which is pretty easy now to do, they can use the Blippbuilder platform. If clients really want to push the boundaries (I know you want to talk about OnePlus), they can come to us and we will build those novel world’s first R&D-heavy experiences using our studio. Clients come to us when they want to do something really exciting and we’ll build it for them.


OnePlus AR Product Launch

I do want to get to OnePlus, because their recent activation was really exciting.

Faisal: OnePlus is an example of a solution which was built by our custom team. OnePlus was launching a new mobile phone, the OnePlus Nord. We were called back in March when it became obvious to the OnePlus team that a conventional launch, where it would happen in a convention center and invite five thousand journalists and the CEO speaks, could not happen because of the global COVID pandemic. They had to find a different way of launching the phones. They had the realization that OnePlus Nord is a 5G phone with powerful capabilities, so why not launch using AR and showcase the technology that lives inside the phone. They asked us to do the world’s first live AR launch and they gave us less than three months to do it, which was really not very long. Regardless, in July, we supported the launch of their new phone. It was a 26-minute AR experience. The CEO of the company came on to a virtual stage which you can see by holding the phone in front of you. Rather than the journalists having to go to a convention center, the convention center came to you, wherever you are. We were able to do a highly interactive AR launch of that new mobile phone.

It was better than a traditional launch because rather than just inviting five thousand journalists, they were able to invite half a million fans of OnePlus while everyone had their own unique version of the launch happening in their kitchen or lounge. In the end it was so exciting and the results were so great that 620k people saw the live AR experience through Blippar on that day. During the 26-minute launch, 27k gigabits of data were transmitted, that’s approximately 1k gigabits per minute. Put another way, this would represent 1% of all of India’s internet traffic in a single day. Subsequently, around 7 million people watched the live AR experience streamed on the Internet. In the week before launch, 300k apps were downloaded, and OnePlus added 1 million Instagram followers. It far surpassed any expectations anybody had. It’s been great to learn how successful AR as a product launch medium has been.

(Source: Blippar)

Congrats! You mentioned that they considered launching this way given the circumstances of COVID and social distancing. So I was wondering given the success of this project, in the future will they do more launches via AR? Or is it something that’s more relevant in a COVID environment?

Faisal: I think what happened in the last few months, because of the pandemic, it accelerated how we use technology. We accelerated four or five years into the future. What we demonstrated here is the scale at which we can do a product launch, which previously people didn’t think about, even last year. We were able to take a launch, which otherwise would’ve only gone to five thousand people, and took it to 7 million people. We made the OnePlus Nord launch our biggest, most successful launch in Amazon India across any product ever. Again, it represented 1% of India’s Internet traffic on that day, where we have the biggest market. The Nord phone became super popular and became the #1 selling phone on Amazon in the UK, France, Germany, and Italy.

This is an example of a technology change that is here for good. We’re talking with many different companies across not only consumer electronics, but doing product launches, like new cars, in AR. Even thinking more creatively, we’ve had conversations with sports clubs that want to present their new players and new shirts, which have global audiences, using AR. Because we’re not going back to a situation in the near term where people can be in close proximity with each other. This ironically allows you to take that experience and massify it with a bigger audience.

There are definitely use cases and new ways of doing things that have come out during this pandemic period. They have been accelerating and shifting in many ways. I noticed that OnePlus launched around the world, and it is also a Chinese company. Given that many of our audience members are interested in Asia, and particularly China, what else is Blippar doing in China in terms of business opportunities and potential investments?

Faisal: Traditionally and historically, China has been a part of the growth story of Blippar. I think when we look forward into the next couple of years, we’re talking with a number of important Chinese companies about doing not only similar product launches and marketing and advertising experiences. That covers everything from makeup and beauty trials, to showcasing new consumer electronics like headphones and TVs, but also one of the things I know from launching Skype in China and working with Spotify in China is the importance of having a local partner. It is very early days for us as we only relaunched the company less than a year ago. China is a huge market and a huge opportunity. We are very cognizant of the fact that 5G and many 5G enabled phones will be first seen in China and Asia. It is a huge market and we fully intend to be there. I’m looking at a number of options for who to partner with.


5G + AR

That’s very exciting. Some of the work I did with Blippar involved China, so it’s good to hear more stuff going on there. You also mentioned 5G and what that enables. You’re right that there’s going to be 5G across the world, but many areas in China currently have 5G base stations installed and are probably faster to market. Are you talking to any of the telecom operators or some other related players? How do you take advantage of that?

Faisal: We can’t announce anything now, of course. But one of the really exciting things that’s happening is the rollout of 5G by telecom operators. When you have 100 times the bandwidth of 4G with less latency, it really changes what’s possible with augmented reality. Obviously, a 4G network is perfectly fine with streaming movies or for messaging on WeChat, but when you have such an increase of available bandwidth and speed, it really points to a more experiential and more immersive experience. That’s the next generation of the Internet. That could be holographic calling or 3D shopping. There can be a lot of innovation that we see from the next five to ten years.

In the immediate short term, one of the things we are really excited about is working with mobile operators who are selling new 5G phones and 5G contracts and helping them explain to customers why they need 5G, why they need 100 times the bandwidth of 4G. The way to do that is by showing them some AR experiences that are now enabled using 5G.

Can you share with us some of the AR use cases that are enabled by 5G? Is it something different from what you’re currently offering to clients? Or is it just some of these experiences are done even better and a smoother more realistic experience?

Faisal: I think we touched on some of the holographic calling which I think will be very exciting. We’ve seen in the last few years advancements of calling. From traditional calling from fixed phones or mobile to Skype calling from voice or IP, and then Zoom. All of those have taken place in a very one- or two- dimensional format. Zoom calling is great, but it is still a flat representation of a human and people aren’t 2D. You lose a lot of motion and sensitivity when you reduce things down to 2D. When you can see somebody in 3D, it creates a whole level of emotion and allows our intuition to work as well. I’m really excited about that.

Alongside that, we’ll also see some real advancements in AR gaming, which you can really only do in 5G. We’ll also see people being almost transported into sports environments and be able to see themselves in different sporting environments. You can imagine the Olympics and the World Cup in a couple of years’ time where many people will be able to feel as if they’re really there in Tokyo, at the sidelines and really seeing themselves there using augmented reality. Clearly, what we do today will be better, faster, and smoother. I also think that it will enable a whole world of new experiences. It’s almost like going from laptops to mobile phones to this new computing platform. Once spectacles are available more widely, it will start a whole new era of 3D immersive computing capability.


Blippar’s Next Step

I wonder as you run Blippar, you come across investors, and other types of collaborators in the broader eco-system. AR and VR is very hot from an investment perspective early 2010s with many betting on the stream of something big, a new platform. It clearly cooled down during the mid 2010s in the last couple years. I’ve heard more sentiment about investing more in these types of areas, certainly a lot has been COVID-driven as well. I was just wondering as you run Blippar, what do you hear from the capital side? What’s required to bring this to further fruition?

Faisal: I think global investment and venture capitalists are one side of the equation, and we’re certainly very lucky to be well-funded. The other side of the equation is investors also require exits. You can see from the M&A perspective, AR has been very hot over the last 12 to 18 months. There seems to be an acquisition in this space, if not every week or every month. One of my observations from being an investor previously is that there seems to be an overestimation of the capabilities of technology in the short term, and an underestimation in the long term. I think we are now in the part of the cycle where a lot of the hype around the early 2010s hasn’t come to pass. But we haven’t really begun to understand what’s going to happen as we come out of that as we now see real AR and VR deployments and we know some spectacles and wearables that are being developed, and some really big investments into AR and VR. The fact that the eco-system with 5G is being rolled out globally, it means that the eco-system is now ready to support from a product perspective, from a device perspective, from a software perspective, the ubiquity of AR.

I do notice some M&A across both AR and VR. There’s NextVR, Scape Technologies. Also, is a company I looked at last year when I was in the Bay. It seems they were picked up by Niantic lab. I wonder what they do with that technology. Niantic with their Pokémon Go was extremely interesting because that was one of the first example of AR being monetized. Though it wasn’t a true immersive AR experience, it was a very simple overlay of a Pokémon in the real world, clearly they have something in store that’s very exciting.

So we spent a lot of time talking about Blippar in terms of what it was, where it is today, what it does, and some of the activations with OnePlus and other clients, and we talked a little bit about China to some extent, and 5G. I think it is very helpful to get an overview of what’s going on in that space. Another topic that is on the mind of a lot of people is geopolitics. What is going on with China and US tech? Clearly there seems to be increasing tension between western and Chinese tech sphere. For you, when you think about what’s going on in the world, how does that impact Blippar and the type of work you do in regards to China?

Faisal: We’re a technology company and one of my observations having being part of Skype, Spotify, and Kayak is that the best technologies in the world are global tech companies. Blippar has also been a very global technology company. From our perspective, technology is global and Blippar has a global prominence. We aim to be the AR platform of choice for any brand, agency or enterprise. We’ll work on providing the best AR solution everywhere. We don’t seem to get into politics. We are a technology company and our role are to democratize the availability of AR as a toolset to everyone.

I haven’t been back to China for the past few months for obvious reasons. But as we discussed I spent a lot of time in the region for Skype and Spotify in the past. We look forward to being present in China. We’ve got a lot of discussions going on and I look forward to sharing these with you, perhaps in person sometime next year!

That would be lovely. Thanks so much for being on our podcast, and for sharing your unique perspective across the past decade in technology!