This article details the success of an American startup with Ukrainian roots: Ring - a home security and smart home company. You will learn how the talented entrepreneur Jamie Siminoff and his team achieved a great reputation with investors, high levels of sales, and worldwide recognition in the first year of the company's operation.
Founders: Jamie Siminoff and Lubomir Vasilyev
Offices: Ukraine: Kyiv, Lviv. U.S.: Santa Monica, Pennsylvania. Europe: Amsterdam, London. Taiwan.
Company Valuation: $1.2 - 1.8 billion
Total Funding: $209.2M
Founded In: 2013
Unicorn: From 2018
As with many interesting projects from Southern California, the idea of Jamie Siminoff's startup came to him in a garage. Jamie was often out for work and wanted to have a way to see who visited him, in case someone rang the doorbell, but he wasn’t home. He came up with the idea of a device that would connect a camera to a smartphone, allowing the user to see home visitors live while they were away. In 2011, he gathered a small group of engineers and interns to develop his idea into reality. One year later, in December 2012, a team of five people introduced DoorBot (the initial name of the company and product) - a doorbell with a camera and Wi-Fi connection, which would show the residents of the house who was visiting when the doorbell was rung.
According to Jamie, it was challenging to create the final product, given the need to provide video streaming, instant messaging, a mobile app, and a battery life of one full year. However, even with a very small team and lack of funding, the first "smart" Rings were offered to customers as early as November 2013 - less than a year after the product was announced. In just one year, the company produced 20 thousand units and delivered them to buyers in 85 countries.
As an entrepreneur, Siminoff first appeared on Shark Tank in 2013, where he pitched the idea of his DoorBot project to the show hosts. Shark Tank is an American reality TV show featuring entrepreneurs presenting their business ideas in front of a group of five investors, or "sharks", who decide whether to invest in that company or not. Although the investors liked the idea of his product, no one invested in Jamie’s company. However, 5 years later, the entrepreneur redeemed himself as he was invited to the show as a business shark himself. Jamie was thankful for his appearance and gave credit to Ring, and to his wife.
After his appearance on Shark Tank, Siminoff rebranded the company, changing the name from DoorBot toRing, referring to the "security ring" that the company's gadgets create around the user's home, soon making additional sales of $5 million.
The main product of the startup is a "smart" doorbell, which has a camera and a Wi-Fi connection. The RingVideo Doorbell sends a message to the user’s smartphone, tablet, or PC every time someone rings the bell or gets close to the doorbell’s motion sensors, allowing homeowners to communicate with a visitor in real time. The service provides top-quality communication through the use of HD video and two-way audio. The product also functions as a surveillance camera and automatically starts recording during a call, or when its motion sensors are activated.
The company also has a “Neighbors” service that allows people to share information about the area’s security. In their app, users can find videos made by other Ring devices. The service allows users to share this footage, so a community can help identify home crime suspects. Ring also has partnerships with local police departments in numerous cities, allowing neighbors to be included in crime monitoring processes.
Locations in Ukraine
According to angel investor Nick Belogorsky, to succeed abroad, Ukrainian startups need to have two offices - at home and in the United States. The Ukrainian office should house developers, who are talented and relatively cheap. On the other hand, the founders and sales people should work in the States. This is the most successful business model on which several successful Ukrainian startups operate. Therefore, as a technology entrepreneur, Siminoff decided to launch R&D labs in Ukraine to maximize growth, mainly through access to qualified and talented specialists in the tech industry. Assembling a team of such specialists in San Francisco would have been many times more expensive. One downside of Ukrainian R&D offices is that it is difficult to find experienced project managers and researchers. In other development functions, Ukrainian IT professionals are exemplary, and they compete in the world labor market without difficulties, says Kira Rudyk, former chief operating officer of Ring Ukraine and now a member of the Ukrainian parliament.
Ring's head office is located in California, but there are multiple R&D offices in Ukraine. The Kyiv office of Ring is located on the 8th floor of the business center "Toronto". The office occupies 2000m² and is divided into open space work areas, 12 full-fledged meeting rooms, and an event-zone for conferences and meetings. Only managers and department heads have their own offices. For the team’s comfort, the office is equipped with a sleeping room and a small gym. Presently, Ring Labs (opened in 2016) is engaged in software development of machine learning, computer vision, data intelligence, and other areas of artificial intelligence.
The total investment that Ring attracted throughout six rounds was $209.2 million.
· Seed: $1 million
· Series A: $4.5 million + $5.5 million
· Series B: $28 million
· Series C: $61.2 million
· Series D: $109 million
22 investors chose to back the company, including Kleiner Perkins, First Round Capital, CRV, True Ventures, and others. Eventually, Amazon bought Ring in February 2018 at an estimated value of between $1.2 and $1.8 billion.
The company has released a wide range of home security products. In addition to a smart Ring device with an app, they have introduced Spotlight Cams - cameras with motion sensors and the ability to transmit 1080 HD video. The company recently unveiled a new generation of its smart Ring device: Ring Video Doorbell 2. It supports video streaming in 1080 HD, is equipped with night vision, and has customized motion sensors. The company promotes all of its products as a way to combat crime in residential neighborhoods.
In the following posts, we will talk about successful Ukrainian startups that were able to create a quality product and an effective team. We will learn how their ideas came about, how they chose the right partners, and found their first investment. The next company will be People.ai - a service that helps sales representatives to improve their effectiveness by using Artificial Intelligence.