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A few years ago, augmented reality (AR) suddenly came to the attention of the public and set off a boom for this emerging technology. This boom gradually cooled, however, as an array of AR products – including Google Glass – failed to take off. Nevertheless, AR has found a place in numerous industrial fields, and is catching on again. RealWear Intelligent Technology Co-Founder and CEO Li Bo (CEIBS Global EMBA 2014) hopes to free the hands of front-line COVID-19 workers with a head-mounted intelligent device driven by AR and other technologies, so that they can work more efficiently and tackle the challenges ahead of them.

Li Bo

RealWear (Shanghai) Intelligent Technology Co., Ltd.

Co-Founder and CEO

Imagine the following scenario:

Despite a severe strain on medical resources in Wuhan during the early days of the COVID-19 outbreak, local physicians still had to make their daily rounds to confirm their patients’ conditions. Adding to this, seasoned chief physicians are generally older and more prone to infection and exhaustion from this type of gruelling work.

Now, suppose a young intern wears an AR device and enters the ward. At the same time, a chief physician monitors the ward via this device adopting a first-person point-of-view, and can talk to patients, observe their vital signs and offer guidance.

During the fight against COVID-19 in Wuhan, the third medical team sent to Hubei province from Tongji Hospital in Jiangsu province was equipped with head-mounted computers from RealWear. RealWear’s device aims to help medical experts and management staff remotely monitor wards from a first-person point-of-view, and enables chief physicians to remotely guide students through standard medical operations.

From a Ph.D. in engineering to a start-up owner

Li Bo received his Ph.D. from the Department of Electronics and Computer Engineering at Carnegie Mellon University in the US and has long been exposed to cutting-edge technologies, such as robotics and artificial intelligence (AI). His original idea was to become a professor, but instead he entered the world of industry, which he believed “would bring him closer to the market.” During this time, he worked as a senior research fellow at General Electric’s global R&D centre in New York, where he was in charge of core technologies for industrial products, such as sensors and microcomputers.

The R&D job did not bring the exposure to the market that he was hoping for, however, and he still wanted to develop more customer-oriented products. So, after ten years in the US, he returned to China and engaged in the development of Johnson Controls’ R&D centre. During this period, in order to broaden his business horizons, he also decided to pursue a Global EMBA at CEIBS. After graduating, he served as General Manager of a division of Johnson Controls, where he was responsible for marketing, production and R&D. After that, he acted as Chief Strategic Officer of Greater China at 3M, where he was responsible for the company’s digital transformation.

Soon, however, Li Bo wanted to shift his focus from strategy to product development to better meet the market’s needs. Coincidentally, through a former supervisor in the US, Li Bo made an acquaintance with his now-start-up partner, who asked him what he thought of AR. At the time, Li Bo said he was not optimistic about its prospects on the consumer side. Given a complete eco-system for mobile phones, AR devices would merely be nice-to-have accessories which – like Google Glass – would likely fall short of the technology’s original objectives. But his partner pointed out that industrial AR devices were aimed not at consumers, but at enterprises. Li Bo thought it over and concluded that this market could be a promising one for AR.

“China’s consumer applications like Alipay and Meituan are ahead of the pack around the world, but most industrial applications in China are introduced from abroad, from companies such as SAP and Oracle. As a result, this market gap offers a valuable entrepreneurial opportunity,” Li Bo says.

Added to this, Li Bo brought to the table a deep understanding of corporate customers, with whom he has a deep experience.

“Unlike ordinary consumers influenced by ads, corporate customers put a premium on product value. For popular consumer-oriented products, massive advertising campaigns can produce desired effects; for industrial products, we have to take things one step at a time to win over corporate customers,” he explains.

Subsequently, Li Bo and his partner had a powerful meeting of the minds and, in November 2018, he quit his job, registered a company in Shanghai and got down to conducting product R&D and verifying their business model. By the end of 2019, the company had closed a $9 million (USD) round of angel investment. In early 2020, it settled at AIsland in Shanghai’s ZJ Innopark (Zhangjiang Hi-Tech Park). Presently, the company has more than 200 corporate customers, while going from zero to one in exploring the business model.

Freeing the hands of workers

Steve Jobs believed that fingers were the best interactive tool. This may hold true for some consumer products, but front-line COVID-19 workers must keep their hands on their task. For example, if they have their hands full operating a computer, their work efficiency will only decrease.

Similarly, when conducting a fire inspection in a building, a fire inspector needs to look for hazards, take photos, and make notes. After returning to his office, he uploads the photos to his computer and transcribes the records into a Word document. Fire inspectors usually do not carry computers to inspections because they are cumbersome for them to use while performing checks.

As Li Bo points out, numerous industries are constrained by similar pain points. As such, he believes a voice-controlled head-mounted intelligent device can come in handy to free the hands of front-line workers.

Together with Alibaba Cloud, RealWear has also assisted Henan Expressway with AR-enabled operations and maintenance. A vehicle identification system embedded in AR devices can not only identify license plates, but also perform vehicle diagnostics and on-site traffic controllers can record vehicle information without the need for other equipment, improving their ability to deal with traffic accidents and congestion. When a piece of equipment breaks down, on-site maintenance workers can receive remote guidance from technical experts via head-mounted AR devices, simultaneously transmitting the on-site repair scene, locating malfunctioning parts, and visualising the repair method, in order to reduce repair time.

After first outlining RealWear’s mission to empower front-line workers, Li Bo thought hard about how to realise this mission.

“As CEIBS Professor of Entrepreneurial Practice Gong Yan has noted, a start-up owner should focus on key points and resist distractions during the entrepreneurial journey that may lure him into a trap,” he says.

Furthermore, Li Bo says he wants to build RealWear into a platform company rather than a project-based one. To put it simply, he hopes to build a platform eco-system, in which different types of companies can develop software and hardware based on its head-mounted intelligent device – instead of customising products to meet personalised customer needs – in order to avoid falling into a project trap.

“To meet customers’ diverse needs, a project-based company has to delve into new technology and business processes whenever taking on a new project, because it is impossible to replicate the original model on a large scale. Start-ups that focus on generic products must steer clear of this trap,” Li Bo explains.

RealWear has come a long way in building a platform eco-system, and has attracted dozens of well-known enterprises, such as Honeywell, Microsoft, Qualcomm, Tencent, China Mobile and China Unicom, in addition to Alibaba Cloud.

By way of a platform strategy, RealWear has rapidly tapped into many industries, including automotive, IT and telecommunications, advanced manufacturing, transportation, electric power and public utilities, oil and natural gas, and chemicals. And, its generic products have appealed to a number of enterprises, such as PetroChina, State Grid and Baosteel.

Developing a B2B business step-by-step

Although RealWear has built a large customer base of prominent enterprises and has raked in more than 10 million RMB in just two years, Li Bo is very aware of the potential challenges ahead.

In the short term, the COVID-19 outbreak is leaving many corporate customers in a bind and plunging oil prices have left a dent in their purchasing desire. In this context, RealWear needs to constantly acquire new customers to maintain stable growth.

In the long run, RealWear will need to continually expand the range of application scenarios for its device in order to increase sales and frequency of use. If their devices can be used only in limited scenarios, some corporate customers will cut down on their purchases and use it only when needed, leaving it to gather dust on the shelf.

In addition, although an increasing number of enterprises have realised the importance of digital transformation, some of them are unwilling to purchase or invest in intelligent devices because they see no value in transformation in the short term. In Li Bo’s view, as transformation is the shape of things to come in the business community, corporate customers need to gradually heighten this awareness.

Nevertheless, Li Bo says he is optimistic new opportunities will arise.

“It is estimated that by 2025, 4% of front-line workers in China will use an AR-enabled computing platform, which will create a 140 billion RMB hardware market and a 70 billion RMB software and service market. These markets will offer enormous potential,” Li Bo says.

As the development of new infrastructure gathers momentum across China, the commercial value of AR will further increase. As such, Li Bo says he believes that the AR market will pick up slowly, but will considerably enhance efficiency in information acquisition and delivery. Moreover, by virtue of the broad bandwidth and low delay brought by 5G technology and AI-enabled efficient decision-making, wearable AR devices will experience explosive growth. Additionally, Li Bo says he does not worry about the looming challenges from business giants.

“We are focused on building a platform eco-system to bring in more corporate partners. Moreover, given the huge differences between the business side and customer side, it is rather difficult for an enterprise to put in place a business process covering all types of customers. Only co-operation will produce win-win results,” he says.

The dramatic transition from being a Ph.D. in Engineering to a company executive and then to being a start-up owner has made a big difference for Li Bo. He walked out of an ivory tower into an enterprise, in the hopes of rolling out some market-oriented products. Later, as an executive, he only needed to keep abreast of KPIs. In order to create something from scratch, he finally chose to start his own business.

“If I didn’t start a business, I’d regret it,” Li Bo says.

Perhaps, to be a person of action is part of his character. At the same time, he emphasises that passion alone is not enough, because a start-up cannot get off the ground without an excellent partner and the founder’s experience.

“You can’t start a business bare-handed,” he adds.

Furthermore, in his view, CEIBS has offered a huge boost to his successful transformation.

“I used to look at the world more from a technical perspective, but the CEIBS experience provided me with business and management perspectives, which helped me a lot in my entrepreneurship. At the same time, I met a group of like-minded friends at CEIBS. I often communicate with them, drawing great inspiration from their ideas,” he says.

Looking into the future, Li Bo says he aims to keep a level head.

“B2B business is slow to thrive, so you can’t act with undue haste. It does not wilt as easily as B2C business, because loyal corporate customers tend to make repeat purchases, but it does not explode quickly. I will continue to maintain confidence and patience to focus on the present and embrace the future,” he says.

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