ISE Alumnus, F. Scott Moody, tells students how this little phrase was the secret to taking on the competition and winning
iPhone users around the world were excited by Apple’s announcement that their new higher-end iPhone will come equipped with a fingerprint sensor for added security, called Touch ID. That technology could one day allow the iPhone to function as a secure digital wallet which means it will keep user’s digital coupons, airline and train tickets, movie passes and rewards and gift cards. It could also mean opening doors in cars, homes, and businesses, and interacting with smart tags, among other things.
Apple acquired this technology by purchasing a Melbourne, Florida company known as AuthenTec last October for $356 million. AuthenTec was co-founded by ISE alumnus F. Scott Moody (BSIE 1980) in 1998.
In 2007 the company went public, an event marked by Moody’s three daughters (his youngest, Kourtney, is presently a student at NCSU) ringing the opening bell on NASDAQ. The company was able to raise money and Moody had even planned to retire, including hiring his replacement. Unfortunately, AuthenTec’s fingerprint scanning device, known as FingerLoc, largest market was high-end laptops and with the downtown in 2008 lower-end and lower-cost laptops (remember netbooks) were all the rage severely impacting the market for these expensive laptops.
The company’s revenues plummeted and Moody knew he had to make a bold decision. He decided that instead of laying off many of his employees, he would go out and hire more engineers. “99% of innovation is driven by engineers,” Moody told the group of ISE students recently as the guest speaker at a Society of Manufacturing Engineers meeting.
Top 5 Pieces of Advice for Young Entrepreneurs
1. GRADUATE! Starting a business is a risky venture. Always have something to fall back on.
2. GET A JOB! Work in your chosen industry to better understand the true needs of the customers and discover opportunities.
3. DO YOUR DUE DILIGENCE. Know the market and your competition. Also ask the tough questions to determine if there is a market for your idea.
4. DO WHAT YOU ENJOY. There will always be bad times and you will need something to drive you through them
5. SET PRIORITIES. Know what is truly important to you, not what others think is important. Do what you love and do it for the right reason.
From the beginning, most of AuthenTec’s competition was developing their fingerprint sensors for law enforcement, the FBI and other government agencies (or at least to those standards) with the philosophy that their product would keep people out. AuthenTec, under Moody’s leadership, went in a different direction. He wanted their product to make peoples’ lives easier. “I even had a speech I used to give at conferences called, “It’s All About YOU!” joked Moody. It was this decision that allowed AuthenTec to separate from and ultimately defeat its competition.
With the downturn and this philosophy in mind, the team of engineers got started on developing a device that was much smaller and could work with today’s mobile devices. While they had always succeeded in developing smaller and lower cost products, the problem, according to Moody, was that “the thing was ugly”. So he sent the engineers back to the drawing board with the idea that the sensor needed to be covered with a thick coating and still be able to work. “I knew that what I asked for probably wasn’t possible,” said Moody. “I wanted something that looked good so we met every Tuesday and Thursday mornings, which is like detention to engineers, until we came up with something that worked.” After about 500 failed experiments, the team developed a working sensor that could be hidden.
That philosophy carried on after Moody left as the full time CEO, but the effort to drive down the size of the sensor and one that could see through thicker coatings was eventually shown to AuthenTec’s top-tier customers including companies like Motorola, Fujitsu and Apple. It caught Apple’s attention and eventually Apple decided that they didn’t want to share the technology and that lead to the purchase of the company in 2012, Apple’s first acquisition of a public company.
Moody is now living in the Triangle and is the Founder and Managing Director of First Talent Ventures, where he invests in, mentors, and advises startups and entrepreneurs. He’s recently returned from Rwanda where he did mission work and has plans to travel to Ghana. Follow him on Twitter at @fscottmoody.