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Profiles

Sphero

By Eric Peterson | Sep 04, 2015

Aerospace & Electronics Consumer & Lifestyle Colorado

Company Details

Location

Boulder, Colorado

Founded

2010

Ownership Type

Private

Employees

100

Products

Robotic toys

www.sphero.com

Boulder, Colorado

Founded: 2010 (as Orbotix)

Privately owned

Employees: about 100

The force is with CEO Paul Berberian and company as they roll out this generation's R2-D2.

At the Disney Accelerator program in fall 2014, Sphero was approached with a concept that looked a lot like their flagship product, an app-controlled rolling robot: BB-8 from the upcoming Star Wars movie, The Force Awakens.

Were J.J. Abrams and the other masterminds behind the new trilogy inspired by the original Sphero? "I think it was just a happy coincidence," says Berberian. "They come at it from a totally different angle. They want to create a character and make some movie magic."

For their part, Sphero co-founders Ian Bernstein and Adam Wilson have been creating magic since they mat at TechStars in Boulder in 2010. The robotics wizards' idea for phone-controlled toy droids captures the market's imagination since it first shipped in 2012. The follow-up robot, the Ollie, came out in 2014 and is like the SUV to Sphero's sports car, with tank like treads and enough toughness to roll through mud.

© & ™ Lucasfilm Ltd.

But BB-8 is on an entirely different level.

Berberian says the initial production run is about 10 times anything the company's ever done -- and that's saying something, considering Sphero has shipped about 500,000 units to date.

The connecting thread between all three products? "We're taking sophisticated robotics and making it transparent to the end user," says Berberian, highlighting the control system, "dynamic" locomotion, and the software.

Every robot can be controlled with multiple apps, opening up a wide range of possibilities. "They're easy to program," says Berberian. "The software defines the experience."

While design and enigineering are in Boulder, Sphero works with a contract manufacturer in China, says Berberian. "Anytime you make something overseas, it's very complicated. You have to have a physical presence there." He says he's spent over six weeks in China himself in 2015, but some engineers have eclipsed 100 days. "You get your frequent flyer miles," he cracks.

Photo courtesy Sphero

Having the right partners is critical. "We have a real cooperative CM," Berberian says. "They've worked some miracles for us."

Would it ever be possible to bring production to the U.S.? Berberian's not sure. "For us, there's a lot of labor involved," he says. "There are over 100 steps to decorate this product." But it's not just about the cost of labor: "They have skills we don't have. They've cracked this code."

Closing on a $45 million investment in June 2015, Sphero's steep growth curve -- it jumped from 40 to 100 employees in the last year -- looks like it will go vertical. "We'll probably grow 300 percent year over year," says Berberian.

And with The Force Awakens opening on Dec. 18, 2015, 2016 could be even bigger. "I think it will be the biggest movie of all time, bigger than Avatar," he predicts. "It's going to be huge."

Photo courtesy Sphero

Challenges: "Keeping up with volume," says Berberian, noting that stores were selling out of BB-8s in minutes. It could well be the Furby for the 2015 holiday season.

"If this continues, there's going to be big shortages," he says, noting that the BB-8 requires a lead time of about six months. "We thought we were making a lot. We ordered big and I think we're off by a factor of three."

Another challenge: "Making sure we capitalize on this momentum," Berberian adds. "How do you top Star Wars?"

Opportunities: To be this generation's Kenner Products, the original maker of action figures for the franchise. "We have a launchpad of incredible retail distribution to get other products to market," says Berberian. The next Sphero product has not been announced, he adds, but the annual Consumer Electronics Show "is always a good time" to do just that.

Needs: "We need more BB-8s, and we're always looking for top talent in Boulder," says Berberian. The local talent pool "is good, but we're starting to import a lot of people from out of state, and the wages aren't as good as Silicon Valley. We're getting to the point where we need specialists, not generalists, and top talent requires top compensation."

Sphero CEO Paul Berberian

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