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STORIES OF ACROBATS: Dino Florjančič and MonoDAQ (Dewesoft Monitoring)

"If someone had told me in 2015 that it would take me four years to get rid of the minimum wage, six years to make the company stable and eight years to make the first major profit... I might not have chosen this path then."
In 2023, the nine-person team generated €3 million in revenue, €160,000 in added value per person and just under €1 million in net profit after tax.
Do you know the story of the creation of MonoDAQ, which was renamed Dewesoft Monitoring?

Dino Florjančič 30.04.2024
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IT’S THE CULTURE THAT MATTERS

My first visit to Trbovlje was in 2011 when we had the Formula Student team and were looking for a data acquisition solution for our car. A member of our team knew Dewesoft because they previously helped him with building a homemade go-kart, so that was the initial connection. During Formula Student years I had a chance to meet many companies as we were trying to get sponsorship deals. Dewesoft immediately seemed different and definitely the coolest of them, even if there were just 20 employees at the time. You could see parts of racing cars and Space Shuttle photos and then there was this super normal guy called Jure who actually understood what we were doing with our Formula Student cars.

I remember thinking that Dewesoft could be a good company to work for sometime in future, but at the time I was not interested in electronics, so I dismissed the idea. However, I did ask Jure if I could participate in some road testing of real cars, which Dewesoft was involved in with their customers. I didn’t really believe it would happen, but Jure actually came back with an email in only a few weeks. They were going to visit Fiat Alfa Romeo test track in Balocco, Italy. Do I want to join a two day trip? Turns out it was on a date of one of my exams that I already postponed due to our Formula Student activities and I would have to do it like a year later if I did not participate this time. I sadly explained this to Jure. Then, to my absolute amazement, Jure moved the customer meeting one week later so that I could still join!

During those two days I could feel what is still today for me the most important value of Dewesoft: being initially open to anything - and especially anyone. Jure did not have to invite me to this trip, but he did. Dejan and Primož, who were also joining, could make me feel “what are you doing here”, but they were perfectly cool. Only a few years later would I recognize they are also two of the cornerstones of Dewesoft company and culture. 

I then moved to The Netherlands for two years to do a masters of aerospace engineering at TU Delft, but always with a goal of returning to Slovenia. Bojan, a good friend of mine, was at the time already working at Dewesoft and talked me into joining for an internship. I liked what I saw in Trbovlje: a group of smart engineers moving mountains. Was I good enough to join them for real after graduating? 

GETTING A SALARY OR BUILDING A BUSINESS

I guess Jure thought it worth a try, as we agreed to meet in summer 2015 to discuss potential joint opportunities. Jure offered three projects: two were technical positions in the existing Dewesoft company while the third was about creating a start-up company within Dewesoft that will develop and sell low-cost DAQ instruments. I could choose between getting a salary or working almost for free and getting shares in exchange. I did not even ask what the salary would be.

So what Jure offered seemed like a dream scenario. Dewesoft would provide some funding for development while I had to assemble a team and figure out how to sell the instruments online. If someone told me at the time that it would take me 4 years to get off the minimal salary, 6 years for the company to break even and 8 years to make a first significant profit - I might not have chosen that option at the time. I am glad we never thought about how long it would take but only how we could do it.

8 YEARS OF LEARNING

What did we do in those 8 years then? The initial idea was to design a low cost DAQ device with limited hardware capabilities and offer the world’s best DAQ software - Dewesoft X - together with it at no additional cost. We named it MonoDAQ - single channel, small DAQ device. Jure already had a concept in mind to build a small scale DAQ instrument based on the latest available EtherCAT chips. This turned out to be too advanced and still expensive for the low cost DAQ market. We reworked the concept into a USB device that was actually affordable enough to start testing the market. It turned out the low cost DAQ market was way smaller than we believed which basically made our business case non existent.

The biggest problem was that all this took us three years and about 300k EUR. The development of both platforms was done by external engineering contractors, as we could not afford to hire for long-term and it was difficult to find people who would work in exchange for shares. This meant I could only afford one additional permanent team member next to me during this time, so the choice better be good. I worked with many brilliant engineers during Formula Student years, but the majority were mechanical-oriented like me. I had to team up with an electronics engineer therefore I had to convince Alex to come on board. It was probably the best achievement of those first three years.

BUILDING THE TEAM

We were not alone with Alex. We had Jure as our biggest fan and supporter. We built nice relationships with the contractual developers we worked with: Robi, Dušan, Žiga from R2DS and Uroš and Tomaž from Isotel. And we had the whole Dewesoft team, starting with Andrej. Perhaps not everyone understood what we were trying to achieve and why we operated as a spinoff company instead of being a department in Dewesoft, but no one ever stood in our way and we got all the help that we asked for.

Since we had very little business coming out of our main business case - selling DAQ devices online - we also had to find other sources of income. At least half of our time in the first three years was spent on various Dewesoft projects, which our company got paid for and since our salaries were low, we could use some of that for other expenses. We also designed some automated measurement systems for a local steel production company that are still operational today. While this was in a way a waste of our time as it did little to advance our main cause, it did relieve some of the pressure we would feel if we had zero business for all this time. The external development costs were still covered by Dewesoft, of course being our majority shareholder.

An important milestone happened in our third year. Rok joined the team as business developer. Having just sold his shares at a startup company he co-founded, he was looking for a new challenge. We succeeded by slightly overselling our present potential on the market, but how else do you win over a natural salesman? ;) Rok quickly got us into ecommerce platforms, but he also learned about technical details of our solutions. Since we are all interested in learning and understanding different technologies no matter our previous knowledge, and we all like to spend long hours doing it, we quickly felt mutual respect for each other. Another guy who is happy to work as much as needed is Tine, who joined soon after Rok, to take care of our production as we finally started to sell more devices. 

What we also did in those first three years was learn. Alex grew into a brilliant all-around hardware and software developer. I learned much about measurement technology and market needs. This allowed us to rapidly build application-specific solutions based on our existing hardware and software platforms. One such solution is a triaxial MEMS accelerometer, digitized and embedded into our EtherCAT platform and connected to Dewesoft X software with an unattended monitoring setup. We could create this in very short time to answer a special request from Dewesoft’s Italian sales director Gabriele. This product opened up a totally new market for us: structural health monitoring.

While the online sales provided some daily cash flow, it was not nearly enough to allow us to grow. Hence we started to shift our focus to structural monitoring. We realized there are thousands of bridges and other structures that need live monitoring and as the cost of MEMS sensors dropped, a big market was opening up. We had to be fast on implementing new technologies into our products to become a player. And being small allowed us to act fast. 

5 YEARS FOR "OVERNIGHT SUCCESS"

The Italian opportunity took way longer to turn to business than we anticipated (we were used to that by then) but the daisy chained synchronized accelerometer system that we developed on Gabriele’s request opened many doors from skyscrapers and offshore wind turbines to mining. This gradually increased our margins and we could afford to expand the development team with Patrik, who masterfully created our Historian, a server-based software for long term data storage. The production team also grew with Milan, Žiga and Miha joining at the right time to be ready for a big challenge of 2023: production capacity of 500 accelerometers per month, courtesy of the Italian bridges finally being equipped with our solutions, 5 years from initial negotiations. In 2023 a team of nine people created 3 mio EUR in revenue, 177k EUR of added value per person and 1 mio EUR in after tax profit, basically placing our numbers on the same level per employee as those of the overall Dewesoft group. Like in other Dewesoft companies, every employee is able to buy shares in the company at book value and the company is bound to buy it back at any time, also at book value. We also renamed the company from MonoDAQ to Dewesoft Monitoring, to better reflect our main business activity.

THE BIGGEST BENEFIT OF CREATING WITHIN THE DEWESOFT ECOSYSTEM

The whole idea of starting a fresh company in close partnership with a big established business finally did not make us grow faster, but it ensured we never lost steam and just kept building our foundations. Our customers benefited greatly from our flexibility that would not have been possible in a big organization but they can also feel safe that we will keep playing the game and support them long term. For me personally the most important aspect of going through those 8 years with Dewesoft as the majority shareholder in our company was not the financial support or the existing technology or the brand and global sales network. It was the opportunity to learn from Jure, Andrej, Tilen, Herbert, Reinhold, Andrew and the rest while having the freedom to add our own ideas and combine it all together into new solutions for our customers.

By now we proved that this model works and will continue to build sensors, software and whatever tools needed to make large scale monitoring of bridges, wind turbines and other structures as simple and effective as possible.

Dino Florjančič

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