Yonald Cherry, our Man in the Whiteboard Wars!

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From: Rohit Khare (rohit@uci.edu)
Date: Fri Apr 21 2000 - 13:26:49 PDT


Whiteboard wars
By Scott Kirsner, Globe Staff, 4/17/2000

Yonald Chery is girding for the battle of the digital whiteboards.

Chery is the affable founder and chief technologist at Virtual Ink in
Somerville. The company makes an incredibly cool product, the $499
mimio whiteboard capture system. You affix the mimio capture bar -
it's thin, and about two feet long - to the side of a whiteboard,
using mimio's built-in suction cups. You plug it into a PC, and you
sheath the whiteboard markers in special jackets that emit ultrasonic
signals, so that the capture bar can track their position. (It also
knows which color marker you're using.)

Then, as you write, sketch, or diagram stuff on the whiteboard, it's
all captured on the PC. Handwriting recognition software can turn
your scribbling into a snappy Microsoft Word file. You can share the
presentation with others (like colleagues who fell asleep the first
time around). And when it's played back, you can watch it unfold
sequentially, or fast-forward to specific spots.

Problem is, another company, Electronics for Imaging of Foster City,
Calif., came out with a very similar product last November, two
months after mimio hit the market. EFI is publicly traded (Virtual
Ink is not), and the company already has a large ''installed base''
of customers for its Fiery product line, which helps manage high-end
digital color printing.

Also, in February, EFI was issued a patent for one piece of the
system - a ''marking device for electronic presentation board,'' in
patent lingo. (Translation: the electronics-laden jacket that holds
the marker.) Jim Etheridge, EFI's general counsel, says: ''You will
see from our history that we're very aggressive in defending our
patents,'' and points to a seven-lawsuit winning streak.

Virtual Ink counters by saying it has a patent just days away from
being issued, which covers technologies that are part of EFI's
product. Litigation between the two is a distinct possibility, if the
market for digital whiteboards proves big enough to be worth fighting

But the competitiveness of this emerging market doesn't give Chery
pause. Instead, he and Virtual Ink seem energized by it. EFI, with
its successful Fiery product line and $3 billion market cap, won't
live or die based on what happens with its digital whiteboard product.

Virtual Ink will. So its only path, really, is to grow quickly, sell
as many mimios as it can, and try to devise better technology and
more useful features than EFI. (And keep its fingers crossed that the
dozens of patents it's applied for yield a patent portfolio stronger
than EFI's.)

Tomorrow, at the spring Comdex trade show in Chicago, Virtual Ink
will announce a partnership with RealNetworks to create
''Boardcast,'' a way of linking audio with whiteboard presentations.
The synchronized sound and pictures can be streamed live over the
Web, or stored for later playback. Imagine taking a correspondence
course in cartooning online, or watching John Madden analyze plays
while a football game is in progress on your TV.

The company also will announce a version of mimio tomorrow that can
hook up directly to a printer - no PC required - to produce paper
copies of whatever is on the whiteboard.

Virtual Ink chief executive Greg McHale is in the process of raising
a third round of venture capital this month. CMGI @ventures will
likely continue to help fund the company, even though Virtual Ink is
the only hardware investment in its portfolio.

Virtual Ink has just passed the 100-employee mark, and is expanding
into another floor of its Somerville headquarters, a former Hood ice
cream storage facility that still has metal freezer doors built into
some of the brick walls.

Chery is a technologist through and through. He carries a Sprint cell
phone with Internet access and two hand-held computers. He got his
bachelor's and master's in electrical engineering from MIT and, while
doing graduate work at the school, he came up with the idea for mimio.

''I was teaching digital systems design in the early 1990s, and the
students were copying stuff down [from the board] but not paying
attention,'' he says.

There were already expensive whiteboards on the market capable of
creating printed output, but they were prone to breaking down and not
easily transportable. That led Chery to start brainstorming about a
small, portable device that could follow the location of his marker
and transfer the data to a computer.

Chery entered the MIT $50K business plan competition in 1997, and won
$10,000 as first runner-up. Some of the judges told him later that he
would've likely won if he'd convinced them that the mimio system
could actually be built. In June 1997, he started to build it with a
group of friends working out of his dorm room, and by July they had a
crude prototype hooked up to a PC.

The product took longer than Chery had hoped to reach the market,
eventually shipping in September of last year.

Despite devoting a considerable amount of time to the company, and
getting married last summer, Chery has continued to work on his
doctorate in electrical engineering.

''I'm planning to walk in June,'' he says hopefully, ''though I still
have to finish my thesis.''

Chery's biggest goal, though, is to dominate the digital whiteboard
market, and to make ''mimio'' a verb. ''I want people to say, `Let's
mimio that whiteboard.'''

To do that, he plans to introduce several new hardware products in
the coming months. And he plans to create new applications for mimio,
such as allowing music teachers to draw staffs and notes on a
whiteboard and have them played on the computer, converting
statisticians' data instantly into charts and graphs, or combining
maps with mimio to do mission planning for the military.

''We have to keep innovating or we'll be blindsided,'' Chery says.
''We have to constantly be aware of disruptive technologies and
constantly be thinking about the next new thing.''

And thinking about it before their rivals in Silicon Valley.

This is a very evenly matched competition. Virtual Ink was first to
market and has the advantage of being a nimble start-up. But EFI is
more experienced at sales and marketing. The patent issue is a wild
card, and a new entrant (or two) could spark a price war that would
hurt all of the competitors.

Now that the browser battles have subsided, the whiteboard wars could be next.

Two hits, many misses

Well, I did only slightly better at picking last week's MIT eBusiness
Awards than I would've done by tossing darts at the list of 35
finalists in seven categories.

I guessed two winners correctly - TRUSTe for the Web Responsibility
Award and Healtheon WebMD for the Industry Transformation Award. I
came close to correctly picking eBay to win the Global Reach Award,
but its application form (which the organizers were kind enough to
give me access to) was pitifully scant, so I took Monster.com instead.

Congrats to all of the winners (the full list is at
www.mitawards.org), and here's hoping the judges make fewer errors
next year.

Scott Kirsner is a contributing editor at Wired and Fast Company
magazines. He can be reached by e-mail at kirsner@att.net. To read
his columns online, go to www.digitalmass.com/at-large.

This story ran on page D1 of the Boston Globe on 4/17/2000.

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