Leading this ambitious project is serial entrepreneur Sonny Vu, CEO of Arevo. Previously, Sonny founded Misfit which was bought by Fossil Group for $260 million. Before that, he worked at Microsoft Research NLP and gained a Ph.D. at MIT. Both Arevo and Misfit are GGV portfolio. Christy Trang Le is the CFO and president of the Vietnam operations for Arevo. Previously, Christy was a country director for Vietnam at Facebook, and she built Misfit along with Sonny. She graduated Double First in Economics at Oxford (BA & MPhil) and an MBA from MIT Sloan.
We spoke to the couple on the Evolving For The Next Billion podcast, and here are the key excerpts from the chat.
Hans Tung: How did you guys meet?
Christy: We met at the International University in Vietnam back in 2006 and we happened to sit next to each other.
Sonny: It’s been a pretty awesome ride being both life and business partners. It’s not easy, but I would say the rewards have been great.
Hans Tung: What are some of the takeaways that you can share about building a global team?
Sonny: Having a global presence from the beginning really helped us. It’s not just about being distributed, but also selling on a global basis. The conventional wisdom is that you focus on one market and expand from there, get traction and then grow and expand. But we knew that if we started Misfit in the US, we’d just get our butt kicked by Fitbit, who had been around five years longer than us and had the bigger brand.
Another big takeaway from the Misfit experience is hiring the best people on the team. The reason why we can maintain our presence both in the West and in Asia is that we have people who are very strong, both professionally and in terms of personality, as leaders in different hubs around the world. Once we have those core people to anchor operations in multiple countries, they can build a great team around them.
Arevo’s innovation hub lies in Silicon Valley and they’re leaning into Vietnam for Asian scale and speed. We’re also leaning into Japan, where we have one of our key executives and a lot of strategic partners.
Hans Tung: Was it a difficult decision to sell Misfit to Fossil Group?
Christy: For me, it’s much simpler because I run the operational side. And at that point we’d just had our first child, so I loved having a break.
Also, Misfit was well known for its design and beautiful products. So once we saw Fossil’s capabilities in the fashion world, we found a common language between us. We believed they will complement Misfit, and offer a strong foundation to reach more users.
Sonny: In 2013, Apple announced Apple Watch was coming out – so we knew the end was near. Hardware is hard, but competing against Apple is much harder. We knew that unless we were going to partner with someone bigger, we’re probably going to be toast. It was a tough decision; we still had most of our series C and a couple million from our Series B in the bank – almost US$50 million – so we were pretty strong financially.
Dimitra Taslim: After selling Misfit to Fossil you both started a family office called Alabaster, making more than 30 deep tech investments. What was so exciting about Arevo that you decided to go all-in on this new venture?
Christy: Our passion was deep tech science – we like the crazy stuff! We’re involved in Perfect Day, for example, which is a [animal-free] dairy protein company. They’re doing pretty well.
Sonny: When we saw Arevo we thought this was one of most interesting things we have seen in years. And they’re looking for a CEO as well. It was actually really good timing, because we’d been talking about maybe starting another company, but it’s just a lot of work. So this is the first time I’ve actually joined someone else’s startup. Usually, when a company is looking for a CEO, that means there’s something wrong. And yet there wasn’t anything wrong with Arevo; it’s a healthy company and the founders are really pleasant. They were looking for someone to grow the company from 1 to 10 after they had taken it from 0 to 1.
I could see additive manufacturing was going to be the future. And after looking into it I realized you shouldn’t be selling 3D printers, you should be selling parts.
Hans Tung: Like 3D printing as a service?
Sonny: Yes. People don’t really need 3D printers, they need the things that they produce. It’s much more scalable. Arevo couldn’t easily build massive facilities to print products because getting all the permits in the US is difficult. So our innovation is key. You have 50 people inventing stuff – laser physicists, roboticists, and material scientists – and people trying to figure out how to make a composite 3D printer that prints fast enough and at scale.
Yet we can make the printers 10 times faster, but we’re not going to be able to make them 100,000 times faster. At some point, there’s scale versus technology. There’s a crossover point. So I thought, let’s scale up – only you’re just not able to do that in Boston.
Hans Tung: What are some of the new challenges and opportunities?
Christy: The great thing this time is that we have experience from what we’ve done before. But also we have friends, the people who were with us at Misfit and other businesses, who joined us and helped us anchor the new company very quickly. This time, we don’t start from zero, we start from somewhere, especially with people.
Sonny: I feel the fundamentals are safer with Arevo. First, there are things we can make from carbon fiber and 3D structure that you can’t possibly make with traditional composite approaches. Second, we can make it cheaper and faster. So we just have to scale it, which seems lower risk.
Dimitra Taslim: Why do you see a future where we use carbon fiber for more applications?
Sonny: A big thesis in our family office is radical solutions which are technology-driven that could have a positive impact on the planet. Being able to make things lighter and more energy-efficient was very meaningful for us. People have always needed stuff to be lighter, particularly in heavy industries. Take big trucks, for instance – they’re not heavy because they want to be heavy but because they have to be able to lift big things. So if you can make those big trucks lighter because you can print them in carbon fiber, it’s an enormous value add.
Why hasn’t that happened yet? Because it’s really expensive. For example, in the aerospace industry it costs over US$2,000 per kilogram for finished parts. So if you can actually make stuff out of it cheaper, the world is at your feet.
Hans Tung: That’s where the Asian scale, speed, and cost come in?
Sonny: Yes, to make the composite part is very labor intensive. So you automate. That’s what robots and lasers in material sciences are for. If you can have a solution around that, it can be pretty transformative.
Hans Tung: Tell us about your first product at Arevo?
Sonny: When we found Arevo, they were focused on longer-term revenue opportunities in the aerospace and automotive sectors – we have Airbus as an investor, for instance.
So the only way I knew to get going quickly to gain immediate revenue and market feedback was B2C. So we took this nutty approach to show off what we can do and get some attention by creating a bike with an entirely new design that was really beautiful and different.
Called the Superstrata, the bike is just to show that we can print something complex, large, and at scale – realizing the vision of additive manufacturing as a mass manufacturing technology. It has brought in a lot of interest from outside the bike industry and demonstrated what we can do.
Christy: I think the limit to our imagination probably partly lies on how much and how quickly we can scale. Our print farm is not about a few machines that we can showcase, printing certain prototypes. We are talking about replacing manufacturing – that’s when we can capture the opportunities.
We’re talking about having hundreds of printers in one place, each one the size of the room. When you walk through the print farm, it’ll be pretty cool and nothing like a typical factory where you have a production line. With this, there’s no line.
Sonny: We’re actually making the printers here in Vietnam. The parts that are sensitive will be made in the US, but most of it is done here, and it’s half the price and four times the speed. In two months, we got the permit, the rights, the land, the buildings, the infrastructure, electrical and plumbing infrastructure, and people.
Dimitra Taslim: Christy mentioned print farms. Is it like a multi-brand, independent cloud kitchen where different brands can “rent” a couple of machines in a 100 machine print farm?
Sonny: It’s just like an AWS for manufacturing; instead of sending up lines of stuff, just buy print time. You don’t even need to lease the printers, we set aside print time based on material or size. Over time, it should be something that you can just order online.
Christy: And it’s not only about how many units we turn out with the print farm, it is about how the composites and the material will change the design of products. It also changes the kind of products that we can make.
Hans Tung: You’ve mentioned that your culture is built on the concept of servant-leadership. Can you tell us about that?
Christy: What I realized over the years is that the power actually comes from the bottom of the pyramid, from the mass. So I believe that whoever can leverage the power of the crowd, that will be the biggest opportunity for the community and society.
Sonny: This is where leaders view themselves as servants, and their main function is to serve others and not themselves. We’re not talking about collectivism – we love individual innovation and contribution. But the CEO is supposed to serve the leaders, the leaders are supposed to serve their team members and the engineers. That’s the only way the engineers can focus on serving the customer, which is what we’re all about.
Dimitra Taslim: Some final questions. What’s the one thing that you admire most about each other?
Sonny: Clarity of thought. Whenever she gives you the answer, it’s like, I got three points, bang, bang, bang, and two sub-points for each.
Christy: I like Sonny’s vision. He always comes up with the picture of the future ahead of people. And many times he’s right.
Dimitra Taslim: Any piece of advice to other couple entrepreneurs?
Christy: Always take it easy.
Sonny: Yes, I agree with that! Starting companies with your spouse is hard. Unless you have a pretty strong foundation, you probably shouldn’t do it, because it’s going to bring stress into the family. But if it does work out, it’s pretty awesome. Because now you really can spend a lot of time with each other and see each other in action, and there’s no hiding. You see through each other which only makes you stronger.
Hans Tung: Thank you both so much.