Eolane Suzhou IoT City

The IoT City has hosted 18 startups since its creation in 2016 (14 are still in the offices). They also have 25 independent companies requiring their production line for small /medium scale.

Regarding the startups, all of them are founded by Chinese people, mostly males aged between 25 and 35 years old. They are attracted by the location (near Shanghai), but more importantly the space, the small EMS capabilities and the expertise of the teams helping them to develop their products (on the use of the LoRa for example). They also look for an incubator that can help to access government helps and grants, as IoT development is very supported in 2017 in China.

The lab uses a lot social networks to attract its new users. They are very active on Wechat and attend many events in Suzhou area.

One of their key development pillars is to target overseas startups (they are looking for a 30% ratio). They count on the international aura of EOLANE to develop this part as well as the attractiveness of the Chinese market.

The initial investment made to set up the place was 1,3 M€. It was mainly to rent the place, build the open spaces and fund the first months of salaries. The machines are owned by EOLANE, which is renting them to the IoT City.

Since its launch in 2016, the IoT City is not profitable yet (September 2017). The two main activities generating revenues are the incubator (co-working space),10%, and the EMS for small and medium businesses (90%). This latter is generating all the profit for the company.

Regarding the costs structure, salaries represent 55%, followed by the rental of the machines (29%), and the rent of the space, 15%.

In 2017, the company is expected to reach 600 K€ revenues, and 1 500 K€ in 2018. In the following years, its growth is expected to be 20% per year. The incubator team is expected to stay flat, as almost all desks are taken already (14 startups currently incubated).

The IoT City model in Suzhou is expected to accompany and foster the growth of EOLANE and more generally EMS services in China.

In September 2017, 14 people are working in the IoT City. 3 on the incubator program (1 operational manager, 1 administration specialist and 1 PR), and 11 on the mini factory (1 operation manager, 2 program managers, 1 process engineer, 1 customer quality engineer, 1 production manager, 1 warehouse keeper and 4 operators).

There is not specific program to join the incubator. Any hardware startup can apply and stay in the space during the time they need. “Every hardware startup has unique development challenges” according to the team.

Once they integrate the incubator, the startups can benefit from the expertise of the teams present onsite, and also from the network of the 8 shareholders, helping them a lot to find their suppliers and materials. Every month, startups have a monthly review with the team of the lab, regarding their advancement and needs from the incubator.

Every week, the manager of Suzhou IoT City reports to the General Manager of EOLANE China, as the two entities work closely together. If case of specific needs, EOLANE provides the services of its manufacture located in Suzhou. A quarterly review is also set up with the board of shareholders.

No formal documentation is required from the startups incubated. But every month, the team of the lab records in detail their needs. The intent is to understand the requirements of the startups, and to anticipate their future challenges to bring an efficient response, and to adapt their program with the time.