How An Italian Entrepreneur Reinvented His Homeland’s Signature Export
Let’s face it, when it comes to vending machines, Italy has more of them in operation than any other country in Europe, most of them preparing coffee.
It is also the world leader in their manufacture and sale, with around 60% of products destined for export.
But when Italian entrepreneur Nino Lo Iacono combined this world class manufacturing expertise with an Internet of Things approach, he came up with a business model that is reinventing the vending industry.
WIB (Warehouse In a Box) is a smart vending store that combines physical and digital channels of sale, and uses patented technology to connect a wide range of retail segments to automated sales of things like grocery, cosmetics, luxury goods, electronics, toys, and wines.
WIB’s web based approach enables customers to purchase on site as well as online from their PC or mobile devices, and collect their purchases 24/7 at their chosen store.
Funded by two Venture Capital funds, WIB has led the most successful Italian crowdfunding campaigns and won the Intelligent Vending Competition 2014, a global competition organized by Intel INTC -0.66%.
Italy’s leading grocery chain, along with several international retailers are already installing WIB machines, helping to drive a revolution in retail technology and convenience shopping.
And it all began in 2010 when, having completed a degree in Mechatronics Engineering at the Polytechnic of Turin and a couple of years at the FIAT Research Center, Lo Iacono turned down a very attractive contract from an international consulting firm for the less certain path as an entrepreneur.
He recalls: “I didn’t know exactly what to do or where to do it, but I had a dream of starting my first business in Sicily, the place where I grew up, but that was not exactly known for being business friendly.”
In fact he was invited to join ARCA, the business incubator of the University of Palermo in Sicily, and it was here that he founded his first consulting company in the mechatronics/automation fields.
One of the first ideas he had revolved around an object that can be found in virtually every office; the vending machine. Having already studied the vending industry, worth €3billion in Italy, Lo Iacono saw opportunities to apply some digital innovation.
“There was a huge competition, but while traditional machines were only able to distribute snacks, cans and beverages, I envisaged a machine that could satisfy all consumer purchasing needs, a machine capable of selling grocery, cosmetics, toys, wines, electronics etc., and of course, capable of accepting online orders and of being managed online by retailers.”
That morning, standing in front of the coffee machine, Lo Iacono decided to reinvent the vending industry.
To provide the flexibility to distribute a wide range of products, he needed to not only to design a new technology, but also to manufacture it effectively. He decided to relocate the manufacturing in a place where the necessary expertise in mechanics and electronics were readily available; Italy’s Motor Valley
“In Italy if you want to manufacture a mechatronic product it is the place to be. Thank to the industrial plants in automotive and ceramic industries it’s extremely easy to find engineers and manufacturing capabilities in that area. We were thus able to reduce dramatically our time to market, delivering the first prototype just six months after we secured funding,” he said.
In 2012 WIB had taken part in SeedLab, one of Italy’s premier business plan competitions organized by VC funds, and won, grabbing the attention of investors.
They following year they qualified for the Intel Business Challenge Europe Finals in Dublin and launched a crowdfunding campaign via the siamosoci.com platform, raising €530,000 in two days and €960,000 in total expressions of interest, closing at €450,000 – an Italian record for funding speed and amount. Last year two Italian VC funds Vertis SGR and RedSeed Ventures also joined the seed round, which closed at €750,000 in November 2013.
WIB machines enable a variety of models for retailers, including remote and strategic stores located in high traffic areas where it would be difficult to implement a traditional store, for example, in hospitals, corporate buildings and malls.
While the company is working with the leading grocery chains in Italy, the aim is to verticalize and position the devices in even higher profit segments, such as cosmetics, consumer electronics, toys, and wines.
“Without changing a nut in the mechanics, WIB can enable retailers in all these fields,” says Lo Iacono. “WIB machines are made up of one delivery unit and one or more warehouse units. It is also possible to mount additional warehouse units, increasing the stock capacity.”
Costs range from €20,000, for WIB’s one warehouse, one delivery unit in Florence, to €50,000 euros for its Las Vegas three warehouses, one delivery unit model.
In less than four years, WIB entered the market with a new product capable of creating a totally new market. Not surprisingly the brand is now attracting commercial and technical interest from foreign markets, including the US, Central Europe and Australia, which they plan to start penetrating towards the end of 2015.
Lo Iacono says: “Next January we’ll launch our Series A funding campaign, which we are already working on, since we also intend to raise money also from European funds in order to boost growth effectively. We want to go fast and expand our business quickly powered by the natural adrenaline of entrepreneurs.”