“Telecom Design is a Tesla-like trajectory and an ambitious industrial project”

LA TRIBUNE – Created exactly 22 years ago, Telecom Design is little known to the general public. What are the origins of this company?

Philippe MATEPresident It is first of all the story of a meeting between the five historic founders of the company in May 2000 with complementary engineering and business profiles (see box). We started from the start in the field of mobile terminals and connected objects by successively developing different projects. It is only since the beginning of the 2020s that we focus 100% on Telecom Design.

Bruno MAUREL, Managing Director in charge of Marketing and Strategy – From the start, we are all in the same state of mind of weariness vis-à-vis our management positions: energy lost internally, reporting, endless meetings, etc. We therefore embarked on business creation to take advantage of the arrival in France of the first laptops and mobile phones. We then have the very strong intuition that this is the beginning of the end of the separation between personal life and professional life and that this will lead to enormous upheavals and, above all, communication needs!

So what is the positioning of Telecom Design?

Bruno MAUREL – We are at the beginning of the 2000s and we know at that time quite precisely what we want to do: develop connected technologies with high added value in the telecom sector to position ourselves either in very deep niche markets, or in emerging markets. We conceive, we design and we prototype everything here, in Gironde, but we subcontract the manufacturing in France then, quite quickly, in China. This lays the bricks of our strategy, which is mainly BtoB, even BtoBtoC, which explains why we are not well known to the general public. For several years, Telecom Design will actually operate as an R&D workshop to develop various projects.

What are the main projects developed by Telecom Design?

Bruno MAUREL – There have been several successive BtoB tools: we developed the Homerider Systems remote water metering solution before selling it to Veolia in 2009, then the GPS location tool Kirrio that we sold to ViaMichelin in 2005 and, finally, in 2007/2008, we developed the Leyio, a connected object capable of transferring data wirelessly. Five million euros were raised at the time to develop this very promising terminal. But in 2010, we decided to stop the Leyio project, which was swept away and atomized by the iPhone which then took all the light and made any competition inaudible. It is from there that we focus on Telecom Design by capitalizing on all these experiences.

We understand that we have a differentiating know-how in connected objects and the market opens with the arrival of Sigfox (Toulouse company today in difficulty and bought by Unabiz a few days ago, editor’s note) which allowed us to penetrate certain markets very quickly. We are in 2020 and we are then positioning ourselves on our two current markets: safety and aging well.

These are two very competitive markets. What sets you apart from the competition?

Bruno Maurel We have developed a real ability to understand the needs and uses of our customers and to deploy the right solutions to meet them. We have not only had success, but we have always forged long and collaborative relationships with our technology suppliers and with our customers, which has often allowed us to save a lot of time in our developments. Today, our connected security solutions are distributed by the European leader Verisure (formerly Securitas Direct) and our connected objects marketed by our Vitalbase brand are present with nearly 60 insurers! Our alarms are among the best on the market, easily controllable and resistant to jamming, and, on aging well, we reach younger seniors with less stigmatizing, highly connected products, etc. These are colossal markets that are constantly growing.

Philippe MATEI think our backgrounds and our experiences also speak for us. Then, the growth trajectory of the company speaks for itself since we have gone from 8 to 50 million euros in turnover in the space of five years in the two most buoyant markets of the ‘IoT. Many competitors in connected objects have stagnated or even stopped, but players like us, with a profitable business and an Ebitda that has increased from 10% to 15% over the same period, ultimately, there are not that many that !

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Philippe Maté and Bruno Maurel (credits: Agence APPA).

You managed to raise 70 million euros a month ago from a pool led by Andera Partners. A record amount in New Aquitaine. Concretely, what will these funds be used for?

Philippe MATE First to finance our very ambitious industrial development project, in particular by accelerating on the NB-IoT, the LTE Cat-M network

then 5G. We are now a little over 60 employees and we plan to climb to more than 90 people within two years, in particular by strengthening the marketing, R&D and industrial teams with engineering profiles in electronics and embedded systems, full stack developers, business profiles, etc. Bruno MAUREL –

At the same time, as we have been doing for several years, we are going to spend at least two to three million euros on R&D per year for the next six years. We are also going to develop in Europe beyond France and Spain where we are already present. In particular, we are going to set up teams in England and in the Nordic countries.Philippe MAT E

These funds will also allow us to consider acquisitions either on technologies or to accelerate in such and such a country. We will be very opportunistic with Andera Partners on these possibilities of external growth. And, finally, to go from 50 million to 250 million euros in turnover in a few years, this implies significant cash requirements to secure and pay for components and raw materials. Today, obtaining electronic components is more expensive, takes longer and requires a lot of energy and cash. When the components are available, you have to buy them cash!

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With a profitable and growing business, have you considered doing without fundraising to remain in sole control? Bruno MAUREL –

We examined different options but when we look at the growth pattern in which we are part, it was essential to seek out a partner of international stature with substantial resources. The other parameter is that we are soon to be 60 years old and that we will not have enough energy forever to carry out this business project which will probably be our last. This is also why we wanted to speed up now and not in two years: because we want to be part of it and above all we don’t want to completely sell the company so that others write this page for us. !

Now the goal is not to burn the cash in two years or to sleep. We are aiming for the ceiling of 100 million euros in turnover within two years and then the bar of 200 million euros two years later. In 2021, we went from 30 to 50 million euros in turnover. When you look at our growth in recent years, it’s a Tesla-like trajectory.with an ambitious industrial project! And we’re not talking about small volumes: we turn two million products sold per year with several hundred thousand units per product. Philippe MAT

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– We have a startup spirit but with a large industrial tool. We are not in a scheme where we raise funds to start but to support and accelerate a profitable industrial development plan. This requires structuring the teams and carrying out external growth operations in order to grow.

Telecom Design

In the design workshops of Telecom Design, in Canéjan (credits: Agence APPA).How do you manage your supply circuits in the current geopolitical context? Philippe MAT

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– Since 2002, and like most telecom players, we have everything manufactured in China, in the Shenzhen region. Recently, we decided to diversify our sources of supply by selecting a supplier based in Hungary which allows us to have a European production tool. This provides guarantees to our customers and also secures transport issues.Do you plan to internalize all or part of the manufacturing of your connected objects? Philippe MAT E

No, because they are two different professions! Manufacturing involves having a factory, production lines, staff and working with contractors. As far as we are concerned, we don’t see the added value at all there, we think on the contrary that to be in control of our added value we have to invest in R&D rather than in the industrial tool. It is also more flexible and therefore safer in the event of a market downturn. Finally, our suppliers also work for other customers and can therefore rely on economies of scale that we would be unable to generate on our own.

Bruno MAUREL –

For the moment, we have decided to internalize only the functions for which there is a very high added value. There are two reasons for this: the capture of the intrinsic added value but, above all and it is much more complicated, our ability to maintain and grow this added value. Each time we have tried to internalize high-value people on functions that we do not fully master, people have withered and then left. We therefore prefer to focus on what we know how to do: engineering, innovation, etc. Because in these areas we know that we will be able to advance our employees and ourselves with it.

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