Inside the Startup: Luminovo

Luminovo started out as a service-oriented business, building cutting-edge AI solutions for over a dozen large corporations, and liberating employees from manual work. Since 2020, they’ve been transforming the trillion-dollar electronics industry, which is vital for innovation but sometimes antiquated in its processes.

Munich-based Luminovo will be exhibiting at electronica 2022, at stand B1.214 – we’ll also be there, and we’re looking forward to the in-depth exposure we’ll get to their products and services. We did a quick catch-up with them in anticipation.

How did Luminovo come about?

Luminovo was founded by Timon Ruban and Sebastian Schaal. Both are originally from Munich and graduated top of their class in electrical engineering from ETH Zurich and TU Munich, respectively. They both went to Stanford University on a Fulbright scholarship for their graduate studies.

Timon graduated in electrical engineering with a strong focus on deep learning. He engaged in Computer Vision research and worked as a teaching assistant for Andrew Ng. He also worked for Google in their smart imagery team before returning to Munich to found Luminovo.

Sebastian focused on Management Science and Machine Learning, but returned to Munich one year earlier to finish his entrepreneurship program at the Center for Digital Technology and Management (CDTM) and his second masters in electrical engineering at TU Munich. Before founding Luminovo, he worked for the tech and robotics startups NavVis and Magazino, as well as for McKinsey and Intel.

Timon and Sebastian met at Stanford and decided to join forces and return home to build an AI solutions company that should bring the Silicon Valley spirit to corporate Germany.

Luminovo was founded in December 2017, originally as an AI solutions company. The idea was to gather AI talent with a focus on deep learning and consult corporates in understanding what this technology can do for their business, but then mainly engage in high-value development projects. Between 2017 and 2019, we did over 30 projects with around 20 clients, ranging from Silicon Valley startups to Global Fortune 500 companies.

In 2019, we went on the hunt for “what’s next”, having developed the urge to increase our focus and transform Luminovo from a service-oriented to a product company. At the end of 2019, we found an answer: Luminovo would from now on focus on the future of the electronics industry, which was kind of a return to home for Timon and Sebastian, but with a lot of experience in modern and smart software solution design in their bags. Most of the team stayed and immersed into this new topic together.

You have over 60 manufacturers and developers already using your SaaS product, and it's barely 18 months old. How do you manage to reach so many of the right customers so quickly?

We found amazing co-development partners right at the start, meaning 2-3 companies that have been with us since the first lines of code, testing what we built and giving us constant feedback. This combined with a stellar team that knew each other well and had been working together before in the project-based setting, we managed to build the first features in a very efficient customer-centric way. This way, we could create value for the first customer groups after a few months and since then, every new feature built opened up value for more and more customers. And we’re still keeping our customer-centric way of development, also with new customer groups coming on board (OEM). This ensures constant and fast value creation.

The software you've developed understands the industry and its challenges. What are the main problems you wanted to solve at the outset?

The Luminovo suite — The Luminovo Suite is a solution to laborious, manual quoting processes.

What we are solving already:

Our first features were developed to solve the problem of manual, error-prone, slow and non-transparent quoting processes of electronic manufacturing service providers.
Many EMS these days are struggling to provide competitive offers because it takes them too long to find the right parts, or because they can’t always find the right parts. Many are struggling because they only get parts when they accept early deliveries which, in turn, cause manufacturers’ inventories, and thereby working capital, to explode. To a significant proportion these struggles are due to solo player attitudes on all sides and inefficient communication along the value chain (between EMS, their customer and their suppliers).
By integrating distributors and suppliers directly into our tool, by letting intelligent features take over a big part of the operational work and by offering separated yet joint views for different players into their shared project within the same tool, we’re realizing a fast, efficient and collaborative workflow.
The same general problems of manual and inefficient quoting and non-transparent processes but with different modules, we are also solving for PCB suppliers. Gerber files can be uploaded to the tool, which will analyse and convert them to an innovative format (digital twin) that helps determine relevant details of the design like clearance or trace width within a few seconds. On top of that, the software supports with creating even complex layer stacks and its innovative PCB pricing module enables calculating precise prices automatically.
This offering is also solving issues for OEMs already. It gives users relevant component information (lifecycle, availability, lead time, price and compliance of parts) in real-time and before prototypes are built and money is invested. This minimises the risk of re-designs on the way to production and the risk of shortages throughout the product lifecycle.

What we still want to solve:

With new modules specifically developed for OEMs we will support them even better in getting the right information right at the time they make design decisions to avoid costly redesigns, meaning we’re moving towards first time right approaches. Additionally, we will support the collaboration between engineering and procurement departments at OEMs with a shared space to manage their parts, align alternatives and discuss issues on a design and component level. People are comfortable with generic Excel spreadsheets and email, inefficient as they may be.

Obviously, with new, complex software, comes the "how-to-use-it" learning curve. This time spent learning new software is a valuable resource. Do you find that potential customers may be reticent about investing in learning a whole new software suite, or are they keen to jump in, given the benefits pitched to them?

To a certain degree, there has been a general industry-wide reticence to change, otherwise the need to modernize wouldn’t be so big. But that’s true for many industries and societal topics of today.

We find that the developments of the past couple of years (electrification and de-globalisation of the world, Covid, supply chain issues, etc.) have really motivated companies in the electronics industry (and probably also other industries) to look around and invest in new technologies.

Most companies and people we meet, either at fairs, industry events or virtually, quickly see the benefits we can offer them and are keen to try the tool.

With the way we build our product, we also have a huge focus on usability. Our user experience (UX) designers are constantly testing their designs with customers and industry experts to make sure that everything that’s shipped is easy and intuitive to use and simplifies people’s lives instead of creating another burden.

Do you offer comprehensive in-person training to accommodate the required learning, or is there online support, videos, perhaps all of the above?

We have a well-guided onboarding process to introduce every user to the tool. This includes an initial virtual session with everyone together and then as many follow-up meetings as needed. In addition, there is extensive documentation including videos that can be accessed by all users at any time.

And once the solution is implemented, what sorts of examples have you seen of the benefits of unlocking those siloed processes and improving real-time collaboration?

EMS customers have told us they have increased their quoting efficiency by 80% because they get supply chain data aggregated in one system via our API connections instead of having to go through each supplier manually.

And how long did that take, from inspiration to launch?

Beginning in 2020, we started our structured approach in mapping out all the stakeholders involved from having an electronic product idea all the way to having them manufactured for the mass market. In over 150 interviews, we gathered a clear understanding of the pain points and created our vision and roadmap towards it. Since April 2020, we have been developing our solution in close cooperation with innovative customers in Germany and launched our beta version in February 2021.

So, apart from introducing welcome efficiencies to the supply-chain, what about the end customers? Are you seeing the results ending up in the hands of happy end users, yet?

End users benefit from Luminovo through the stability we bring to the supply chain and the accelerated technological progress. When the supply chain works efficiently and collaboratively, there are fewer production delays and bottlenecks and end customers will receive their products faster and more reliably. When the supply chain works more automated, designers, engineers and manufacturers have more time to focus on building better products. When it’s supported by smart tools, designers, engineers and manufacturers get even more predictive insight into their products and can build even better products even faster. Since this effects many industries from medical to automotive, end customers will experience Luminovo’s benefits in all aspects of their lives.

Did you know that this year at electronica 2022, we’re celebrating fast forward’s 6th anniversary? Visit the electronica fast forward booth at Hall B4.440 and get to know the next generation of startups that are about to change the world of electronics. Who knows – you might be able to see and talk to the next Luminovo!