Small in size, huge in performance

Mr. Kappeler, what was the beginning of the company's actually still young history?

Markus Kappeler: I already had my own company together with three other partners before bytes at work. We were heavily software-heavy. However, I always wanted to produce a product to touch, while my partners wanted to stay in the service sector. That's why I split off, let myself be paid off and started anew with bytes at work. At first I was alone, but very quickly I had my first customers. So I enlarged the team. In the meantime, we are seven people and still looking for people. In 2012, we launched our first hardware product. We deliberately focused on small solutions so that it would fit into as many designs as possible. I see a market need here. Furthermore, I am convinced that Linux will establish itself as an operating system in the industry in the long term.

Why are you so convinced of Linux?

The system was tailored to many architectures from the start, unlike Windows, which only ran on Intel processors. And it has a very small footprint, which means it requires very little memory. That's why it runs on large server farms as well as the smallest embedded devices, like ours. That's a huge spectrum that hardly any other operating system can cover.

What exactly is your unique selling proposition or that of your products?

It's the combination that it's not the software that's matched to the hardware, but the other way around. And that's because we put the focus on the software first. So we don't come from the resistors of the controllers, but top down.

You write on your website that continuous industry development also has its downsides. Which ones?

One difficulty, of course, is getting into this market as a newcomer. You need customers and, not least, people who trust you. Nevertheless, we have succeeded in winning good projects. They help us to move forward. But we now need further capital. There is another shadow: We are not "sexy." The industry is sluggish; it thinks long-term. Cycles last several years.

But now the Internet of Things and Industry 4.0 are coming. Surely this increases the "sexiness" for investors?

But for me, it's about building something longer-term that will still be around in 10 to 15 years. We are currently in talks with two interested parties, and I hope that it will be clear by the summer how things will continue. I am confident. We can show that there is a market and that our products find a market.

What exactly does this market consist of? Is it mainly small buyers of your products, or does it also include large ones?

The really big ones tend not to. Our modules are produced in quantities of between 5,000 and 10,000 units, and beyond that, they break down because of the costs. Modules are no longer worthwhile. It is not the size of the company that is decisive, but the number of end applications.

Where do you manufacture your modules?

We have outsourced production to specialized companies. We have production carried out in Switzerland. That is important to me. Machine hours cost the same all over the world. With highly integrated and innovative products like ours, it doesn't matter whether we produce here or in China. Proximity and close cooperation are important to me.

But Switzerland is now known for being an expensive place to work.

That's not true about Switzerland being an expensive place to work. Switzerland is quite competitive in an international comparison. You just have to take everything into account: If people have to fly to China several times until a certain production quality can be ensured, that costs just as much money as if you produce in Switzerland right from the start. It's not cheaper, but it's certainly not more expensive. But in return, you get production reliability at standards that don't have to be discussed at length here.

Speaking of costs, you procure in euros and pay in euros. In that sense, the current strength of the Swiss franc hardly bothers you?

That is correct. The components are indeed not a problem. The situation is different for services: Here we have little to report, as we recently discovered again at a trade show. It is therefore important to talk to customers about complete solutions, not just about hourly rates for services. In this respect, we have little chance against German competitors, for example. However, with our know-how, our experience and the speed at which we can deliver, we are very competitive.

How do you hold your own as a small company in the concert of the "big ones"?

We convince with customer proximity and close cooperation. We are prepared to go the extra mile where others would forego it due to lack of interest. Even quantities of 500 to 1,000 per year are feasible for us, which would not be economically viable for other suppliers. However, with the economic crisis, larger manufacturers are also becoming interested in smaller orders. We are strong where software comes into play, i.e. when it comes to putting a device into operation. There we are superior to our competitors because we can cover the entire spectrum. Our weaknesses - and we should talk about this - are in the pure sale of hardware. We are still lacking in sales. We're still in the process of building that up, and I'm hoping that more capital will enable us to do so once and for all. However, it is important for me to first have the certainty that the products work. This has been the case for half a year now. References are there, quantities are there - now it's a matter of multiplying them in the market.

To do this, you need more people. How do you - again as a small company - have enough chances to get skilled workers here?

The size of the company is certainly an advantage. For us, it's important to find people who don't want to pursue a career in the classic sense. For people who are interested in technology and fascinated by Linux, we are an excellent employer. We cover a broad spectrum and offer interesting challenges. Certainly, we are not comparable to companies that write large applications. We program drivers. That is quite comparable to application development. Unfortunately, it is difficult to get young people excited about it.

On your company website, you describe yourself as a role model in terms of resource utilization. Are your products built to last, so to speak?

Durability is one thing. On the other hand, we make sure that our components consume little power. We are already at a low level in this respect. The fact is that the components have to run around the clock 365 days a year for 15 years. The sum of all the small parts can become quite large. Again and again, I point out that there is great potential in software. A lot of energy can be saved with software, which is often forgotten. With clever programming, a lot is still possible not only in the embedded area, but also in the area of large servers. Google once calculated that enormous amounts of energy costs could be saved if the answers to search queries were delivered half a second later. IT as a whole has now become a major energy consumer. It is important that we address this as a company.

You are the founder, owner, CEO and at the same time active in many areas. As your company continues to grow, how will your responsibilities change?

I am open in this respect. I enjoy actively developing products. That helps me to appear competent as a company boss. In our industry, development is so fast-moving that you quickly lose touch if you're away from practice for a few years. That's why I try to retain a certain know-how throughout my life. However, I am well aware that as the company grows, I will move further and further away from the operational business.

So towards the pure manager?

That is conceivable. But it's also conceivable that I'll hire my own boss at some point. I am an engineer, and my heart beats for development. The only thing that matters to me at the moment is that we can grow and continue to work on our products.

bytes at work

Founded by Markus Kappeler, bytes at work AG has become a leading international company in the field of industrial computing and software and hardware development. The company's computing modules, which are robust against vibrations and temperature fluctuations, are used even under the most difficult conditions, for example in mining. Together with industrial gateways and HMI systems, they stand for Swiss quality worldwide. With the production of the smallest module in the industry, the company caused quite a stir worldwide. The bytes at work AG works with Linux open source products and is part of the Yocto project of the Linux Foundation, where it actively contributes to the further development of Linux in the embedded computing sector.

bytes at work https://www.bytesatwork.ch/