Kry10 founder Boyd Multerer says the "Internet of Things" largely runs on software designed in the 1990s. He pitches his firm's platform as a more secure and reliable way of managing machines that talk to other machines over the net - especially in "mission-critical" areas like infrastructure and cars kitted out with all kinds of smart systems. Image / Getty Creative
Kry10 founder Boyd Multerer says the "Internet of Things" largely runs on software designed in the 1990s. He pitches his firm's platform as a more secure and reliable way of managing machines that talk to other machines over the net - especially in "mission-critical" areas like infrastructure and cars kitted out with all kinds of smart systems. Image / Getty Creative
Boyd Multerer - the man whom Microsoft called “Xbox’s father of invention” - now lives in Wellington, where, with a crew that includes a former Treaty negotiator, he’s created software close to being adopted by one of the world’s largest carmakers.
His startup, Kry10, released version 1.0 of its product in December and is now on the cusp of its first big enterprise deal; one that would make it our tech industry’s next big global success.
But first, let’s rewind. Our story starts midway through the last decade when, as director of development, the American had wrapped up a huge push to get the Xbox One console out the door.
After that multi-year effort, Multerer was looking for a new challenge. And, in fact, a whole new country.
“My wife is a data scientist, so when we were looking for a place to live, she built a model and crunched numbers and the top five cities in the world were Wellington, Auckland, Sydney, Stockholm and Melbourne. Two of the top five best cities in the world were in New Zealand – that told us something,” he says.
Multerer spied a WellingtonNZ promotion called LookSee, which offered 100 free trips to the capital for tech workers who landed job interviews with local firms.
The 2017 promotion, which cost ratepayers $850,000, turned into something of a dog’s breakfast. It was snowed with 48,000 applicants. A rapid-fire selection process saw 93 visits and what WellingtonNZ described as a “handful” of hires.
Multerer was not one of them, but it did lead to him scoring a trip to the capital.
“The phone rings while I’m putting my kids to bed and a voice said, ‘This is Nick from LookSee. You’re overqualified and we have no jobs for you, but we want to bring you to Wellington anyway’.”
Multerer spent a week meeting with Wellington tech firms. That didn’t lead to anything - for starters, he didn’t have a work visa - but it did lead to the Xbox man deciding NZ was a great place to found a startup.
In 2018, he secured a visa under the Edmund Hillary Fellowship’s Impact programme, and with his family decamped from Seattle to Wellington, where he founded Kry10 (his wife landed a role as a data scientist with Dot Loves Data, the business intelligence firm recently bought by ANZ).
"There are more and more computers out in the field by themselves,, with no one babysitting them. They're using AI, they're running power stations, they're the brain inside your car" - Kry10 founder Boyd Multerer. Photo / File
Multerer was known as the technical brains behind the Xbox Live architecture - which became the world’s largest network of devices connected to the cloud within a year of its initial launch. His idea was to take the principles he’d learned from connecting gaming consoles and apply them to software for managing the emerging “internet of things” - or machines that talk to each other over the internet; the likes of smart power meters, smart home devices and all sorts of navigation and safety and other systems in today’s cars. There are countless classes of device, and one common theme: heebeejeebees over security. IoT devices are notoriously susceptible to hackers.
His focus was on utilising “seL4″ - a standard, which grew out of the US military, for verified, secure and “self-healing” software to wrangle connected devices. Multerer already knew his way around this sort of technology. Before Xbox live could ship it had to be certified by the US Department of Defense that it would not be a vector of Russian attack.
The American has his eye on a broad range of markets, but the automotive industry stands out because it’s so obviously in flux. The world’s major carmakers are totally re-engineering the way they make vehicles, and manage them when they’re on the road, amid the seismic transition from petrol to electric vehicles.
Photo / Getty Creative
“The way we make cars is fundamentally changing. Elon Musk has shown the way in terms of building a car. And Tesla has shown you can update software on cars after the fact,” Multerer says.
He likes the new methods being adopted by the various automotive giants, but says they’re often adapting technology that’s more than two decades old (and in some areas, that includes Tesla). He pitches Kry10′s platform as the path for software updates that are secure from hackers, and that can contain any bugs so they don’t destabilise other systems. He also bills it as having the smarts to discern between the likes of a cyber-attack, a software glitch or a faulty sensor - phenomena he says can all look the same to other systems.
Multerer knew seL4 had the chops for security. But also that it was complex and not very user-friendly.
Kry10 (pronounced “Kryten” after a character in the cult UK sci-fi series Red Dwarf) is set to work on a platform for easy management of connected devices. The founder says it’s unique because of its comprehensive formal mathematical verification, without compromising performance in Kry10′s target markets’ “mission-critical” IoT areas from manufacturing to power stations.
Tesla CEO Elon Musk at the opening of a new Tesla "gigafactory" near Gruenheide, Germany in March 2022. "Tesla has shown you can update software on cars after the fact,” Multerer says.
Seed funding has come from Wellington-based venture firm Movac (which has a 10 per cent stake), the Crown-backed NZ Growth Capital Partners via its Aspire fund (6 per cent) and Sir Stephen Tindall’s K1W1 (1 per cent).
Multerer (65 per cent) and staff hold most of the balance of the shares. The CEO says Kry10 will likely hold off on a Series A raise until it has its first commercial deals in the bag and it has “reliable, repeating income”.
While Multerer is bullish about Kry10′s prospects, he says he’s been hampered to a degree by NZ’s immigration rules. While he had a high-profile role at Microsoft, he was a salaryman and did not have enough cash to qualify for an investor visa (which has three tiers, ranging from $3 million - which has a 47-month wait time - to $15m). He says the process of obtaining his impact visa was “arduous”.
He’s yet to become a New Zealand citizen. Before he can get his passport, he has to spend no more than four months out of the country (whether one long trip or over many short trips) for five consecutive years. Multerer says that provision has proved something of an albatross as he’s established a firm with an office in the US, and many prospective customers, and potential backers, in North America and Europe. (There’s always the rough chance of a ministerial fast-track, if anyone in the Beehive is reading this. Another US entrepreneur, multi-billionaire Peter Thiel, was granted NZ citizenship in 2011 by then Internal Affairs Minister Nathan Guy after spending just 12 days in the country).
Lovina McMurchy - who has worked in both venture capital and tech roles - is setting up Kry10's US office and driving its next raise. Photo / File
Regardless, Multerer recently made a key appointment, Lovina McMurchy, who is establishing an office in Seattle while he remains shackled to Wellington for most of the year.
McMurchy is a Kiwi who held senior roles with Starbucks, Amazon and Microsoft in the US before returning home in 2019, when she became a general partner at Movac and an independent director on Pushpay’s board. In September last year, McMurchy quit Movac and returned to the US, where she’s establishing its North American beach-head as chief operations officer and “driving the next funding round”.
In investment notes for Movac, the serial expat neatly captured where she thinks the Internet of Things dream has fallen short, and Kry10′s ambitions bid to fill the gap.
In the early days of IoT, “There was much excitement about how many devices and machines would also be connected to the internet and how this would revolutionalise industry, making it more productive and more intelligent. I myself worked at Microsoft during those years so I remember our hope for this brave new world enabled by the cloud. All the major tech vendors talked about it and yet somehow it never quite happened,” McMurchy said.
“Why? Largely because the risks of connecting mission-critical devices such as expensive industrial equipment, secure communication networks, self-driving transport, and utilities such as electrical grids and water systems were too great. We did not have the security we needed to ensure these systems could withstand the concerted efforts of foreign actors trying to attack them and bring them down.
“In a world where the US has not ever had a foreign war on its soil, the idea of an enemy being able to shut off water or power to populous cities is unthinkable. Boyd’s insight is that neither Windows nor Linux would ever be secure enough to enable this to happen. It might be doable for something like an Xbox but not for the industrial complex developed nations rely on, nor for governments in their work of running countries. Both the war in Ukraine and the 2020 presidential election gave us a peek into the future of warfare and how it could undermine both emerging and developed democracies.”
After four years back in NZ, McMurchy said she was looking forward to returning to the US. “It’s a place where people with energy and talent can continuously learn, make big important contributions and be rewarded for their effort,” she wrote in a LinkedIn post on US vs NZ work culture that went viral. By contrast in NZ, “Some hiring managers feel threatened by returners that have had experience at scale [and] promotions are tough since current leadership hang on to their jobs and can’t be replaced by someone better. That’s just not allowed. While this structure appears ‘kind’ as people don’t live in fear of losing their jobs, it limits companies both in aspiration and ability to execute ... New Zealand where employment law is extremely employee-friendly and where lay-offs are incredibly hard to do. There is no at-will work and it is tough to get rid of even poor performers.”
Absolutely positively formal
Ironically, Multerer has found NZ a perfect fit - albeit in the context of moving from corporate boss to startup founder.
“Frankly, I don’t know if I could have done this anywhere else. New Zealand is the only place I could have done this from.”
And the reason has less to do with work culture than maths.
Specifically, he sees New Zealand (and Australia) as a hotbed of talent for an extremely mathematically intense branch of computer science called “formal methods”, or modelling work used in the creation of robust, reliable and verifiable hardware and software.
Kry10′s engineering lead Kent McLeod - raised on Auckland’s North Shore - graduated with a degree from the University of New South Wales, which Multerer regards as the “epicentre” of formal methods.
His crew also includes head of partnerships and legal Jason Fox, a former chief executive of three post-settlement iwi entities (including the Ngāti Whātua o Kaipara Settlement Trust), a special adviser to the Government on Treaty negotiations and the co-founder of Cultureflow, NZ’s first commercial language learning software.
Also onboard is strategist Mahi Paurini, a former chief adviser for MBIE and Mana Labs director, and the aforementioned McMurchy.
And on the board (with Multerer) are two big names in tech engineering: ex-Motorola global vice-president Rob Shaddock, and J. Allard, a former chief experience and technology officer for Microsoft’s consumer division turned chief product officer for GoFundMe. Both are based on the US west coast, but Shaddock has Kiwi connections. He’s a Movac operating partner and was on the board of Auckland wireless charging startup PowerbyProxi, bought by Apple in a deal somewhere north of the Overseas Investment Office’s $100m approval threshold (in a public filing, the tech giant valued the Kiwi firm at $270m as it shifted the firm’s assets to a related US entity).
Kry10 does seem on the verge of a breakthrough. It was the major carmaker that approached the Wellington-based firm, not the other way around. (It’s rare to get a straight-up response to the always-telling “Who-approached-who?” question.) Assuming it does all come together, Multerer says his startup will, naturally, ramp up its expansion overseas. But he sees its core engineering work remaining in his new-found home.
