The Challenges of Selling at Retail and Competing with Behemoths – Part 4 of a Conversation with Alain Kornhauser

By relying on internally generated cash-flow and never receiving outside investment, Dr. Alain Kornhauser explains how he was able to keep a firewall between his interests in ALK Technologies and his teaching at Princeton. From humble beginnings in 1979, ALK grew to approximately 200 people and in January 2013, it was sold to Trimble Navigation.

In the above interview, Kornhauser explains that the initial spark for the company was the work performed for Congress on what would become Conrail. This provided the foundation for a number of firsts to improve efficiency in the North American Railroad System.  Some of these innovations include the first computer-graphic Operation Control Center at Canadian National and the first Optimal Locomotive Management System at Burlington Northern.

As Kornhauser explains, ALK evolved its offering to include the creation of the first digital maps of the roadways, helping virtually all of the trucking companies in North America choose the most efficient routes.

Then, in the mid-1990s, Kornhauser discovered that the Census Bureau was creating a digital street network through its TIGER initiative. This led to a consumer product: Door-to-Door Road Trips, using the database marketed at TravRoute. As the name suggests, this software product was the first to deliver turn-by-turn directions without having to make a trip to the local AAA office.

Kornhauser explains the challenges of bringing the product to retail, particularly compared to today’s world of app stores. But alas, ALK ran into the software behemoth, Microsoft, which priced their map product at the same price and then bought market share by providing a rebate that essentially gave away the product.

In part 5 of this conversation, Kornhauser discusses how ALK didn’t dwell on this retail challenge but instead pursued a slightly more precise direction.

Click here to watch part 3 of this conversation.