C3 IoT: Enabling Digital Industrial Transformation
This case follows Silicon Valley software veteran Thomas Siebel as he launches a new company, C3, in 2009, and steers it through two major pivots – transforming the business from a firm focused on energy conservation to a data management, machine learning, and artificial intelligence platform for large enterprises. The case looks at the multiple business transformations and re-brandings C3 went through and examines the strategic challenges the company was facing in 2018 as it began to compete head-to-head with companies such as IBM and SAP.
In 2009, three years after selling his eponymous enterprise software company Siebel Systems to Oracle for nearly $6 billion, Siebel launched a new business, C3. “C” stood for carbon, and the “3” was shorthand for three “M” words: measure, mitigate and monetize. The idea was to help large companies navigate the new world of carbon taxes and reduce their carbon footprints. But after just two years, C3 was in trouble. It had found clients for its software product, C3 Energy Management, yet oil prices had stumbled, and in wake of the financial crisis, companies pulled back on spending.
Siebel was no going to give up. He saw great potential in the data flowing from sensors in smart meters, turbines, transformers and other infrastructure in power grids. In 2012, he laid off about 100 of C3’s 150 employees, retaining the core engineering team. The company renamed itself C3 Energy and helped grid operators aggregate and analyze data from various sensor devices and enterprise software systems. C3 Energy’s engine processed data at very high rates, then applied machine learning to do useful things, such as predictive maintenance, detecting theft, and monitoring sensor network health.
After several years, Siebel came to believe that his platform had great potential beyond grid operators and large utilities. In 2016, C3 Energy renamed itself C3 IoT and began offering cloud computing, data analytics, AI, and machine learning applications to industries from aerospace to manufacturing, and even government agencies. In 2017, C3 IoT became a “unicorn,” valued at more than $1 billion.