The story of Nextspace — the Kiwi company set to crack open the burgeoning digital twin technology market — is really three stories in one.
At its broadest, it’s a chronicle of the rise of digital twin technology, a rapidly evolving, burgeoning industry, whose time has almost come.
Secondly, it’s the history of some NewZealand-made companies that, after a few decades of ups and downs, might still hold the key to the forthcoming open, intelligible, data-rich 3D omniverse.
Finally, it’s the story of Nextspace founder and CEO Mark Thomas, a pioneer in visual computing and design, who, through a combination of prophecy and perseverance, has already delivered several industry-changing technologies — perhaps with the biggest yet to come.
For Mark, it’s been a 30-year journey, starting in the computer graphics dark ages: the late 1980s.
Mark cut his teeth on the IBM mainframes of University of Auckland — home of the first university course in computer graphics — fascinated with the intersection between engineering technology, graphics and the business world.
Mark proudly announced the launch of his first business, Computer Aided Design Systems Ltd (CADS for short), in September 1987, just a month shy of Black Monday, the unexpected market crash that sparked a long and deep decline in the New Zealand economy.
But timing isn’t everything. Depressed market or not, Mark didn’t let the dismal economic situation hold CADS back. Primarily a distributor and reseller of AutoCAD and other CAD software products, the company quickly grew to become the largest reseller of CAE systems in NewZealand, with clients including Fisher & Paykel, Glidepath, Tait and many others.
Reselling was only part of the gig, however. Mark and his three-person team were soon developing a slew of innovative new products, including the world’s first PC-based 3D Paint software for film, TV and games development, and the ground-breaking 4D Paint and Deep Paint 3D software products.
In the process, the company struck deals with major industry players including Weta Digital, EA, Disney, Unreal, Xbox and The SIMS.
With a cadre of global distributors and an increasing presence in the 3D and gaming industry, the company was thriving. (By one estimation, “close to half” of the games on the market in the early ‘90s would have been painted using the company’s 3D painting technology).
It was early days for the industry, but with one foot in the engineering world and the other in gaming, Mark had already noticed something: there seemed to be an enormous amount of valuable and compelling visual information ‘locked’ in the engineering departments of companies.
What if someone could take this complex data, he wondered, liberate it, and, using a game technology approach, present it in such a way that anyone could understand and interact with it?
By the late ‘90s, Mark decided a reshuffle of the CADS business was in order. So CADS was split in two. One company would continue the CADS mission, and the other would be Right Hemisphere, a new company focused on the promise and potential of 3D-modelling software.
Raising capital from angel and VC investors in New Zealand, it wasn’t long before the company was inking deals with influential aerospace players, including Boeing, Sikorsky, Spirit Aviation and Northrop Grumman.
At the time, Boeing was working on a concept of ‘model-based definition’, an idea built around the integration of design and manufacturing information into a three dimensional representation of the product.
Right Hemisphere worked with the aerospace company to build an ingenious system of rendering that could display engineering and manufacturing data in a lightweight 3D PDF format. Developing the Adobe 3D PDF technology and .U3D format, Right Hemisphere was able to reduce 3D CAD data from hundreds of MB to just a few MB. And what had been a stack of 100 sheets of 2D drawings to became a single, easy-to-use three dimensional PDF document embedded with all the engineering and manufacturing data required by their its supply chain.
It was an exciting project, and Mark could see that Boeing’s thinking reflected much of his own: if a picture was worth a thousand words, surely a dynamic, data-rich, 3D digital model — a digital ‘twin’ — was worth many more.
On digital twins
Digital twins are dynamic digital models of the real world — digital counterparts of physical objects or processes that aim to mimic the behaviour and state of those ‘things’ in real time.
Using real-world data inputs — sensor technology connected to real world objects for example — and 3D rendering, these dynamic models could be projected into the digital world, making it easier to understand, manage and interact with complex data from multiple sources.
The result? Better monitoring and diagnostics practices, more effective optimisation programmes, and improved efficiencies, just for starters.
Equally significant, individual digital twin instances can be joined together to form larger and more comprehensive digital twin scenarios — from individual machines to connected cities, countries and ultimately the globe — offering currently unimaginable insights into the way the pieces of our world interact with one another.
The potential was — and still is — enormous.
Coinciding with the Boeing project, Right Hemisphere also struck deals with NASA, SpaceX, Gulfstream, Caterpillar, Chrysler and others.
Such developments didn’t go unnoticed. Right Hemisphere won numerous New Zealand export awards during this time, including nabbing the title of Supreme Winner at the 2006 NZ Hi-Tech 2006 Awards.
The problem with proprietary tools
Although Right Hemisphere was gaining recognition —and a cluster of high profile clients — Mark saw that the fundamental issue remained: to truly realise the potential of digital twin technology, users needed to be able to import and export data in multiple different file formats and from manifold sources.
However, the proprietary impulse of the companies developing these tools however, was getting in the way. When users wanted to visualise concepts or simulate how their design would perform in the real world, they were — and still are — forced to choose between different proprietary tools, to essentially make bets on specific file formats and data structures, such as AutoCAD, Dassault software or Bentley systems. The desire of these companies to control the data chain came at the expense of the end user who needed to openly view, combine and share that data.
It was — and still is — a world in which open data and general communication requirements collide with the interests of companies that want to control that flow of data as closely as possible.
In hindsight it might seem obvious, but at that time, the idea was revelatory: true utility lay in the ability of digital twins to incorporate any kind of data, myriad data sources, standards and technologies, including those yet to be invented.
During this time Right Hemisphere attracted the interest of Intel, who asked the company to port its software across to its latest chip technology and provided financial and technical support in the process.
Local angel investment rounds followed, and in the early 2000s, the company secured backing from prestigious US venture capital firm Sequoia Capital.
German software giant SAP had also noticed what Right Hemisphere was doing. Recognising that the company’s tools could revolutionise their production and manufacturing processes, SAP soon signed on for a joint development and marketing agreement.
With international recognition — and significant investor support — Right Hemisphere was on track to scale globally.
In the early 2000s, New Zealand’s public sector tech investment was timid and unstructured, often delivering small, piecemeal sums to small start-ups, without a significant ‘big picture’ or strategic focus.
So Mark pitched the government a different vision: invest significantly, and bring together business, academia and capital to build a true 3D ecosystem — a 3D global centre of excellence — in New Zealand.
Negotiating directly with then prime minister Helen Clark, Mark proposed a deal that would create spinoff company Nextspace, a public/private partnership between the government, Right Hemisphere and SAP, focused on using 3D visualisation technology to improve productivity and economic opportunities for New Zealand.
Additionally, Right Hemisphere would supply free 3D software to schools and universities, and undertake certain R&D commitments.
When talks finished, Right Hemisphere had secured an US$8m interest-free loan from the government— a substantial investment at the time —and one that raised a few eyebrows in the press, with local journalists questioning the size of the loan, and just what the New Zealand taxpayer would receive in return.
Then, in 2011, to the surprise of some, Right Hemisphere was sold to SAP.
The optics may have been poor, but for all the ink spilled, the government loan was repaid in full, as were investors, with several concrete benefits delivered to New Zealand. SAP now has a large and growing development team based in New Zealand, NewZealand-built technology is being sold internationally, and offshoots like Nextspace are thriving and showing significant potential.
Also a part of the deal however, Mark would be required to go and work for SAP, leaving Nextspace to carry on without its founder at the helm.
The next move for Nextspace was to pivot to become a self-sustaining commercial enterprise. Raising money from the Ice Angels, and with help from SAP and Right Hemisphere, they it reformulated the company as a private enterprise in 2011, with the government taking a chunk of equity in return.
For the next few years Nextspace focused on building a services business around the SAP platform, but even as the company was securing major global clients, it was struggling to remain profitable.
Three more funding rounds kept the lights on, but by 2015 it was apparent that the company was facing liquidation.
Meanwhile, after three and a half years with SAP, Mark departed to pursue other interests. Fortuitously, a tender was issued by the Auckland Council issued a tender — seeking a partner to create a digital twin from the mess of data that they had at the time, and Mark realised immediately that the Council was expressing the same problem that he had seen all those years earlier in the aerospace industry.
He put in a tender, vowing that if it was successful, he would use the opportunity to solve this problem once and for all — through Nextspace — cementing long-term relationships with existing investors and supporters.
The tender was won, and Mark returned to the company he had started almost a decade earlier.
Mark’s return to Nextspace has been something of a rebirth for the company, and since then, several major software deals have been completed, including significant commercial projects for the New Zealand government and new investment. Nextspace has now secured support from NVIDIA — an important vote of confidence from the global leader in computer chip architecture — and recently raised a NZ$5m convertible note, giving the company the fuel to support its next stage of growth.
Mark’s early ideas around digital twin technology — even before it was named as such — are now coming to fruition. Excitement around digital twins, the metaverse and the omniverse is gathering pace, with key companies — including NVIDIA, ARUP, SAP andDeloitte — recognising Nextspace’s alignment and experience in the industry.
Nextspace is currently growing at a clip, with expansion plans focused on larger enterprise and government projects, dedicated to creating the next generation of digital twin technology, centred around the latest in cloud and web computing services.
Betting on Bruce
Nextspace’s key product for doing just that is Bruce, a SaaS digital twin offering that unifies multiple data types into a single, open standards data model, helping digital engineers create powerful digital twins quickly and easily.
It’s the culmination of the work Mark started 30 years ago, work that has evolved into a complete digital ontology management system. With the Bruce technology, creating digital twins integrated with CAD,BIM, GIS, IoT, Point Clouds/LIDAR and other data, is faster and easier than ever before.
It has taken some time to get to this point, but that’s understandable. Some of Mark’s ideas have been considerably ahead of the curve, and it’s taken advances in cloud-tech, IoT, high-speed communications, open APIs, hand-held 3D display devices, web-based rendering and VR, AR, and AI to bring those ideas to fruition.
Revolutions may happen overnight, but evolution takes a little longer.
The financial support that Right Hemisphere and Nextspace have received from the private and public sectors is beginning to pay even greater dividends. Wider demand for this technology is here and Nextspace is focused on creating the next generation of digital twin technology: a platform-based approach that can integrate this real-world data from these myriad IT systems and data schemas.
If they Nextspace can pull it off, the payoff will be huge. Not just because they will it have developed a data interoperability platform that makes it simpler, faster, and cheaper for digital engineers to create digital twins, but because such a platform has the potential to democratise digital twin technology itself, revolutionising the way we think about design, construction, operation and management across industry and government.
Over the longer term, this technology could profoundly impact almost all areas of life, and ultimately create a more predictable, more efficient and less wasteful world.