Imagine you’re strolling through the aisles of a supermarket and just as you approach your favorite pasta sauce, a virtual “buy one, get one free” coupon for the product, redeemable at checkout, appears on your smartphone. Rather than having you page through a weekly compilation of in-store offers—that’s so 20th century—the store has delivered the coupon directly to your phone based on your current location and shopping history.

Making this possible are standard overhead LED lights that not only illuminate the room but also function as an indoor GPS. Enhanced with microchips, the bulbs contain sophisticated software that causes them to flicker fast enough to transmit a distinctive, information-rich signal that a smartphone camera can detect and a retailer’s mobile app can decode.

In just three years, the Boston-based startup that developed the software, ByteLight, has become a market leader in indoor location solutions, a burgeoning industry enabling mobile device users to access discounts, directions, and other highly targeted services at precise locations within buildings. Energized by a recent influx of $3 million from investors, ByteLight is piloting its technology at several global retailers, including 3 of the top 10 big-box stores, as well as at 100 stores in China.

Spearheading this success story is ByteLight’s CEO, Daniel Ryan (ENG’10), who cofounded the company with classmate Aaron Ganick (ENG’10) in 2011 based on concepts they studied and implemented as research assistants in ENG professor of electrical and computer engineering Thomas Little’s NSF Smart Lighting Engineering Research Center. Inspired to pursue careers in electrical engineering by childhood visits to Boston’s Museum of Science, Ryan and Ganick devised ByteLight’s core technology in the lab, developed a prototype and business plan in the technology incubator space at the BU Photonics Center and Highland Capital Partner’s Summer Program, and then raised sufficient capital to launch the company. While Ganick moved on last year to pursue other endeavors, Ryan continues to grow ByteLight to meet a surging demand for its unique indoor location solution.

As a smartphone-toting customer approaches a product in a department store, the ByteLight app displays discount information. Photo courtesy of ByteLight

It’s a demand driven partly by the rapid adoption of LEDs, and partly by the product’s market-leading accuracy, responsiveness, and reliability. LED lights equipped with ByteLight software can pinpoint a mobile device user’s location to within one meter in less than a second—far outpacing the performance of other indoor positioning systems developed by industry giants, including Apple and Google, that triangulate distances between hotpots and handsets on wireless networks.

“Sub-meter accuracy has long been the holy grail for retailers experimenting with indoor location,” says Ryan. “With ByteLight, retailers finally have the opportunity to install a wall-to-wall solution that just works.”

Also lifting ByteLight above its competitors are its low infrastructure cost and compatibility with all mobile devices. Unlike other solutions that require additional hardware such as WiFi hotspots or Bluetooth beacons, ByteLight software exploits an existing and ubiquitous infrastructure: overhead lighting. ByteLight not only uses light waves to transmit useful information to smartphone-toting customers at specific locations, but also to quickly and securely verify their presence for loyalty programs, mobile payments, and more at “tap-and-go” check-in and check-out locations equipped with the company’s Light Field Communication readers. Compatible with all smartphones, the ByteLight readers cost five percent as much as the increasingly popular Near Field Communication (NFC) readers, which use radio signals to process such transactions and work only with a limited set of mobile devices.

Once integrated into a retailer’s app and LED lights, ByteLight software promises to boost customer loyalty and sales by delivering personalized savings from store shelf to checkout. Since ByteLight technology was introduced in 100 stores in China, the stores have seen a 30 percent increase in loyalty reward redemptions.

“Brick-and-mortar retailers are demanding new solutions that can leverage digital assets within physical store locations to engage and retain customers,” says Don Dodge, developer advocate at Google and an industry leader in indoor location technology. “ByteLight’s indoor location solutions assist retailers with delivering hyper-targeted information and content to customers on mobile devices within their stores based on the device’s precise location. More importantly, these solutions fully integrate physical commerce with eCommerce to give retailers an omni-channel offering.”

ByteLight software exploits an existing and ubiquitous infrastructure: overhead lighting. Photo by Dan Watkins

ByteLight’s primary focus is on the retail industry, but the company’s technology could also be deployed in venues ranging from museums—including Boston’s Museum of Science, where ByteLight is used in one exhibit to display location-sensitive content—to factories to airplanes. To expand the company’s repertoire, ByteLight provides its customers with a software development kit they can use to invent new applications for the software-enhanced lights. In the coming years, as the use of LED lighting and mobile devices continues to grow, Ryan envisions integrating ByteLight technology into stadiums, conference centers, schools, office buildings, hospitals, and other domains.

Little, who is also affiliated with ENG’s division of systems engineering, served as mentor to Ryan during his undergraduate years, and is now an adviser to the company. He is bullish about his former student’s prospects. “Dan is an exceptional individual who epitomizes what engineering school is all about—learning to solve problems. Any problem,” says Little. “And to be adaptable and agile in a continuously changing technological world. He has demonstrated the ability to deliver a product coupled with software integration and analytics that support a complex supply and distribution chain with diverse market stakeholders.”

In his role as ByteLight’s CEO, Ryan draws on engineering, entrepreneurial, and interpersonal skills that he cultivated at ENG, where he helped launch a small satellite while participating in the BU Student Satellite for Applications and Training (BUSAT) program, took an ENG/SMG course in entrepreneurship, and served as the Class of 2010 Commencement speaker. Today, as he steers ByteLight toward a rollout in US stores from a new office in Boston’s Fort Point Channel neighborhood, Ryan finds himself applying these skills to solve a full spectrum of problems.

“Each day brings a new problem, ranging from product development to technology to new competition,” he says. “The key to responding effectively and moving forward through the chaos is your team. It’s that simple. At ByteLight, we’ve been fortunate to build an incredibly talented core of technologists to take our vision and turn it into reality.”

One of Ryan’s valued team members is former classmate, Manny Malandrakis (ENG’10), one of the first ENG alumni to become a ByteLight employee. He focuses on digital signal processing and communications systems, the subject of two courses he took as an undergraduate.

“These classes were the foundation of this company,” says Ryan. “We’re leveraging the core theories and techniques we learned in these courses every day.”

A version of this story was originally published in the spring 2014 edition of Engineer.