SciBlogs

Posts Tagged Innovation

In the rush to all things digital, are we missing a biological trick? Peter Kerr Jun 12

1 Comment

New Zealand is missing a trick when it comes to the startup weekend, incubator, accelerator programme ecosystem that’s got lots of attention lately.

And sure, I can appreciate how the digital side of things is extremely quick at developing and validating a business through processes such as Lightning Lab.

Where I wonder if we’re underplaying to one of our strengths, is in the biology/technology economy (the analogue economy perhaps?).

What would be the new research and commercialisation projects if we had fired up scientists, engineers, manufacturers,  hands-on finance and distribution people, digital experts and some other odd and even people hothoused in a similar way to the incubator models?

How much learning, cross-fertilisation and ‘ideas-worth-pursuing’ could we generate?

Would the intersection of different peoples’ thinking create new opportunities?

The answer is surely it would.

But still, you’ve got to wonder whether the gift that mother nature has given us to produce biological raw materials isn’t being leveraged to anywhere near the extent we can and should be doing.

As far as I’m aware, there’s no forum that brings a width of sector participants together to collaboratively cook up new schemes.

Obviously, the dairy, meat, wool, forestry, and fishing sectors have their conferences – but they tend to be only mildly looking-over-the-horizon talk fests.

It is rare that people come away from such events with the attitude “I didn’t realise that,” or “I wonder if there’s an opportunity with…”

Now, the last thing I’m suggesting is our country should be either digital or analogue; we should do both, and both should and do inform each other.

Examples include TracMap, started by a former Wrightson colleague Colin Brown – which has expanded from using GPS and other clever computing to expand from helping fertiliser to be applied more accurately, to a range of markets under the heading ‘Situation awareness made easy’.

In fact there’s any number of digital/analogue connections for New Zealand’s primary industry – as evidenced at last year’s initial mobile tech forum.

However, we’re less good at the market end, adding value in areas such as functional foods, or ramping up the use of wood fibre as a multi-talented resource.

I appreciate I’m merely stating the problem without coming up with many answers.

But, how can we as self-described inventive Kiwis, create and explore biological/technologydigital opportunities better; much better?

 

 


Lightning Lab II grows up – will its offspring make it to adolescence? Peter Kerr Jun 03

No Comments

 

Anyone that’s been around young children will appreciate there’s a heck of a difference between a one year old and a two year old.

A similar comparison is valid with Lightning Lab II, which last week had nine of its 10 starters from three months ago pitch to about 250 would-be investors, and a number of others who mostly filled Te Papa’s main theatre last Wednesday.

As LL itself says, it is modeling the way it works off TechStars and other USA originated accelerator initiatives.

But there’s a New Zealandness to how it is done.

So, as well as the added degree of presentation polish, one of the more notable aspects was, apart from three business asking for just under $500k each, the other six businesses were relatively low in how much money they were asking for.

This partly reflects there’s still more market validation and proof required, and also the New Zealand environment.

Often overseas startup accelerator businesses have already obtained some money (from friends, family and fools) before they begin the three month intensive mentoring and ‘is there a business here’ questioning process.

New Zealand accelerator startups at this LL tend to be less mature, and the degree of realism in the money pitch in bringing new investors onboard was one of the features this time round.

Naturally, since many of the pitches are as much about selling the sizzle as the sausage, there is a touch of scepticism required in the growth projections put forward.

But, without any due diligence, all the pitches sounded like they could – with the right combination of expertise, clear direction and luck – gear themselves up to grow.

And, rather than attempting to break down each businesses’ prospects myself, I’ll repeat Nicolai Thomson’s speculation. Nicolai, (Twitter handle, @nicolaithomson) is the founder of Lendyour.co.nz. Here are some of his, and some of his colleagues’ thoughts about the business propositions put forward at LL Demo Day.

He raises some interesting points, that investors too will no doubt explore as they look under the hood of these potential part-purchases.

In Nicolai’s words:

I don’t rate Twingl’s business model though I would totally use their product. They need to look at alternative monetisation and in the last 18 months I’ve heard their CEO twice and don’t rate his ability to spot a future trend, change and win fast enough when established companies jump on their un-patented mapping.

MishGuru, too reliant on Snapchat being a fad today, and limited audience using it. Snapchat will pass and be dead in 3 years. Their subscription plan is also fundamentally wrong as their target market is enterprise paying $10 a month. Every company will start on that level with little incentive to move to more expensive plans which would assure MishGuru can pay their bills.

Floc has a great concept but little future. Using Telco data is not going to be given to a brand new team with no reputation, and would be revoked the moment a controversial CEO or diplomat was tracked leaving their building after someone eyeballed then and identified their dot after hacking in to Floc systems. Never-mind the fact restaurants have legal obligations when it comes to employment and cancelling shifts before or on the day won’t fly for long in the name of saving the owner some dollars. Staff would likely leave and cause unnecessary headaches.

Coach Seek will be a safe bet, no spectacular exit so ideal for the risk averse of those investing. I like the product though maybe a touch too expensive starting at $49USD a month.

Cloud Cannon were my top pick, followed by CommonLedger.

CommonLedger will have a competition issue and will probably be best to position themselves to be bought out quickly. They will be overtaken by deeper pockets if their concept starts to take off. Their CEO gave the impression they are going to build a global giant and may miss a good return which some investors could be spooked by.

Cloud Cannon though probably have the closest disruptive product but I spoke to a designer friend last night and there are major concerns with SEO ability if you get quite messy code that it would deliver the site through. There is no comparison to original source code being indexed. This service cuts out the core web developers who provide the framework/CMS which is why WordPress has been so popular. If they can get SEO to be great, then it’s a winner. Again, won’t take long for others with resources to reverse engineer. Great business model though.

What I didn’t see from any of the teams though is a disruptive produce that carves out a niche which cannot simply be reversed engineered, or copied by teams with deeper pockets, more experience and crucially an existing customer base to test, and get faster feedback from. There were a couple of self-proclaimed engineers and maths geeks, however no one stated their competitive advantage was an algorithm that is one of the few things not easily replicated.

 

 

 


To business plan or startup plan? That is the question Peter Kerr May 20

No Comments

Just at the time I have no clue what to write, up turns this blog, It’s well worth repeating.

I’ve written about Nicolai Thomson and LendYour, a startup ” to be the place people come to rent”.

Here’s his very well written observations on the difference between a business plan and a startup plan…with the word rhetoric in the opening sentence.

By Nicolai Thomson, CEO, LendYour.com

Follow him on Twitter @nicolaithomson

Believe it or not, there is a big difference between a Business Plan and a Start Up Plan. The following stories come from experience and not rigid theory. Stories help illustrate points, and provide context by somehow firmly embedding knowledge in the real world, unlike rhetoric which can lack grounding.

I was sixteen and still at school when I started my first business in the UK. I designed jewellery and had it made and imported from Hong Kong, along with Indian and Brazilian style costume jewellery. This was back in 1999 so the few pieces I actually sold were at car boot fairs and markets. It was fun, but not a lot came of this business other than my sister getting a huge box of stock once I was through with it all. But still I collected my lessons and learnings.

Four years later, at age twenty, I started Executive Hospitality which later became taxiclub.co.uk. We created a basic website that could give you real-time taxi quotes driven by owner-drivers all around the UK. We also offered, minivans and executive cars in addition to normal saloon cars. We basically did half of what Uber does today, except back in 2003 so we were ahead of the game. We sold the company in November 2005 for an acceptable figure and it still operates today. I took off and travelled around the world for three months before deciding to start over in bonny New Zealand.

Although both experience were helpful and I learnt a lot, my fundamental mistake was having no Business Plan. Without well-thought-out visions and strategies the businesses floundered. We had no problems working out our short-term tactics, which got us short-term gain, but we had nothing to help us attain longer-term goals or even just a steady footing.

Too many people out there assume that a Business Plan is the first thing you should do. Don’t get me wrong, there is a place for a Business Plan, and it must be comprehensive, but if you are either thinking about, or have got beyond that to starting a business, then you need to start with a Start Up Plan. A Start Up Plan will give you time to think about the business without being bogged down in trying to work out financials or marketing strategies when you should be thinking about your vision and initial strategy.

How do you proceed with a Start Up Plan and what are the benefits?

First thing you need to think about is your vision, which should not fundamentally change unless there is a complete change in direction.

My latest venture, LendYour, started out as a simple marketplace website wanting to list holiday homes, motorhomes and boats, but that idea soon crystallised and we decided we wanted to be an international network providing mobile-first search, pricing, booking and review services for cars, vans, trucks and motorhomes — so, anything that drives on a road. Our vision, however, barely changed and has always remained “To be the place people come to rent”. Rock solid.

Do you have a grand vision for your business yet? If so, be sure to check your vision is not the same as what your product is meant to do. Your vision is what your legacy will say about you and your business. Richard Branson’s vision for Virgin is to ‘Improve society through the businesses we operate’.

Some may call this idealistic, but it reminds everyone that we’re here to enhance other people’s lives. In other words don’t be selfish, help others first. Imagine if every business in the world was there to enhance other people’s lives, and their actions were held accountable by boards and shareholders. This world would look very different!

Next is your strategy that is produced by thinking a lot about your goals and objectives. It’s OK and expected that these change often so don’t feel you are a dreamer that never does anything because strategy is the hardest, and takes the longest. It’s also what your product is. You should refer to your business idea as the benefit to your customer of using your product — don’t go around saying you are building ABC for the XYZ industry. Sell the benefits, not features because they are the things that a customer can relate to.

A company I have really enjoyed watching grow over the last six months is Groove. Their first description of the business focused on what they do, which quite rightly is “SaaS & eCommerce Customer Support”. It was bringing thousands of visitors to the site but did not get many sign-ups. Why? “… it doesn’t give me a single reason to do business with you” was the feedback.

Groove’s team then spoke with customers, asked their advice, and why they used Groove — a journey that could’ve happened at the very beginning.

The outcome and new message was “Everything you need to deliver awesome, personal support to every customer”. Conversions nearly doubled.

Perhaps building in Groove’s awesome customer support in to our software would be even more beneficial to my customers?

Think about your tactics last, as they could change daily or even hourly. Don’t be tempted to think about tactics until you have your strategy nailed. Tactics are ideas that turn your strategy into a business, which then absolutely requires a Business Plan, funding, sleepless nights and little social life.

I decided to apply the above Groove example to LendYour by describing our benefits to target customers and asking them, “If this product existed, would it be important enough that you would make it one of the top priorities for you or your company this year?”

The first client feedback shifted our strategy slightly, and after accepting and proposing that change he promptly said yes and committed to paying $25 a month for the basic plan. A sale! Talk about a confidence boost.

It’s only at this point that you need to think about detailed financial forecasts, sales strategies and marketing plans with your team.

Must haves of a Start Up Plan

Your Start Up Plan should be no more than 1 page long, and answer the following:

  1. What is the vision for your business? A good question to ask yourself is what’s the purpose of your business even existing. Be honest.

  2. Set your goals and objectives. Goals are not tangible things you can easily measure, whereas objectives are. Goals are also broad; objectives are narrow. This is how your strategies comes in to being, and are the two sentences on your Start Up Plan that you need to keep updating whenever your ideas change. Your objectives will reveal clues as to your competitive advantages too.

  3. Your team. Do a SWOT analysis on them. If you do not know what a SWOT analysis is find out. At this stage your answers to each can just be one or two words. Pretend you are in a large company, then ask yourself if you would employ the team you are heading up to launch this internal project you are writing a business case for. Again, answer honestly, and write down the concerns you would have because in a few months time you may have overcome those issues and its useful to have them written down to remind yourself of the progress you are making.

  4. Identify your three core markets or industries you are going to be involved in. This is where you go looking for your target customers.

  5. Identify what you can charge money for. Allow the answer to this question to influence your goals and objectives heavily. Neither of these questions has to be detailed at all, they are there for you to reflect on as your ideas change the strategy.

Once you have written this down, print it out and stick it on your wall somewhere you will see often. You are now ready to formulate strategies. Write them all down somewhere electronic and cloud-based so you can edit and add to them often. I use Evernote that has been absolutely amazing for this exercise. Every now and then I scroll down through my various notes about objectives and goals, growth, revenue, markets, or quotes I realise how far the business and my thinking have come.

Once you have those fundamentals it’s time to start refining that elevator pitch but don’t be rushed in to working it out until you have given due time to thinking about your strategy. If you rush, you may make mistakes and the probability of you going bust will be much higher than they need to be.

Don’t be afraid of spending an extra 2-3 months thinking and talking about your strategy to target customers. You may have noticed I have not talked about friends and family during the thinking period. Proceed with caution, because your ideas are going to change so often that you risk others close to you doubting your ideas and ability, which has serious knock-on effects to your confidence. Talk to the people who would be paying customers before friends and family.

Next, if you are up to it, write about your experience somewhere because it will be extremely useful to many people out there struggling to get to Start Up ‘first base’. Good luck!

Follow Nicolai on Twitter @nicolaithomson


Capitalising on virtual and reality Peter Kerr May 13

No Comments

Who would’ve thought that the term Holographic Virtual Reality (TM) was still there to be taken by 8i?

Equally (except we’re sort of now used to it), who would’ve thought four non-New Zealanders, who together form 8I, and who now call Wellington home, would have come together to help build the improved visual engine to power the Oculus Rift virtual reality head-mounted display.

The Oculus was initially funded through Kickstarter in 2012, and in March Facebook stumped up with $400m in cash plus $1.6bn in Facebook stock to buy the company who aims to puts the head-mounted display’s price within the reach of gamers (among other things).

Making the display, but more importantly the background code that enables the holographicness is therefore a big, complicated, maths-heavy, piece of work. The May 5 announcement on the 3D leap forward is notable.

The four person co-founder team that’s more or less self-assembled is top shelf stuff.

Australian-born Linc Gasking started and sold out of a highly success San Francisco net-based startup.

He’s recently written a self-funded study and report on “Five ways New Zealand can accelerate a sustainable high-tech ecosytem”, is a co-founder of Free Range Farms, a space, place and pace for startups, and also of Chalkle, a community based learning/teaching platform.

Joshua Feast, is a Kiwi, who has been based in Boston for a while involved in tech ventures.

Sebastian Marino, the Chief Creative Officer brings some serious applied maths and visual effects grunt to the team. He won a 1999 Academy Award for his work on virtual clothing in a Star Wars movie, and provided much of the algorithms and computation behind 77 Pieces – a 2D to 3D modelling tool that allows shows what a flat patterned piece of cut out cloth will look like as part of a pair of jeans (for example).

I’ve not met Chief Scientist Eugene d’Eon, but Mr Google reveals a Lord of the Rings involvement as well as numerous (solo and shared) publications in computer science journals with names such as ‘A layered, heterogeneous relfectance model for acquiring and rendering human skin’.

We’re very lucky these guys have chosen to base themselves here. They could set up wherever they please, so whatever secret-ether Wellington’s emitting to attract and retain this sort of talent should be bottled.

They’ll be calling on the home-grown and imported talent pool to help develop the next iteration of the Oculus Rift, and deliver a consumer product.

As Linc Gasking said in the press release, 8i is acquiring deep technology from Oculus. But equally, 8i it is also adding its own expertise, boosted to by the team it is building….people who among other work gigs have been immersed in building the 3D Avatar movie.

Oculus, and in turn Facebook don’t just choose any old random to do this sort of work.

Keep an eye on these guys as they capitalise on a time, place and collective brains sychronocity and synergy.

If we do this right, and not put the word innovation anywhere near 8i, Wellington and New Zealand could create a commercial 3D nucleus as the company scales the opportunity to make Holographic Virtual Reality the real deal.


Entrepreneurial success means starting at the end Peter Kerr May 07

No Comments

Start at the end and work backwards.

This was the ultimate, underlying piece of advice from Laura Humphreys, who has started and successfully exited two businesses in Wellington, and now among other things is relaunching herself as a business author and mentor under the Liber8me label.

Speaking to Wellington’s Entrepreneurs Club, Humphreys described how she worked her way up the advertising copywriter ladder in London, Singapore and then Wellington.

Having an “early mid-life crisis” in her late 20s, she studied other peoples’ success, (including a stint of following Robert Kiyosaki of ‘Rich Dad, Poor Dad’ fame, as he lectured around the world), she decided to create her own advertising agency.

Red Rocks, as she’d planned, was very successful, and she sold it to a multinational nine years later. One advantage was being the only woman CEO in an industry that then was dominated by male bosses (and egos!).

Her next venture was Pet Angels – a brokerage, with end to end automation between pet owners, pet carers and the whole booking, billing and payment system. It grew to having 150 angels across New Zealand, and that was sold to a competitor (as planned) two years ago.

I’ve followed the formula in a business plan. Start at the end and work backwards,” says Laura.

Approach what you’re doing as building an asset, something that can provide you with financial freedom.”

She broke the formula down to the following steps.

  1. Start with the exit in mind (think about who might want to buy it).

  2. Set your end goal(s) (how much do you want to sell it for)

  3. Paint your end picture (what are you selling, what is your model)

  4. Plan backwards with milestones (this is a map, concentrate on the first 12-18 months, then review)

  5. Plan your first and next milestone

You’ve got to think like a big dog, about what is possible, about being a big organisation from the start,” she says.

Laura a big fan of using an advisory board – and early on in her Red Rock business brought on two directors. Even though they were comparatively costly, the fact of having to monthly report to them was a hugely important discipline.


Lightning Lab grows up, gets into its groove Peter Kerr Apr 30

No Comments

The Lightning Lab’s demo day had some quite fascinating works in progress…bring on Demo (to investors) Day on May 28 at Te Papa.

The team behind LL are also, as you’d hope, a year wiser, further along a path with the aim of rapidly ramping up verified/proven businesses.

It also isn’t surprising to see the LL accelerator (now there’s a nice rhyme/assonance) expanding to Auckland next year and Christchurch.

The nine, mostly two or three man teams (and a question asked why so few females?), have had assumptions challenged, hard questions posed – as teams are forced to think about building a business as opposed to creating a product.

There is also wider value beyond the incubation itself, as Ken Erskine, director of startups at The Icehouse, (as appears in Stuff), puts it perfectly

He says research showed successful startup accelerators provided a network of highly experienced and committed mentors and investors, an active alumni network and, most importanly, connections to future capital.

Together, we have a phenomenal combined network of mentors, investors and startup entrepreneurs to help ensure the success of the nationwide accelerator programme.”

At the demo, with a small d, day on April 23, one of the three month intensive’s more interesting pivots was the horse guy.

The original pitch was to do something to make horse shoeing more easy. But the team lead by Ashok is now looking to create a tool so that businesses can run campaigns on SnapChat (the instant appear/disappear photo app).

The guys looking to build a tool to automate translating accounting figures from say Xero, MYOB or QuickBooks to an accountant’s own chart of accounts has already got strong traction and demand.

One of the startups wants to capture, retain and effectively distribute that deep institutional knowledge longertime employees have about a company and how it works.

There’s an app to help the hospitality industry manage its staff/flow requirements, and software for managing shared expenses – as in flatmate situations. An easy, no-bugs way to get a web design quickly going live and updateable, a water tank monitor device, management software for sports coaches, and an app that uses social networks as a way to connect offline – say a quick game of tennis – were explained, and a brief lessons learned given by all.

Finally, and this will be interesting to see if they can get it right – a map that shows where you’ve been on web searches – a way of collecting notes and creating shortcuts through the world’s knowledge.

So, obviously no shortage of ideas up for grabs.

But, as we all know, ideas are easy – it is getting them to sustain flight that’s the trick.

And, an interesting final note:- LL is a partnership between founding investor partners (who receive a percentage share of any startup’s initial offer) and MBIE, part of its accelerator funding pool.


The Kiwi innovation space is starting to look awfully crowded Peter Kerr Apr 16

2 Comments

Is it just me, or is the innovation/commercialisation space looking awfully crowded and confused these days?

Sure, we like to think we’re (NZ Inc) inventive and entrepreneurial.

But there seem to be more entities out there offering innovation (and I shudder to use the term) advice, funding and connections than there are companies with good ideas.

Wearing my taxpayer’s hat, I have no problem when private money puts their proverbial on the line and takes a punt on a startup or early stage company being the next big market success.

Therefore the angel investor community, private equity companies and even family, friends and fools are to be admired and encouraged.

But the plethora of government, university and regionally financed organisations servicing our entrepreneurs is started to look very overlapping, rather uncoordinated; and the lack of transactions by some players needs to be questioned.

A cursory list includes (I’m not sure if I should apologise for accidentally missing some!):

NZVIF

Callaghan Innovation

MBIE (well, parts of it)

KiwiNet (and the individual university commercialisation units that are part of it)

Icehouse

SODA

BBC

CreativeHQ

powerHouse

Sparkbox

In fact this blog was inspired by the recent announcement that there is to be a merger between Wellington-based Kerasi Ltd, and powerHouse – though Kerasi’s website states it is a powerHouse partner so decide for yourself who the kingpin.

powerHouse has also recently announced a merger with Dunedin incubator Upstart.

Then there’s a new body I’d never heard of – Innovation Council NZ.

Again, one of its main sponsors is government via Callaghan Innovation.

All in all, I’m afraid it means that there is quite a bit of overhead costs to be paid for by someone (us) as all and sundry scramble around looking for something to invest in.

In other words, there’s lots of pedaling by a lot of people, but without the sense of urgency that having your own money invested brings to the game.

There will be a lot of meetings though, and any number of bureaucratic hoops to jump through to make sure that ‘value’ is being delivered to the taxpayer.

And then, by the time that someone higher up that government food chain ponders the question of whether flinging a whole lot of money at innovation, and seeing what sticks, actually does work, it’ll be time for another change of policy.

But by then minister of everything Steven Joyce will probably have ditched the science and innovation part of his portfolio!


Re-arranging science funding’s deck chairs Peter Kerr Apr 09

2 Comments

Well, I guess you can’t have too many science funding bodies…

An alert colleague pointed out a GETS call for applications for – Capability in Independent Research Organisations Funding. (GETS Reference: 41196)

This fund is aimed at non-Crown Research Institutes,

“which hold significant research capabilities supporting national outcomes in areas of government priority.”

This will appeal to organisations such as the Cawthron Institute, HERA (Heavy Engineering Research Association), Opus Research and other independent researchers. (You can see a full list here at IRANZ, the Independent Research Associations of NZ).

The major surprise is that this fund is to be administered by the Health Research Council (HRC).

In a way it all makes perfectly logical sense given the way that science, innovation and commercialisation ‘policy’ (used in the very loosest terminology) has gone over the past few years

We had science policy and funding being separated – a Ministry and a Foundation for R,S & T.

Then these two were brought together to have a Ministry of Science and Innovation.

That lasted about five minutes, and MBIE was set up, with much of its funding allocation removed when Callaghan Innovation came, and is coming into, being.

Oh, there’s also the Primary Research Growth Partnership administered by the Ministry of Primary Industry as another entity entirely.

And now this.

The HRC does make funding allocations to researchers in health – which presumably they have a fair degree of expertise to do so.

Now they’ve got to become experts in a wide range of research fields, completely unrelated to their core knowledge.

Instead of the fund being under MBIE, and aligned to its overarching goals which seeing as it helped write them it should understand, a completely different body gets to do the choosing.

I guess, when as a country, we have no clear idea of what we should be concentrating our limited scientific endeavours on, then spreading the resource ever more thinly and hoping something, anything, serendipitously happens to happen is as good as any other approach.

But it takes us ever further away from the exemplar countries such as Denmark and Singapore – countries that have a plan, stick to it for a bit, and then modify what they do to achieve the clear goals that they have.

Talk about re-arranging the deck chairs!


‘Fire engine envy’ + time = sales Peter Kerr Apr 01

No Comments

Fire engine envy.

No, I never knew that such a condition existed, though it kinda makes sense if you happen to be involved in the fire fighting business.

But fire engine envy is one of many factors that’s assisted Lower Hutt’s Fraser Engineering into a pre-eminent position as an Australasian manufacturer of such tenders.

Speaking at a recent gathering of Technology Valley participants (and totally coincidentally, held at Petone’s Fireman’s Arms pub), Fraser’s general manager Martin Simpson told of how firemen looking enviously at the units put together by his own company, make comments that gradually and ever so slowly filter up to positively influence decisions made by a purchasing officer.

Fraser’s manufacture virtually everything in a fire engine tender beyond an imported truck chassis and cab (though they’re thinking about building this as well).

It starts with feedback and input from real firemen.

Hosereels, pumps, valves, nozzles, cabinents and the whole kit and caboddle are designed from scratch, from single components up, on a SolidWorks 3D CAD software platform.

Most of them are then created through the use of more than $20 million of manufacturing equipment, including an increasing amount of 3D (additive) metal and other products printing.

The demands of fire fighters are an important element in designing extremely robust equipment.

“A fireman’s pumped with adrenalin when they’re in action,” says Martin.

“They don’t want to be grabbing something in the heat of the moment…and it breaks. Likewise, a pump must start first time, every time.”

Another aspect of firemen psychology is that, during some of their downtime (mostly they’re not fighting fires), they’ll often surf the net, checking out tools of their trade. (You can imagine that this sort of exercise would certainly contriubte to fire engine envy!)

Martin says that unlike some of their competitors’ fire engines, all Frasers’ vehicles are immediately able to go into service (commissioning is relatively easy). The company also concentrates on the “whole of life cost” of the tenders, noting that Fraser’s has virtually zero warranty issues. In other words, the fire engines work first time, for a long time.

It is information and feedback such as this that slowly filters through the fire services of different states and countries – helping to build Fraser’s reputation.

Martin says Fraser’s is helping to organise a major fire fighting conference to take place in Wellington in September 2014, which may be attended by up to 2000 people.

“If there’s any other fire fighting related companies who would like to attend this event that will have every purchasing officer from Australia and New Zealand there, as well as a swag from other countries, we’ve love to hear from them,” he says.


Fraser Engineering; a billion dollar company in the making Peter Kerr Mar 26

1 Comment

Well, you can’t accuse Hutt Valley-based Fraser Engineering of lacking ambition.

Speaking at a recent Technology Valley get-together, general manager Martin Simpson says it wants to be a billion dollar company.

The 60 year old private company with 100 designers, engineers and fabrication and production specialists has tweaked what it makes a number of times over the years – with its latest incarnation having manufacture of fully-specified fire engines as one of its major product lines.

Fraser’s are now the largest fire engine manufacturer in the Pacific area, and one of the largest in the world.  All of this has been achieved by ploughing profits back into the business, and NOT outsourcing to the likes of China.  It means that the company has more than $20 million of manufacturing ‘kit’, from 3D laser printers, to laser cutters, 9-axis machine tools to powder-coating facilities.

However, all this machinery starts and interacts with a Solidworks 3D CAD design software. (Martin noted that there’s a very large bill that the company has to pay for licence fees for this capability as one of the largest privately-owned users in New Zealand).

As a result Fraser’s are able to barcode-view the manufacture of every single part of the appliance, control valves, nozzles, hose reels and host of other components that make up a fire engine (or any other job it does for outside clients). From materials to drawings, purchasing and all aspects of turning raw metal into often very complex finished components, Fraser’s can track the process and progress of any individual part.

Should a replacement part be required, Fraser’s can find its specifications virtually instantly, and be able to produce it on the spot if required.

By maintaining a design-led in-house manufacturing and engineering capacity, “we’re now a powerhouse that can compete with anyone in Australasia,” Martin says.

“In fact, we’re advancing our manufacturing capability so quickly, our opposition can’t keep up.”

This in-house expertise also means that Fraser’s know to a few cents, how much an item costs to manufacture. Detailed information and internal reporting such as this is one reason that Fraser’s is now building 20-30 fire engines at any one time.

The company also has an intellectual property strategy that isn’t based on patents.

“The way we do it is to keep ahead of the competition,” says Martin. “If you copy you will never lead.”

Martin is also dubious (to say the least) about some of the ‘advice’ received over the years from government ministries.

Fraser’s deliberately didn’t outsource parts of its manufacturing to China. An observation he’s made of other engineering companies who have done so, is the waiting and co-ordination required to make sure hundreds of parts arrive on-time to create the component. This wait, and just as important the resultant delay in getting paid by your own customers is part of the reason the company has been so insistent on being a one-stop-shop, and/or outsourcing some manufacturing elements  to local collaborative partners.

Control of the process is key.

“Don’t sell your assets,” was one of Martin’s take-home points. “It keeps you in control.”

He says an exemplar company for Fraser’s is Rosenbauer.

They are often asked (with incentives) whether they would also like to establish themselves over the ditch.  In the meantime though growth will come through being smarter than their opposition.

That, and no doubt, a large degree of listening to themselves and not to others who don’t have skin in the game.


Network-wide options by YD - Freelance Wordpress Developer