“We are happy to celebrate the opening of the TRuCapSol lab here at Bridgeworks,” said AEDC Executive Director Scott Unger. “Not only have they made a considerable investment in their facility, but they have also brought a highly talented team on board to grow the company.”
TRuCapSol (Time Release Capsule Solutions) is a company that takes high-value actives, uses their materials expertise to encase them to form micron-sized balloons, such that these balloons retain the active in the supply chain, then release the active over a duration of time. The company is focused on utilizing natural materials, which allows them to produce environmentally friendly and world-class capsules. By utilizing their patented technology and production processes, TRuCapSol can decrease waste and improve the effectiveness of the formulations delivered to their customers. The company’s initial product line will focus on the consumer goods space, specifically laundry products such as detergents, fabric softeners, etc. TRuCapSol has six scientists working out of the Bridgeworks location.
“We are enthusiastic to be a part of the Bridgeworks community,” said TRuCapSol CTO Jiten Dihora. “It is a great culture fit for us and allows us to scale-up technologies from the bench scale to pilot plant scale.”
AEDC Program Manager Anthony Durante was also excited to see the TRuCapSol lab space come to life.
“The team at TRuCapSol has built out an amazing space, the first of its kind in the building,” said Durante. “Not only will it serve their company well for several years, but it will be a terrific space for another startup company needing a wet lab that is suited for scaling up from R&D to production.”
1. What is one thing you did that really helped the company take big steps forward in growth?
Mike Grather – We stepped outside of our comfort zone and pursued some research opportunities that required the purchase of new equipment. Although the research work itself didn’t generate a lot of income, it opened the door for some other types of work that later became a large percentage of our revenue stream.
Stephen Maund – Setting recurring corporate goals – Setting goals are not just for large corporations! They don’t have to be overly complicated, and as a matter of fact, shouldn’t be. Goals should be easily understood by everyone on the team. By setting three basic goals and a frequency by which to measure progress, we are able to have a consistent double-digit percentage revenue growth year-over-year. Our goals are measured in annual or biennial timeframes and target new customer/partner acquisition, new technology advancements, and product development. For us, new long-term customer/partners and keeping in front of technology are paramount to long-term growth and success.
Terry Rufer – There wasn’t one thing, per se. It is a combination of all aspects of a business from legal, finance, and marketing, to production and hard-working people. You have to do them all, even the ones you don’t like! As they say, “cash flow is king,” and Engineering Manager and Treasurer Ajay Khatri, in particular, stayed on top of that, which kept us going.
2. What is the one thing that you thought was a good idea at the time but didn’t work out as well as you expected it would?
Mike Grather – We continued to expand for many years without spending the resources necessary to create the infrastructure for expansion. There’s only so much work that a company can handle while also working evenings and weekends. It seemed like a good idea at the time because we weren’t sure that the demand was going to continue to increase. At a certain point, however, it becomes imperative to have faith that the demand will continue, and invest in the infrastructure that will allow the company to grow.
Stephen Maund – Self-Financing a move to a new facility – We’ve been in a consistent growth phase as a company and were in dire need of a facility expansion. After reviewing the moving/improvement cost budget, business disruption, impact to projected cash flow, and operating line of credit, it seemed that self-financing the move was the way to go. In retrospect, keeping cash available for expanding other aspects of the company operation would have been a much better decision. A term loan for facility expansion would have been the wiser choice.
Terry Rufer – I guess a comprehensive business plan seemed like a good idea, but after a month or two it completely changes as you engage the market and spend your time and money. A comprehensive business plan is good for getting a loan, but not for a fast-changing business environment. Small business does not have time for comprehensive plans and it eats up way too much time. Simple PowerPoint bullets and roadmaps that can quickly be adapted to the fast changes most small business startups have to deal with works much better with far less time invested. If it is simpler you tend to do it more regularly, which also is why we ended up with this process. Planning is important, so for us, the simpler approach of continuously updating plans work very well because we are more inclined to do it.
3. If there was something you could do over again with your company, what would it be and why?
Mike Grather – I would focus more energy on the development of processes and systems, and less energy on the day-to-day work of the business. Although the day-to-day work is very important, if you spend your energy creating processes around your main activities, you can begin to scale your operations for growth. In my opinion, this balance between day-to-day work and working on infrastructure has always been one of the biggest challenges.
Stephen Maund – Grow a little faster – Developing one-of-a-kind advanced technology systems is a risky venture. It’s challenging to balance aggressive growth and risk mitigation. Growing a little faster and not being too risk-averse would be one thing I’d change.
Terry Rufer – We were sued shortly after we started and it slowed us down dramatically by years. Make sure you meet with a good lawyer before you start, and don’t think no one will sue you. We did not do this and got caught off guard in a surprise attack and it dragged on for 8 years. If we had been properly protected and ready with a good lawyer it would have been over fast and without gobs of money spent. And it does not matter if you are in the right, so don’t fall for that since being right does not matter in court realistically. The legal system is designed to generate money for the legal system and bleed you and the other party of cash, so the entity that has the most money wins, which is never the new startup because it’s always short on cash and time.
By Anthony Durante, Program Manager, Bridgeworks Enterprise Center
At least once per week, I have this conversation with a prospective entrepreneur:
Entrepreneur: “I have an awesome idea for a product!”
Me: “What problem are you solving for your potential customers?”
(Entrepreneur responds with a long list of features that he or she is planning to build into the product.)
Me: “But what does the customer actually NEED the product to do?”
(Entrepreneur launches into another excited explanation of how awesome the product is and how everyone will need one.)
Me: “Have you actually spoken to a potential customer about your idea, or maybe gotten one to agree to buy or test the product when it’s built?”
Entrepreneur: “No, why would I have done that? I have been working on this awesome idea. Isn’t it awesome?”
Internet entrepreneur and venture capitalist Marc Andreessen defined product/market fit as such: “Product/market fit means being in a good market with a product that can satisfy that market.”
Dan Olsen, the author of The Lean Product Playbook, further defines product/market fit as the end-game where a startup has built a product that creates significant customer value. “This means that your product meets real customer needs and does so in a way that is better than the alternatives,” Olsen explains.
Put simply, if you have a quality product that solves a painful problem for a lot of people, then you can probably build a company around making that product. Ironically, this seems to be one of the primary stumbling blocks for many of the prospective entrepreneurs that I come across.
Finding Product/Market Fit – Customer Discovery
I recently watched a great video (see below) posted by Philadelphia venture capital firm First Round Capital, where Michael Sippey, a former Twitter executive, says: “If you can’t get 30 meetings, you don’t have a product.” In other words, if you can’t find 30 target customers who are willing to sit down with you to discuss how you are going to solve a very painful problem for them, then you’re probably not solving a real problem that they have.
The crux of this is simple. As an entrepreneur, you need to validate your assumptions as quickly and inexpensively as possible. This means getting out in front of your customers, asking simple basic questions, and listening carefully to the answers. Sippey says that this process can be covered in a simple one-hour meeting by asking the following:
We think you have this problem. Do you have this problem?
How are you solving the problem today?
How does this problem impact your business?
How much are you spending to solve the problem?
Here’s how we think that we can solve that problem.
Feedback and next steps
What can you learn?
Obviously, some of the key discoveries you can make through this process are:
The customer really doesn’t have the problem.
The problem isn’t as big as was originally expected.
The proposed solution misses the mark in a major way.
Although these discoveries may sound catastrophic, it’s extremely important to learn them very early on in the process. Otherwise, considerable amounts of time and money may be wasted on creating something no one will buy. At the same time, by getting this information you can redirect your efforts to build the ideal product that solves a big problem in the market.
There are other key things that can be discovered during this process. One might be the realization that the person you thought was the customer may not be. For example, there may be a distributor between you and the end user who will be influential in getting your product out into the market. It may turn out that the distributor is really your customer – not the end user.
Another could be that the end user whose problem you are solving may not be the person who makes the buying decision. Although it will be early in the process to make this discovery, it will be something that you want to keep in mind as you get closer to going to market because your messaging will need to be customized for each group in the decision process.
What it’s all about
Mr. Sippey brings goals of this customer interaction process together very succinctly in three questions,“What problem are we solving? Who are we solving it for? How will we measure success?” These are the key questions to be answered through face-to-face interactions with the target customer.
In the end, the key thing an entrepreneur wants to do is expose themselves and their product idea to the market as early as possible. The sooner they can validate their assumptions, the quicker they can craft the right solution for their future customers.