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From Startups to Success
Posted By DAR Web On April 28, 2010 @ 8:35 pm In Feature, Spring 2010 | No Comments
A solar company president who introduced President Barack Obama at the Denver Museum of Nature and Science, showcasing how the sun powers the museum’s environmental system.
Two engineers who lead what Forbes magazine named the most promising company in America.
A president and CEO whose company saves money for commercial building owners through modular-based energy efficient heating and cooling recovery systems.
A spine surgeon who created health beverages.
What do they have in common? They’re all Vanderbilt engineers who launched successful businesses. Their methods?
Creativity and collaboration, a focus on giving people what they want, plus access to capital, savvy management and a singular passion for making great ideas reality.
Blake Jones, BE’96, says opportunities are everywhere for entrepreneurs who are motivated and willing to learn. His Boulder, Colo.-based company, Namasté Solar, emerged from his 10 years as a civil engineer and project manager in the U.S. and Egypt for an oil services company. Later, he was engineering and service manager for a renewable energy company in Nepal. His return to the United States in 2004 coincided with Colorado’s passage of legislation mandating that a portion of the state’s power come from renewable resources.
“I realized that everything I’d been doing had led me to this point,” says Jones, who credits his Vanderbilt engineering education with turning him on to the potential of solar energy. He says that Colorado’s abundant sunshine—along with Boulder’s educated, affluent residents—reinforced the choice of location for Namasté Solar.
In February 2009, Jones introduced President Obama at the signing of the American Recovery and Reinvestment Act in Denver. Since clean energy and the creation of green jobs were a large part of the president’s stimulus package, the connection was natural.
Presidential connection aside, Namasté Solar still faces the challenges of being an entrepreneurial startup. Jones advises rising entrepreneurs to do work they love, to network continuously with other professionals and in their community to find new opportunities, and more important, “never be too proud to ask for ideas and help.”
Chris McKinney, director of the Vanderbilt’s Office of Technology Transfer and Enterprise Development (OTTED) and adjunct professor of engineering management, says that is good advice. “Entrepreneurship is a team sport. The best entrepreneurs look for the best people to complement their skills. It’s about leveraging your assets and finding others to help with the rest.”
OTTED is Vanderbilt’s own entrepreneurial link. It protects the intellectual property assets of Vanderbilt, licenses technology developed by Vanderbilt inventors and innovators, and assists in the startup of companies that commercialize Vanderbilt technology.
McKinney says the myth of overnight success falls flat under close examination. “An entrepreneur is willing to knock his head against the wall. Try. Fail. Try. Fail,” he says, adding that he believes VUSE students are predisposed to entrepreneurship through the depth and breadth of their education, work with entrepreneurial faculty, and ability to manage and communicate.
Management was one of the elements that recently led Forbes magazine to name VEXTEC (see sidebar) the most promising company in America. The pioneering company founded and led by Bob Tryon, PhD’96, chief technology officer; Animesh Dey, MS’94, PhD’96, chief product development officer; and Loren Nasser, CEO, beat out thousands of other companies for the Forbes honor. Forbes selected VEXTEC for the quality of its management, technology and opportunity, stating that the Brentwood, Tenn., company represented the very spirit of entrepreneurship in America.
VEXTEC uses computer modeling and materials science to predict the reliability of a product or product component. One of its greatest assets is the way its technology and leadership bring together the resources and people across an organization. “Each market sector has its own challenges,” Dey says. “Success for us comes from recognizing that the objective is the same—understanding when something is going to break and helping the client translate that to improved reliability.”
There’s a lot of wasted energy in the cooling of commercial buildings. To take advantage of this issue, Mark Platt, BE’87, used his own money, plus funds he raised, to buy and expand Multistack, a modular chiller and cooling products manufacturer. Focused on innovative air conditioning technology, the company has grown 700 percent since 2002; its compact equipment has been installed in facilities such as manufacturing plants, blood banks and even the notoriously cold Ed Sullivan Theater in New York City, where The Late Show With David Letterman is taped.
Recently, Platt and Multistack were finalists for Ernst & Young’s Entrepreneur of the Year award. “Multistack’s success comes from our ability to recognize new, disruptive technology and leverage it into products that save customers money,” Platt says.
He confesses Multistack’s maturation has been a learn-as-you-go enterprise, one in which he raised $3 million of seed capital. “It’s amazing what you can accomplish when you don’t know it’s impossible,” he quips.
He credits close relationships with customers and employees with fostering a home run. “We’re always looking for the next big idea. We fight the drag of our success. Our philosophy is do the right thing for customers quicker, rather than later,” the company’s president and CEO explains. “Life is relationships. Everything else is noise.”
The groundwork for entrepreneurship, say Vanderbilt University School of Engineering faculty, is laid in the classroom and occurs on many levels; the multidisciplinary senior design project course brings it all into focus.
“This required class is a launching pad and an opportunity for students to go through the normal design frustrations, where they spark off each other’s ideas and learn teamwork,” says Paul King, professor of mechanical and biomedical engineering, emeritus, who has taught the yearlong class since 1991. “Teams learn to work inside and outside the box, to solve real problems, to follow a structured approach and how to brainstorm.”
For those who want an edge and more of the tools entrepreneurs need, VUSE also offers an engineering management minor. The interdisciplinary program teaches business management as it relates to engineering, with a special emphasis on issues involving technology development and innovation.
“The challenge is learning to manage implementation of their creative ideas so they’ll generate positive cash flow quickly,” says David Berezov, adjunct professor of engineering management. That, in turn, attracts capital and growth. “It’s eye-opening for students to see firsthand how an idea, its financing and operation come together, and to see the relationship between technologies and the underlying financial profit.”
Dr. Alex Hughes, BE’99, MD’03, agrees. A spine surgeon who developed a line of health drinks under the brand name Function Drinks, he puts it this way. “You need to be realistic, know what the market opportunity is, and have accounted for the back-of-the-envelope costs,” the biomedical engineering graduate advises. “Look at the trends and the potential legal issues and do due diligence with competitors. Sure you have an end vision but also know it’s not religion—that you have to approach it like science.” Function Drinks, available in stores such as Target and Whole Foods, was named the best new product of 2007 by BevNet, a leading beverage industry authority.
An entrepreneur who now works in consulting services, Gary York, BE’81, has been involved in launching several successful software companies. “Ten people see the same problem you see but seven won’t do anything about it. Three will and they’ll be your competitors, so you have to execute it better,” says York, who advises less experienced entrepreneurs and who has been described as a serial entrepreneur. Key in launching a new product, he says, is partnering with a paying customer whose business serves as both a proving ground and validation for investors (and the market) that your product has potential.
David Limp, BS’88, a Silicon Valley veteran associated with multiple entrepreneurial successes including PalmSource, says it all comes down to two things. “You’ve got to articulate and execute an idea that captures the imagination of customers,” says Limp, who has worked both on the development and financing side of entrepreneurial ventures (see sidebar). “If you can do that, you can find someone to write you a check.”
But that check, he warns, isn’t technological or creative carte blanche. “Your inclination as an engineer may be to solve a problem in the most creative way, to strive for perfection,” he cautions. “You have to understand that what the customer wants and needs may not be the perfect way of solving a problem, but it is the right way. To be successful, engineer/entrepreneurs must learn to balance those dynamics.”
Entrepreneurial ventures often occur when engineers combine interests with a challenge. Chikai Ohazama, BE’94, developed the product that became Google Earth by combining interests in 3-D graphics, medical imaging and geospatial data. Sunil Paul, BE’87, co-founded two successful Internet firms and today is a venture capitalist with interests in clean energy technology. His wife’s frustration with spam emails sparked Paul’s development of Brightmail Inc., an anti-spam computer software firm later purchased by Symantec.
Jordan Eisenberg, BS’04, pursues similar success and personal interests. Eisenberg has developed and licensed a medical device concept to a major manufacturer, authored and applied for two patents, and launched a company to market and distribute his products. He credits his widespread entrepreneurism with the problem-solving skills he learned at Vanderbilt. “Would you rather have several small businesses that are profitable or one large one that isn’t?” he says pragmatically.
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