NovaCentrix’s chief technology officer Kurt Schroder reflects on the company’s rocky early years and describes how a pivot into printable electronics changed its trajectory
How did you get into nanotechnology?
I grew up on a farm in southern Indiana and, to be honest, I must have been born a physicist because I didn’t really fit in with the farmers. It wasn’t until I arrived at Massachusetts Institute of Technology (MIT) as an undergraduate that I found my people. After I received my bachelor’s degree I spent a couple of years designing weapons for the US Navy, and then I went to graduate school to study plasma physics because I was really interested in fusion research. However, oil was cheap at the time, so the Department of Energy cut our funding. One day, my PhD adviser pulled me aside and told me that I could start drinking a lot of coffee and get in at 7 a.m. every day to finish my PhD before the money ran out, or I could get a Master’s degree. I chose the former, which somewhat ruined my health. However, the output from that work led to what really got my career started.
It turns out I was a better inventor than I was a physicist – inventing is part physics, part engineering and part business, all mixed together – and my biggest invention came as I was trying to finish graduate school. I was feeling a little depressed because I had thought I was going to be a fusion researcher for the rest of my life, but then I happened to walk into a Walmart and as I was looking at their hammers I realized every hammer that had ever been made had been designed incorrectly. If you hammer things all day long with an ordinary hammer, the shock and vibration will eventually give you lateral epicondylitis, or tennis elbow. Manufacturers knew this and designed the shape of their hammer heads to minimize this effect, but that leaves you with a hammer with reduced momentum transfer. I figured out that if you put air into the hammer’s grip in certain strategic locations, you can eliminate most of the shock and vibration, and that allows you to change the shape of the hammer to give it greater momentum transfer. Now, almost all hammers sold in the US have this technology in them. The invention has sold about $1.5bn in total, and I ended up applying a lot of the skills I learned in developing the hammer to my work at NovaCentrix (which was then called Nanotechnologies, Inc. – we’ve gone through about four different names).
How did you become involved in NovaCentrix?
I was hired by the founder of our company because I was an inventor, not because I had a plasma physics background – although the latter did help. Our original device began as a weapon during the Strategic Defense Initiative in the 1980s. We changed it around to make nanoparticles instead. The current device uses an intense, pulsed arc discharge (~100 kA) – a synthetic lightning bolt, if you will – to ablate electrodes, and make silver and aluminium nanoparticles. These particles have several interesting applications, and we still sell them industrially, but it’s hard to make a living and pay the bills when you’re just selling particles. By 2004, the company was in the process of going bankrupt, so I decided to start experimenting. I knew I was going to lose my job anyway, so I thought I would at least have some fun. That’s what led us into printed electronics and the photonic curing technology we use now.
How did that invention develop?
At the time, I had not really heard of printed electronics. I just thought “Wouldn’t it be interesting if you could use an ordinary printer to print an electronic circuit onto plastic or paper?” So I was approaching it from a fresh perspective, and we had these silver nanoparticles. I thought, hmm, I could take these particles, make a dispersion out of them, put it in an inkjet printer cartridge and use the printer to print silver traces. I was able to print the traces, but the bigger issue was that in order to make wires, you have to sinter the particles together. This is a little problematic as silver melts at 962 °C, but paper famously combusts at Fahrenheit 451 (233 °C). You don’t need 962 °C to sinter silver nanoparticles, as chemical and other techniques somewhat work, but in order to be effective and do it quickly, you still need a much higher temperature than paper or plastic can take.
Now, recall we were already using a pulsed-plasma device to make nanoparticles. It makes a lot of light, and as I had a background in radiation, I theorized that I could use a flash of light from a flashlamp to heat these silver traces and sinter them in less than a millisecond, without damaging the plastic or paper substrate. It worked! As we already knew how to make reliable, intense arc discharges, scaling this new process up by building an industrial flashlamp system was within our capabilities. To use a very relevant analogy, if all you have is a hammer, everything looks like a nail, and that’s how we developed the process we call photonic curing.
As a start-up, your team is not your most important asset. Neither is your technology – despite what your technical people might think
What are the advantages of that process?
If you really want to make circuits cheaply, you probably need to print them, and if you want to make a lot of them, you need to do so on a big roll of paper or plastic. The printing can be done fairly quickly, but if the ink takes 10 minutes to cure, and you’re running the roll through an oven at, say, 100 m per minute, you’re going to need a kilometre-long oven. That isn’t practical, and although you can squeeze it down a little bit, you will still end up with an oven the size of a large building. We’ve replaced that with a device called a PulseForge® that is less than 1 m long and uses a fraction of the energy.
How did you develop the market for that device?
Printing electronics is still considered a new field, and we also had a new technology. That combination gives you a lot of opportunities – for success, yes, but also for failure. Consequently, we realized that to sell a product in this environment, we had to do a lot of vertical integration. Back when we were just making nanoparticles that meant asking our customers what they wanted to do. One of the responses was “Can you make a dispersion?”, so we learned how to do dispersions and then we made inks and then we learned how to print them properly, and finally we processed the printed circuits with our photonic curing technology and made a machine that did it all. And because this is still a new field, and our livelihood is at stake, we still take a lot of input from our customers and put that (as well as the profit from the sale of the equipment) back into developing new equipment and new enabling technologies around it. The net result is that we end up having the best technology and our customers end up being evangelists for it as well.
How did you get funding for NovaCentrix?
Early on, we had venture capital funding. This was during the late 1990s and very early 2000s, when the dotcom boom meant there were a lot of people around who didn’t have a lot of experience, but because they had made a lot of money, they thought they were geniuses. They weren’t, of course, but the person with the money is generally the person in charge. So in the early days of the company we had what you might call a “seasoned management team” because that’s what the venture capitalists wanted to see. At one point, we had more vice-presidents than we had technicians. However, it turns out that as a start-up, your team is not your most important asset. Neither is your technology – despite what your technical people might think. I mean, technology is nice, and we had a lot of exciting patents. But a patent alone won’t even buy you a pint. In reality, the greatest asset of any company isn’t the team, or the technology, or even the product: it’s your customers, and they are what saved us back in 2004.
The way it happened was that I was playing with this photonic curing technology, and although the technical folks in the company were getting excited about it, our business folks were more worried about their next job – because as I said, we were in the process of becoming bankrupt. Then my boss and I went on a trip to the South Dakota School of Mines and Technology, where a lab director told us about the printing they were doing with nanosilver-based dispersions on low-temperature plastics. They needed a higher conductivity on these low-temperature materials. So when he passed around a sample printed on plastic, I asked him to show me the resistance. Immediately, I pulled out a $7 disposable flash camera I had bought and flashed his sample, which instantly reduced the resistance by a factor of two. My boss gave me a look and was getting ready to let me have it, but then the lab director became very animated and started saying things like “I want one of these machines right now. Will you build me one? I’ll get you the money!” That, in addition to a similar incident with Sun Chemical, caught the interest of one of our early investors, the Munson family. They had been minority investors, but Charlie Munson, who’s our current CEO, saw what was happening and they bought the company. So, it does involve a little bit of faith on both the technical and business end.
What do you know now that you wish you’d known when you were getting started?
People at a new company think they can do anything, and they tend to chase flowers in the wind – a tiny source of revenue here, something else there – instead of focusing on what their product is going to be. You sometimes hear “Don’t put all your eggs into one basket,” but the only people who truly deliver are the people who, to some extent, do just that. We should have said, “This is our core competency; this is what we can do.” Instead, we’d have eight projects going on even though we only had the resources for two. That approach guaranteed failure for all of them. It’s very important to identify the one or two projects that have the highest possibility of success, and worry about the other ones later if you get to it. That is very tough for a researcher to learn, and it’s also difficult for a business person because they’re afraid they might miss an opportunity. But doing so hurt us quite a bit. One example is that in early 2001 we secured a large amount of money to expand our nanoparticle business. The money came so quickly and so easily that our management became a little greedy and they started talking to other venture capitalist firms to find a better offer. But then the September 11th attacks happened, the American economy tanked and a lot of that money was retracted. We ended up laying off a lot of people and nearly went under – we nearly went under several times, in fact. I think being too greedy and not focusing was part of that.
Any advice for somebody who’s just starting a nanotechnology company now?
It’s important to know your customer. I see many inventors, physicists and engineers who like to build stuff. They get excited about doing that. But they don’t really think about, okay, when you build this, what are you going to do with it?
I also think it’s very important to go through the mental exercise of “what if?” It’s almost an adage that a start-up will always need more money than its founders expect, it will always take longer than they think to finish and there will be resources they need that they didn’t think about. There is a cartoon I love that shows some dogs shipwrecked on a life raft, and one of the dogs says: “Okay, we have enough food for two weeks. Who votes we eat it all right now?” And of course all the dogs raise their paws, because that’s what dogs do. But in some ways start-up founders are similar in that they’re often too optimistic. They use so many of their resources early on towards activities that are not important to achieving success. That’s what you need to avoid.
One final thought regarding the choice of key personnel. Usually, when early-stage companies build their team they look for specialists. This is a mistake as invariably the job they were originally hired for will change or even go away. Specialists generally can’t pivot. Instead, we chose to hire expert generalists. This paid off well, as when the company pivoted, they could follow in unison. Later on, as the company grew, specialists became a better choice.
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