The Catalyst Campus for Technology and Innovation has been a hotbed of activity for the past ten days while the inaugural cohort of the Catalyst Accelerator energetically tackled the curriculum provided by our partners at the Small Business Development Centers of the Boulder and Pikes Peak regions. Recent interviews with the founders found them bursting with eagerness as they worked through the Customer Discovery phase of the curriculum.
“Customer Discovery” refers to cohort founders making both warm and cold calls to helpful people in their target markets to learn as much as possible about the viability of their product, the direction their industry is headed, the names of even more helpful people – and oftentimes to discover an entirely new use for their technology. These conversations can bear tremendous fruit, and some of the founders we spoke to seemed stunned by the rapidity of the changes in their plans as they quickly incorporated and adapted the many things they learned during this phase.
As Dr. Rebecca Decker, Program Director for the Catalyst Accelerator, explained, “It was like watching lightning strike over and over again, as everyone made sudden, big discoveries about their products, with the result that many founders are now pivoting rapidly to keep up with the new information.” Becca went on to explain that a list of industry insiders and technical experts was provided to the cohort, which was helpful in reducing the inevitable pressure of cold-calling by ensuring some, at least, were warmer calls.
XplotraX, Colorado Springs
As we spoke with Brandon Tripp, COO of XplotraX, he was vibrating with excitement over the results of his customer discovery calls. As Brandon tells it, “It was a fantastic experience! [It was] a massive revelation for us because we learned that our product, Weather Rock, has actually been created by another company already for the special ops community. That saved us a ton of time, effort and energy, because now we know that we don’t want to pursue that market sector. We’ll go the commercial route, which is fantastic! So it was a great customer discovery experience.”
When we asked Brandon what else he learned during the customer discovery phase, he replied enthusiastically, “The biggest thing that we learned was not to pitch our technology but actually to ask intelligent questions and let the customer or user speak about what they think the application would be for in their particular market segment. And that was really enlightening for us, because we actually found out certain segments, like AFRL, aren’t even interested in our technology because they developed their own types of technology. I would say we learned a lot more what not to do rather than exactly what to do, which has been good in guiding our business canvas.”
Brandon went on to explain that the hardest part of customer discovery is “finding the lowest hanging fruit for us in terms of market turnaround. Who needs this product right now, who is willing to pay for it, and how big is that market segment. We are looking for our entry point into the market, and we think it is most likely going to be on the commercial side.”
Brandon finished by saying ruefully, “It was interesting doing cold calling; what a juxtaposition that was to warm calling, because when you are cold calling a company and they don’t know who you are or what you want, it’s a chilly reception!”
SaraniaSat, Los Angeles
Dr. Thomas George, Founder and CEO of SaraniaSat, also seemed excited, almost ebullient, as he spoke to us about his technology and his efforts during customer discovery. As it happens, Tom has so far only spoken to one potential customer, but the experience has been very encouraging: “The customer I spoke to at the Air Force Academy is an expert on Air Force Weather, to get the requirements from him. I am getting what the Air Force’s needs are, and then I will go and see if there is a funding mechanism that will enable us to do what we need.” Tom went on to explain that there have been several very helpful discussions with this customer, but that he also has some appointments set up with other customers.
When asked what he had learned so far during the customer discovery phase, Tom enthusiastically described his product in great detail (it is currently serving an essential need for the agricultural industry). Then he caught himself, laughing. “The problem with being an engineer is that an engineer likes to explain all the details. I was stopped short by a venture capitalist who said, ‘Just answer the question like a lawyer does!’” In brief, Tom’s remote sensing technology uses multiple wavelengths to produce data wherein both the spatial and temporal resolution are very important. He discovered that the Air Force needs data from additional wavelengths and requires a much higher temporal resolution compared to the current agricultural applications for this technology. Customer discovery has led SaraniaSat to the conclusion that, “If we have to supply what the Air Force needs, we will have to pivot.”
The most difficult part of this phase? According to Tom, it is “how do you get into the procurement process? what is the right mechanism? how do you respond to an RFP? and so on. So thankfully, I am in the right place at the right time because this is the place to learn how to handle that part.”
Guidestar Optical Systems, Longmont, CO
Dr. Troy Rhoadarmer, President and Principal Scientist, and Aaron Buckner, Vice President and Chief Engineer of Guidestar Optical Systems, sat with us to share their experiences with the customer discovery process. In yet another bolt from the blue, they, too, discovered that they would have to pivot to find a viable market niche.
Aaron: So, our main product from when we went into business, thinking that this is the “it” thing, was adaptive optical systems. The majority of the folks I have talked to said that, while they believe that adaptive optics is needed to meet the government customer’s goals, the government customer doesn’t want to fund it. So there’s a barrier to entry there that is partially due to [the fact that] they don’t believe the technology is mature enough; they don’t believe that the supporting technologies, the other pieces that have to go with what we build, are mature enough. Our system might be several hundred thousand dollars but what they are finding is that the supporting pieces need even more expensive development efforts before they are ready.
So we kind of had to take a step back after hearing all that. The other thing we found was that calling these guys and saying, “I’m not trying to sell you something,” saying we were involved with the accelerator, involved with the Air Force, kind of gave us credibility with the guys that we were talking to. They understood that we weren’t coming to them trying to sell them something, we were trying to understand their problem and where their issues are. Most of the people I called already knew what we did, so I wasn’t spending ten minutes explaining what we do. It was very quickly, “Here are the problems that I see and where your stuff might be able to play, and issues to bringing your things to market.” A big one was where they said, “These illuminator lasers [which are needed to make adaptive optics work for directed energy] are the big issue, and they are five years out.” So that caused us to take a step back, and we’ve got a couple different areas and projects that we have been working on, and so very quickly we are shifting our focus to putting more resources into developing those technologies.
So rather than investing a bunch of money in this unobtainable laser, maybe they want to come to us and buy a more efficient sensing technology that can use lasers that they already have. So…we are kind of revectoring a little bit.
Troy: And there is still some development that needs to be done there, but it looks more obtainable than lasers which have physical constraints on them already. I think it’s a more of a clear path to get there.
We broke into their enthusiastic descriptions to ask Troy and Aaron what they felt they had learned from the customer discovery process:
Troy: I think the biggest thing we’ve learned is when we jumped into the accelerator, we were coming from a technology applications base that can use weather. So, we talked about taking some of the sensors and some of the technology that we’ve developed for the laser applications and applying it to the weather question that the Air Force has posed as a supporting thing for these other applications. Almost everyone that we’ve talked to [sees that as] the million-dollar thing right there. If we can solve that, if we can provide something there that’s simple to use, small, fairly low-cost, that’s really a plug on to these larger systems, that’s something that they definitely need. And while we all kind of knew that going in, it’s hearing it from the customers, and from the prime contractors, hearing them all say “Yeah!”
Aaron then went on to share the most difficult aspects of customer discovery – including an often-scarce commodity for all of us:
Aaron: For us it’s been time.
The other thing I’ll say on a personal note is that I had to get over my introverted-ness, not wanting to just pick up the phone and call people. That was the hardest thing, other than the practicality of carving half an hour out of my day to talk to someone. Having the introduction and being able to say I am working on this small business accelerator at the Catalyst Campus with the AFRL – everyone I emailed to ask for a meeting or a phone call came back with a “sure, no problem.”
The primes that I was talking to, [the fact that] the Air Force is looking for innovative procurement avenues was really interesting to them. Some of the primes I talked to haven’t heard of the OTAs (Other Transaction Authority) and the ways that we are looking to connect to the Air Force as a small business, and that the different ways that we are looking to connect don’t disqualify large businesses from playing. So they were very interested in, “Can they really do that? Is that really going to happen?”
[And the answer is] “Yes, they’ve done it already and the groups that we’re working with here are connecting us to that infrastructure.” They were looking at it as, “Hey, if we connect with Guidestar, we might get pulled along,” even though it sounds weird for Guidestar, this little company, to pull along this behemoth prime, they are seeing it as a potential opportunity. They don’t know what might come of it, they don’t know what it is, but it’s the fear of missing out.The founders we spoke with were universally surprised and pleased to learn so much more about their potential markets during the customer discovery process. They all experienced an “a-ha” moment, a lightning bolt of revelation about the true prospects for their products, which is exactly the reason customer discovery is conducted so early in the curriculum.
Stay tuned for our next blog post to learn how our cohort progresses as they delve even more deeply into the Catalyst Accelerator process.