Monday 11 December 2017

A fair wind for Air Synergy as it adds selling to its skills

Fearghal O’Connor talks to one businessman about what it takes to turn technology ideas into commercial successes

Gerry Butler, chief executive of Air Synergy, has added sales nous to the company’s technological brilliance
Gerry Butler, chief executive of Air Synergy, has added sales nous to the company’s technological brilliance

Fearghal O’Connor

On a remote stretch of Germany's border with Poland, invisible waves of carbon monoxide blow from the east. The Germans suspected that the Polish coal industry was breaching EU regulations but have struggled to prove it.

A cleantech operation based in Longford and Dublin had the answer. Air Synergy produces specially patented, self-powering street lights, that it can also equip with anything from air monitors to wifi, that are to be installed to monitor pollution along the border.

Air Synergy's technologists spent years developing the technology behind these 'smart poles'. The engineers found ways to make airflows more efficient, in the process redesigning the concept of a wind turbine. No longer is it necessary to erect hundred-metre high poles and fans that dominate the landscape.

Using combinations of this wind technology, solar and rechargeable batteries, Air Synergy can install self-powering applications - such as the smart poles - that are discreet and can be used in a wide variety of situations, for example lighting, security cameras, wifi and monitoring.

A key advantage is that there is no need to dig up the ground to run electric cables.

But what the company had not done effectively was to find markets into which to sell the new technology. The problem was that it was so busy inventing groundbreaking technology, it had neither the time nor the skill set to turn its attention to commercialising its products.

When private equity investors stepped up with new investment of €16m in recent years, that all changed. A new focus on commercialisation and the pursuit of markets globally was needed.

Enter Gerry Butler, the highly-experienced former chief executive of Xtra-vision and HMV Ireland. Butler had been behind the transformation of both companies into online players after they had been bought out of administration by private equity firm Hilco.

Last December, he was appointed ceo of Air Synergy and has since brought in former Aryzta executive Martin Kelly as chief operating officer.

"The challenge facing Air Synergy was to turn its highly regarded technological ideas into commercial success stories. We were brought on board to restructure and bring Air Synergy to the commercial world," said Butler.

"It was run by a very smart group of technologists but it was not commercial."

The key for Butler was to bring the right processes and structures to the company. His skill set is all about restructuring and growth, whereas Air Synergy had been very focused on the technology itself.

"Air Synergy was at a place that is common with technology companies when they are run by technologists. Technology people do things that I could never dream of. I can talk to you about the technology but I can't design it.

"This is a potentially global company with fabulous technology but it needed a commercial vision," said Butler.

The highly technical nature of the products was a key challenge when trying to bring them to market, particularly as they require certifications from trade bodies or government departments.

"If you don't have a business background, you don't fully appreciate or understand the deadlines and you could be burning up money,"

"A pre-revenue company is generating no income, so you are raising money and spending it. It's like having a hole in a ship. You can keep throwing the water back out but at some stage you have to stop the hole. You have to commercialise and move forward."

The first thing he did was cut costs by €1.3m.

"We had a range of engineers who were designing products but who were not focused on a sales pipeline," he said. "What Martin and I bring is a market knowledge and international perspective. I clearly know what I am not good at. I cannot design turbines. But what I do have is a skill for managing businesses into a profitable business."

Crucial to the success of the restructuring was buy-in from the whole team and Butler is confident that the company has the right people, in the right positions doing the right things.

"The inventors of the technology are getting ready to develop phase two and three of this technology and the sales people's job is to go and sell it. Our job as management is to create an environment that allows them to achieve this."

The refocusing appears to be working. Air Synergy has now taken three of its patented products to market and is offering global organisations, companies and municipalities more economical, environmentally friendly methods of extracting power from air. The company has established a global partnership with Flex, one of the world's largest component manufacturers, and this, according to Butler, gives Air Synergy the global reach it needs to sell its innovative product line.

The German border application was just one example of the new focus on finding buyers. Orange County in California is also interested in using Air Synergy's poles to monitor smog levels by placing them around the city in areas where there is no grid connection.

The company has also just done a deal with Lidl here in Ireland, installing an initial smart pole at the retailer's new Drogheda outlet, as well as a deal with energy giant Veolia in Germany.

Butler says a number of other major contracts are almost ready to be announced. Indeed, he plans to launch Air Synergy in 10 or more countries within the next 12 months and has set a target turnover of €30m by 2018.

"There's no country in the world that can't take some of our products," he said. "But the biggest challenge we face is choosing which countries and why. Our skill sets are about directing the company in a positive way and in a logical sequence. What we have undertaken to do is to re-identify the actual market for the products. The technology experts in the company had identified great products but not the actual markets in which they should be sold."

For now, said Butler, Air Synergy is concentrating on four major international markets: Ireland for proof of concept, UK "because it is on our doorstep", Brexit notwithstanding, and the two really key markets of Germany and the US.

He is not shy about his ambition now that the company has met many of the initial challenges.

"We believe that with a fair wind this will become one of the major growth stories of Irish business in the next five years.

"Its products are patented. It has groundbreaking technology and there is nothing else like it anywhere else in the world. It is now a case of harnessing that and commercialising it."   

Sunday Indo Business

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