Happy Holidays from Amplomedia! Holiday chillaxin may be in full swing this week, but the Amplify Your Business episodes haven’t stopped rolling in. In today’s episode, Lance meets with Anthea Sargeaunt from her startup, 2S Water. This episode is all about startups - from the ‘light bulb moment’ to prototyping to bringing your product to market - Anthea has a few golden nuggets of advice to share!
What is 2S Water? [0:49]
2S Water creates sensors that detect metals in water in real time. If you’re aware of the water crisis in Flint, Michigan and the 8,000 children who now have permanent disabilities because of this crisis, then you understand that this technology is a huge market need. In the mining sector, which is where Anthea and her business partner, Tony, hope to have 2S Water directly serve in the near future, mining can have parasitic effects to water supply chains, to communities downstream, and to the mining companies themselves as metals can cake onto machinery and inevitably cause productivity issues.
The infamous ‘light bulb moment’ for 2S Water happened in 2017. Concerned with creating a business that balanced being equally profitable and environmentally conscious, Anthea and Tony interviewed people on the ground to see if there were existing companies in the space already. There seemed to be none. They then resorted to reading scientific papers, developing ideas, and taking them to their university to continue the research and development stage. This lasted a long time, between 2.5 and 3 years! Anthea says that investing in a water technology company seemed like a surefire way to diversify Alberta’s oil-dependent economy.
Anthea’s Advice for Startups
#1: When it comes to taking an idea to market, done is better than perfect. [7:53]
In the startup world, taking an idea from the R&D stage to prototyping to market can be quite the process (2S’ R&D stage took less than 3 years alone!). Anthea stresses that many entrepreneurs have this idea that everything should be done right and perfect the first time. If this were the case, then it would take forever to get an idea up and off the ground. To Anthea, perfection is the enemy in the startup world. Rather, it’s better to have something done instead of perfect. This was a lesson she learned while balancing scientific rigor with creating a functional prototype. There will always and should be opportunities to tweak and improve models after market penetration.
#2: Funding - take advantage of as many resources as you can find. [10:27]
One thing Anthea learned very early on is that Canadian angel investors are a lot more risk averse than their American counterparts. Here in Canada, angel investors need to see real market validation and an uptick in revenue before considering investing. In Anthea’s case, she is fortunate that she was able to receive financial support from family and friends, along with taking on some personal debt and successfully applying for provincial grants. Balancing conservative spending over speed can also be a tricky lesson to navigate.
#3: Government grants - how do you find them and what’s the application process like? [12:27]
Anthea says that to discount grants is to close the doors on wonderful and impactful innovations that come from people who do not have the financial backing from wealthy, high net worth friends, family, and contacts. She believes that the government does an excellent job at supporting entrepreneurs and that it’s in the entrepreneurs’ best interests to take advantage of these grants. It’s these grants that essentially democratize entrepreneurship on a grand scale.
One thing to note, Anthea mentions, is that applying for grants is just as effortful as working with investor funds. She and her team spent lots of time finding grants, completing applications and providing supporting evidence - it can be a whole other job in itself! The longest grant application she’s done was over 80 pages long! Anthea says not to let this discourage you, though. It’s a rigorous but fair process.
On a monthly and quarterly basis, make it a point to search for new grants and keep up-to-date on changes to existing grants. Anthea goes on to say that innovation departments are very supportive. They are willing to help you and be successful in receiving the grant. It’s as simple as picking up the phone and calling the grant provider. They’re good at answering questions and telling you if you’d be a good candidate or not. They don’t want to waste your time as much as you don’t want to waste theirs.
Another tip is to collaborate with other startups and network contacts for help with grants. If you know someone else who operates in the same sector as you, chances are they have learned about or applied for the same grant(s) as you.
#4: Connect with a company’s Innovation Branch [18:10]
In Anthea’s case, she already had a background working in the oil and gas sector. Reaching out to her current network has made it easier to pitch 2S Water to prospects.
A useful tip, Anthea notes, is to apply to a company’s Venture or Innovation Branch and then request to speak to someone in Operations about your company. This streamlined way of communication will ensure that you know you’re speaking to the right person without having to play extended games of telephone and/or email tag.
Another tip is to apply to a company’s accelerator program, as long as your product or service is aimed at the right market and fits the criteria of the program.
What are your current challenges? [19:00]
Anthea pegs the mining industry as one that is more conservative. She’s pitched her company to a lot of rooms with different suits; but the same feedback has kept coming up: “It’s a great idea. I’d love to buy one, but I don’t believe you can do it.” Translated: “It’s a great idea on paper, but not (yet) in practice.”
Until you have a product being used in the field, how can you demonstrate its effectiveness? This, Anthea says, is her team’s current struggle - jumping through that first hoop and landing her first client.
To date, 2S Water has a pilot installed in a water treatment facility. This helps validate the technology within a facility environment. It removes the initial barriers and objectives that a mining company may bring to the forefront. They’re hoping they can segue the data and application from the water treatment facility into a pilot directly for a large mining company. From passing the beta test to enhancing the prototype to final product delivery, this is another huge learning curve she hopes to overcome.
#5: Know the different kinds of investors [22:21]
Anthea references the book Crossing the Chasm by Geoffrey A. Moore. In it, Moore talks about how there are different types of investors every entrepreneur should know of. On one end of the spectrum, we have very conservative investors, mid-range investors, early adopters, and then there’s the innovators. The innovators are a small group of investors who are absolutely fanatic about new technology.
It’s finding these classic innovators that has been vital for Anthea and the 2S team. She explains that working with a classic innovator feels like there are really no barriers to bringing this product to market. These types of investors believe in your product and company as wholeheartedly as you. Instead of kicking you to the curb when the first launch or test fails, Anthea says, innovators will sit down with you and troubleshoot. They want to achieve success as much as you do. Anthea and her team have chosen to work exclusively with innovators for the time being.
How do you find these classic innovators? [25:16]
According to Anthea, what really worked was finding a few industry groups to help spread the 2S Water name across the rest of the industry.
For example, the Canadian Excellent in Mining Institute (CEMI) recently promoted 2S Water in one of their webinars. CEMI’s members are people in the mining industry who are interested particularly in mining innovation. They are essentially the champions of this industry. Connecting with others who are just as excited about innovative technologies as much as you will allow the conversation or pitch to flow a lot smoothly.
As Lance suggests, it’s the way you frame the value of your product that will determine how a cold contact will respond. To be a good entrepreneur is to have the confidence to reach out and connect with others. After all, the next great opportunity may be one connection request away.
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