That’s My Business

What, in a nutshell, does your company do?

Microsaic develops and manufactures miniature mass spectrometers. We aim to put the analytical power of mass spec into the hands of many more users. 

What is the rationale?

Mass spectrometry is the gold standard for analyzing the composition of solutions (and gasses, too, but we are working mostly with liquid analysis). It tends to be centralized in specialist analytical labs because of the size, cost and the required infrastructure. Tens of thousands of chemists have chromatography equipment and use a walk-up or central-service mass spectrometer. If they could monitor their chromatography or reaction in situ as it happened, they would be more efficient. 

 That’s where Microsaic comes in. Our instrument gives similar results to conventional mass spectrometers in a much smaller form factor with fewer infrastructure requirements, has a lower cost of ownership, is easier to use and is portable.

Where is the market?

A desktop mass spec system is never going to be the leader in terms of ultimate performance but an awful lot of what is done with mass spectrometers doesn’t need the complete technical capability of the instrument. We can give the individual chemist mass analysis at his or her fingertips. There’s an analogy with the launch of PCs. The idea there wasn’t to grab some mainframe market share but to greatly increase the number of people with direct access to computing.

We are concentrating on the pharmaceutical and related sectors for now, but the potential application space is broad – forensics, sports, testing foodstuffs in ports of entry, and demanding environments, such as in the oil and gas industry.

How did the company develop?

It was started 11 years ago at Imperial College by me and two colleagues, in the electrical engineering department. We didn’t specifically start a mass spec company, it began with a number of technologies in a few different areas. The backdrop was silicon micro-engineering – making tiny things that resemble integrated electronics, but which could also be micro-optics, micro-fluidics or micro-mechanics.

Microsaic started small, funded by consultancy work and research contracts. Mass spec seemed to hold most promise and gradually became our focus. In 2006, we created a business case around the development for a liquid mass analyzer and pursued first round financing to build up the product development function.  

We have about 30 people now, based in Woking, southwest of London.

Where did you gain your business acumen?

It’s largely self-taught, although I have had advisors, both formal and informal. We had a strong peer group at Imperial, people who had built up companies before us and could provide advice, and we added external directors to guide the company around commercial, funding, financial and corporate functions. Still, when we launched the company, it was really new to me. We grew slowly and bootstrapped – there was a lot of learning-as-you-go. 

How would you compare the mindsets of academics and entrepreneurs?

They share a surprising amount. Academics have to achieve a lot of things by themselves: perform research, raise money, recruit and manage a group, and get results out into the world. They are very free to choose their own direction. It’s all quite entrepreneurial. 

One big difference is time-frames. In academia, projects tend to be measured in years and are planned appropriately. There are short-term goals, of course, but they form part of a continuum. In the commercial world things move quickly. You have to respond rapidly to changing circumstances and focus a lot of energy on shorter-term goals.

Another difference is that sometimes you have to let go a little bit of your dream to get something to the marketplace. The risk lies in being in love with your technology; endless tinkering, as is done in the academic lab, has to be avoided. Ultimately, the company’s goals have to be commercial; they have to be about customers and about selling.

As you develop a technology, you’ve got to develop the business case early on. A lot of start-ups take a broad bush: they argue that “If I develop this thing, I know in a generic way there’s a market for it because this industry needs such-and-such.”  That is not a good sign. Needs are very specific and if you don’t engage with them very early on you risk embarking on a long R&D project that doesn’t produce what the marketplace is looking for.

In addition, you can’t think of development as a serial process in which you complete do all the technical development before going to the market. We’ve done a lot of close work with big pharma companies and that helped us to direct product development towards applications that they are interested in. It gave us a handle on software and features and performance thresholds that would make it an interesting instrument. That was very helpful.

Despite this, was there a time when you thought Microsaic might not make it?

Certainly, there have been stressful times, some technology developments hit roadblocks that took longer to overcome than we expected. You have to have a certain level of optimism, a belief that you are going to survive and flourish even when the evidence on the ground suggests otherwise.

Also, like every company, we are influenced by external economic situation. When we started thinking about a second round of fundraising it was getting into 2009 and IPOs had dried up. The risk appetite by investors had pretty much disappeared. It was very, very difficult.

What did you do to make the company attractive enough to funders?

First, we had been careful with our resources and went out looking for money when we had quite a bit left in the tank, so we were not desperate - that’s never a good way to raise capital. Our story is very good and that helped us. However, we did have to adjust our expectations in terms of what valuation we could get and how much money we could raise. 

With the IPO in spring 2011, we caught a bit of a window. We had done some homework and pre-marketing at the end of 2010 and managed to get a few investors enthusiastic about backing it for floatation.

To what extent is luck involved?

It definitely comes into it, but the old chestnut about fortune favoring the prepared mind is relevant. You need to be on the lookout for opportunities, recognize them when you see them and have the willingness to embrace them in an open-minded and creative way.

Do you have a final piece of advice for budding entrepreneurs?

You sometimes need a little bit of irrational optimism to keep you going in tough times. Exuding confidence in the company, particularly if you are a leader, helps to maintain the belief of others, inside and outside the company.

You also need to be patient. It’s going to take longer than you thought. If your only reason for doing it is to get rich quick I would advise you not to bother. You do have to be motivated for more than just making money – satisfaction, learning, excitement, and not just a slog which hopefully has a pot of gold at the end of it.