Choosing team players over superstars: SolemteX
As Owen Boyd grew his business, he picked the most impressive résumés from the pile to build his management team.
This, he says, was his biggest mistake.
“I wish I had known at the time how important building a team was rather than building a company,” said Boyd. “I hired everyone based on their resume rather than how they would fit together.”
Boyd’s hiring strategy gave him a very intelligent group of people, each with their own big ego. The ability to work well together is critical for a small start-up team, and Boyd found that all the egotism stifled collaboration, prompted managers to exaggerate their progress, and caused them to make the same mistakes again and again.
Boyd now knows that mutual respect, honesty, and the ability to learn from mistakes are crucial traits for a team. It took five years and a complete staff turnover for Boyd to find the right people, but the current staff has been in place for three years and the company has doubled revenues each year.
Boyd thought of the idea for SolmeteX, which develops and manufactures specialized technology for the safe and economic removal of heavy metal contaminants, while he was working with his father in power plant development. He noticed that industrial water treatment systems, like those in power plants, used 100 year old technology. He had recently read an article about a new technology for drug separations and believed that its principles could be applied to modernize water purification.
Beginning with money from family and friends, Boyd rented a basement and began to test chemical separation techniques. He warned his funders that they had little chance of getting their money back. After the early stage, he wrote a business plan and secured venture capital money to continue. Although using venture capital meant ceding some power (as Boyd explains, no matter how much stock share they have, “they have the cash, which means they have control”) he became more comfortable with them over time, realizing that they were also relying on him.
His initial strategy was to market the chemical separation technology for large projects. Holding lunches at engineering firms brought in sales, but not profits. Boyd notes that to succeed in unprofitable times, “you have to have the idea that you will be successful and understand why you are not making money.”
Boyd responded by shifting his focus to smaller applications in markets with dominant distributors, including a device he developed to trap mercury during dental procedures. The large dental supply distributors pushed SolmeteX products to dentists. Demand was mostly driven by regulatory standards for pollutants, so SolmeteX concentrates on educating regulators about the need for and availability of better technology. In regulated markets, SolmeteX has achieved 50-70% of the market share.
This will be the first profitable year for SolmeteX, a feat that can be enjoyed by the current management of the company. Now that the egos are gone, SolmeteX has a team that feels like a family and demonstrates mutual respect. Boyd says “people really have to enjoy what they are doing. It’s like sports: they want to be on a winning team.”