Stephen Falder is Deputy Chairman of Byotrol plc and also the company's Business Development Director. Byotrol is a brand new hygiene technology that delivers broad-spectrum, long-lasting, antimicrobial protection.
A lot of entrepreneurs know they want to run a business at an early age – Stephen is clearly one of them, although his first entrepreneurial foray was somewhat unorthodox. At primary school he and a friend launched the ‘Acme bug company’ – which sold homemade rubber beetles and spiders for a penny each. That is, until the head teacher found out.
Despite the rough start, Stephen learned a lot about business from his home life. The Falder family owned a successful paint-making business, and Stephen’s Dad was always happy to involve his children in business-related issues, both good and bad.
“This was really helpful because I think from quite an early age, I realised that satisfied happy customers were and are at the heart of success,” says Stephen, who actually acquired his first ‘real’ business from a receiver.
The company, Bradite Limited, was a 50 year old paint maker that was ‘evacuated’ in WW2 from Coventry to Bethesda in North Wales. It had enjoyed post war success but then fell into a slow decline, and eventually went bust in the early eighties. For Stephen, acquiring the business presented an opportunity not to be missed.
“It was a fantastic challenge to ‘wake up’ the company and feel it re-energised and growing. While true start-ups are fun, I loved the challenges and unique politics of refloating a failed but historic business.”
Stephen’s early entrepreneurial life was therefore very ‘paint focused,’ and this provided the inspiration for Byotrol, his current company. Byotrol was born, according to Stephen, out of a great deal of frustration and increased interest in a safe, effect, anti-microbial paint, particularly in the food industry.
Truly innovative materials often surprise people so the first time they look at them they don’t do it very carefully
“To me (I studied as a microbiologist), the conventional additives all seemed to be either not very good, or not very nice! So I developed, with a small team, a better, simpler approach to killing germs in paint... that we now call Byotrol.”
In business, small changes can often be the catalyst that propel the company to high growth. Thinking outside the box, and considering how your product can be used more widely, can diversify your potential target markets. This is exactly what happened with Byotrol.
“The big insight was taking away the paint to just leave the pure germ killing technology. This had some truly revolutionary characteristics and was immediately recognisable as a potentially global game-changing piece of science.”
Stephen and his team patented and tested the product for over five years, mostly in secret to protect the IP. In 2005, they decided to float the company on the Alternative Investment Market
(AIM), believing the company’s high growth potential would be attractive to investors.
And the company has experienced significant and impressive growth. While this is fantastic news for Stephen and his team, he does admit there have been some challenges.
“The potential for Byotrol is really spectacular, but we are very mindful of the fact that you have to be careful not to create a global ingredient brand without all the resources of a global company. What this has meant in practical terms is making sure that Byotrol first appears on the market associated with well-known household names, or in highly technical and specialist areas.”
This particularly issue has been a challenge for Byotrol because, Stephen says, many of the simpler and down-to-earth products have had to wait for the company to get commercial traction with some of our bigger partners.
And despite the door-opening power of a fantastic invention, Byotrol’s intellectual property has at times been a hindrance to growth.
“Of course our unique properties are at the heart of the success that we are building, but there is always a credibility gap to be closed if you are an SME talking to world scale businesses.”
Those attempting to replicate Stephen’s success by focusing their skills and time on creating an innovative product may silently wonder if success owes more to luck or skill. Stephen is unambiguous on the issue.
“I think the most important attributes of creating an innovative product and bringing it to market are determination, because these things inevitably take a little longer than you expect, and passion, because people like to deal with people who truly believe in what they are doing.
“Luck and skill certainly play a part but of the two of them I have always believed that it is better to be born lucky than to be born rich.”
And despite the advantage of an innovative product, Byotrol faced a number of issues starting up. Stephen highlights three main challenges they faced when the company first launched.
“Firstly we were not sure whether the technology was truly special and this was overcome relatively simply by asking and paying for expert opinion under confidentiality agreements. This meant that our experts could be very candid about what they thought we had.”
“The second was that Byotrol was invented in a paint company, but is not paint, nor anything to do with paints, so we needed to take an early decision to spin it out as a separate entity with its own budget management, etc.”
“Thirdly, truly innovative materials often surprise people so the first time they look at them they don’t do it very carefully. This meant that at the outset people tested us twice: firstly without a great deal of interest and the second time properly.”
For companies that already have an innovative product, Stephen says that one of the biggest dangers is looking through rose-tinted spectacles when everyone else is seeing the reality. Business owners can often be blind to their products’ flaws, he explains, making it essential to check with experts (under confidentiality if necessary) that the products really are special and innovative.
“Also, don’t try to have your cake and eat it. If you have an invention that has got potential you will definitely be more successful if you work with others to try and achieve that potential. Keeping all of your cards too close to your chest may mean, notwithstanding the brilliance of your innovation, it stays in your living room!”
Stephen's thoughts on companies with innovative products starting up during a recession...
"My family business, HMG Paints Ltd, was started in 1930 and my first business was acquired during a recession, so I suppose I would have to say that economic instability is a condition which has helped rather than hindered the businesses that I know best.
Certainly during periods of economic flux people are more interested in change and innovation and competitors are potentially downsizing, or reducing service levels, add to a general mood for change.
So an innovative product, an enthusiastic team, and a strong business case seem to me the perfect toolkit to start up in a period of financial turbulence."
“You should make sure you protect the important parts of the innovation with patents, trademarks, design registrations etc and make sure that you really understand those processes – do not rely solely on others to protect the value of your invention.”
As an SME, growth and profitability are still top of the agenda for the company – at least for the time being. For Byotrol, growth and profitability will provide the platform for further expansion, but must remain simple and focused to deliver success. Even with this priority, the company is also focusing resources in other key areas.
“We have never stopped improving, developing, understanding and refining our knowledge about our own technology and potential new technologies. We believe that being truly expert in these fields is one of our greatest assets.”
The company has recently signed deals with a range of big corporate names including Tesco
. For an SME, teaming up with such large juggernauts can seem intimidating, but Stephen says that it doesn’t have to be.
“It is helpful to realise that very large businesses have a formal process for practically everything and to understand that process before you start.
“I have no doubt that practise helps to make perfect, but very large companies are not hugely different from smaller ones in that they will have within them people who are supporters of your idea and those who are yet to be convinced.
“We are very fortunate at Byotrol in having some very experienced senior team members who are used to dealing with global companies and who are very skilled at doing so.”
For many SMEs, dealing with big corporate names are the holy grail of business success, and a sure-sign that things are going well. Stephen suggests an assertive approach for small businesses that do wish to go down this route.
“It’s best to act openly and proudly as a SME. I think it’s a shame that some SMEs ‘pretend’ to be global/giant corporates when dealing with their customers, big and small.
“By being honest, and above all, proud of the SME virtues such as inventiveness and nimble footedness, I have found that this very rarely places us at a disadvantage.
“My fiercest competitors have nearly always been other SMEs, not the large corporate organisations, who I look on as potential partners and enjoy developing working relationships with.”