Trying to find sleepy old industries to disrupt? A great way to identify them is by looking at the amount of money, as a percentage of sales, they spend advertising their undifferentiated commodity products. Case in point: we sell our UV-C disinfection system, Arc, to a large number of professional sports organizations and a number of them have told us we can’t mention them publicly because our chemical-based competitors pay huge sums of money to be the “official disinfectant” of their team.
I view this as a good thing. These more than 100-year-old companies spend anywhere from 6–10x more on sales and marketing than they do in research and development. Their products haven’t changed significantly during our lifetimes, and their solutions aren’t good for our health.
By the way, the sports teams we serve are delighted with our new solution. They just can’t say that in public.
Our strategy is pretty simple: to innovate aggressively against entrenched competitors who innovate almost not-at-all. (To them, innovation is a new minty fresh scent or different packaging.)
To be a bit more specific, R-Zero is adding software and visibility to the disinfection process while delivering a non-chemical-based sustainable option. We not only eliminate germs from a classroom or office, but we also can provide an audit trail to verify when each room was last disinfected.
For an organization to document their work with our competitors’ solutions would necessitate a call to a supervisor who checks with a guy named Bill or a girl name Martha to see when he or she last disinfected the room.
It’s not my intention to be snarky here. Success spawns all sorts of scale, and it takes an immense amount of resources and structure to make millions of tons of chemicals to clean things the way they have been cleaned for the past century. Just imagine how many chemical plants it took to wipe down everything — literally everything — again and again this past year.
These companies have to operate 24/7/365 just to barely meet the current demand. My guess is they have never had a better year. The problem is, their solutions aren’t healthy for humans or the planet.
So just over one year ago, Eli, Grant, and I asked ourselves a simple question: what should disinfection look like in 2021?
We didn’t have an existing sales channel nor product portfolio to which we were wedded. We got to start over with a clean whiteboard and look at all the different technologies that exist today. What we came up with was the ability to leverage technology to replace the need for chemicals.
Our long-term vision is to provide continuous automated disinfection, which is critically important in a Covid and post-Covid world. We want to make it possible for organizations to no longer buy chemicals or need an applicator to apply those chemicals.
As a society, many of the things we do today are rooted in inertia. We do them that way simply because we’ve always done them that way. But when you step back and rethink a 2021 version of the same goals, it’s relatively easy to identify far better ways to operate. That’s why far more industries remain ripe for disruption.
The whole point of a startup is to build something that can either create a market that didn’t exist or upend an existing market with a new way of applying technology. Time and again, we’ve seen startups be successful in trying to slay the giants (Amazon, Tesla, Netflix, Spotify, SpaceX, etc). So my advice to others is: don’t be afraid of the giants.
What you do need, however, is a plan. When we were first raising money for R-Zero, investors would ask me, “How do you compete with the legacy UV-C players?” My answer was that we fight with software to create the first consumer-like experience in the category.
The next question was usually, “Okay, but how do you compete with the massive disinfection players like the P&G’s of the world?” My response to that was it is even easier, because they only sell chemicals. They have nothing else.
I would then ask the question if they would rather have their offices sanitized with caustic chemicals that require an applicator to don PPE or a sustainable light array that not only provides a higher degree of disinfection but answers the question of whether the disinfection even took place?
What was state-of-the-art when P&G was founded in 1837, is no longer the best way to provide disinfection and for that reason, I truly believe we’re bringing a gun to a knife fight.