Op-Ed: The Frontier Series: Finding success in advanced manufacturing & chemicals
February 13, 2018
Alex Reed, co-founder and CEO of Fluence Analytics, is a leading entrepreneur and technology innovator in the advanced manufacturing and chemicals industry. Hank Torbert, a founder of The Frontier Conference, interviews him about how his New Orleans-based company has sustained itself in a changing sector.
Alex, you are the founder one of, in my opinion, the most impressive industrial emerging company in our area. Can you tell me a little about Fluence Analytics, your team and how it was started in New Orleans?
Fluence Analytics is a spin-out from Tulane University that delivers hardware and software products for the measurement and control of polymer and biopharmaceutical processes. The foundational technologies were invented at Tulane University by Wayne Reed, a longtime physics faculty member. Over the years, federal, state and corporate sources funded his work which positioned us to spin out in 2012 and commercialize these pioneering technologies. We have 12 issued patents and 35 pending applications to date and are very focused on innovation and technology. (Reed) is also my father, so I grew up hearing about his research and worked with him in the lab. Later, after graduating from Tulane, I took on the role of the entrepreneur leading the business. We co-founded the business with Mike Drenski, our chief technical officer, and Bill Bottoms, our chairman. Since then, we have continued to grow and build out an incredible team of very talented scientists and engineers from diverse backgrounds. We truly have an exceptional group of people and are very excited about the opportunities ahead.
The chemicals industry is rapidly transforming through mergers, increased research and development, etc. What is driving innovation in the chemicals sector? Who is leading the development of new technologies?
There are many factors driving innovation in the chemicals space. Many of these come from the ever-expanding opportunities for materials in advanced applications such as lightweight materials, energy storage, 3-D printing, etc. As material properties are improved through new types of chemistry and improving advancements in enabling manufacturing technologies, their applications are expanded into more and more complex areas. On the other side, there is much M&A activity, which constantly changes the industry and the players. Sometimes it also provides opportunities for cultural and technological cross-pollination. However, it is much harder to understand the impact on innovation from M&A in general.
In your view, where will we see the greatest disruption in the chemicals sector?
Operationally, once a solid foundation of use cases can be built, automation, data analytics and connected technologies (what many are calling Industrial Internet of Things) will have a significant impact on efficiency, quality and end product composition. Hyper-specialized applications and unique business models to take advantage of smaller (modular), higher value production will be developed in certain markets. Even transformation of performance properties for commodity products will drive further innovation on the chemistry. We have also seen a wave of new synthesis pathways for chemical feedstocks and computer models in the lab capable of running ‘experiments’ without requiring physical experiments.
Fluence Analytics is a great example of when an innovation eco-system works optimally and key stakeholders (universities, angel investors, advisors) develop and support the emergence of a company. How did these efforts help you to form and grow Fluence?
We were very fortunate to have a base of multinational chemical and pharma companies supporting original R&D efforts while at the university. We also benefited tremendously from the networks at Tulane and in the local ecosystem. From Tulane, we had support and introductions from the Office of Technology Transfer, and I gained access to mentorship from our chairman and many others. Locally, participating in the Idea Village accelerator and working for many years with the New Orleans BioInnnovation Center, including financial support from the BioFund, have also been very helpful to our growth. Additionally, there were several beneficial tax credits and state programs from Louisiana Economic Development that helped, including SBIR R&D, Technology Commercialization and Software Development Tax Credits as well Economic Gardening and CEO Roundtables. We also benefitted from competitive federal grants for technology development from the U.S. Department of Energy and National Science Foundation. Finally, some of the early financing, prior to our institutional round, was primarily a group of local investors. Overall, we have received a lot of support and assistance from many sources.
As we seek to create and industrial innovation eco-system in New Orleans, how important is it for us to support the commercialization and tech transfer efforts our universities? What can we do better?
University tech transfer and talent development is critical for this type of activity. Universities, if presented with the appropriate problem sets, can produce highly impactful technology for many industrial areas. Linking faculty, and especially students, to real world problems that need to be solved would be a big support of this effort. This requires industry interaction and experts defining critical need areas. Overall, the ecosystem is very supportive and receptive of viable business ideas, so more of these is the logical place to start.
You have deep knowledge of chemicals and manufacturing sectors We all talk about expanding advanced manufacturing sector in Louisiana. Is that viable? What types of companies would benefit?
Yes, it is possible with the right focus areas and investments. Some of the areas that have seen major success in similar or parallel industries were often catalyzed by a major state or federal investment in partnership with key stakeholders. It is no secret that Louisiana has a lot of manufacturing and related industries, and pulling it all together to find common areas through a coordinated effort would drive a lot of this. With the right environment, as seen in other innovation focused metro areas, the entire value chain would benefit from small manufacturers and technical service providers all the way through large, established manufacturers adopting new technology.
What’s the future for Fluence Analytics? The company has grown rapidly, and you have an amazing team.
We have launched new generations of our products and have now focused on several key markets to drive growth. We will be very focused on those efforts in the near term to grow the business while continuing to advance our technologies.