SM: Can you walk me through the process behind the thinking? Was it the problem regarding the weight of the wire which came first, or did you have a technical solution first? PC: You have to know the market, and I knew the market. I knew that if we could make a light weight wire that was inexpensive, it would be worth a very large amount of money. I thought that our technology could yield a product that could save a lot of weight. Put the two together. A technology push, if you don’t have an existing market, does not work.
In addition, you have to know the market. You have to know enough to know the value of the product you are trying to develop. If you are developing a product that has a low margin, you can’t spend a lot of money developing the product. If you develop a product that has a very valuable market, then you can spend a lot of money to develop it.
The first year at Raychem we developed five products. Three of them became successful and two did not because we could not make them. It was like the desalinization problem; we had a good idea and a product, but it was not good enough and would not solve a problem. If we had solved the problem of the other two, they would have been successful, so it was a technical failure.
SM: Is the market still there for the ones that failed? PC: The market is there. Just like desalinization of water, the market is huge and has always been there. However, 21 years is a long time to work on it.
SM: I can’t imagine there are any VC’s who are going to fund 21 years of anything! PC: Not even close. You must have a market. First you need a pioneering technology; second you need a market that is viable. A friend of mine is running a nano technology company in Reno trying to make batteries. They have an idea and a technology that they believe will yield quicker charging batteries that have a higher rate of discharge, would pose no fire hazard, and have much greater density of power content of the battery.
Everybody knows that is a valuable thing to do. Many people are working with nano technology. They think they have the lead and that they are going to solve the problem. There is a huge market; every computer, every automobile would need it. They are racing as hard as they can, but will it be fast enough to satisfy the VC’s? If they can do it as they believe they can, then they will.