Help Wanted: A VC-Backed Start-Up in Water Technology Needs a CEO
Company: Start-Up Water Technology out of MIT
Position: CEO with capital raise and technology experience
Search Start: August 2009
Search End: October 2009
The Challenge: A new membrane technology developed in an MIT lab by two distinguished PhD’s had surfaced as a potential solution for commercial, municipal and industrial applications. The unique properties of this membrane offered an easy-to-clean, reusable filter capable of capturing microscopic particles needed to clean industrial waste water, and did not require frequent and costly replacement With only IP and a small amount of starting capital in hand, the founders had no network to support the build out of an Executive Team, and they had few resources in order to attract the right people. But the formation of a company was there, and the first order of business; hire a CEO.
The Search: Meeting with the Co-founder in August of 2009, it was clear the team needed someone who could meet three basic needs; 1) A background in water technology and preferably a focus on membranes development. 2) Leadership of a small, growing company with few resources and limited budget. 3) Experience in raising capital and influencing the investment community.
Targeting the local water industry experts would not be too difficult. There are a limited number of companies focused on membrane development, however, simply because membrane’s are considered a commodity and are more popular overseas than in the US for industrial application. Finding an expert CEO-level person may mean a national or international search.
Using my own network as a strategic first strike and seeking referrals would only get me so far. I knew I needed to approach this search with more than a few phone calls. I had to get out into the expat community and find a water expert who could introduce me to more water experts. Coupled with a target list of local water technology companies with advanced product lines for commercial and industrial applications, I was fairly confident I would find this person here in the Northeast. The uphill battle would be identifying a credible and effective CEO who would also be willing and able to take on the high risk of a start up.
The Solution: Several candidates were surfaced within the first few weeks of the search. Two were Senior Level group leaders from companies such as GE Water and Koch Membrane. I knew I was on the right track, and both were capable of leading a technical team as well as running the operations. Both had experience working on start up technologies. But neither had capital raise experience. Regardless, my client was thrilled with the progress and met these two experts while I continued my pursuit for the “grail” of a water industry CEO.
A call came from a friend suggesting I attend a networking event for expats in the Boston area. This was a tight knit group of C-Level foreign nationals working and living the Boston area and they met once a month to network and collaborate on a variety of professional and personal projects. I was seated next to a French CEO who was not only affable but very forthcoming about his job search. He had recently left Millipore and had two spinouts of the parent company under his belt where he served as COO and CEO. He was looking for a start up.
The conversation lasted through dinner and dessert. In the process of getting to know him, I had interviewed and vetted him for the role. In the morning I drafted my presentation to the client. They met later that week. As I closed the double doors to the conference room that morning, watching them lean forward simultaneously over coffee cups, their body language said all I needed to know about the search process. It was over.
Interestingly, one of the other two candidates was so technically advanced and enthusiastic about the technology, the Founder decided to retain her as well to round out the team and apply her advanced knowledge to develop the product.
Today: Within months of the CEO taking over the reins of the organization, he had achieved a $3M round of capital with the option of another $5M upon meeting milestones. It was a joyful yet very challenging period in the development of the company as it was during the height of the recession and green technology in every corner of the industry was struggling to survive. The CEO is still advancing the technology and company’s position. With two successful projects (one completed with the US Navy, and one near completion), they are seeking additional capital and potential acquisition. The Senior technologist also remains on the company’s payroll and is enjoying her role as both technical strategist and entrepreneur.