dangletech

You can read “Born Lucky” on a t-shirt that Pamela gave me. I thought of it last week when we closed a bridge round at Metafoam. Not easy. It took 7 months to find the justification for it and I had to answer a simple question from investors: “Why do you ask for more money when most companies are reducing expenses and preparing for the storm.” My answer was simple: it is exactly because of the financial situation that we need to spend more right now.

Business is slower everywhere, especially in consumer electronics. Most manufacturers with whom we talk in China tell us they are anywhere between 10 and 30% of their capacity and they are sadly closing factories and letting people go. But some of their customers, the PC manufacturer brands, are looking for new solutions to differentiate and trigger new sales. This is an opportunity for Metafoam.

Since we proposed a new cooling components that increases, by more than 200%, the heat that can be dissipated in a computer, it is essential to accelerate our product and business development efforts to make sure we will not miss that a window of opportunity. Also, the financial situation of our potential production partners in China facilitates the negotiations for outsourced production. As a small company, not yet with large volume, we were able to negotiate a pilot production agreement with some advantages for us that would not have been possible in an upturn market.

We are validating (pull) our value proposition with the computer manufacturers and we are in test phases (push) with the biggest cooling manufacturers. The interest we have received and test results are surpassing the hopes I had. Now we have few months to finalize the roadmap and crack the code on the devil’s triangle: cost, margin and selling price. Only then we will know if we really have a business and if I can frame my t-shirt!