By Andrew Hobbs
AN APPETITE for risk is a crucial asset for any group aiming to build a small to medium enterprise (SME), Paul Colley, the founder of Total Marine Technology (TMT), told attendees at AOG 2015.
“You can’t start up without risk. I would love to tell you you can mitigate it all off, you can process it out… but I can tell you about the sleepless nights of, when we started, signing our house over to the bank because the bank didn’t understand what an ROV was.”
Remotely operated vehicles (ROVs) are the pride of the company’s manufacturing range, with TMT currently operating 31 across the world – from South East Asia to Brazil and even offshore Cuba.
Such devices are used to conduct repairs and bring components to structures located at depths far beyond the reach of any human diver – a range of highly technical devices that require a good deal of investment to build.
Mr Colley said the ROV business was a difficult one to be in, and only got off the ground because he and his project partners had a shared vision for doing so.
“Why do you get the vision? Because it becomes too uncomfortable to stay the same,” he said.
“People get vision when they can no longer stand what it is they are doing or how other people are doing it. You build from there.”
Together, the group believed it could offer innovation and fill a value gap in the market – which was populated already by stiff competition.
“If you have got an opposition that says ‘you are never going to start an ROV company in Australia,’ that perception is actually a strength, because they ignore you for long enough until you get traction, and then when they realise you are serious, you are already up and running.”
That said, Mr Colley also urged companies not to be too starry eyed about their vision for the group.
“Vision is, I found, two parts reality and one part aspiration,” he said.
“Get a grip on the reality of where you are going, clear goals and expectations and defining your successes and failures in respectable timeframes, guarding against close-sightedness and far-sightedness – and knowing when to stop.”
There is no reality check like a lack of cashflow, and as Mr Colley told the audience, “cash flow is king.”
Valuable work may not be interesting work, he told attendees, but some smaller tasks could provide resources that could fund future research and development projects.
This, he said, was a factor that appealed to banks – which Mr Colley said did not normally understand oil and gas technology in the same way as they understood houses and construction infrastructure.
This may lead SMEs to look overseas for funding sources, he added.
Nonetheless, Mr Colley said he had found that banks were mostly friends, rather than the enemy.
“Yes, tell everyone what you are doing. Tell the truth enthusiastically … so people can believe you and respect the people who are putting money into your company because it is the people who are putting the money in who are perceived by the market as the people taking the risk, not the people developing the technology.”
While the project partners shared a common vision, that is not to say they thought alike – with Mr Colley saying diversity in thought and of background was an important asset for the group.
“You need experience and you need enthusiasm – and they don’t necessarily go hand in hand.”
“Employ people who are smarter than yourself… Don’t be the smartest person in your company. If you are the smartest person in your company you have failed.”
Ongoing investments in the business and ensuring that the professional development and support of staff was constant were also factors behind the company’s ongoing success.
But ultimately, Mr Colley said success required a long-term view in the world of manufacturing – a lot more than could be determined in a five-year timeframe.