Innovating: critical for a company’s existence

When stepping into Machinefabriek Boessenkool from Almelo, it’s like walking into the Willy Wonka’s Chocolate Factory. Large halls, impressive machines and appealing inventions. A dream place for entrepreneurs. Eelco Osse, director and owner, took over the company from his father in 2005. Not without doubting: “I really was not looking forward to being an employer.”

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In short

  • Innovating is critical for a company’s existence.
  • Eelco Osse, an entrepreneur from Twente, talks about his mission-based innovations.
Something truly has an impact when it improves the world

“I was seconded to my father’s company when I was working for my former employer. Soon my fathers’ employees said: ‘when will you start earning money for us?’. I always wondered whether the organisation would accept me, as I’m the bosses’ son. I knew I wanted to be an entrepreneur, but being an employer…? When my dad asked, I realised: now or never. We signed at the notary and the week after that we had a meeting at the bank. To my surprise, my dad did not show up. When I called him to ask where he was, he said: ‘no, I am not coming. It’s all yours now’. To which I replied that I was completely unprepared. His response was: lesson one, always be prepared.”

Innovative entrepreneurship

“Our machine factory produces many single-piece orders with high risks, meaning that we produce machines only once and never repeat. That’s when I got the idea to develop products ourselves. Such products scale, offering a solid basis for the company and a bright future. We now work on five products, so now it’s time to have some of them reach maturity. We get ideas from the market. For example, our flywheel was initially developed for one of our customers. When they asked to scale up based on their expected number of sales, we decided to join forces. We can’t scale up our production based on expectations of our customers. That’s how our joint venture started.” 

Listening

“For me, innovation is facilitating and problem-solving. It is exploring the unknown. A problem I have to face repeatedly is the traditional rules that do not yet provide for new developments. The huge lobby that is necessary to change those rules is tiring. In my opinion, governments should better listen to those that are influenced by their decisions. They should not strictly follow the rules but instead, act along the lines of those laws. They should be more open to embedding new technologies in the current set of rules, more cooperatively and creatively. The newspaper headlines often mention SMEs being the backbone of the Dutch economy. What a shame that regulators often make great ideas and innovations by SMEs impossible.”

Working capital

“Next challenge: financing. We used to be able to get a substantial part funded by banks, but they are becoming increasingly cautious. A good example in the jungle of subsidies: having to submit a detailed budget while no-one has a clue how far the dot on the horizon is. It’s weird: innovation by definition is not predictable. The government should think again, whether it is correct to tell an entrepreneur that innovation is predictable.”

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The market

“We were able to market our products successfully, simply because they all started with demand in the market. Our recycling machine was immediately adopted by an American, while our e-tractor is harder to market. Germans love our innovative capacity, but often do not dare to do so themselves. The southern countries are not as strict on rules, so there are more ‘cowboy entrepreneurs’. Also, governments are more flexible. We work on a project in Bangladesh that can solve a major problem. Five million refugees cut down eleven hectares of tropical jungle per day just to cook their food on. They leave their waste and move on to the next part of the forest. We want to convert their waste into fuel. Guess what the government says? ‘Your machine is too expensive or does not fit in this subsidy or program’. What about that forest, is that not priceless? It often seems like entrepreneurs are seen as criminals by default as if a genuine entrepreneur does not exist.”

Impact

“Something truly has an impact when it improves the world. It is rarely ever known in advance whether an innovation will make money, as turnover is in the far future or when the market is too conservative. In some cases, it is clear that innovation will help people. However, it is also clear that it will not make any money. If such a project is the only one you are working on, you need to stop as this will kill your company. If your company is killed, you cannot produce other future impactful innovations. I want to do something about the plastic soup, one of the most important threats on earth. Five rivers contain and cause eighty per cent of the plastic soup. The mouths of such rivers are manageable in size, so why not just place a net? Compared to the size of the problem, this cannot be extremely expensive.

Corporate growth

“If my employees are struggling, it helps to push an attitude of collaborating and ‘doing it together’. Together, after all, is less threatening than alone. We develop based on future possibilities, more so than purely developing to keep the company stable. Innovation and profits can counteract. We would have had higher results when we would not have innovated. Still, we decided to reinvest all free cash flow in the company. It is not that thrilling when realising it improves prospects. If you think of something that can make an impact, you must make it grow to make it have true impact.”

 

“One of our decision moments was the purchase of a piece of land, doubling our size. It was financially not feasible, but the neighbour’s lot on sale is a one-time opportunity. I have no clue where we’ll be in ten years, although I must say that our current location blocks growth for some products. We’ll have to produce them elsewhere, abroad.”

Mission-based innovations
  • Flywheel: able to able to absorb and smooth out current and frequency peaks in electricity networks or at electro-intensive factories. Additionally, the flywheel can be used to store energy.
  • MultiToolTrac: a fully electric tractor that can adjust its track width and control its four wheels independently from each other.
  • DeSpray: a spray-can recycling installation that can separate liquids, gases and metal, converting them to 100% renewable raw materials. Each installation can recycle foud million cans per year.
  • Drone4Emergency: a drone that can carry 500 kilos. With it, wounded or fallen soldiers can be taken from a dangerous area without endangering other lives.
  • Drone4Logistics: a drone that can transport pallets and other cargo of up to 500 kilos autonomously
Date: 15 May 2019