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Raised $500,000, then returned it
Cold-calling factories
Chris Power moved to the United States wanting to do highly automated manufacturing. He spent six months cold-calling factories in Dallas and Oregon, asking to talk to the supply chain people and the factory people about what was actually going on.
Why buy certified shops
Advanced manufacturing here is highly certified and regulated. Becoming a supplier to a prime like Lockheed Martin or Raytheon usually takes seven or eight years to get certified, and the paperwork is as complicated as a hospital billing system. Starting uncertified means competing with China and failing. So he raised a small private equity fund to buy certified aerospace machine shops first and add technology later. Investors gave him two years of runway to find a deal, and they thought he was nuts, since they had never done a manufacturing deal.
What diligence showed
Twelve months of diligence changed his mind. Legacy manufacturing businesses could get maybe 30 percent more efficient, but never all the way, because the capital equipment, the training, and the software all had to be rebased at the same time. When the fund closed, everyone got their money back, and the 100,000 dollars spent rolled into Hadrian at a severe discount. The answer was greenfield: an empty building with a brand new factory built from scratch.
Why does aerospace certification take so long?
AS9100 is the quality management standard for aerospace suppliers, first issued in 1999 by an industry group of aerospace manufacturers. It builds on the general ISO 9001 standard and adds requirements for traceability, configuration control, and risk management. Outside auditors review a shop's records and processes, and the shop must show a track record before approval. Many prime contractors require it from suppliers before awarding work.
Why can't software simply upgrade old machines?
Many older machine tools use proprietary controllers that were never designed to share data. Retrofitting each one means custom interfaces, and machines from different builders speak different languages. In 2008 the Association for Manufacturing Technology introduced MTConnect, an open standard for exposing machine data, to ease the problem.
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