HOW CHALLENGING THE STATUS QUO CAN CHANGE THE WORLD

Lontra, CEO Steve Lindsey

Air compression might not be the most exciting sector in which to launch a career as an entrepreneur. However, when Steve Lindsey discovered that air compressors absorb a staggering 10 per cent of the world’s energy, and no-one had succeeded in making them more efficient for 100 years, he decided to do it himself.

Such ambition would have challenged a qualified engineer. But Steve was a management consultant.

A decade later and the company he set up, Lontra, has just announced it intends to build a new manufacturing facility near Southam in Warwickshire for its range of industrial compressors. The project has been praised by the government’s Innovate UK body.

The first part of the factory will open later this year, with a single flexible production line complementing the firm’s existing R&D Technology Centre at Napton. Lontra’s workforce is expected to double to 50 this year, with 25 new engineering and production line jobs. The project is backed by Shield Group Engineering, one of the largest manufacturers in the UK with contracts to supply components to Caterpillar, Cummins, Aston Martin, Jaguar Land Rover and JCB.

The global air compressor market is expected to exceed a staggering $37 billion by 2022, driven by additional demand from the food & beverage and pharmaceutical sectors, among others.

Shield Group and Lontra will invest £65 million into the development of the new Southam site and a further site, and funding is already being sought for a second phase of expansion.

Steve said: “We’ve led the world in innovative ideas. The spread of technology across prototyping and manufacturing means Britain is perfectly placed to lead the fourth industrial revolution.”

A grand idea

How did a London-based management consultant become an inventor?

“I’d always had grand ideas to build something and make a difference, but I thought I should get out into the world first and see how big companies work,” said Steve. “I’m not an engineer, I studied chemistry and physics at Bristol University, but I like learning things.”

In fact management consultancy is not unlike the process of invention and engineering Steve points out. “Break the function of a compressor down into a consultancy-style problem and it only has to do four things: get air in, get air out, not leak too much and compress. The trouble was, those on the market weren’t doing that very well.

“When someone told me that it would be impossible to make compressors more efficient, I decided to find out for myself.”

The problem with a lot of inventors, according to Steve, is that they come at problems from the wrong angle. “Some come up with an idea, then think of a problem to apply it to. Others chase something that isn’t that important.

“For instance, there is a concept of perfect balance and you’ll see complex machines with extra spinning discs that are perfectly symmetrical, but that symmetry doesn’t help at all. It’s extraneous to the issue.”

Steve worked his way through the European patents (available free online). “There aren’t many things that, with a fresh perspective, can’t be improved. Too many people are blinded by the idea that something can’t be done better.”

He’s proved them wrong. Lontra’s blade compressor is a circular mechanism. It replaces the old “up and down” piston technology by compressing air, or gas, in front and inducing the air behind in continuous motion. This minimises waste. It’s oil-free, more energy-efficient and more reliable than alternatives.

“Our compressor saves 20 per cent energy over other compressors. It’s good for customers, it’s also good for the world.”

“We want to be a significant UK exporting company and in 10 years, there’s no reason why we can’t be globally successful,” added Steve.

Gaining credibility within the market

How do you get a product to market when you’ve got limited knowledge of the sector?

Part of Lontra’s success is Steve’s technology and part is his understanding and exposure to the financial world.

“Investors need proof points and gateways.” To get over the first proof point and gain credibility for his invention, Southampton University agreed to run a fourth-year project based on the compressor. At the end of the project, Steve had the endorsement he needed.

“That was my first proof point. Then I raised money from The London Development Agency which enabled me to approach Cosworth Technology in Northampton to establish proof of concept.”

Lontra’s compressor received a glowing report from Cosworth. It also secured the expertise of engineer Clive Hudson, who liked the invention so much he agreed to become Lontra’s engineering director.

With funding and proof of concept, Lontra could establish its own base. But where to go? Steve lives in Richmond, South London. “I could have headed to Shoreham, in Sussex – where there’s a lot of relevant engineering expertise, or we could open in the Golden Triangle of Warwickshire, Oxfordshire and Northamptonshire.”

He chose Warwickshire and the business now employs 22 people. The majority are experienced and skilled engineers drawn from the automotive and aerospace sectors.

“Skilled engineers like working with us because what we’re doing is new and challenging. They get to follow the project from beginning to end; we give them the freedom to do things properly and we work with the best in the industry.

“Warwickshire is in the heart of the UK’s automotive industry, and just as important for the engineers, it’s located in a pretty village, not on an anonymous industrial estate.”

“We want to be in the UK because we are British, but it’s not done foolishly – we really believe Britain is the best place to make our products,” explained Steve. “I believe that R&D should be close to manufacturing. We have globally competitive partners and some brilliant engineers.”

The importance of nailing IP

The company’s first chair, who sadly passed away in 2015, was Peter Watson. He was behind the team who licenced the lithium ion battery and used his expertise to help Lontra secure its first licence agreement with Swiss industrial engineering company Sulzer, for the waste water market – a significant milestone for the company.

Licensing proves a product’s credibility and provides all-important IP protection.

Peter had a good story, according to Steve. “When they first licensed the lithium ion battery, the licence was infringed by an American company. Peter took his legal team over to challenge them, but the American company said: ‘so what’, because his company was so small.

“When Peter explained that one of his licensees was Sony and they had the right to defend their patents, the conversation changed and they settled.

“We have set up a similar process at Lontra. It’s in our licensee’s interest to defend our IP.”

Lontra received The Institute of Mechanical Engineers’ first investment through the Stephenson Fund, a £2 million investment fund aimed at companies working in mechanical engineering.

Innovate UK is also working with Steve’s team on three projects and the company has just won around £1.5 million pounds from the EU’s Horizon 2020 fund, to take its products into the food and pharmaceutical industries.

The Carbon Trust is also a supporter and encouraged Lontra to approach the water industry with its compressor. In September 2012 it launched a very successful trial with Severn Trent Water. Within nine months the blade compressor was supporting the site. It was the company’s first prototype, proving far more reliable than Seven Trent’s existing machines, and more than 20 per cent more efficient.

4 facts on Steve Lindsey

    • Former demo driver for Audi
    • Used to race Caterham cars
    • Lives in Richmond, spends three days a week with his Lontra team in Warwickshire
    • Has designed a unique hybrid wooden and steel garage with much better insulation