On early 2019, we accompanied a young EPFL spin-off called CompPair, and wrote a post about their initial efforts to uncover promising market opportunities for their unique self-healing composites. 18 months later, we decided to go back and see how they are progressing with setting their strategic focus. We wanted to share insights from their learning and validation process, and how it can be reflected on the Market Opportunity Navigator.

The promising innovation of CompPair

Inspired by the human body, CompPair develops healable composite materials. Their pre-impregnated textiles reduce maintenance costs, increase products’ lifetime and improve global sustainability, all while keeping standard specifications and assuring compatibility with existing production lines.

At the beginning, CEO Amael Cohades and his team searched for the killer application- the one product they should bring to the market. Together with a team of PhD students, they examined opportunities ranging from prosthetics to hockey sticks, evaluated them with the Market Opportunity Navigator, and compared their attractiveness. Yet, as they progressed with their learning, it became clear that economies of scale were critical in most of these domains- an edge that cannot be fulfilled by an early stage startup.

The challenge of moving down the value chain

Gradually, they decided to move down the value chain, and provide smart prepregs as a semi-product for part manufacturers and OEMs. On one hand, this decision allowed them to address an extremely varied set of verticals that can benefit from healable materials. On the other hand, each vertical required specific adjustments to the material, and demanded a complete implementation support.

So while theoretically it was possible to play in multiple industries simultaneously, this was in fact impossible to execute for a small startup… once again prioritization was necessary! CompPair needed to prove their value in a one fast-adopting market, and gradually build their roadmap for growth. But which vertical should this be?

The strategy: from Quick-wins to Moon-shots

Composite materials create a 90 bn$ market, with 5% CAGR. Glass, fiber, and natural composites are used in endless applications, including industrial, medical, energy, and transportation – to name a few.  The annual cost of composite repair is estimated around 17 Bn$, and waste is expected to reach 110 Mtons in 2050.

In this huge landscape of opportunities, CompPair’s team needed to find a first market which was sensitive to damage, and willing to adopt their innovative material despite the fact that ROI was still difficult to assess.

They categorized their options into 4 main domains:

  • Marine and sports
  • Wind turbines
  • Aerospace and airplanes
  • Automotive

Marine and Sports: the overall volume for composite materials in this domain is estimated as $ 1.6 Bn. It is a market that is receptive to innovation, willing to adopt sustainable designs, and low on regulation – so adoption can be relatively quick. Yet, the main challenge lies in dealing with many, small-mid sized actors, each one demanding its unique support.  Overall, it seems to be a Quick-win opportunity.

Wind turbines: this $ 2.3 Bn market is composed of large OEM players. Although it bears higher potential, the challenges associated with this market are also higher: it is highly regulated, production processes are constrained, and time to revenues is high. Overall, it is estimated to be somewhere in between Quick-wins and Moon-shots.

Aerospace and airplanes: The key advantage of this $ 2.5 Bn OEM market, is the high price-tag per unit, creating a high potential opportunity. Yet, regulation is extremely heavy, and adoption barriers are immense. It is definitely a Moon-shot.

Automotive: Finally, imagine you could point a heating gun on your car scratches or damage and fix them within 1 minute? The volume of this huge market is estimated at $ 10.8 BN, yet economies of scale are critical and potential margins are extremely tight. It bears a super-high potential and super-high challenges.

Examining the Attractiveness Map for CompPair revealed a relatively clear vision: starting with a Quick-win opportunity – to gain the required capabilities and prove the value of self-healing composites, and then gradually expanding into the Moon-shots. The strategy and expected time-lines were set and shared with employees and stakeholders:

It’s an on-going process

CompPair’s team is working days and nights to validate and execute their strategy: finding, serving and retaining customers from the marine and sports industry, while keeping open future growth opportunities.

It is a long process, full of extensive challenges but also mind-blowing achievements: CompPair prepregs have received the Solar Impulse Foundation label as an Efficient Solution, selected by Space4Impact as the startup of the year 2020, and was nominated as one of the 40 best high-tech start-ups in Europe.

While the road to success seems promising, future crossroads are sure to appear. Eventually, finding the right markets is a crucial and ongoing process throughout the life of a business. Managers should keep in mind that they are on a learning journey, and adopt structured approaches to reach decisions and move forward with confidence.