During Phase 1 we have carried out a feasibility assessment that confirms the expectations for the business:
• Technical studies: We have confirmed the technical requirements for the product depending on the different segments
• Economic studies: We have obtained the prices of other DP1 systems in the market, as well as of those systems providing functions that a DP does (autopilot, joystick, trip computer, etc.). We have also analysed the costs of our DP1 system: software, hardware, installation, maintenance services, advertising, etc.
• Market acceptance confirmation by:
1. Analysing the market figures and characteristics of all defined market segments
2. Getting the feedback from potential customers. Based on the trustful relation we have with our customers, we have carried out surveys directed to them answering the following main points:
- Technical capabilities they expect from a DP1 system in order to be interesting for their fleet. In how many of their units/year would they install it? And in how many old units?
- Will it make a difference if it allows your units to lower consumption in long voyages? How much are you willing to pay for a DP1 in such case? It will depend on the size of the vessel, and it might make sense only for relatively big crafts and units, so we must focus on the interesting ones. In how many of your units per year would you install it? And in how many old units?
- Did any obstacle (beside the economical) prevent you from acquiring a DPS in the past?
3. In the yachting Industry we have analysed our main customer by reading technical reviews of their models, and with meetings with them.
• We have developed the business model (confirming the business opportunity), the commercialization plan and the implementation plan (including human resources). The work in Phase 1 has allowed us to confirm all the hypotheses already mentioned: costs involved (commercialization and funding), market opportunity, the return of investment, financial analysis, interest from customers, profit margin, etc.
• Intellectual property studies
The main conclusion of the different studies carried out within this phase 1 is that we believe that project shall continue. Development of phase 1 has allowed us to refine the whole project and confirm the business potential. Although the main ideas remain the same, some details have changed:
1. The objectives of the excellence section remain the same, but the concept and approach has changed slightly. In this part we have decided to:
a. Include some sensors in the hardware to be supplied with the controller unit because not many vessels have them, i.e. the wind sensor, the DGPS, and the IMU unit will come with the unit, and the quality of the selected sensors will be proportional to the segment needs in order to be cost effective.
b. Provide different functions in the system that suit the different market segments. For example, a low-speed mode is mainly useful for the yacht segment, and it is thanks to the conversations with this market that we have decided to include it (as it is less typical of classic DP units). These new functions are very easy to implement, since they are just a new way to control the core of the system. In the case of the low-speed mode we only need to change the speed range for the joystick and update the user interface to add the function.
c. Reduce the price of the equipment by finding the appropriate units. For instance, thanks to the suggestion by National Instruments, we have reduced the price of the cRIO unit almost a third, since we have selected the cRIO 9031 instead of the more expensive and thus out-of-purpose cRIO 9082 (which was the one selected for the proposal of Phase 1).
2. In the impact section we have made the following changes:
a. We have added a new market segment, so there are 4 right now. Namely, we have split in two the third market segment, since although the value proposition is the same for both (manoeuvring improvement), they have a different nature. The new segments are those working units interested in manoeuvring (fishing vessels, tugs, megayachts, etc.) on the one hand and yachts built in series on the other. The adjustment of serial units is cheaper, their purpose is also different, the installation companies are different, etc.
Besides, the segment of working units interested in manoeuvres has some units coming from the first segment of the proposal for phase 1 (like fishing vessels, etc.). Thus, the first segment now comprises the units with classic DP, which mainly covers the offshore Oil&Gas and Wind energy sectors.
b. The market analysis has led to an increment in the expected number of sales, which has allowed us to adjust the impact of several activities in the price of the units, making the system even more affordable. This will help in our purpose of spreading the system in the market.
c. We have adjusted the commercial strategy. In this phase 1 there was only one price for the system, and we conceived the possibility of reducing it slightly for serial production. Now the price depends completely on the market segment, as we will change the hardware or even limit the available functions (not impacting on the development and guarantee of the other functions and eliminating the associated hardware).
d. We have realised what things we must change about the company communication activities as well as the company structure in in order to reach new clients.
Kind of support that will be useful to develop our business further:
1. 4 main allies will help us to get a good positioning in the market through Strategic Alliances but no exclusivity rights. The first 3 allies are capable of reorienting the clients, and the 4th plays a major role in the price.
a. Aksoy: a shipyard producing offshore and merchant vessels that are appropriate for our system.
b. Rodman: a yacht yard producing many units per year that are very suited for our control system. They will grow thanks to the added value of our system and so will we.
c. Nautical: an installation company involved in about 40-50 installation a year and with presence in three continents (which can help to reduce maintenance costs in the future).
d. National Instruments: they are the developers of LabVIEW, the programme language of SeaDP.
2. The EU SME instrument is a key player:
a. They can provide us with a 70% (1,286,682 €) of the total eligible costs, helping us to achieve the breakeven two fiscal years earlier.
b. They can make our business model much stronger thanks to the coaching services.
c. The European enterprise network can help us to find other allies.
3. We must increase even more the Marketing and Commercial activities after Phase 2.
