How Reactive Technologies Turned Technical Barriers Into Competitive Moats in Critical Infrastructure

How Reactive Technologies Turned Technical Barriers Into Competitive Moats in Critical Infrastructure

Most startups worry about competitors copying their product. Marc Borrett, CEO of Reactive Technologies, had a different problem: his first customers wanted proof that his grid measurement technology wouldn’t cause nationwide blackouts before they’d even consider a pilot.

In a recent episode of Category Visionaries, Marc shared how the technical barriers that nearly killed his company in its early years became the exact mechanism that now protects them from competition. The insight challenges conventional startup wisdom about moving fast and breaking things—sometimes the hardest path creates the deepest moat.

The First Question Wasn’t About ROI

When Reactive Technologies approached their first potential customers with technology to measure grid stability in real time, they expected questions about pricing, implementation timelines, or return on investment. Instead, they encountered something far more fundamental.

“The first kind of conversations we had in the very early days were all about, are you sure you’re not going to black out the power grid if we allow you to do this, we don’t want to have any problems,” Marc recalls. “So how can you prove to us if we allow you to do this measurement, you’re not going to upset damage temporarily or permanently destroy the power system?”

This wasn’t typical customer objection handling. Grid operators manage infrastructure that keeps lights on for millions of people. A failure doesn’t mean lost revenue or customer churn—it means potential catastrophe. The bar for new technology isn’t “prove this works better than alternatives.” It’s “prove with absolute certainty this won’t cause disaster.”

For a startup with limited resources, this level of scrutiny felt existential. “It did take a high degree of technical persuasion, justification, explanation just to be able to get a first small scale pilot started for obviously the right reasons. But as a startup, that’s very challenging,” Marc admits. “If you can’t actually get to go and start to prove what you’ve got because someone else is holding the playing field, that’s pretty tough going.”

Why Technical Barriers Persist After You Cross Them

Most startups view early customer resistance as a temporary obstacle—something to overcome and move past. Marc recognized something more valuable: barriers that are hard for you are equally hard for everyone who comes after.

“The level of technical scrutiny we were put under was very tough. But as long as you’ve got enough gas in the tank to ride that through and come out on the other end and you’ve got a genuinely helpful, positive technology, it does mean that there’s another, those same barriers apply to anyone else,” Marc explains.

This insight flips the conventional startup narrative. The barriers didn’t disappear once Reactive Technologies crossed them. They remained in place, now protecting the company rather than threatening it.

“So even if you’re the first one encountering those barriers, as long as you can get over them, that means those barriers are still going to be there for others,” Marc notes. Every technical review, every safety analysis, every proof point that Reactive Technologies had to provide would be required of any competitor attempting to enter the market.

The result: time invested in technical validation compounds. Each conversation with skeptical engineers, each data review, each pilot program doesn’t just advance one sale—it builds institutional knowledge that becomes increasingly difficult for competitors to replicate.

The Infrastructure of Trust

In critical infrastructure, trust isn’t built through marketing or sales tactics. It’s earned through technical credibility that can withstand expert scrutiny.

“When you’re selling into a relatively conservative set of customers, as we said rightly risk averse, trust is the thing you have to build,” Marc emphasizes. “And the only way that we, I think we’re able to do it is really from having a very credible technical team.”

This requires a fundamentally different approach to go-to-market. Your engineering team isn’t supporting sales—they are sales. “You know, we have a very, I would say, high calibre engineering capability and at some point that quality starts to become evident because, you know, you’re able to back it up, you’re able to share data, you’re able to show the physics of what you’re trying to do.”

The implication: competitive advantage in infrastructure doesn’t come from features or pricing. It comes from the accumulated technical credibility that only years of expert scrutiny can provide. You can’t fast-follow your way into this market because the validation process itself takes years.

When Growing Problems Carry You Through Scrutiny

Technical barriers only create moats if you survive long enough to cross them. Reactive Technologies’ survival depended on a problem that grew faster than their cash burned.

When Marc’s team began working with their first customer, the annual cost of the problem they addressed was roughly 16 million pounds. But the energy transition was accelerating. “Over the next five years, as we were working with them and we were going from a small scale pilot to a bigger scale to then a national scale, that problem grew fivefold. So 16 million turned into 32 million and eventually got to somewhere north of 250 million in that time period.”

This problem growth created natural momentum that sustained them through technical validation. “You’ve got to also be addressing a problem and that problem has got to be getting bigger,” Marc notes. “So the platform that we were saying was going to start burning actually took hold and caught a light.”

The lesson: technical barriers create moats, but only in markets where the problem grows fast enough to justify the time required to cross them. A static problem of even significant size can’t sustain the years of technical validation that critical infrastructure demands.

The Conservative Customer Becomes Your Best Defense

The same conservative nature that made grid operators difficult first customers becomes an asset once you’ve earned their trust. These customers don’t switch vendors lightly—the same risk aversion that made winning the deal difficult makes keeping it easier.

Marc’s marketing strategy reflects this dynamic. Rather than focusing on demand generation or competitive positioning, Reactive Technologies focuses on becoming the technical standard.

“General approach for us is really to achieve sort of the best practice solution,” Marc explains. “We need to make sure that the solutions we offer, you know, if you imagine a risk dial for a customer, we need to move that dial from. We’re not the risky innovative solution that might cost your job. If you go with us with a proven technology solution that delivers the measurements that you need to run your grid.”

This positioning—from risky innovation to proven standard—only works after you’ve cleared the technical barriers. But once established, it creates switching costs that go beyond contracts or integrations. Switching means restarting the entire technical validation process with a new vendor, repeating years of scrutiny and proof.

The Broader Principle

Reactive Technologies’ experience reveals a counterintuitive truth about building moats in critical infrastructure and regulated industries: the obstacles that nearly kill you become your strongest protection.

This principle challenges startup orthodoxy about moving fast, lowering barriers to adoption, and making buying easy. In some markets, difficult buying processes aren’t bugs to fix—they’re features to embrace. The years of technical validation that feel like wasted time are actually depositing competitive advantage that compounds over time.

The key is recognizing which barriers are productive friction versus destructive obstacles. Productive friction—technical scrutiny, safety reviews, expert validation—builds moats. Destructive obstacles—confusing pricing, poor user experience, unhelpful support—just slow you down.

For founders considering critical infrastructure or highly regulated markets, the question isn’t whether you can eliminate barriers to entry. It’s whether you can build a business model, raise enough capital, and maintain sufficient conviction to turn those barriers into moats before your competition even understands they exist.