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From PhD to Factory Floor: How One Technical Founder Built Trust with Industrial Giants

Technical founders often struggle to bridge the gap between innovative technology and real-world customer adoption. In a recent episode of Category Visionaries, Berk Birand, founder and CEO of Fero Labs, shared how he transformed from a Columbia PhD graduate to leading an AI company that’s revolutionizing industrial manufacturing.

The challenge wasn’t just technical – it was about earning trust from conservative industrial companies to let a startup influence their critical operations. As Berk explains, “We’re talking about where they’re taking 50, 60 tons of scrap steel, melting it into liquid steel, and then turning it into an actual product that goes into a building.”

For many startups targeting large enterprises, the temptation is to offer free pilots hoping to land the first big customer. Berk took the opposite approach. “One of my advisors in the early days told me to never do that, to always, even if it means hurting your chances of getting this customer, don’t do free work,” he shared. The reasoning? “If you do that, then companies will see you as kind of an extracurricular activity of sorts. They’ll see as a way to learn from you as much as they could, so that to see if they could build it internally.”

This stance was particularly bold given their target market: multinational manufacturers with “$5-10 billion plus in revenue, usually with 50-100 plants worldwide.” Yet the decision to always charge something, even a small amount, helped establish credibility and identify serious buyers early on.

The breakthrough came through a combination of humility and clarity about their value proposition. “Being very upfront, being very humble since day one, very clear that we don’t know anything about steel,” Berk explained. “Our value add here is not steel production. It’s not chemicals production. What we bring in is the data science part, and you guys are the experts.”

This approach resonated with their first major customer – a steel manufacturer building beams for the new World Trade Center. When the IT team raised security concerns, their internal champion took a bold stance. As Berk recalls, “This champion of ours just signed the contract. And he signed the contract. And then the IT team was like, wait a second. We’re just going through the IT security steps here. And then he goes, well, I signed the contract. What do you mean?”

The key was making it clear that customers remained in control through explainable AI. “Our software also tells them why these predictions, what recommendations are made,” Berk noted. “And as a result, there was this human in the loop aspect that actually reduced the off chance of something going wrong.”

Looking ahead, Berk sees AI becoming the “intelligence layer” atop industrial hardware: “The industrial sector is very much like an organism, where you have factories that produce one thing in one side and then send it to the other. And I really believe that we can go from optimizing a single factory to optimizing the entire organism using AI.”

The results validate this vision. At one customer’s steel plant alone, following Fero Labs’ AI recommendations saved a million pounds of raw materials in just one year. “It’s just quite incredible to bring in a team together that can drive this much impact across the world just by redoing digital software through software,” Berk reflected.

For technical founders targeting enterprise customers, Berk’s experience offers valuable lessons: maintain pricing discipline from day one, lead with humility while being clear about your unique value, and ensure your technology empowers rather than replaces human expertise. The industrial sector may move slowly, but with the right approach, even conservative giants can become champions for innovative startups.

Actionable
Takeaways

Leverage Academic Skills in Entrepreneurship:

Transitioning from academia to entrepreneurship involves a steep learning curve, but the research, writing, and grant application skills you've honed can be invaluable in selling complex technical concepts and securing funding for your startup.

Emphasize Impact Alongside Innovation:

When founding a tech company, especially in sectors like sustainability, focus on how your technology can make a real-world impact. This not only motivates you and your team but also resonates with customers and investors looking for meaningful advancements.

Integrate Profitability with Sustainability Goals:

Early on, identify and articulate how your solution not only addresses sustainability challenges but also enhances profitability for your clients. This dual value proposition is increasingly becoming a necessity for businesses across sectors.

Educate Your Market:

In emerging or conservative sectors, part of your go-to-market strategy should involve educating potential customers about the feasibility and benefits of your technology. Use transparent communication to build trust and demonstrate the practical application of your solution.

Never Underestimate the Power of Early Adopters:

Securing your first few customers will likely be challenging, but finding and nurturing early adopters who are willing to take a chance on your solution can be pivotal. Their feedback and success stories can serve as a powerful tool for scaling and attracting more customers.

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