Russ: This is the Businessmakers Show, heard on the radio and seen online at thebusinessmakers.com. It's guest time on the show and our topic today is water. Clean water to be a little bit more specific, because my guest is the president and CEO of Albuquerque-based MIOX Corporation, Craig Beckman. Craig, welcome to the Businessmakers Show.
Craig: Thank you, Russ. Great to be here.
Russ: Well, tell us about MIOX.
Craig: Sure. MIOX is a technology company based in Albuquerque, and we focus on water disinfection. Specifically we produce machines that our customers use on their own site to actually produce their own disinfection chemical, which is safer, and often for them less expensive.
Russ: Well, I think everybody would agree that clean water is seeming to become more and more important in the world.
Russ: So it must be a great time to be in the water business.
Craig: It is a great time to be in the business. It's never a lack of challenging situations to find, and certainly never a lack of interest in our technology. We've had our base historically in swimming pools and drinking water, and are no leveraging that base to look at some other industrial segments, specifically oil and gas development, and energy.
Russ: Okay, cool. So how old is the company?
Craig: The company is about 15 years old. It actually goes back originally to the Los Alamos labs, where technology was developed with a government grant to come up with a better form of disinfectant that could be produced safer, more effectively. And that technology was then licensed into MIOX to create our corporation and really our beginnings in the drinking water segment. And since we've done a number of innovations to look at what other chemistries we could develop and solve problems with.
Russ: Okay, now disinfectants, you mentioned swimming pools and drinking water. I always thought all that was just solved by dumping a bunch of chlorine in water.
Craig: Sure. That is by far and away the most common disinfectant that's used globally, and it is very effective. However, it does have some side effects. Whether it's used in liquid form or even in gas form, it can cause some safety hazards. So for example, Homeland Security, for the last ten years, has been very interested and has gotten more involved in the handling of gas chlorine, because gas chlorine is actually the same thing as mustard gas. And so Homeland Security has gone to most of those municipalities that have used gas chlorine and required them to switch to an alternate form that is safer to handle and poses a less or a smaller security risk for national safety.
Russ: Wow. That's pretty interesting.
Craig: So they've looked at alternative sources. Their alternatives typically are liquid chlorine; bleach, the same thing you'd use in your laundry; or on-site generation. On-site generation, which we do as MIOX, offers some distinct advantages that it is more stable, because you're actually storing the salt in a dry form and then activate it through the machine on-site, as opposed to storing liquid bleach, which actually breaks down in heat.
So in Houston, for example, where we sit, chlorine will actually lose its effectiveness every week. So even though you're buying at 12-percent, by the time you use it you might only get 8-percent. So you've lost 20 to 30-percent of what you bought. In addition, in a bulk form it isn't very safe to handle.
Russ: But you mention machine, so describe the machines that actually perform this.
Craig: Sure. So the machines that we produce are as small as a marker-size, which you could carry on a backpacking trip to treat for you and your family, to as large as a number of refrigerators sat next to each other that could treat a city of Fort Worth. You'd need a number of those at different treatment stations, but with four or five installations of that size you could treat all the drinking water in Fort Worth.
Russ: Okay, so you mentioned large city drinking water cleaning. What's the alternative that cities have? I mean do many cities just dump chemicals into the water?
Craig: Many cities, in fact, most cities around the world still use liquid bleach. By far and away the most common disinfectant used by cities for primary disinfection is the chlorine. It offers two benefits; one, it kills bacteria very effectively, but also carries a residual out into the community. And so that's how cities really measure the effectiveness of their treatment, both the concentration of the disinfectant at the treatment, but then they also go out to their furthest distribution points and measure at that points. Our chemistry has some unique attributes to it that help them in that secondary measurement around disinfection byproducts.
Russ: Okay. Well how do the environmentalists feel about the MIOX way of cleaning water?
Craig: I certainly think they would be fans. All of them that I've talked to personally are fans because our product has a much lower carbon footprint, for example. So if I was the city of Wichita Falls I would actually be delivering bulk chemical in tanker trucks, but it would still be mostly water that I'd be purchasing. It would be 12-percent perhaps active chemical, but then 88-percent water. Our product on the other hand, takes the water that's already at the site, doesn't need to be moved; we simply mix it with salt, activate it through the machine, and create the chemical right on site.
Russ: Okay, really interesting. So the company was formed how many years ago did you say?
Craig: Goes back 15 years now. Technology came out of Los Alamos Labs, was licensed out, and we now have recapitalized the company a few years ago to accelerate our growth and to launch into some industrial verticals.
Russ: Okay, well that's what I find kind of interesting. So probably for the first 10 years or 15 even maybe, it was mainly municipalities and swimming pools.
Russ: But now this whole issue of water challenges throughout the globe these days have become appealing to MIOX?
Craig: Yes, they have. There's a couple real specific examples that most people would relate with or understand. Frack fluid, for example.
Russ: Oh yes.
Craig: The frack chemicals, that there's been a real push for more disclosure on what chemicals are used in those fracking operations. They use biocides in frack water to prevent and slow any bacteria growth in the gas formations. Today they use a relatively harsh disinfectant called glutaraldehyde. Most of the frack companies are looking for a greener, safer alternative, and our technology offers that for them.
Russ: Wow, so that's a pretty sizable market right now.
Craig: It is a very large market. And all of the companies, from Devon to Anadarko to Chesapeake are all looking for and evaluating right now what is that green alternative. We've yet to see one of the majors make a wholesale change, but certainly they're all anticipating, either through their own initiatives or through regulation, they'll need to make that change in the future.
Russ: Okay. Well now let me move to you a bit. I did some research and know that you're relatively new as the CEO of MIOX, right?
Craig: I am.
Russ: But you, kind of like me, have this business development background, sales. So tell us a little bit more about that. It was always in water, wasn't it mostly?
Craig: It has always been in water. I started my career about 20 years ago in Detroit, Michigan, and I was selling to the automotive companies. In the automotive industry they use a lot of water in the painting process. They need actually pure water to rinse the vehicles through the painting process. And I moved out there to sell. I had the keys to my car and a quota on my head and that was about all I knew, but over a couple of years and some hard knocks I had some success and got us listed as a tier one supplier to Ford and to Chrysler, sold some systems and learned how to sell out in Detroit.
Russ: Okay. And so from there it was to another focus-
Craig: So from Detroit, that was with a company called Osmonics. I moved back to headquarters then to run sales and marketing for that company for a number of years, and eventually that company was sold to GE Water in 2002. And it was one of the four large companies that GE rolled up that has now become GE Water.
Russ: Okay. Now as you know, our audience is a pretty smart business audience and they probably find this to be very interesting. Did you always aspire to be the CEO of a company?
Craig: I didn't aspire to be the CEO. I always aspired to be able to make decisions that had impact. And so whether that was in sales and marketing or product development. I've always been fascinating with technology development, and getting technology into customers' hands to solve problems, which is never easy, because whatever customers have done in the past is always what they think is the right thing to do.
Craig: And convincing them of a new solution is never easy. So I've always found that challenging, and so I guess, yes, my experience led to an interesting background for trying to take this technology into the industrial space.
Russ: We also have a fairly young audience, we think, that watches this show a lot, and most of the young people have grown up in the digital age. And it seems like in the digital, you know, marketing has sort of increased in its importance and popularity. At the same time, sales sort of seemed to decrease. But there's still major sectors of the business world that depend significantly on people that can convince others to change and take action.
Craig: Yep. Sure. Sure.
Russ: So people from my camp applaud you making it to where you are today. Which sort of brings me to another question. Marketing, what can you do in marketing for a company like MIOX?
Craig: Sure. Great question. It is a big challenge for us on how to reach our audience, and then how to tell the story. And we're actually getting pretty effective at how to tell the story. Recently we actually did a video that we posted on YouTube that was a side-by-side example of how our technology could affect biofilm on a cooling tower surface, for example. Our challenge now is how do we find the right audience to look at that video, and then how do we compel them to actually do it.
Craig: So recently we had a pretty good experience where we sent to a target audience a physical USB drive that we then prompted them to put in their computer and watch a video. And it was in front of a trade show, and we got actually really good connection out of it. So even in today's digital age, having a physical presence and a reminder I think is effective.
Russ: Sure. What kind of trade show was it? I mean was it-
Craig: It was a trade show that just ended last week in California called The American Water Treaters Association, AWT. And it's focused on regional water treatment companies that would treat pools, spas, light industrial, hospitals, universities. They would do boiler and cooling treatment for those types of facilities.
Russ: Okay. I thought for sure you were going to say, "We take a glass of real dirty water, perform the MIOX magic on it and drink it right there."
Craig: Sure. We have done that also. If you'd like to go to our website, our former CEO did that and-
Russ: And survived.
Craig: -and survived, yep. That's a common one. Especially in the oil and gas industry, we see that challenge a lot as we try and clean up frack water with a clean disinfectant, we're often asked of, "Well, would you drink it after we treated it?" And my answer is always yes.
Russ: Oh my god.
Craig: It may not taste well, but it would be safe.
Russ: All right. Good. Okay, Craig, let's say somebody's watching right now and they're interested in knowing more about MIOX, what do they do?
Craig: Best thing is probably go to our website, www.miox.com. We have a number of videos posted there that they can view and see some of these results that I was talking about, as well as extensive literature in our technical library.
Russ: Okay. And that's M-I-O-X.com?
Craig: It is, M-I-O-X.com.
Russ: Okay, Craig. I really appreciate you coming in and sharing your story with us.
Craig: Thanks, Russ. It was a pleasure.
Russ: You bet. That's Craig Beckman, the president and CEO of MIOX Corporation. And this is the Businessmakers Show, heard on the radio and seen online at thebusinessmakers.com.