From Distribution to Deep Tech: A Deep Dive with Avocet CEO Kieren Hall

[Music] Hello and welcome back to Conversations with Agents of Change. I'm your host, Easy Void, Digital Strategies Community Builder, and your Agents of Change Jamkin. On this show, we go beyond job titles and uncover the people reshaping our world through innovation, impact and bold ideas. Today's guest epitomizes that spirit. I'm joined by Keirne Hall, CEO of Avocet Battery Materials, and a driving force behind the rapid evolution of the European battery manufacturing sector. Keirne, he's reshaping an industry from building localized, traceable supply chains to accelerating R&D through the Avocet Research Center. He's turning material science into meaningful change. Keirne, welcome the show. Thanks, thanks, Easy, not so many trials. Let's start at the beginning because your journey isn't a typical CEO trajectory. You joined the company back in 2012, and you have grown alongside it. Today Avocet spans battery materials, precision metals, and extra foils, and an R&D center. How did you move from a distribution focus business into becoming a manufacturing lead group? Great difficulty, to be honest. I'm very, very challenging. I've worked with my dad since 2012, and when he set the group companies up back in 1996, he was very much of the view of let's keep our overheads low, let's do distribution only. And to be honest, that's a great model. It works, but for me, there was just something missing. And yeah, as much as from a lifestyle perspective, he was great. I mean, we could work whatever hours we wanted. There was really just three of us at that point, and life was good, but I just felt a little bit like something was missing and a bit unfulfilled. Because I always felt like I always wanted to be responsible for our own quality, our own product, and as a distributor, as much as you can do quality checks, like if you do have an inherent quality problem, you have to go back to manufacturer, and I always wanted to make our own thing and be really proud of what we make. So I just felt like something was missing, and to be honest, COVID for us was a big turning point. So when COVID hit, a lot of our business slowed down, and we had an awful lot of chance to reflect, our own little bit sat in our garden, in the sun. When COVID hit, it was like 35 degrees, and it sat at home in the April May time, thinking, "You know what, this is an opportunity. I can either sit on my ass and ride COVID out, or we could do something." So we actually set about really trying to plan how we take our business to the next level. So what that looked like for us was, the real catalyst actually was innovate UK. So I don't know if you know of innovate UK, and in particular the batch proportion sensor, but we got introduced to them for one of our customers, and we really saw an opportunity to get into manufacturing through a particular very niche product, which we basically submitted a grant application to the UK, so it's through the Advanced Propulsion Centre, and we were very fortunate to be successful with that. So we kind of had a bit of an old shit moment where we'd got all of a sudden this grant, which is 1.4 million pounds worth of grant and we had no ways of delivering it. We didn't have any people. All right, this is serious now, we need to do something with this. So we set about then trying to raise some investment, because basically the APC and the innovate grants, they basically pay you the money back. So for every pound that you spend, maybe you get 50p back if it's eligible for the grant. So if we had 1.4 million a grant, but we needed to match that with our own cash to be able to spend it. So we set about raising, trying to raise some investment, which is extremely difficult in heart attack, so in manufacturing the appetite for investing in physical things and machinery. Isn't that when you compare to like a software type business? I think the reason being, particularly in the UK anyway, is typically like in London, we're a very service based economy. Investors are used to putting money into businesses where maybe the overheads are not big. Whereas in manufacturing, you're buying a physical thing, you need space, you need people. It's an overhead that's going to be there even when businesses is down to and you've still got the overheads of your building, your rental rates. People, and I think the kind of returns profile that investors are looking for in the UK are much faster. I think we kind of paint this picture of these unicorn businesses, every business that's going to raise investment. That's to be a 10 billion dollar business. That's great if you can do it, but I just think there's very low chance of success for those businesses, whereas I think maybe in other areas, they're kind of more realistic of what patient capital looks like. Okay, every investment in this company maybe returns or more. I could tell you there are bases rather than a two-year basis, which some investors are looking for, I think, in the UK. So raising the cash was challenging. We did it, and we basically went from having a small office in our own town to having a manufacturing space in Homes Chapel, which is just south of Manchester. It's a small manufacturing space, but it's hours. When we first rented this new space, I thought, wow, bloody hell, this place is massive. I will never fill this. Fast forward to today, five years later, and we're full, and we're trying to find ways of creating new space, whether that's a new premises, or whether we're doing something a bit more reshuffle downstairs. So it answered your question of how do we do it? Great difficulty was the answer. What we didn't know about the products. We thought, to be honest, that product we were making was relatively straightforward. Actually, it's not really complex, there's a load of material size behind it, a load of chemistry behind it. So one of the first challenges we had to do was basically create our own IP. So we needed the challenge we had as a special surface treatment on our part, and basically we make a special connector that goes into batteries in very simplified terms. It's a connector that's got a surface treatment. The surface treatment protects the connector from corrosion within the battery cell. So in a lithium ion battery cell, basically the liquidness inside it is extremely corrosive. So if you think of any packaging or components inside, they've got to be able to withstand that corrosive environment. So our connector needs that surface protection on it, and in Asia, they do it using a chromium based surface treatment, which basically you need a big long plating line to do it, 40 meter long plating line. It's expensive, it's slow, but it works. The challenges is extremely hazardous to the environment. So doing it in Europe is a no-go, doing it in the UK is a no-go. We needed our own way of doing it. So the one of the first things that we did was settle our own R&D team to work on that challenge, and that kind of snowball that has ended up with is working with the University of Manchester, we've got a PhD student there, working full time with the project. We've since registered our own IPP, we've got a solution that works. We're in the process at the moment of validating that in live sales with a view to scaling that technology up. So that was our first challenge. Second was how on earth do we get people who have never made this component before? So this component is only made in Asia outside of us. So we're the first company outside of Asia that makes this particular part. So that skill set, that know how it doesn't exist in Europe, it doesn't exist in the States. How on earth do we create that? So to be honest, by making a lot of mistakes is the answer. So we gave our team a lot of time, a lot of space to be able to learn how the equipment runs, make the errors which we learned from, and now we're in a position where I can confidently say like the expertise now exists in the UK for this particular component, which is actually critical to the localization of a supply chain for a power cell. So when I talk about a power cell, what I mean is there's, but there's essentially three core high volume types of battery that are used when you're talking about EV type applications or drone applications or energy storage. So the three type types are cylindrical, in which kind of looks like, I can say you're average, you're a cell, round battery, that kind of cylinder type shape. You get different sizes, they're kind of standardized sizes, but that's what we call a cylindrical cell. There's a prismatic cell, which is more of a box type shape for most of them. A simple way to describe what it looks like is it. It looks more like a typical carb battery. It can be more a square or a cube type shape, although some of them are quite, sort of oblong or rectangular. A power cell is basically the most customizable of the battery types. So a power cell has a laminated aluminum-based bag. It can be flexible. You can make it to any shape. You want our component is used in that type of battery cell, and depending on which battery cell manufacturer you speak to, will basically depend on that I'm telling you, which is the best? Because there's always this discussion around, okay, what's the best form factor? If you ask the lines of Elon Musk, those guys use cylindrical cells, so they'll say theirs is the best. Companies like Nissan, they use a lot of powge cells, VW, prismatics, a lot of drone manufacturing is now going towards pouch. A lot of heart really high performance applications are in powge cell because they can really customize it. And it's a bit easier to do R&D with as well. So if you want to make quite fast, iterative different types of battery cell, then the pouch is quite a good form factor. To summarize, we didn't buy, getting in the cash, getting the right people. So we hired experienced manufacturing people who've set up factories all over the world. We hired those types of people. Hired, very smart people in R&D. And we're not afraid to pivot and change our plan accordingly, depending on what the market was saying. So example to that is when we first set up the business, we were really targeting the EV sector, that EV growth has not been quite certainly for European. Cell manufacturing is the growth has not been to the extent that we expected a lot of companies start, battery company started and our target customers started and then into administration. We've pivoted now to really high performance applications. And we developed some of our own tech as well in that. So yeah, I heard that answers your question, is it? - That is what I think, yes. - Absolutely, no, it's brilliant, because actually I was very curious, because when you think about it, batteries are pretty much everywhere nowadays. And I was about to ask you like, how did you know which of the types of batteries would you want to choose? But I suppose that it comes from the clients and the needs. And I suppose that kind of felt like the right moment to create a new chapter for our website, is that right? Whenever you went into batteries and thought, "This is a different way that we need to explore separately." - Absolutely, so we've always been very ambitious and we found ourselves in the battery industry, ourselves through distribution. - So today we're part of our business is growing and we are the UK's largest distributor of battery foils, for example. So we were in that industry and we could just say, if there's all these companies who are starting and there's no supply chain over here, we've actually got an opportunity to be at a forefront of an industry and we need to, if we've got that, if we believe in the market, we believe in the industry, let's do it. Let's kind of dive in fee first and transition our business and we've done that. But it's not been without these challenges and the kind of a key shift for us was when we moved away from targeting those really high volume customers for EV, automotive customers. We've kind of shifted, we're still interested in talking to these types of customers, but really today who we are supplying and doing really, really great work with is in the high performance sector. So that maybe that's defense, maybe it's for drones, maybe it's for some motorsport applications where they might need something a little bit different to the ordinary where we've got the expertise on hand, maybe the volumes are not crazy high. It's a nice volume for a UK company to get involved in and yeah, that's kind of where we're winning at the moment and that shift in mentality where we've gone here. That's okay, let's not necessarily focus on volume, let's focus on maybe some smaller volume applications whereby we can offer something a little bit different to the market and maybe give our customers a competitive advantage through performance improvements. That's really, really interesting. And I suppose that if we zoom out for a moment and we see battery industry as such, how do you think it's exploding? What's the landscape in Europe and in the UK? - Yeah, I'll tell you what it was like when we really started setting up our business back in 2019, 2020. So back then, if I said there was a new gigafactory announced pretty much every week for about six months, there was a new one announced diver in the United States or in Europe, you know, it was a real kind of like, there's a wave coming. These factories are gonna be built in the next four, five years, everyone get ready. - That was 2019, 2020. The reality of what's actually happened is those, a lot of those companies are no longer here. So an example would be in the UK, there's a company called BritishFull who announced a huge factory that was gonna be up in blive in the northeast, they secured 100 million of funding for the UK government. And that business, I think lasted maybe two or three years before they went into administration. A really high profile one in Sweden was a company called Norfolk. They were kind of the shining light for Europe, particularly for the start-ups because they were competing with the likes of a lot of the major Chinese companies and big Korean companies in the battery space who had been making battery sales for many years and Norfolk raised billions of pounds and had big facilities in Sweden. They had planned sites in the States, Germany, and yeah, unfortunately last year, they went into administration. That was the big blow actually to the industry because that was a company who raised a significant amount of funding and would kind of thought like the Cape Dance Europe success story right there. But they encountered many challenges and I've seen, you know, not worked in that company but from reading articles, the way I think has happened is the actual know-how and manufacturing capability. It was just very difficult to replicate that from what's going on in China and Korea. So if not easy to make battery sales, there is not just a case of biopiece of equipment and you can make it. It's a case of, you of course need the right equipment to make it, but you need skilled operators to run it. You need to know the right recipe to make that battery sale. There is an awful lot of a trial and error when you're making a battery sale and it's very expensive so the materials are going to batteries and are not cheap materials at all. So make and the processes to make them are not cheap. So when these companies are trying to make the sales of the scale and their yield is poor, that puts a huge, huge pressure on their cash flow. I believe Norfolk had issues with yields and ultimately their customers lost faith and I think that ended up with a collapse of that company. So that was a real challenge for the industry and that was only last year. But what I can see people shifting away from is a lot of these companies were set up focused on EV because EV was going to be where that growth was. They kind of got hit with a double whammy of challenges. One was the kind of challenge to make then which I just described. This second was the uptake from their customers was not as rapid as what they expected. So these factories that were built and set up if their customer pushes them all back for six months. Well, some of these factories are employing countries, maybe thousands of people. It's a huge amount of overhead to take on if that customer's not taking the product. So that made huge challenges too. So what we're seeing today is I think a bit more resettled landscape. So a lot of these companies who announced these big plans either are not here or they've changed their strategy and change of strategy could be one of the few things. One could be the focusing more on specialist applications. A little bit like us where they're going for a game well, specialist applications, lower volumes or maybe where the end customer requires something more customized or more high performance. That's something that some companies are doing. Another is their partnering maybe with Asian companies and maybe utilizing factories in Asia to make their product to begin with. And that's a bit of a win-win for the local company in Europe or the States. And also their partners in Asia because of course if we've felt the slow down in EV then it's the same in China, a lot of the battery factories are also left with some lines redundant waiting orders. So if they can fill the capacity in Asia through working with European or American battery a manufacturer who maybe markets that product for them then that's a bit of a win-win. So what we're seeing some companies is utilizing maybe some Korean and Chinese. That's called a subcontract manufacturing out there with a view to then once they've built up that business and they've got that order book and they've got that client to then say, okay, well we'll put in a factory local to the end customer because ultimately I think that is what end customers want. I think they do want to have, I think COVID really highlighted that in particular long-haul supply chains are difficult. They're fine whenever he's running smoothly but recently you also got what's going on in the Middle East. Obviously COVID, you got Russia great. We're in quite volatile world so companies would want to have more of a sure to supply chain, more control. If there's anything happens they can call on maybe their local partner rather than somebody in a different time zone to support them. So ultimately I think that's what end customers want. But with that I think does come a potentially a small cost to pay because particularly if you're comparing the Chinese market to Europe and the United States the cost base over here is higher. So how can we make a batch of sell for the same cost as what it makes in China? when today the supply chain's not quite there, America's, for example, they've imposed tariffs on products coming out of China. And if I tell you that in 2019, 99% of the world's batteries came from China. So the supply chain is set up there. So if you put tariffs on China, it is going to hurt those local manufacturers who are importing from China. After political damage, I don't know the answer to at all, but I think it's just why, in particular, the European United States, I'm trying to push more of a local supply chain for these types of products. It's so interesting because there's so much complexity to it that they cut the eye to the first time. So there's so many layers, you know, there's so many aspects to be looked at. And I think that the way opposite is doing it is very interesting because it's partnering when it's to be partnered and it's trying to pursue local one can. And I think that's a very interesting idea. I want to bring back to what you were talking about. There's plenty more for our sales, so it's not just ABM. So I want to talk about the precision materials and why they matter. So I've been following your social media and I see that there's a lot of precision materials. And I love to hear for many listeners that it might feel very abstract. What's really the backbone of the modern manufacturing? Where are precision materials and why they matter so much in today's industry? That's a good question. So I think when most people hear metal, they kind of think of big sheets or big steel girders that go into building sites, right? And of course, you know, that's one type. When we talk about precision, these are materials that are manufactured to order that are manufactured for a very specific application. So this is where a customer will maybe they're making a particular component, let's say, for the aerospace or or medical device industry, they're making, I'm fine. I'm going to use medical device industry, because this is quite good example. So the catheters that they go into the body. So they're made using a precision stainless steel wire that's braided. So the wire that's needed to make a catheter is thinner than a human hair. They come on and they look like, you know, like small like sewing bobbins when you're buying like a little bit of cotton, a little sewing cotton bobbin. So they're supplied on these little tiny bobbins like this and they're placed onto a braided machine. You may be put 16 bobbins onto this machine and they're braided to make basically a shaft. And what that does is that provides the catheter with the rigidity that it needs, because when you're, if you're doing an operation for the body, the surgeon needs to be able to maneuver the product perfectly around the body with ultimate precision and having that rigidity in the products is essential. So for when we work in with catheter manufacturers, for example, there may be producing different sizes or maybe different catheters for different applications. They need different materials. Some might need a precision flat wire that's going to give the catheter different properties, some of the use around wire. Maybe some will need a different tensile strength. So what I mean by that is almost a kind of flex in the steel wire itself. And they'll specify very specific material properties for that wire so that they achieve the properties they want for the final product. So that is what I think is a good example of what I would call a precision metal. And it's something that people don't necessarily realize, but it exists. It's absolutely essential for a lot of life's products. And yeah, we are absolutely one of the leading supplies of those types of materials, but we're based yourself with Manchester. And that is so exciting, because as you mentioned, like we would know how customized materials would be until you face a situation in which let's say in the medical industry, they will be like, well, we need something very specific. How do we get it? And who would we get it from? And the fact that you are, like, also this, so the family products that you are dealing with, they are very vast. So they will be like from different materials, as you mentioned, like precision strips and coils and thin wall tubing and foils and wire. And there are so many things that you would know unless you're looking for it, which I find that is very interesting. And it's a cotton age properly in the way that we are building things that are needed. And they are just some precision that the diverse size industry requires. So I think that's very relevant. And at the same time, I think that it's such a capability that you have to bring all these materials and the knowledge and the technical part to it. So it's very interesting. And what other industry will rely very heavily on these precision materials? You mentioned, for example, medicine, but isn't there any others? Absolutely. So we do a lot of fly the aerospace industry. So in one of the markets we're in, it is for aerospace turbines. So it's called a hoodie comb seal. That's the end application. And what they need for that is a really high temperature alloy. So this is, you might have heard terms like super alloy. So these are materials that have got particular editions of particular alloys or particular metals to elevate the properties. So maybe a particular metal might give it a higher temperature resistance and eat it up. It's still going to stay in shape, for example. Or maybe it gives a particular corrosion resistance to a particular environment with a particular addition of a metal. So until about super alloy, these are really highly engineered materials that are designed for particular applications. For this application, they need a very thin foil, which is then cooked to very narrow widths that we supply it in a coil form. And there are very, very few manufacturers who can do it. So working with those types of materials is very challenging. We have worked with a US company since 2010. And we've worked with it as their UK agent. So we have represent them in the UK and Ireland markets. For this type of material, so we sell their products. And we set up stocking programs for these types of customers so that if they need a creek delivery of this type material, they can come to us. So aerospace, it is one. Batteries is another. So when we talk about batteries we're talking about, current collectors as well. So within a lithium ion battery, there's a layers of copper and aluminium foil. Those products are customized for the particular battery. So maybe if they're making particular chemistry, they need a particular type of tensile strength or surface roughness, then we will tailor the material to assume what they aren't actually doing with it. Like those types of foils are extremely thin. So for example, we're going down to like four and a half microns in terms of thickness for the copper, which is just crazy. The thing, you know, it's a type of foil way, you're just looking at it and it starts to wrinkle. So you need to handle it in a very, very particular way. So batteries, aerospace, medical, and there are some in sort of electronic applications as well. And we actually ship these materials all over the world. So it's not just to UK and Ireland, but we actually ship them. I find it amazing. Sometimes we ship to like New Zealand's Australia, which I always find incredible from as a UK company that we're doing that. But yeah, we're actually shipping somebody up to Taiwan as well. It's just pretty amazing. Yeah. Sorry, that gives you good idea. It's just not impressive because I'm getting from all these that you're not only helping your customers to manufacture something, but you are guiding them from the whole process from, okay, so what's your problem? Let's help you with the innovation and what is the the precision that you need and the design together like co-designed the product that they might need. And then you obviously do the research, that you have people working with you in terms of what do we need in chemistry and in engineering and in manufacturing and all that. At the end, delivering a physical product that they might use for their own industry, which is so interesting because it's not just making things, it's creating them and finding ways to make them more efficient. So I think it's very interesting and very challenging, of course. And I would like to talk about a bit of the on-song battery hero. So I think copper foil is taking the world. Something many people don't know is how copper foil is foundational to lithium ion batteries in production. So I wanted to tell you about how you became the biggest distributor of copper foil in the UK and Europe and what are your plans after that. I mean, what's coming? Absolutely. We started really, this is probably about 10 years ago, just with a couple of customers. We were supplying copper foil for applications and we got asked by a couple of customers can we supply foil for batteries. So we logged into a decent research and we found that the foil that we were supplying was actually suited really well for application. That was our entry point and then we have developed and launched where we are today. So electric foils is if you want to www.batchitfoil.com, you'll see our projects. This is where we are bringing copper foil manufacturing to Europe. So similar to 99% of the world's batteries produced in China in 2019, it's a very similar story for a copper foil. So the majority of the world's copper foil that's needed, not just for batteries, but for PCBs, for very specific electronic applications, they all need a very, very thin copper foil which is made through electro-deposition. So this is a product that's manufactured based out and a simple way to describe it is, I remember doing electrolysis at high school. where you're depositing copper onto an anode and basically that's what we do in this but on a much bigger scale. So we have a two meter diameter titanium drum that rotates through a bath and in that bath is dissolved copper ions and the copper it then deposited onto the titanium drum and is peeled off into a foil. So that process is the process that's used at scale to supply the foil used for batteries. There is two manufacturers in Europe today. There are many many many in China. The deficits in Europe or the trade deficit between how much the market needs versus how much is being made locally is quite huge. So we've partnered with a Japanese provider of the equipment. So the titanium drums basically are only made by a couple of companies worldwide. We've formed a JV with one of those. We've also formed a JV with a existing manufacturer of foil. The reason why we're doing this is we think it's going to be easier for us to because we realize manufacturing foil. There's a lot of know-how. There's a lot of specific know-how with the manufacturing, the recipes. It's not straightforward material to make. It's not you can buy the equipment and make it. That's not in a tool. You need to have that expertise. So we decided let's form a JV which we've done with two other companies. We're now in validations with a number of high-profile customers to get our product validated. And then once we have those validations, we have the confidence we're in the market. We can actually create a manufacturing facility. We were supported by UK government for this and we secured a large grant to be able to deliver on this project. The way that the market has developed in the last couple of years, we've slowed down a little bit. We want to make sure that our customers want this product to evaluate it. The market is going the way we want it to go. So we have slowed down a little bit but absolutely we're dedicated to delivering on this project and we want to create a local manufacturing facility this product because there's a huge opportunity here that we're in a perfect position to fill. A lot of our customers are really welcome this because again they want to deal with often local businesses who are very easy to pick up the phone, place orders, a troubleshoot, discuss specifications. I mean, we can hold some stock locally for them. We're exhibiting actually next month at the trade show. Italy is the PCB show. Again, we're not launching this product but presenting this product. This project is getting a lot of momentum now. It's something that we only started two years ago and it's now getting a lot of momentum and we're really excited about it. So if you go on to www.battrifull.com, you'll be able to see this project and what would you? I definitely put that on the notes so people can access that. It's going for interrupt and you there, but I think that through your work with, I was a little extra for you, but you are operating within two worlds. The industrial world's one side is the research on the development and is focused on innovation and standards and advanced engineering and the other hand is the manufacturing that is usually more Asian market and is focused on scale and in deficiency and the production capability and this is position you in the intersection of the innovation and scale. Well, technology is developed when it's actually produced and it's very strategic and it's very important because the future of advanced materials and the clean technology depends not just on the innovation, but in how we can actually make it and scale it and it's reliable and it's competitive and as you said, it's local and it's, you know, like the supply chain, it's easier and smooth. So I am really loving it that's what you're doing here because it is kind of putting all these things together and things very smart and even though when you think about how the future looks like in order to have a local corporate for a supply chain, it is so exciting and I was just wondering if you have seen any changes in the way that the performer requirements have changed or have evolved for batteries? Yeah, I mean the requirements is basically to go thinner. So the challenge in batteries always can we charge faster? Can we deliver higher power, higher energy? That's essentially what companies want. So I mean, the great range debate for EVs, you know, what's enough range for everybody? It's been developed basically by pushing the boundaries of what's possible with materials and if you can create thinner copper foil that can still be rigid enough to withstand the coating process for that's required for the battery and then essentially you can have more layers within your battery cell, more layers, a storm or energy to deliver higher power. That's essentially always happening so the thickness of copper foil is probably almost reduced to maybe 30% of what it was. So previously, so average thicknesses were like 12 microns. If we go back to this year 2018, now it's pushing towards like four microns. So although it's only eight microns different, that the advantage three times thinner is that's what you need to look at. Yeah, so it's way, way, way thinner cost is also a factor as well. So they want better performance for cheaper than what they're paying now. So the big battery companies like BYD and CATL, like these are huge, huge Chinese companies who employ thousands of people. I mean, they're R&D headcount alone dwarfs, most European companies to warston. We're talking thousands and thousands of people in R&D. The registering patterns are rate of knots. They are really, really pushing the boundary of what's possible. That's so cheap thinner cheaper is basically because you would think that the the battery production is straightforward until you actually talk to people who are in the industry. And then you think, well, actually, I didn't realize that involved so much complexity and I think it's very interesting because when you think about the process and all the the chemicals that we need to be used and all the logistics of how to handle that and all that, it just sounds like it's not easy. And at the same time, it sounds like science material is it's playing an important part here. And how do we use that science to prevent failure at scale? So how is in general the industry preventing that scaling from failing? So I'm going to use the Asian market as an example. So there's established players, so I mentioned BYD CATL, but some of the Korean players as well, LG, energy solutions, Samsung, they've been making these products for many years and they know how to do it. They know how to do it very well. They know what works. They have the budget for R&D to be able to test these new materials. They also were very closely with equipment manufacturers, so specifying if it's a new product, then these are new process. They work hand in hand with our equipment suppliers to be able to make sure that when it goes into production, that machine does what it needs to do. And I think what's interesting when it's about the battery industry, I think when people think batteries, they think it's your cell. But really what we view as a battery industry is this Korean edge of all the latest technology will need a battery. So your latest smartphones, your latest laptops, but also what's why I think's interesting is robots. So this is absolutely coming. It sounds like a conspiracy theory, but I robot, I'm sure you've seen the world specifically. Those types of humanoid robots are absolutely coming and they all need battery cells to run them. There's anything today that has an internal combustion engine that is absolutely a drive to make it electrifies and that's batteries. And the reason why a lot of governments are supporting battery manufacturing is because if you think about national security and any country, here's totally reliance on the import of that entity storage device, when it powers everything that country needs from communications infrastructure to the vehicles, if there are lines on one country for that, that's a dangerous position to be in. So to talk about energy security in a lot of time, we're talking about oil and gas for energy security, but there's also things like thinking of energy storage security and batteries and how we can't be too reliant on one location for those battery cells, because if you're restricted, if you make a car, for example, in the UK, but you have to import probably one of the most, if not the most expensive components of the electric vehicle, which is the battery, if you have to import it from Asia, why are you making the car over here? So the UK, for example, is pulling our support behind at the moment in particular to businesses, one is agriculture, which is huge factory again at time. South and Somerset, it gets 40 gigawatt hours and that factory when it's established will be supplying the lights of JLR with battery cells. You have Envision ASC up in the North East, which is another big, big factory that are supplying Nissan across the road from them. So the idea is that if you, to the automotive industry in the UK is extremely important to the UK economy. If we don't have battery manufacturing over here, then that industry is at risk. So it's really, really critical to support UK jobs that this industry exists and yeah, the agriculture factory in particular, I think, is a really exciting factory that's being built and we really hope it's successful because it's going to really be a good example of UK capability to produce battery cells at scale, but also support the wider automotive industry and ensure that jobs over here don't go overseas and they stay in the UK. Absolutely. I was looking at earlier your website and your social channels and I just looked at some of your big customers out in China and the US and I think that's changing very fast. So who will be your biggest customer right now, not just in terms of name, but you know, the industries and countries that you're seeing that they are building that momentum now? Yes. I'm sure they can't give you names. We have names. We've always told our customers, but I guess maybe give you some of the markets. So we have a big customer in the United States for our US defence. We have one of our big customers in China and which I find quite amazing. We have a product which we've developed which is very unique to us, which is for lightweight applications. So it's a product that only ABM in the UK make it. So we're able to export it to China and we do so successfully. We're looking at putting that product into different applications like, for example, drones. So because it stays China and then we also have some really nice growing business in the UK for example, for spring manufacturers. So a simple spring, right? Everyone thinks it's that simple, but again, a precision wire, there's been manufactured to a particular tensile strength to a particular dialis, so we'll give that spring the exact properties and these. Good example is a suspension spring on a car. So in everyone's cars, you've got a suspension springs, there's obviously supporting the wheels and that suspension spring needs to have a particular property. It needs to be able to withstand when you go over a pothole, which is many of where we live. That spring, it doesn't snap, it exorbs the shock and it's a really highly engineered product. So we have some big customers for that type of product, for example, another would be for chimney flows. So in your house for your chimney, there's a stainless steel liner that lies the internal of the chimney and that uses a very thin stainless steel product. And again, we shipped to many UK companies for that industry and that's very, very good for us. So we are quite in terms of applications and we are quite broad, but I hope that gives you a good idea of what we do. But essentially if someone is making a highly engineered product that needs a specific material properties, then they can come to us and we can talk to them about how we can make that product and how we can optimise their own production process and optimise their own products using the raw materials that we provide. And that's one thing that I admire really is how our city is not just supplying the materials, but it's actually creating, as you just said, and you get another person, another customer that constantly will look, this is what I'm looking for. And then you create all those things. So I just wonder if you can tell us about some unique products that you have developed, especially through ABM and ARC, your research centre. Yeah, so we set up the ARC and it is headed by Dr. Martin Brown, who is our head of technical. And essentially it's our new product development division. So when a customer comes to us with an idea or maybe a problem and they say, look, can we help fix that? Well, look into where we say our ARC team will take that on and they'll look at developing that. So an example would be our own patented surface treatment technologies. So on the ARC team are developing that at the moment. So we've created a very eco-friendly, very cheap, very fast, efficient way of applying that surface treatment that I described at the beginning. And where we do that in a very clean way. And that's being developed. It's totally unique to us. We've got a range of patterns on that. And we're now looking at launching that into the marketplace for that product. We're actually further supported by the Advanced Propulsion Centre. We have a grant at the moment, which is the Drive 35 competition, which is a very prestigious and we're we're thrilled to win that and be part of that. So that's supporting us with that development. So that's totally unique to us. The other one is our fly weight by metallics, which we've developed, which is our connector, which are described at the start, but it's for very lightweight applications. And with the company in the world, that makes those types of connectors. So that's where our ARC team, they really developed it, they developed the processes, refined it, and then handed over to our production team and our production team that now make that scale for our customers. And that is totally unique to us. And it's something that we're really proud of and something that we're able to export successfully because of how unique it is to us. It's so interesting and I love that because it is taking something, the idea, and then moving that into prototype and removing all the barriers that companies who maybe can't fund a full R&D cycle themselves. So you're doing that from themselves. You're helping them. And I just wonder how are these innovations changing the industries? I think every talker can about batteries as a big drive to become. I know I only went to about sort of lighter and cheaper, but also cleaner. Yes, so there's a term certainly back in 2019 to 2020 because of the dirty batteries. So dirty battery is a battery that's made with maybe hazardous materials, maybe the factories powered largely by coal-fired power stations. So it is a product that you perceive to be green, actually, dirtier than the alternative, right? So everyone's trying to move towards more eco-friendly products. So our patented technology absolutely does that because it removes the requirement for that. Really hazardous material and it's cheaper and it's faster. So it's kind of a win, win, win. And for that, I think the kind of energy density is the other challenge that people are trying to really improve. So energy density is how much power can you store in your battery cell, if you like, per unit of space if that makes sense. So if you have a smaller battery that delivers more power and you can store more energy, it's got a much higher energy density. So people are trying to do that. So in that term, it reduces weight of the of the battery, but still delivers the same power. So our product for the lightweighting improves the energy density of the final battery cell, which of course, whether that's whether you translate that to a drone, for example, it means it can fly further on a single charge, if you translate that into aviation. So when we talk about drones, that's one thing, but electric aviation. So as much as when we talk about electrification, everyone assumes four wheels on the ground with cars is absolutely happening in the skies as well. We go to Barbara Airshow every two years. And every year there's more and more EV toll. So they see electric planes on display. They all require batteries, they all require really great energy density cells. So again, our innovation, it translates that to electric aircraft, just means it can fly further on a single charge so we can help it. Maybe go from a city hopper, maybe it'll go to maybe something they can cross into new countries and maybe push just the limits and hopefully try to support that decarbonisation. Ultimately, that sports, I think the objective with kind of electrification is that decarbonisation. Absolutely. And you know, I found it really interesting because I think that all the people that work for Avoset and with Avoset, they must be really proud. Maybe they are not as boggled, but I think to be playing a part, such an important part in the change of how the industry is moving and how playing, you know, every person is putting a little bit on to move toward something that is more sustainable and it's more efficient and it's smaller and thinner and faster. It's just so exciting as an individual, as professionals. And I think that is so exciting because we would think when we host a podcast about agents of change, you would think, oh well, making a change must be something very theoretical, but it's very practical. And would you translate that into real action into everyday life? It's very interesting. And you have mentioned before the importance of the local supply chains, but I understand that in practice, many critical materials are still sourced globally. So can you talk to me? to us through how you currently source your materials and what drive those sources to sessions? - I'm sorry, if I talk through our manufacturing, for example, so the new technology that we've developed, that will enable us to source our raw materials locally, which is a big, big step, which means we can place our plants anywhere in the world and basically have a local supply chain for that product for the end customer wherever they're located, which is really critical. Ultimately, I think if we talk about precision metals, I think sea balm is gonna make a difference next year. So, sea balm is a carbon border adjustment mechanism, which is impacting aluminum and steel, being important to the UK next year. And I think many companies are seeing this as a compliance regulation. - Yes. - Actually, it's a big cost regulation and we've developed some software internally which allows us to see how much predicts what is our sea balm exposure from any supplier in the world if we were into imported to the UK. Really important to understand that because from basically the first of January next year, any steel that's imported to the UK will attract a tax which is directly linked to the carbon emission that that product has in the manufacture of that product basically. So, that is gonna have a bit of a shake up in the industry and I think because before it's been very easy to import materials from particularly Asia, whereas now there's gonna be a cost to that. And what we're trying to do is help not just decarbonize some of our local suppliers, but even encourage our suppliers that maybe are located further afield to get them to decarbonize because there isn't a cost to have import now. So, it's gonna hit all the box quite hard, I think, next year if companies don't react. So, we have a piece of software that we're using internally and if any of your listeners are interested in finding out if they're importing any materials themselves and they want to find out how much their sea balm exposure is gonna be from early next year and then just come in towards them. We can help show you what that cost is gonna be because I think it's in the minutes with a hidden cost and it's not been talked about too much, but yeah, it's coming and I know in Europe it's already been in place and they've had a transition period. So, companies have had a couple of years to kind of get used to it before those taxes come into place. You can see it's different, it's just hitting next year. So, this natural position period is just gonna hit. So, that's gonna be a bit of a shake up actually and it's something that we're watching and we're proactively changing how we think and how we act and get this software as kind of a first step in that space 'cause it's something we've developed and it's a really useful tool to be able to predict how much tax is gonna be liable on any import or any supply in the world from any date in the future using the predictions on what the carbon cost is gonna be in the future. So, it's kind of useful but a bit of kit and that's helping us navigate this new legislation that's coming in next year. - And, you know, I'm so happy you mentioned that because I have a plan to have a specific podcast about even but I will definitely bring you on if you are up for it and we can discuss with maybe a panel about that. But, you know, what I'm getting through this is that it's not the way you made decisions in terms of how do you source. It's not just about the value or the intent but is shaped a bit in the capability and the risk and the speed and all of those things. But, I suppose that that's where the funding matter. It's because building local alternatives take time and capital and patience sometimes and in many business, simply we don't have that on your own. So, you need to bring that. And from your experience, how accessible are those funding routes really for business like yours, especially SMEs working in advanced materials and battery innovation? Are they easy to acquire or are there many challenges in the way? - No, they're extremely competitive. They're not easy to get hold of at all. So, for every really grand competition that's open, they probably get maybe 100 applicants, I would say, and maybe six to eight of those are successful. So, you've probably got less than 10% chance to secure in one of those. So, the companies need to make sure that their project really strongly aligns with the competition briefing that it's a strong commercial position. So, what needs to happen is that yes, there's maybe there's an R&D funding support that you also need to make sure there's a credible exploitation route, which the company can execute on. That's probably the key to it is probably that exploitation. And I think what a lot of companies have found challenging and we certainly found a challenging after our first one. I think we've had four grants now that we've been successful in receiving. But after our first one, it was difficult because the funding supported us for three years. And then it very abruptly stops. And unless you've got your exploitation and you've got orders coming in through the development wherever you've developed, then how on earth do you fund those new hires that you've had to make to deliver that project? So, how are we've been able to do that successfully as we're a group of companies is we're obviously generating revenue and we have been generating revenue for about 30th year this year. So, we're able to use that to support us otherwise it'd be very challenging to do. So, I'm so sure that they're very difficult to obtain. They are really good when you get them as long as the R&D that you want to do aligns with your company strategy. So, if you're just doing it just to get a grant then that's not the way to do it. But if you're doing it because your company strategy requires you to do that development, then absolutely a brilliant resource. We've had very, very positive experience with those. - That's really good. And I think that funding is usually measured through short-term outfits and milestones and reports that you deliver and you justify your spendings. Using the current grant frameworks measure the right thing is when it comes to innovations, especially in deep tech. - Yeah. - I have a general science. - That's a really good question. So, I think, so they mentioned a lot of the times on job creation. So, how many jobs does it create in the median? How many forecasts to create? And I understand why because obviously it's a value for money for the taxpayer. If they've given a company a certain amount of money that okay, well, it's created 20 jobs, 30 jobs, 40 jobs, or whatever that number might be over how long and it's worked out and it's good value for money. The challenge is, I think it comes back to that point I made earlier that a lot of investors are looking for those 10 billion pound companies that's gonna be that size in two, three years. And if you're hiring people or rating knots, it just means that you're, if you're not got the orders coming the other way, that your overhead is just getting bigger and bigger and yes, if it's funded for a year or two years then you've got some contribution to that. It's great, but when it stops, it's quite a abrupt stop. And I don't know what the solution would be to how to measure it, but sometimes it feels like it would, like if we say we make a higher, we've got a better chance of winning that competition because it's extremely competitive. So if we take on two, three, four people join the project, is that gonna be helpers? When the project, I don't know how they deem success, I think is difficult. I don't have an answer for what's a better way. I just know that it's challenging, sometimes I've got a job creation and I always recommend companies if they've not done these applications or just to be really cautious of making those long term highest to deliver on the grant. - Absolutely, because innovation doesn't stop when the grant ends, it just continues. And there's more to them. And I think that definitely in terms of the funding a ecosystem, something needs to change to bring a better support in a long term. And again, I don't know the answer, but I think that there's something that the government and the industry and the academia should be working together to improve all that. So because when you think about it innovation is not straight, it's not a straight line. And anybody working in advance when Gerald knows that there are moments where like in any other areas of innovation, like it touched stagnation, don't extend. So the progress isn't as straightforward either. So when you are developing something, maybe just the progress tops and the idea is tall on the data and as good as you are in the system around you make it feel just impossible. So when you want your teams work with it and you feel that it's a dead end, how do you personally approach that moment and what helps you decide whether to push through or people or step back? - So we use stage game processes on our side. So here's basically a kind of go-no-go steps that we do for our projects. And those might be technical, it might be commercial. But we kind of set those in advance and we only progress to the next stage once we've delivered on those parts and you're right. So some of these R&D projects that you do, maybe. - Maybe you're testing something, you expect it to work and it doesn't work. Well, it doesn't work and they point carrying on. You just have to kill it quickly. - So we use a stage game process and I'd imagine other companies use very similar process to what we've got. It's gonna be awesome times because people can attach to their ideas as therapists. They want it to work, they want it to work, and you know, you just have to take a very data-driven approach to whether to go forward or not. And I think at that key is to learn what doesn't work, that still progress. It's just not taking you to the direction you have for originally, but it's still progress. Yeah. Even if it doesn't fit neatly into the reports that you have to deliver us for the grants, or maybe even for students that are early career engineers, and the moments might feel brutal. But it's not a signal that they are not caught up for this work. It's just that the work is not going into that direction. And sometimes it's that learning bit that is not the end. It's just that reframing that problem and we'll try to find a solution. So I just have a feeling that you have a very mentor strategy there when it comes with the people that you work, because you have been there yourself, like from having no people behind you or around you and then having a very strong team. So I'm guessing that the development that you have achieved, it comes because you have been sort of a mentor to your team. So I wanted you to talk about that, how you help your team when they feel like stuck. And how do you move yourself personally as well? And so when you feel beast, I have the hunch that is going to work. So how do we make it happen? So priority was setting a baby in. I never managed a large team before, only one person I've managed before. So it was a very steep learning curve for me to go from kind of just having myself to think about really to all the sudden, I mean, we've got 30 of people here now. So we'll be sitting down to make sure they're all okay. And how on earth do you manage that? And the only way to do it is I think through experience. One of our first hires was somebody who I felt could mentor me. So that was the first step. Was for me to get up to speed a bit more and he helped me develop my own kind of managerial style. And I'm definitely not perfect or anything like that. But I think I'm a bit better than what I was at back in 2020 for sure. And then our management team, I think that we have is really strong here. I think we're all quite like minded and that we're all relatively, well, in fact, we've got a good mix of experience and youth, I would say, in our management team. So we've still got some experience where, you know, if we've got a complex situation or we need a bit of support on that we can get, we can go to that. We've also got a bit of a single swim attitude, you know, the only way to do try something to know is going to work. It's just to try it. It's the only way because we're all kind of learning together at the minute. So yeah, we have a bit of a mantra of all. We'll look back at let's say a project or a situation and go okay, but maybe not we didn't do that the best. How can we be better next time? And we just learn him from it constantly. And I don't think one is a substitute for a better school than that. Well, I also don't mean there's any other way to learn, you know, as much as you can go through, like on courses and all that sort of thing, the only way to really learn properly is situational experience. You just got to dive in and do your best. And I think we kind of have that. So often, if someone asked me a question, the person asking they normally know the answer themselves, they just need to reassure and stay there. And that's normally, if I was to ask someone, I've already spent a bit of time thinking about it. I'm just going for some reassure. And so normally they've got the answer and they just need that little bit of confidence just to kind of go and execute on it. Makes sense because it sounds like it relies heavily in the team that you're having, the people that you surround yourself by and the expertise and the experience and the way of thinking and the way of behaving and the way the people around us tackle problems and how we all work together. So I think it's very interesting. Do you do something similar when you're vetting and selecting your suppliers? We supply it tends to more come down to the quality of the product and responsiveness. That's probably our two most important aspects. So quality is number one for sure and we'll validate that through kind of internal processes and we have our in-house lab that can look at materials that we've got material scientists, you can look at materials and then also from our customers, you know, what do our customers think of of those materials? So that's how we can validate a new supplier and then responsiveness. If we have technical questions, if we have an issue, you know, how responsive are those suppliers in that? Because it's always a partnership. It's no good just having a one-way relationship with a supplier. It's always a partnership. There's always a better give and take than the day we're getting a product that we want and in return, they're getting paid for it. But the service that comes in both ways, we need to ensure we pay off, we pay on time, we need to make sure we're curious to that supplier and the same the time we expect, you know, responsiveness to requests until it's not just about that kind of transactionalist, more of a partnership that we try and create and I think that comes from our background as reps. So our business started 30 years ago as a representation business where we represented a couple of companies in the UK market. So we've always developed partnerships rather than just a supplier relationship and that helps us as a company because it means we've got the backing of a steel mill or the backing of a producer of a certain material and we can do in a very open way. We can have open conversation with our customers and it just means we can deliver a much better service for our customers. Lessons print. Now before we close, I just want to ask you something that I asked most of my guests and what is for you to be an agent of change? Good question. I think it's about, for me, it's not necessarily about bearing big things all the time. I think it's just about doing your part and doing it well and maybe having an incremental change. So if I take others as an example, we really want to help the world decarbonize. We really want to help that. How can we do that? Well, if we can push this industry, push localisation and support the industry as much as possible to be a success, then we think that's going to kind of certainly help. I think with our steel business, for example, on the sea by the side, we're helping our suppliers look at decarbonization and why it's important and it's now, I think it's a good and bad legislation at the same time. I think the good part of it is that it's actually putting a cost now to suppliers who don't decarbonize. So it's actually going to hurt people's pockets if they don't and we're trying to give people as much encouragement and give them as much knowledge of the cost that they're coming up so that they can do that. So I think it's about maybe doing that small change but also maybe trying to get like-minded people on board. So what you're trying to do and from our small facility and home chapel, hopefully we can have a bigger impact on the industry as a whole. I love your answer because I want to openly a public say that I think that you care and people in, I will say, are agents of change because you are actually actually day-to-day trying to change the industry and we have batteries in our mobile phones, in our toothbrushes, in our headphones and pretty much everything you look at and everything needs rapidly changing and you are doing your best to bring that to a smaller scale and a bigger scale in some cases into faster and more efficient and more sustainable and locally sourced and as much as we can in intention to decarbonize. So I really admire that about outside and about your work personally because as they head off, you're leading the company into a true direction that is very admirable from my perspective. I didn't know anything about batteries until I was looking into your social media and your websites and I was just impressed by what you're doing so I'm really excited about what you're doing so I keep an eye on what you're doing in terms of research and about your new products and all like that so this has been such an insightful conversation. It's not just about contributing into the battery industry but it's just restraping the material supply and the manufacturing and the innovation and I think that is very relevant and thank you for joining us today in conversations with agents of change and to our listeners if you believe that business can be a force for good and that one voice can spark a movement. You are absolutely in the right place and make sure to follow and I will be leaving the notes so you can connect to I will say to learn more about all the different things are doing and I am is a void and I'll see you next time. These both can be produced by the Change Impact Group.