Phoseon Technology - A business story of light and time

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Rob Karsten is EMEA Director for Phoseon Technology in Europe. As the world leader in UV LED industrial curing, Phoseon provides the broadest portfolio of LED-based solutions for printing, coating, and adhesive applications and is a sponsor at the forthcoming LiT Summit in Cambridge. Phoseon has been an impressive success story since their launch in 2002 and now employs +150 people worldwide and has recently added 50% more capacity in their factory to cope with demand. Ahead of LiT we ask Rob some questions.

Since InPrint was launched in 2014, what has changed for you since then?

We are seeing growth in competition which is interesting. OEM’s tend to want to go with the companies with a track record and a significant installed base. Some of these companies are in Europe, India and further east in Asia, but we are still leading the market, I don’t say that arrogantly or complacently but it is a fact.

Is the growth in competition a trend that concerns you at all?

I am confident that we can out innovate and outsell our rivals by being better across the board. This competition is a good thing, the overall market is growing so the actual market for UV LED technology is expanding, so more competition is to be expected.

This is because we have been really successful, and I think the market looks at this, learns from our mistakes and benefits from our leadership position and to some extent from our considerable R&D investment over the years. But really they don’t know what we experienced to get our business to this point, how we did it, and this still gives us an advantage. As an example, Up-time for a press is critical.  Phoseon UV LEDs have been running on new and retrofitted presses for the past 10+ years.  We know what the press environment is like across 1000s of end-users and how to design products that deliver day in and day out for the presses they support. 

It is true that there is a real cost to being the market leader in this technology because innovation is expensive, whereas copying things is cheap. Innovation needs time, expertise, experience and resources and this takes a lot of investment. That is something that not every business person wants to undertake as the risk puts them off.

The journey of Phoseon up to now has been the story of a start-up that has overcome challenges on the way. What we learned, how we started, where it went wrong, how we overcame our challenges and where we are now is what I will present in Cambridge.

Would you agree that you have to fail in order to succeed? If so, how did you experience this?

It’s only ever really a failure if you don’t learn and adapt from it. I agree that there is a need to do this in order to discover the true purpose and value of your business.

Our very first technology was designed for MEMs technology inspection for airbag sensors. We developed a system which was a cleanroom compatible inline process for sensors. It was an imaging system which used a particular wavelength that can penetrate silicon. When near-infrared frequencies are fired onto silicon it becomes transparent so you can see fine details to 2 microns of what is inside the silicon. An early component of this system was the light source module – the SLM semi-conductor light matrix. This is the building block of the current Phoseon business.

Our first UV application was to cure print onto a CD. The early CD’s were made with two pieces of plastic laminated together whereas the blu-ray featured a single layer with a single coating. You then digitally printed on top of it and it really worked very well - people loved it.
So we brought the product to market and then the CD market collapsed! So just when the printing process was transitioning into inkjet Apple’s iPod suddenly gathered momentum and changed everything. However, despite this, we noticed that the inkjet market was growing in other application areas and we were able to solve some problems for inkjet and this was the basis of the business.

So what technical problems did you encounter in the early days?

IJ had resolution problems in the early days. If you look at a barcode, then line definition is really important. With inkjet, the read reliability went down. Low power pinning light sources were very instrumental in improving print quality from that we started developing higher power light sourced for full cure.

A lot of this would have been more in terms of print for packaging. The date codes, bar codes, serialisation and the monochromatic finish, then it grew into the CMYK graphics printing. It started from the basic black and white, into graphics, and now into its third incarnation to where we are now, which is Industry 4.0. The direct to container printing and the industrial inkjet applications are now possible, even to the extent of printed electronics. We still, however, make technology for coding and marking and graphics, but more and more into industrial direct to container and even printed electronics.

So the quality of inkjet printing has improved, why is the print quality better?

The heads have gotten better because we have learned how to control dot gain etc. For example, working with companies like Industrial Inkjet who facilitate a lot of this into their OEM equipment, makes it much easier. Someone like IIJ can integrate using all the elements including light sources, ink, software and you can put it into your machine then this makes it easier for end customers and gives you quicker entry to the market.

What has been the single source of Phoseon’s success?

To lead by being the first to develop a new technology and market opportunity – we go for it and we are quick at solving problems for our customers. As we grew and increased the output power of the technology our business started to really grow by developing solutions to new problems. At the same time, the number of materials widened and then the material companies we worked closely with created better and better materials. I guess it really was the convergence of output power and materials. But this took a lot of time and investment working with material companies.

By leading and moving first, Phoseon really developed this new UV LED market opportunity. If I step back neutrally, Phoseon is the single most important company responsible for developing this market and everyone else has been following. So the single source of our success has been to lead. Phoseon is now the strongest company in the UV LED marketplace.

So to lead, to constantly innovate and not accept a compromise of quality and performance. We want a product that is inherently reliable and this is where some of our competitors have fallen down in that they underestimate what is involved in doing this. Building a lamp that lasts for 40,000 plus hours is no small endeavour and Phoseon has proven our capability consistently over the years and with each innovative product we deliver. 

How many people are employed by Phoseon now?  

By the end of this year, we will employ around 200 people. When I started there were 8 of us. I started off basically as a sales and tech support for EMEA – now I have my own team, tech support, admin, and we are growing all time. We need more salespeople, tech people etc, etc!

So has the culture of Phoseon contributed to the success? What are the people and leadership?

We are all very committed and really believe in what we are doing. We are all a certain type of person. Down to Earth.  We think it is better to make a decision than to not make a decision at all. So we move quickly, innovate fast, and we are prepared to invest and are not scared to take risks. We are not like these big companies that take too long to make a decision. The pace and speed are quick, and our investment in R&D is significant. We want to innovate as it is in our DNA. 

We tend to keep our feet on the ground despite our success. For instance, our CEO drives an old Subaru, he doesn’t fly business class, we don’t have big flash offices, we are out there in the market working with our customers, and we are encouraged to just be ourselves. We are an honest, ethical and straightforward company. We work hard, if we make mistakes, which everyone does, we put our hands up. If we can see a problem the customer was not aware of, we correct it immediately, much to their surprise sometimes!

What underlines this I think is when we win a customer they tend to stay with us as we provide a lot of good service and support. This gives them a great sense of security. Reliability and integrity are core features of the product and the business.

With all of the structural change and contraction in the traditional print sector, has print, in your opinion got a future?

Yes, it has. When you look globally, generally in third world countries literacy is increasing so, therefore, print is increasing. E-books have stalled in growth and this just hasn’t wiped out the book industry despite people predicting it would. More books are being printed and yes they have a healthy future going forward. Digital print will continue to grow to its strengths – it may never replace traditional analogue. There will be plenty of areas where digital print will be used. Inkjet itself is going to grow substantially.

But every technology has limitations. For example, RFID was going to be used on every package – but it didn’t happen. Just because it is possible doesn’t mean it will happen. There are a number of new technologies that have really displaced old technologies – but I don’t think you get a complete replacement.  There are still radios, Netflix has revolutionised TV – it hasn’t been the death of TV. Post offices were going to die – but now they are handling more than ever due to the online retail revolution.

It is great to hear of all this positivity, growth and success, but has it been tough at times?
Yes in the early days in particular. Getting going, suffering pay-cuts, making the money last, not flying anywhere, this is the reality and you are scrabbling around to survive. We were lucky we had some great people, good strategy and leadership whilst being small, quick and nimble and this is a big asset.

Has your growth in numbers posed a challenge to your fast and flat culture?

Yes, our challenge is to maintain our speed. Back then we only needed two or three people to make a decision. Now, this has to be managed more. This is just a reality of a growing company. We have more inputs, project management, assigning responsibility and new aspects of the company growing. All this takes time - planning forecasts, how could we change this, where do we need more people? But we have maintained the culture which is really important for us. So it is important that the new people who join us really fit in culturally. If they do then the rest of it is detail and process.

What is it that Phoseon means?

Phoseon is a combination of two Greek works. Phos = light and Eon = Long lasting.

Clever. Come and see Rob speak about the Phoseon Story at LiT in Cambridge on 28th June