Case Study: Heatsolve
Countries Involved: Ireland, UK
Heatsolve was formed in 2004 by a number of former employees of a subsidiary of a US multinational in Ballina, Co. Mayo. The company decided to pull out of Ireland and the assets of the company were taken over and the jobs of the employees were saved. Heatsolve now employs 18 people.
The company manufactures electric heating wire and has traditionally supplied manufacturers of electric heat pads, electric blankets, underfloor heating elements and medical devices. There are only a small number of suppliers in this market and entry costs are high. Having new technology was seen as a good entry strategy.
The company recognised a trend in the market for increased safety in electric blankets, particularly for overblankets. Hotspots in overblankets are usually detected by a fusible part of the circuit which cuts out the blanket. A more reliable system which indicated that the blanket was folded and which cut out before damage to the blanket occurred was identified as very desirable.
One of Heatsolve’s customers in the UK who manufactured electric blankets had patented a heating wire with a particular metallurgical composition which was able to sense overheating conditions. Heatsolve agreed to work with them on perfecting the product and getting it into volume production. They would then become a supplier to this company and entered into a sole licence. This is a licence which is exclusive but the licensor is also in the market as well as the licensee. With assistance from Materials Ireland, one of the Programmes in Advanced Technology, Heatsolve perfected the production using its existing equipment. Materials Ireland helped them to understand the metallurgical properties of the wire and to use this information to achieve the required performance and quality. This has given them credibility in the market and enabled them to offer the new heating elements to a wider range of customers. Many customers are now looking for a complete solution consisting of heating element and matching controller and Heatsolve can now meet this need.
A legal contract was drawn up for a patent licence and technical cooperation, paid for in the form of royalties. A moratorium on royalties was agreed to give Heatsolve time to get the production to the required volume and quality.
The technology transfer phase involved trials of samples and working with the technical director of the UK company. Heatsolve has now developed its own technical capability for this type of product which has given it credibility with new customers.
The company sees inward licensing as a quick method of getting into the market with high technology products.