Five years ago, snowboard-mad engineer Richard Palmer was hit with an avalanche of an idea. After one too many painful tumbles, the 39-year-old Brit reckoned there had to be a better way to avoid bruising than the restrictive, uncomfortable, and often ineffective gear available.
"I looked at protective products on the market and thought this is a load of crap," Palmer says. "I thought I could do something better."
Palmer quickly proved he's not just talk. His company, d3o Lab based in Hove, England, developed a futuristic liquid armor that hardens on impact. Today, the shear-thickening (a term that refers to a fluid's viscosity) material—called d3o—is used in a range of sports equipment and apparel ranging from soccer goalkeeper gloves to skateboarding shoes. The U.S. and Canadian Olympic slalom ski teams used d3o-enhanced Spyder racing suits in the 2006 Winter Olympics.
"Marketing new sports products today is all about enhancing performance," says Marshal Cohen, chief analyst at NPD Group. Performance-enhancing brands such as d3o, he says, are a bit like steroids. "Every athlete wants that extra little edge and the brands that can deliver it have a huge leg up on the competition."
Palmer's ambitions go well beyond sporting goods, however. With potential applications ranging from protective gear for the military, police, and firefighters to safety seats for cars that protect against high-force impact to soundproofing, the feisty upstart is attracting the attention of big-league players such as NASA and Boeing. The company is currently in discussions with the U.S. Army to develop a protective suit to soften the impact for troops when they hit the ground to dodge bullets. "We're going to be the next Gore-Tex," Palmer claims.
But for a tiny startup with limited funds, building a big brand from scratch is challenging. Initially, Palmer thought the material's innovative qualities would market themselves. But he soon discovered that having a good idea and patenting it isn't enough. Even his impressive demonstration routine, hammering his elbow while wearing a shirt with d3o panels sewn inside, failed to convince many potential buyers and investors.
"At first people don't trust their own judgement," he says. "It's like leaving a bar of gold in the middle of the street: No one will pick it up because they don't believe it's real."
Palmer, though, never doubted his own judgment. To get d3o off the ground, he quit his job as a design consultant, sold his house, cashed in his life savings—even auctioned off his belongings on eBay—and spent 18 months crashing on a friend's couch. That friend, fellow engineer Adrian Hampstead, became the company's first investor, ponying up $50,000. By 2003, Palmer had standardized samples, a Web site, and a staff of three—but no customers, no products and no money.
He made the rounds of the trade shows, and in 2004 through word of mouth d3o started to gain attention. Cortland Schurian, footwear director of California-based Globe, a maker of skateboarding shoes and apparel, immediately saw d3o's potential. "I was sure it was too late for me to be on the forefront of this technology, but to my surprise no others had ever pursued it." Globe did, and launched its Icon range of skateboarding shoes, embedded with d3o in the heel to absorb shocks last October. It sold 12,000 pairs last year alone.
Palmer quickly learned the importance of strong product design in wooing new customers, as he began manufacturing prototypes of everything from shoes to clothing to equipment all embedded with d3o's trademark fluorescent orange logo. Then, borrowing a page from Gore-Tex, Palmer set about convincing athletes to give it a go. His big break came when the U.S. and Canadian Olympic ski teams convinced members to try out a d3o-enhanced Spyder racing suit. "Originally, the athletes didn't even want to try it," Palmer says. "Now they aren't racing without it."
It's part of d3o's strategy to work directly with both professional and amateur athletes to develop and test products. Jerzy Dudek, goalkeeper for Liverpool Football Club and Poland, uses d3o's Contour glove made by Sells, while British alpine climber Kenton Cool dons a d3o beanie when climbing Everest.
"Athletes give the brand a very strong and sexy image just by their association with the product," says Rita Clifton, chairman of Interbrand UK. With its unique material, high-profile endorsements, and its fluorescent orange logo, d3o has "the potential to be the perfect ingredient brand," she says.
World downhill mountain bike champion Helen Mortimer says her d3o suit is much lighter weight and less restricting than previous protective gear. "It's almost like a natural extension of my body." The company has updated Mortimer's suit three times, free of charge, in exchange for her acting as an ambassador for the fledgling brand and providing feedback for product development.
By the end of this year, Palmer hopes to have added a production site in China—to be closer to the manufacturing sites of many of its partners. The design of prototypes will be done via computer back in Britain with the material shipped to China for assembly into prototypes.
While the potential for rivals to copy the technology exists, Palmer believes the process behind it is difficult for others to replicate. The key to protecting the technology from low-cost competitors, says NPD's Cohen, is creating "a brand association that's so strong that competitors will not legally be able to copy the formula."
These days, d3o has more opportunities than it has time. The company is in discussions with 300 companies. "It's a product that has so much versatility that you have to stay focused," Palmer says, "otherwise you'll follow all the opportunities but deliver none of them."
P.S. Folks, you've got to read this awesome post by Steve Olson
10 Reasons Target is Better than Wal-Mart