“I had to go through two dark years before I saw the light and sales picked up.”
Olly Dmitriev says the best business advice he’s ever been given is that if you are going through Hell, keep going.
The cost of resources in Scotland is lower and the same amount of money will get you much furtherOlly Dmitriev
Having launched Edinburgh-based Vert Rotors, which produces miniature low-vibration conical compressors that generate extremely low levels of vibration and noise, he has first-hand knowledge that getting a new technology off the ground is no easy task.
“I had to go through two dark years before I saw the light and sales picked up,” he explains.
But his hard work is certainly now bearing fruit, with sales doubling year on year in 2016 to more than £200,000, and the patented system attracting interest from around the world amid a total global market for industrial compressors expected to exceed $13.5 billion by 2017.
Russian-born Dmitriev is now aiming for the company to reach turnover of £5 million by 2020, a target accelerated after the firm earlier this year received investment of £1.5m, with business angel syndicate Equity Gap leading the deal alongside venture capital firm Par Equity, US syndicate Aero-Den and the Scottish Investment Bank. The funding enabled the firm to scale up manufacturing by opening a small factory, creating five skilled jobs filled by former oil and gas supply chain workers.
Vert Rotors came into being in 2013 after years of research by Dmitriev into the relevant technology, leading to the creation of a prototype of a totally new type of compressor.
Having previously had a “pretty successful corporate career in the telecoms sector”, he then did an executive MBA, and decided that it was the right time to “make a bold move” and start a company.
He moved to Edinburgh, a decision he says proved a sound choice as a company base. As a technology entrepreneur he believes Scotland has “much more to offer” than south of the Border, saying: “The cost of resources in Scotland is lower and the same amount of money will get you much further.”
He started working with a variety of organisations including City, University of London to do further research to progress the technology, and Vert created its first prototype, with Ian Arbon, whose CV included roles as former managing director of Howden Compressors and founder of Caledonian Compressors Limited, joining as chairman in 2014.
The first sales came in 2015, with its benefits quickly becoming apparent, as Dmitriev, who is also an angel investor, explains. “It turns out that it solves a problem in a way that no other technology does and that helped us to start the business and keep generating sales.”
Its low vibration and noise addresses what he says is big hurdle in many applications, and having a compressor that can solve this problem while still producing compressed air has proved “very valuable to many customers”.
The devices can also work without oil, making them suitable for environments where risk of contamination is unacceptable such as operating theatres, and while aerospace is currently the firm’s biggest area, this is expected to level out with the medical-device sector eventually.
Looking ahead, Dmitriev foresees the company being extremely busy and producing thousands of compressors a year to meet global demand, with a pipeline of 1,800 in 2017.
The company now has about ten staff, with plans to grow this and undertake a new funding round next year. Key moments so far include securing a contract with the UK Centre for Defence Enterprise to develop a prototype of the low-vibration cooling system to improve the quality and resolution of infrared imaging in small surveillance satellites. The compressors are even currently displayed in the National Museum of Scotland as examples of Scottish innovation.
With determination to keep manufacturing north of the Border, Dmitriev is passionate about the need for “world-class infrastructure” in Scotland, saying it cannot be competitive globally without the latest technology.
He adds that currently, 85 per cent of Vert’s customers are overseas. Its main export markets are the US, Germany, Belgium and France, with customers including Fortune-500 manufacturing companies, and with potential enquiries coming in from countries including Japan.
He now cites interest from around the world as a key motivation for him, and comes after progress in the initial, difficult years, was “all based on my faith that this was going to be a success”.
Born: 1980, Moscow
Education: Executive MBA, London Business School, Columbia University
First job: Consultant, PwC
Ambition while at school: I spent a lot of time reading about Japan, trying to understand how the country transformed itself into a hub of innovation
What car do you drive? I proudly drive a pick-up truck with Vert’s logo which I love
Favourite mode of transport: Bicycle
Music: Classical: Liszt, Paganini – I most enjoy listening to the same piece performed by different people and comparing emotional styles of play
Kindle or book? A good old paper book
Can’t live without: Work – my mind never stops
What makes you angry? When people do not keep their promises
Favourite place: Kintail Ridge in the north-west Highlands