In today’s investment environment it is very rare to experience a startup transferring breakthrough fundamental science via applied science complete to technology innovation and commercial roll out in a short period of time. Lantha Sensors is such a startup and they are the unicorn in hiding – a proverbial deeptech, toughtech, hardtech, frontiertech company.
Lantha Sensors’ trace water analysis solution is the result of deep core science and technology capabilities brought to market in a compressed timeframe. They are the definition of innovation making the previously impossible possible. Many of the world’s most simple and obscure problems end up being very hard to solve — for instance, how to determine how much water is in a chemical or fuel sample. The legacy technologies that have attempted to answer this question (and others like it) have been around for many years, but there’s been a lack of deep tech penetration in the subsector.
We recently had the opportunity to sit down with Lantha Sensors’ CEO, Rob Toker, to discuss the innovation that Lantha Sensors brings to the industry, why that innovation means a lot to the chemical analysis landscape and why they make for a great investment opportunity.
Q: Can you start with a brief overview of your company, its mission and the key aspects of its strong foothold in the chemical analysis industry?
At Lantha Sensors we have a true passion for simplifying the complex, and we strive to be the leading portable chemical analysis company that merges unparalleled simplicity, speed and accuracy to provide the best possible solutions for chemical detection and measurement processes.
Our mission is to revolutionize the entire chemical analysis industry via disruptive innovation and product development and become the world’s leading trace chemical detection and measurement company.
Simply put, we aim to solve these simple problems as you mentioned with elegantly simple solutions. At the heart of the problems are the questions — how do chemical distributors determine whether there’s water in a methanol sample, an ethanol sample, or any number of other chemicals and solvents? How does an ammonia producer that’s part of the emerging hydrogen economy determine if there’s water in their ammonia gas stream? How does an aviation fuel provider providing sustainable aviation fuel to the industry ensure that their fuel is on spec? How do steamship operators, work boat operators, service boat operators, ensure that marine diesel is not contaminated with water, not only in the US, but in ports of call where fuel specifications are far more suspect?
Basically, the answers are far more difficult than the questions because the existing technology doesn’t have good solutions to these problems – they are either too expensive, too difficult, take too long or are impossible to perform in the field.
Q: How does your product work and how does it better solve the problem you just described?
The LanthaLux platform is our flagship product. The platform uses a proprietary application of metal organic frameworks, with the ability to generate a large analytical response from a small amount of sample, to quickly, easily and accurately provide on-the-fly moisture and isotopic purity analysis. This platform displaces the need for expensive Karl Fischer Titrators and nuclear magnetic resonance (NMR) in specific cases, by securing the same results as these techniques, but costing a fraction of those per test, producing zero toxic waste, allowing these analyses to be done in the lab or field setting, and generating results in less than five minutes. LanthaLux is literally a lab in your pocket.
Our solution hits the perfect triumvirate of the tech perfect storm – better, faster, cheaper. Just as the digital camera replaced the photo lab, our platform will replace much of the legacy, outdated equipment needed today for chemical analysis.
If you really think about anyone who’s been stuck using Karl Fischer titrators, or in some specific applications with NMR, GC or FT-IR for their testing, our solution can save them thousands of man-hours and millions of dollars per company.
A company doing roughly 10,000 isotopic purity tests per year can now save upwards of $4M every year just in testing costs alone – and that doesn’t even begin to touch the opportunity costs associated with longer testing times with legacy technologies, inaccurate testing problems or the inability to test in the field.
When you have a new technology that is truly disruptive – meaning it’s better than the legacy technology in not just one or two ways, but every single aspect, you not only change an entire industry, but you help make the lives of every person using it better.
Q: Who are your competitors? And how do you plan to stay in the game?
Because our technology is a true revolution in technological terms (literally never existed before), we don’t yet have any direct competitors. That said, we have a good number of indirect competitors from the legacy technology market – most notably the large manufacturers of chemical analysis equipment for determination of moisture content in organic mixtures, of sulfur content in fuel streams and of isotopic purity in isotopically enriched mixtures.
Right now, the large manufacturers have a stranglehold on the market, but that will quickly change when companies learn of the extreme competitive advantages our technologies offer – and that means a lot when you’re talking about a $21B market.
Q: How would you describe the values that drive your organization?
Everything we do, every decision we make is based on a simple mantra – simplifying the complex. We believe that just because something has been done one way for more than 80 years doesn’t mean it’s the best. It just means no one has taken the time to rethink the process.
Q: What aspects make Lantha Sensors a great investment opportunity?
Lantha has a highly differentiated product; we’re not just a hardware company but we make hardware, we’re not just a software company but we make software, we’re not just the materials company but we make advanced materials, we’re not just an instrumentation company but we make instrumentation. We are a highly differentiated company with a highly differentiated product that yields long-term value for customers and shareholders.
From an investment standpoint we’re going after large addressable market in a highly differentiated way with a frontier, leading edge technology approach. We are very capital efficient with a well-balanced and lean approach to commercialization. From a competitive standpoint we are better, faster and cheaper than the competition. And we have thick margins.
The company is now at minimum viable product and first revenue. We have reference customers that are satisfied, and in fact delighted with our products.
The magic of our business model is the recurring revenue stream that we realize through the sale of single use disposable test strips. These test strips are supplied to customers essentially on a subscription basis; this provides our company with a durable stable long-term revenue stream that drives shareholder value.
