Knudsen Engineering Ltd.

Market Research Confirms an Ocean of Opportunity!

The challenge: Knudsen Engineering Ltd.., a small, high-tech Ottawa area startup, ran up against a classic roadblock: mainstream lenders don't want to back companies whose main asset is knowledge, not bricks and mortar.

Originally based in Ottawa, the fledgling marine electronics company, consisting of Don and his wife, Judith Knudsen, was having difficulty raising capital to finance the development of Mr. Knudsen's "acoustic camera", an instrument that uses sound to form an image of an object. Don had developed the device because he believed that it could address some of sonar's limitations.

When the company relocated to Perth, Ontario and obtained financing from local investors, the company proceeded to rent office space and continue their research.

The next crucial step was using the money as a lever to spring other financing, including government funding.

Don and Judith realized that they needed an outside appraisal of the technology opportunity in order to bolster their case, and approached the Innovation Centre to conduct a comprehensive market assessment. Gary Svoboda, Marketing Manager and Innovation Centre market analyst on the project, recalls that "market opinion was very enthusiastic on the need for a technology like that being developed by Knudsen Engineering."

The outcome of the study confirmed that they in fact had a world-class technology and recommended that they develop a specific product relating to defense.

On the strength of the Innovation Centre study, the Department of National Defense promised funding for a product if the Knudsen's could raise a matching $ 500,000, which led to another meeting with local "angels" who were handed details of the market study. The group also learned that Mr. Knudsen had won a Manning Award for Innovation for his work in digital acoustic imaging, an award that he was nominated for by the Innovation Centre.

In two days, the funding was raised.

Now, in 1997, Knudsen Engineering is marketing a simpler form of its original technology to the international dredging and survey industry. Five U.S. universities are using the product and the Canadian Hydrographic Service has brought it to sound the arctic ice. Other clients include the Department of Defence, Geological Survey of Canada, Department of Public Works, Environment Canada, and Ontario Hydro. To date, the company has sold equipment to eighteen countries.

"The Innovation Centre's market study provided our company with key information at a very crucial point in our company's development." - Don Knudsen - President, Knudsen Engineering.

Knudsen Engineering may be contacted at (613) 267-1165.