Starting Within: Unique Path from Internal Project to Standalone Company

Not every startup begins in a garage. In a recent episode of Category Visionaries, Brian Lozes revealed how his team turned an internal innovation project at a mid-sized engineering firm into a standalone company now serving Fortune 100 clients globally.

The Engineering DNA

Before the spinout, Brian had spent years immersed in industrial operations: “I’m an engineer, trained engineer out of school, and have spent my entire professional career around heavy industrial facilities,” he explains. This deep industry knowledge would prove crucial to their success.

His background spanned crucial sectors: “We’re talking utilities that provide power, chemical plants that make all the product or the feed goods for the products that we consume, all the way into oil and gas facilities that supply energy for the world.”

The Spark of Innovation

The journey began with a customer request that highlighted a massive market opportunity. As Brian recalls, “A customer of ours came to us who understood the problem and said, I think after trying virtual reality technology, we could have an opportunity to expose our stakeholders to that site so they could go vet it and find the problems.”

This aligned perfectly with Brian’s longtime interest: “I’ve always been this big technology enthusiast, and I’ve always had a sweet spot for the idea of pairing technology to nearly enable a larger, more complicated and dangerous industry into better performance.”

The Spinout Advantage

Unlike typical startups facing the challenge of securing initial funding and customers, their path was different. “Ours is a little different. We were able to, as we started as a business here within a mid size engineering company, they were very entrepreneurial as well. And so were able to make a deal to go create this company,” Brian explains.

This unique starting point provided crucial advantages: “We were able to build some momentum with one organization and then create a company of our own. So it was very nice to have investors, if you will, right out the gate who believed in what we’re doing to help us really spring forward. Having the right partners of the room is a big deal.”

Building Independent Success

The transition from internal project to standalone company required proving value quickly. A recent implementation showcases their success: instead of flying stakeholders to a remote site via helicopter for days of meetings, their solution enabled the work to be completed in hours. As Brian notes, “They said that they not only fully recovered the value of that contract, they started bringing additional savings into their organization in one meeting.”

This focus on measurable results has driven consistent growth: “We multiply year over year with revenue, with the number of individual customers that we have on board, and it just seems to be accelerating.”

Looking Ahead

Now fully independent, the company continues to evolve. “We’re investing deeply in our product to increase the scalability to enable that, the readiness to enable that, and then to widen the value proposition so that makes sense so everybody will use it,” Brian explains.

Their vision extends far beyond their origins: “Three to five years from now, we want to be in every worker’s hands and attributable to a vast reduction in the amount of time people are spending in dangerous environments.”

For founders considering spinning out internal projects, their journey offers valuable lessons:

1. Deep industry knowledge can be more valuable than traditional startup experience
2. Corporate partnerships can provide crucial early validation
3. Focus on proving value independently of the parent organization
4. Use early success to build momentum for broader market expansion
5. Maintain a clear vision beyond the initial use case

The key insight? While starting within an established organization can provide unique advantages, success ultimately depends on building something valuable enough to thrive independently.