December 22, 2015 Updated 12/22/2015
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Jeremy Carroll Nick Steffans expects rapid growth at his new company, Hardcoat Technologies Inc.
Knoxville, Tenn. — Startups are nothing new to Nick Steffens.
When he was 24, Steffens walked into an interview in Rockford, Tenn., at hardcoater USi Inc. that was supposed to last 45 minutes. When he excited the interview four hours later, the newly graduated mechanical engineer from the University of Tennessee was USi’s third employee. He soon found himself enmeshed in the fledging hardcoat maker’s new business.
After helping grow that business to $ 31 million, Steffens, 42, struck out on his own last year to launch Hardcoat Technologies Inc. in Knoxville. He’s bringing with him a wealth of contacts, know-how and just the right amount of hubris an entrepreneur needs to get a business rolling.
Steffens has only two employees for the moment, but he’s close to landing a $ 3 million contract from a lighting company that would start in March. Another $ 2 million is out there from four other proposals. Signed agreements would get the like-new 29,000-square-foot plant with clean room humming on a regular basis.
“Another thing that’s been encouraging is that we are already starting to see commitments on business for late next year, early 2017,” said Steffens, who officially serves as president, but also rattles off a list of responsibilities that includes quality manager, accountant, sales director, purchasing manager, materials manager and engineer.
Steffens explained that Cooper Standard Automotive Inc. bought USi in 2011, but decided soon thereafter to get out of the hardcoating business. To Steffins, that sounded like opportunity knocking.
“As I’ve explained to our several of our customers and our investors, we didn’t come up with a new widget that we have to sell, market and push to everybody. We have a product that we’ve all produced for 15 to 20 years. So those relationships have put Hardcoat Technologies in a position where we can skip what some companies have had to do. While [potential customers] are not familiar with Hardcoat Technologies, they are familiar with Nick Steffens. They are familiar with [maintenance manager] David Keith,” he said.
Steffens designed the plant and coating system at Hardcoat, which can put through about 700 parts per hour (depending on size) whether they be headlights, fog lamp lenses or interior trim. Also, he’s keeping his business plan simple: Provide custom-injection molded parts and apply silicon thermal hardcoats to those parts. He said he’s passed on four or five other opportunities because they are outside the new company’s scope.
Staffing up for Steffens’ new venture will be slow and steady. His next two hires will be materials manager and quality manager. In six months, Hardcoat will employ seven. In 12 months, 35 employees should be walking the empty halls and dirtying the now-sparkling plant that Steffins proudly displays to visitors. He projects revenues of $ 10 million to $ 12 million in three years.
Hardcoat plans to work with the major lighting makers like SL Tennessee and North American Lighting. But the first purchase order came from JVIS USA.
“We built all the tooling for the [Tesla] Model X program. They [JVIS] were the first check I cashed. I have a photocopy of it,” Steffens said.
Steffens, of course, had to put up his own money (“a few hundred thousand dollars”) to get Hardcoat off the ground. His venture, however, hit a snafu when two investors from Akron, Ohio, had a change of heart and decided to retire. Undaunted, Steffens found a group of five Knoxville-area investors to back him. He owns 60 percent of the business with the investor group owning the balance.
Despite his enthusiasm and his backing, Steffens naturally has a couple of worries at this stage.
“What keeps me up at night is really getting the business to a point where we are making a little bit of money. Right now, the two things that concern me are my health care costs and utility costs. Those are the two big cost drivers for me, believe it or not.
“But business development and making sure that I feel like my investors and the people who work here can take me at my word and that I’ve been honest with them with what I said I’m going to do. And being a good steward of all our money and that investment. So, that’s what’s important to me. My Dad taught me a very long time ago, the only thing that matters is your word. If you ever lose your word, that’s not a path you want to go down,” said Steffens, who emphasized that he will pay off the company’s $ 2 million debt before pulling out any money from the business.
