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3-D vision: Paul Lindahl acquired an int3-Deresting graphic technology in 2000 and created a company that now generates more than $10 million annually developing interactive simulations for aerospace and defence agencies
Mission: Take Ngrain public to fuel company’s future growth Assets: Adept at navigating the bureaucratic complexities of private and public sectors Yield: A string of multi-year and multimillion-dollar contracts with large aerospace and energy companies and defence departments
 Curt Cherewayko One of Paul Lindahl’s favourite reference books is Crossing the Chasm, a marketing guide for technology developers. It delves into the role of early adopters and innovators in recognizing a startup’s vision, testing its product and validating its business plan. Once that checklist is complete, the typical startup is ready for what Lindahl describes as the masses, or the pragmatists. That’s Ngrain’s position: in the last year, the company grew 300% as new customers – the masses – took note of its technology. Its interactive 3-D simulations are becoming a regular component in the training programs and maintenance systems of international aerospace and defence organizations. “We’re at the classic stage of a company that goes from startup to emerging growth,” said Lindahl. This month, the company opened an office in Ottawa to strengthen its relationship with the federal government, one of its largest customers. That Ngrain has carved out a niche in aerospace and defence is particularly impressive considering Lindahl thought Ngrain’s technology was best suited to the video game industry when he founded the company, originally known as I3Dimensions Inc., in 2000. Born in Newfoundland, Lindahl spent the second half of his childhood in Duncan on Vancouver Island. After graduating from high school, he crossed Georgia Strait to acquire a geotechnical engineering degree at the University of British Columbia. He was a practising engineer in the mining sector for a couple of years before moving east to Toronto to obtain a master of business administration degree from Queen’s University. With an MBA in hand, Lindahl landed a role in IBM Canada’s Vancouver office. During his six years with IBM, Lindahl was primarily responsible for managing the account of HSBC Canada, which used IBM’s hardware and software as its backbone. “My technology background,” he said, “doesn’t come from education but from my work experience.” Lindahl would get his first lessons in entrepreneurialism and government bureaucracy after joining the venture capital arm of Gold River Lodges Ltd. in 1992 to manage the financing and development of a fishing resort. To obtain the permits for the lodge, Lindahl had to manage relationships not only with the municipal and provincial governments, but also with multiple federal government ministries. In 1994, having discovered his entrepreneurial flair, he acquired a large stake and took a lead role in Richmond’s Hewitt Rand Corp., a mid-sized computer manufacturing company. “I realized I get a charge out of starting something, seeing an opportunity and building on it,” said Lindahl. Between 1998 and 2000, under Lindahl’s watch, Hewitt Rand merged with a Seattle-based manufacturer and opened three new manufacturing plants – for a total of seven – in North America. The shrinking margins in the PC-manufacturing industry eventually caused Lindahl to search for other business opportunities. “I put a banker’s hat on,” explained Lindahl. “I said if I was a banker, would I finance that type of industry?” As he wound down his role with Hewitt Rand, Lindahl was already raising seed capital for a new company he was forming around an interesting 3-D graphics technology developed by Paul Halmshaw, a frustrated video programmer who believed that the 3-D graphics of the day were sub-par. Halmshaw demonstrated the technology to Lindahl, who was impressed enough to acquire it in exchange for shares of Ngrain. Ngrain then spent a few years in what Lindahl calls “prototype purgatory.” It tweaked its 3-D simulations and courted financiers. Meanwhile, potential customers tested and tested, but wouldn’t commit to adopting Ngrain’s technology. Last year, Ngrain started seeing a return on its innovation and patience. The company was awarded a one-year contract with four option years to be the sole supplier of interactive 3-D simulations to Canada’s Department of National Defence. If all options are exercised, the contract will total about $20 million for Ngrain. Lockheed Martin Corp. is rolling out a line of F-35 fighter jets that are equipped with Ngrain’s software. Maintenance crews use the software to record damage and repair details on virtual 3-D models of the fighter jets. Strengthening Ngrain’s ties to the U.S. military, Lieutenant General Michael Hough (Ret.) joined Ngrain’s board last June. His role with Ngrain is to open doors to the U.S market for the company. Hough, who was responsible for all planning and training for U.S. Marine Corps aviation before retiring from active duty in 2006, noted that military budgets around the world are being cut and that the most expensive military commodity is manpower. Ngrain’s big opportunity comes in being able to reduce manpower and make defence workers and soldiers more efficient. But to fully capitalize on that opportunity, the company has to get face time with key defence agencies to demonstrate that its technology works. Hough said Lindahl’s unflappability and grace under pressure are key traits for succeeding in an industry populated by military men and big egos. “He’s not a [General George S.] Patton – a yeller and screamer,” Hough said of Lindahl. “He believes in what he’s doing, [and] he makes you believe.” Lindahl, who lives with his wife Kelley and daughters Charlotte and Madeline in Vancouver, will continue to grow Ngrain – the company is cash-flow positive and is on pace to generate more than $10 million in revenue this year – as he keeps an eye trained on the public markets. A public listing would not only give investors a liquidity opportunity, but also provide Ngrain with more fuel to, as Lindahl puts it, feed the fire. •
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This article from Business in Vancouver July 7-13, 2009; issue 1028 Photograph: Dominic Schaefer |
