[00:00:00] Speaker A: We've developed a low floor battery electric delivery truck. Fast forward today, you see, you know, rivian trucks driving around the streets of Toronto just as of a month or two ago, it seems.
[00:00:18] Speaker B: Ray Monado is an accomplished engineer, leader, and entrepreneur on a mission to build world class product design and manufacturing teams who deliver outstanding products and customer experiences. With a professional career now spanning over 30 years, ray is constantly learning and adjusting course. After graduating from Queens University in mechanical engineering, ray started his career in automotive manufacturing, moving on to race car engineering and design, and eventually business operations, entrepreneurship, and more recently, an angel investor. Prior to starting his company Inertia, ray set out and accomplished his childhood dream of designing race cars and then competing as a race engineer and winning on the world stage. At prestigious events such as the 24 hours of La Mons and the 24 hours of Daytona. Ray left that world of speed and excitement to create his own exciting entrepreneurial journey with the founding of Inertia in 2004. Recently recognized as the number one best place to work in Canada and one of Canada's growing companies, ray leads an outstanding team at Inertia, a global hardware, product innovation, design, and manufacturing consultancy. With offices in Toronto and Guangzhou, inertia works with startups to multinationals across a wide range of industries, spanning medical device, agricultural robots, internet connected home products, and high tech sporting equipment. Welcome to the podcast.
[00:01:47] Speaker A: Well, thank you for having me, Jim. It's a pleasure to be here. I'm excited to chat with you today.
[00:01:51] Speaker B: Yeah, and fun fact that we were connected from CFIN, from Jamil Karim, and he does a lot of work and I've done projects with them. So what do you actually do at Inertia? I mean, there's stuff that you do and what does Inertia actually do?
[00:02:03] Speaker A: So Inertia helps other companies design and manufacture things. So a lot of companies do know typically do this themselves internally, but a lot of companies do not. We typically work with startups or early stage companies that don't typically have the team infrastructure of designers, engineers, manufacturing experts. The products we're developing are what we call end use products. So in case some cases might be a medical device or a consumer good. So when we say the word products are not components or parts of products, they're complete products. A lot of times when companies go through that process, you need a significant team to carry that out. And then once the product is in manufacture, then obviously you don't need that big design development team and you can kind of scale back. So it works well for startup companies and smaller companies who are on the way to scaling. And I'd say usually we're working with companies up to the 2030, $40 million in sales. And after that they start to build their own internal teams.
[00:03:02] Speaker B: Building internal teams is really hard though, right? Because I always think about it as a bubble that kind of moves through your factory. But when you're designing a product, you do really need a bunch of specific skill sets.
[00:03:13] Speaker A: Yeah, absolutely. And that sort of led us to where we are today in a company I'll rewind back to when I started in Inertia. I had been working in another engineering services company and I had started out, let's say, like as an engineering services company, helping people solve parts of problems, helping to design parts of products. And then it evolved into complete products people refer to as product development. So you need mechanical engineers, electronics engineers, firmware engineers, industrial designers, and then later we expanded into manufacturing. And so that, again, just requires more in different skill sets as well.
[00:03:57] Speaker B: So what is their pain? And I'm kind of wondering, when you talk to your customers, their pain is probably getting to market.
[00:04:06] Speaker A: Yeah, absolutely. Especially with startup companies. Again, they often don't have the expertise in house, nor do they maybe want to build that expertise again, because they might not need it after they launch their first product. And so the pain for them can be attracting very experienced, skilled, seasoned people because they are small companies. And also, I think a lot of people recognize that once the product is launched that there might not be a place for them there. So what we offer our clients is really the expert team that can plug in and get them to market extremely quickly. So the alternative would be a startup or a small company to hire an internal team. And usually they hire not, I would say, to a minimum level. They don't hire the full team and so it takes them a lot longer to get there. So something that would take a company maybe two, three, four years to develop a product, we would do it in twelve to 18 months, for example. So we really are solving the problem of speed to market, which for a startup is important because they've got a limited runway and they're looking at their flow every month and need to get to market and start generating revenue.
[00:05:17] Speaker B: So who do you work with at companies? Or do you sometimes work with some of the investors of the company saying, oh my god, we need to get some help?
[00:05:24] Speaker A: Yeah, it's usually the founders.
Sometimes we are introduced to companies by the investors of those companies. And we do know a lot of the angel investment community and venture capital community. But typically we're working with the founders because the companies we deal with are usually precede stage to very early stage. So there could be one person, two people, maybe four or five is very common in the startup space. And then even as you go into the larger companies where they're doing 1020, $30 million, they're still owner operators. So we're oftentimes dealing with the owners or the right hand upper management.
[00:06:06] Speaker B: I was scanning your bio and looking at a little bit about what you do and the word microfactory came on my screen. And what is a microfactory?
[00:06:14] Speaker A: Well, in our definition we see microfactory as a small capital light, flexible assembly cell used for local assembly of, let's call it complex products. So again, we're looking at final assembly. In our case there's a component of automation whether it's material handling, assembly or quality inspection. Also we define it that it's flexible and that it aims to produce a wide variety of smaller batch products opposed to a single monolithic mass production type manufacturing setup.
[00:06:54] Speaker B: I imagine your place is a fun place to work because you've got such different things that you're working on and different projects in different stages of the project build and you must have a lot of really interesting tools that you use and areas. Can you tell our listeners a little bit about that?
[00:07:09] Speaker A: Early on in the product development process we are helping people to define what should the product be? Is it the right product for the market? Does it have product market fit? So we start developing user needs, regulatory requirements and things like that and we use these infinite whiteboards which help us to really lay everything out on the table and explore a lot of information simultaneously. It may sound simple and it is a very simple tool, but you can really explore information quickly and scan things very quickly rather than something more linear like Word or PowerPoint. Then we can go into CAD design tools where we're using things like SolidWorks and now Onshape and web based tools like that where we can improve our collaboration, especially with Onshape, where we can collaborate with external partners and vendors and things like that and customers as well.
[00:08:03] Speaker B: No, thank you for that.
[00:08:04] Speaker A: That's great.
[00:08:05] Speaker B: We're going to talk a little bit about staff in a minute. One of the fun things is that you and I have some common clients, people we bump into a lot of times. And so one of the ones I just had on a podcast not too long ago is Lab Forge. Another client is Kenova Robotics. So maybe you could tell us a little bit about what you've been doing kind of in the automation industry and in this case vision inspection.
[00:08:27] Speaker A: The companies that we work with are typically bringing their first product to market. They have to go through this new product introduction phase and scale up. So they're often producing a low number of products to start maybe it could be hundreds to thousands per year and on their way to scaling to tens of thousands per year. And traditional contract manufacturing companies prefer higher volume projects. So these companies often get lost in these kind of bigger these startup companies often get lost in bigger contract manufacturers trying to get their products launched. And so because we're sitting at that with our customers at that point at a product line we thought, how can we bring a better solution to their needs? And this idea, this microfactory concept, spoke to us because, again, we deal with a lot of small companies. So high mix, low volume, and how do we service those clients? Up until recently, that was difficult to do competitively. So a lot of what we had to do is go offshore because of just the speed and the desire for those companies to want to do that work. Local companies didn't really want to touch it. And again, because we're there trying to help our clients find the best way to manufacture.
At the time, we didn't really want to throw our hat in the ring to do contract assembly just with people standing at a table and try to compete on high cost labor of local assembly. So with a few things happening, such as the automation and vision systems that we've been seeing coming to market through these partners like Canova and Lab Forge, we had stumbled upon this NGEN organization which promotes advanced manufacturing in Canada. And they had put out to offer, I guess what they called AI for Manufacturing grant. And they encouraged people to partner together to bring new technologies and methods to market. And we put up our hand in that group and said, look, this is what we're trying to do. We're trying to service our startup and early stage companies with low volume assembly. We want to do it with some kind of flexible manufacturing method and potentially some automation to help reduce the assembly costs and allow that flexibility to happen. And that's where we were introduced to Kenova who manufactures and sells cobots, and Lab Forge who develop vision systems. And there's also another organization, CRBI, that's helping to do some of the AI image recognition development or say mostly form recognition development. And so what we're trying to do is bring this technology into our microfactory flexible manufacturing cell to be able to identify components and pick them up and either aid in the assembly or in the material handling or the inspection of those components and products without having to hard code it or even they call it no code or low code for that combination of technology to be able to recognize what it's supposed to pick up and pick it up and put it to where it's supposed to go without explicit instructions to do that. So that's the long term vision. We've got a lot of work to do still. So we're starting simple and small, but we think we've got some great partners. And our place in this is the application user of the technology.
[00:12:05] Speaker B: No? That's great. And I'm going to put some information in the show notes about Lab Forge who are located in Waterloo, Ontario, and also Kenova Robotics, which are located in Montreal too, and NGEN, which is kind of Toronto and Ottawa based. So what projects are most fun for you and your staff?
[00:12:24] Speaker A: We really enjoy seeing being able to innovate in spaces that maybe haven't really been innovated in a long time or have been maybe neglected or passed over. There's a lot of hype in different spaces and tech and whether it's VR or other things IoT things, there's the latest and greatest always and then the majority gravitate towards those kinds of things. But when I see places that haven't been innovated and sort of are screaming for help, it's really fun to go in and shake things up and say, okay, how can we do this differently? How can we change people's thinking about how you go about this call it not just a design, but how does this product service or serve the customer, the user? And so there's been a few projects along the way that we're very proud of and have been fortunate to be involved in. Going back a long time ago we developed a low floor battery electric delivery truck. This is going back 15 years when delivery trucks haven't been touched in forever. And unfortunately timing was not in our favor. We were at the bleeding edge and we made a lot of progress and proved a lot of the technology and the productivity that was intended to be done with this prototype with Purelator, actually. And just at the time batteries weren't really there in terms of development and so the project wasn't able to get traction. But fast forward today you see Rivian trucks driving around the streets of Toronto just as of a month or two ago. It seems. Something more recent.
We develop and we manufacture this. It's a bluetooth activated padlock. So padlocks are fairly mundane type, know there are a bunch out there and we work with this company, Seraphore in Waterloo and they're access control security experts and they needed a hardware solution. So it's nice just to kind of be able to go into a different industry and come up with something that's just very new and different and provides a lot of value to the customer at the end of the day. Not just technology for the sake of technology.
I think that's what drives a lot of people here. Not one of the diversity of projects, the different things, but the fact that a lot of the products and projects we take on, we try as much as possible to make sure that they end up delivering value of some sort to someone. That it's not just about the tech or the gadget. So things like medical devices are always nice to work on because you know that at the end of the day they're helping someone and those kinds of projects really inspire the team and drive them. They get a lot of fun out of that.
[00:15:21] Speaker B: When I worked in automation, directly doing work on medical device was one of those things, you know you're curing something or you know, you're curing someone's health or something. It was a big driver and a lot of these companies, they don't know what they don't know. Which is, I think one of your value propositions, right, is that we've done that or we've made mistakes or we've seen mistakes. We can help you not make mistakes.
[00:15:43] Speaker A: Yeah, absolutely.
That can be a hard sell. Sometimes it's like selling insurance.
You tell people, look at it, we've been through this and done that. And usually not on their specific product because every product we bring in here is somewhat different.
We're not often developing the same product for different companies. So usually people feel that their product is unique and special and it is in certain respects, but the process doesn't change too much between products. So that's one of the largest kind of biggest value propositions we can bring to companies is we have processes for doing these things, for developing user needs, customer requirements, design and development standards, manufacturing standards. And we can go through those things in a methodical, rigorous way to prevent a lot of waste, a lot of do over. That's what we see a lot out there. If companies are trying to develop something and they get to a certain point and they haven't considered a number of things and they have to do it over again or they bring it to us and ask can you manufacture this? And we say no. Either it can't be manufactured that way or it can't be manufactured for the cost structure that you intend to sell for. And that's always not a great conversation to have with a company.
Which means there's going to be some rework to be done and more money to be spent.
[00:17:04] Speaker B: There's like billions and billions of dollars being spent in different departments of companies doing the same thing and working against each other. So you just know that the work is out there. It's just a matter of kind of them finding you or you finding them.
[00:17:17] Speaker A: Yeah, absolutely.
Again, a lot of companies that are a bit bigger, they have people in house that do do this and sometimes it's just people they have to get to the point where they maybe realize that they're not getting there fast enough or with the right level of innovation. So I think sometimes people get if they've been in a company a long time, they get used to how things tend to be and that happens. You get stuck in your own way of thinking. It happens to us here too sometimes. And we have to kind of shake our heads and like wait a minute, we can do things differently, right? So sometimes we can come as that sort of impartial third party and without a skin in the game of that company and poke and prod kindly and respectfully of helping people to try to think differently and also bring different perspectives from other industries and products.
That's something that we've done a lot of and to help inject innovation in different spaces.
[00:18:16] Speaker B: I like that inject innovation, for sure. So are you seeing some trends in your own business? I mean, you've done a lot of really interesting projects, and I'm sure a lot of projects you can't talk about. So kind of what's happening in your.
[00:18:29] Speaker A: Industry many different ways. I can answer that question as it pertains to product development or contract manufacturing. And let me just, I guess, explain the company a little bit more for people to understand what it is we really do and how companies like us typically exist in the world. So we're a bit unique in that there are contract manufacturing companies out there that will manufacture and assemble your products for you, but they don't typically design things. There are product development companies out there that will design your product, but they don't manufacture things. And so we're bridging those two domains and even a third one, which is what we call product strategy, which is more like about defining and architecting the right product for product market, fit for cost structure and things like that.
The company has evolved this way over time. And so we've consolidated all those three things into one company to allow us to go very quickly.
And so, for companies like us, we're a service provider.
What we see in the market of companies like us are being consolidated by private equity companies to make larger companies so that they can be sold for larger money. Yeah. And or they're being especially if product development companies are being bought by larger consulting companies like Accenture, Deloitte and things like that, because they use those product development companies to help their customers and sometimes even to get their foot in the door in terms of proposals or developing products or services for those bigger companies. So that's been interesting to see us as a company, when we see that happening and we talk to different people in the market and other companies. What we've heard is that these companies, as they get sort of rolled up and bigger and they get more expensive, they get slower, the service goes down. So we're about 40 Ish people right now.
We're aiming to continue to grow our manufacturing services, specifically with the microfactory model, because traditionally, a lot of our manufacturing and just to explain explicitly, we're not doing primary manufacturing like injection molding or PCBA manufacturing. We're doing final assembly. And so we've got a network of companies to do all the primary manufacturing. We're doing final assembly. And so that's where we see our business growing, is through that manufacturing final assembly locally here in Toronto, but also with the microfactory model, we can actually take this model and install it wherever our customer needs, if they want to manufacture in a different market or they want to take it on themselves. So we see this as not manufacturing for the sake of our businesses only. We're going to prototype it and develop it here to service our clients. But we can also deploy these for our clients and their facilities and that's kind of the vision for how we're going to grow.
[00:22:00] Speaker B: So I'm always kind of thinking about you attracting staff and staffing up and training your staff. Can you tell us a little bit about working at your company?
[00:22:11] Speaker A: Well, you'd probably be better to ask my staff that way.
I'm a little bit biased on that.
So as it comes to hiring and attracting, I've got a huge appreciation for the method and process for the hiring people. Over the years, I've hired a lot of people. I've had to fire some people, which is not something where you're proud of doing, but you have to do it sometimes.
And so we take hiring very seriously. We've honed our methods and our process over a long period of time. And that is the starting point for building your team.
If you can bring in the right people and the right fit and the right attitudes, then you're off to a great start. I think a lot of what attracts people to what we do is the diversity of the products that we do work on and the fact that we're starting, usually starting from a very early stage, people really like to be involved in that process is very creative. It's also very challenging. So I tell people when they are contemplating working here, I say it might sound glamorous, everyone has this oh, I'd love to just start from a clean sheet of paper, but there is nothing more terrifying than staring at a clean sheet of paper.
Oftentimes people come to us and they say they'll have maybe some kind of proof of concept prototype or bench prototype. It's sort of like the science project. And they say, well, this kind of works, can you make it a product? And we say, yes, of course we can make it a product. And then we go and we're like, okay, how are we going to do this? But we know that we have a process and we get through it. While people often see the result and they see that, they're like, wow, I'd like to be a part of that. The process is very challenging and not everyone is comfortable with the ambiguity that comes along with that uncertainty and that blank sheet of paper kind of moment. So I try to caution and tell people when we are interviewing them that it's not for everybody, that it is an interesting and challenging process, but it can be difficult to kind of manage that, move forward with that ambiguity at the same time. And engineers can often some of them can have a struggle with that.
I would say that school universities give people very clean problems. Here are your three knowns and one unknown. Solve for the one unknown. In real world, it is opposite of that. You have maybe one known and three unknowns and you have to throw guesses at the other unknowns until you converge on a solution. So it's always interesting to see how people think their way through of problems. So we have some very talented people that are very good at what they do and we spend a lot of time making sure that they are that way. And finally, when I started the company, I just wanted to work with good people, they're a good person. And so coming across the overlap of those two, you know, very highly capable and good those are we're thin slicing the population there a little bit.
[00:25:43] Speaker B: Thanks for that, Ray. So one of the things obviously we're talking to the robot community is that something that's coming up more and more in your basket of business is electromechanical robotics automation vision?
[00:25:56] Speaker A: Yeah, a little bit. Some of the products we've developed have an element of robotics and automation in them. I wouldn't say we're not robot design experts by any stretch. We got involved in an autonomous weed picking vehicle for industrial farm fields. So this is not something you use in your backyard, it's to cover 1000 acre industrial farms. So that would be one example. But in just in operating the business, I'd say maybe shifting more to the manufacturing side of things.
What I don't see is at least in our space and the kind of the areas that we compete in, I don't see a lot of robotics and automation. And when I started my career 30 years ago, my first job was in automotive manufacturing and we were using pick and place robotics. My customers were Toyota and Honda and they had welding robots and it was highly automated at the time even. And so that existed 30 years ago and beyond in those environments. So where we live in smaller companies, lower volume, there really hasn't been a lot of not just activity but it hasn't been accessible to companies like us and our customers. And this is one reason why we're trying to bring more robotics and automation vision systems into the manufacturing process. And I'll just almost stop at robotics automation but also information automation. So how do we marry the physical with the digital in terms of the products we manufacture, the components we manufacture and start what they call the digital thread. So serializing parts as they get manufactured and combining them in assemblies and tracking and traceability and quality testing and having all those LinkedIn databases and things like that. So there's a lot of information automation that we're looking to inject in our business as well. And I just haven't seen a lot of that happening again. I'll caveat that in the spaces that we live in. So I know there's a lot of bigger manufacturers out there. This is happening every day but it's just not available to a lot of the smaller companies. And I think it is more and more available now and we're trying to lead that way.
[00:28:17] Speaker B: Thanks for that, Ray. Did we forget to talk about anything today that you might want to chat.
[00:28:21] Speaker A: With our listeners maybe? I will mention one thing sure as it pertains to microfactories, so microfactories again have usually have a large component of automation. But the other side of it is this flexible low volume aspect. So the flexibility when I got started in my career in manufacturing, I was fortunate to have the opportunity to work with Toyota as one of my customers. And they offered our facility to bring in their management consultants to help us implement their Toyota production system. So through just in time pole production and we did it. And it was quite an experience. It was remarkable, the transformation.
And they didn't ask for anything. They didn't ask for any money, they didn't ask for any cost downs. They just wanted us to be a better supplier to them.
And we took that methodology and we expanded it across the entire plant and we're able to reduce our warehouse space from 80,000 nothing. That was 30 years ago and since then I haven't come across very many companies that have still done that. So I've always had this desire to exercise that method again and in a small low volume environment that can be a little bit difficult to do. And also the fact that this flexible automation is now available. I really think bringing those two things together, the flexible automation actually enables this flexible low volume batch build method in a way that's more competitive, I guess. So we're kind of marrying the lean production system with some automation and that's our vision for the microfactory.
[00:30:14] Speaker B: Thanks for that, Ray. So kind of my last question that I wanted to ask you about. So when you're not manufacturing and project managing, what do you like to do? Do you have any hobbies? Are you racing cars?
[00:30:26] Speaker A: No, not racing cars. That wasn't a previous life, but actually didn't even race much. I engineered a lot of them.
What I like to do now, I've only got a few Hobies and one big one is playing guitar and playing guitar, playing with friends, playing music with friends. And actually we even have a small jam space in the office here that the team will bust out into playing some tunes once in a while. It's a good way to blow off some steam and just kind of take you out of your head, get lost in music.
[00:30:59] Speaker B: That's great. Thank you very much for coming on today. And how can people get a hold of you if they want to kind of learn a little bit more?
[00:31:04] Speaker A: Sure. You can find us online at WW inertiapd.com So inertiapdproductdevelopment.com. Or you can get me directly at
[email protected].
[00:31:21] Speaker B: Our sponsor for this episode is Earhart Automation Systems. Earhart builds and commissions turnkey solutions for their worldwide clients. With over 80 years of precision manufacturing, they understand the complex world of robotics, automated manufacturing and project management. Delivering world class custom. Automation on time and on budget. Contact one of their sales engineers to see what Earhart can build for you. Their email address is info at earhart automation. And Earhart is hard to spell. It's ehrhardt and I'd like to acknowledge a three the association for Advancing Automation. They are the leading automation trade association for robotics, vision and Imaging, motion control and Motors, and the Industrial Artificial Intelligence Technologies. Visit Automate.org to learn more. And if you'd like to get in touch with us at the Robot Industry Podcast, you can find me, Jim Beretta on LinkedIn. Today's podcast was produced by Customer Attraction Industrial Marketing. And I'd like to recognize Chris Gray for the music. Jeff NAD Bremner for audio production, my business partner, Janet, and our sponsors, Earhart Automation Systems.
