M Squared is a leading force in the UK’s growing laser and photonics sector. Founder and CEO, Dr Graeme Malcolm, fills us in on their overseas success.
What does your company do?
M Squared is a photonics technology company that produces advanced laser platforms. We are a multi-award-winning team of more than 85 talented and passionate scientists, engineers and commercial staff with expertise in a range of fields that include quantum technology, biophotonics, and chemical sensing.
We are a fast-growing company that develops photonics products to support cutting-edge physics research and, through our dedicated innovation group, collaborate with leading universities, research institutions and industries around the world from offices in the UK, Europe, and the USA.
When was your company launched, who by and why?
I founded M Squared in 2006 with my business partner Dr. Gareth Maker. We met at Strathclyde University and in 1992 co-founded Microlase. The company caught the eye of the California-based laser manufacturer Coherent Inc. who eventually purchased the company in 1999.
At M Squared, we set out with a disruptive approach to the design and manufacture of solid-state lasers – discarding traditional ‘experiment in a box’ style lasers and favoring the robust, automated and intuitive systems that define the company today.
How long has the company been exporting?
M Squared has been exporting from day one.
What do you currently export, and where to?
We export our lasers throughout Europe, the USA and Asia where our customers vary from world-leading universities and specialist public research institutions to high-value manufacturing firms. Our award-winning SolsTiS platform currently makes up more than 90% of our total overseas trade. This year also saw the business receive the Queen’s Awards for Enterprise in Innovation for this particular groundbreaking technology.
Over the last three years, between 80 and 90 percent of our product sales have been international. Our top export destinations are the USA, Germany, France, Austria and Japan and we have sold products into 22 of the top 25 countries that maintain the highest levels of research and development spending.
What motivated you to start selling overseas, and how long did it take?
We are embedded in a globalised industry that acts in the international interest, shares common values, and pursues common objectives. We have always been a global company, targeting the emerging international market in photonics from day one.
What is the easiest part of exporting?
In the close-knit scientific network, word spreads fast. The products used in scientific experiments are well documented in papers and publications. If you have a product that performs well, its quality is quickly recognised within the global scientific community.
M Squared is fortunate in that it has a specific and well-defined clientele. We understand our customers’ need for technologies that enable them to produce high-quality research – from antimatter experimentation to the development of the world’s most accurate clocks.
And the most challenging part?
Establishing the business as a recognisable partner and building relationships with overseas universities, research organisations, and government agencies was our greatest challenge. Once we had developed these initial relationships, we could grow our client list through customer and collaborator referrals.
Another challenge was acclimatising to the increased level of demand for our products in the international market. After achieving recognition from major organisations in the science and technology sector, we increased our number of scientific, sales and commercial staff.
Have language barriers, currency changes, etiquette and culture ever caused you any difficulties?
The global science community is largely English speaking. This was extremely beneficial when we founded the business but became increasingly less important as we expanded. Today, we recruit staff from around the world and employ many multi-lingual scientific, engineering and commercial staff.
Working with multiple currencies was always going to be challenging, but in areas with thinly traded currencies we made a decision to price our products in Sterling. Like our customer base, our supply chain is international, and this results in a natural hedging of currency exposure, especially when key suppliers price their goods in USD.
Getting used to new customs and new food has been interesting and eye-opening. In Japan, we were told that the local customs advise that a guest should never sit with your back to the door so you can see anyone entering the room and avoid being stabbed in the back by a samurai warrior.
Did you get any support when you wanted to trade abroad? Who from, and was it helpful?
It was challenging to significantly increase the volume of our exports using our financial resources. We are generating a reliable income and use this revenue to support organic growth. In 2015, however, we identified the need to make a step change and secured investment from Barclays and the Business Growth Fund to increase our market share in the Europe and the USA.
What advice would you give to someone just starting to explore overseas markets?
Soon after we created the business we received support from Scottish Enterprise who offered guidance and funding to help with research trips and overseas staffing. This support was exceptionally helpful, and I would recommend it to prospective exporters.
Where next? What markets are you looking into and where do you see the company in 5 years time?
The USA and Europe are our largest markets, and we are focused on developing these regions further. In 2015 we opened dedicated offices in Germany and the USA to enable us to respond to our customers in these regions quickly and in person. We do, however, still manufacture all our products in the UK.
We are also looking to expand our market share in Asia. The success of our customer projects and the flow of international students has raised the profile of our products and is increasing organic demand for M Squared products.
M Squared is roughly doubling in size every two years. We will continue to prioritise the international market, expand our product portfolio and develop new applications and intellectual property.