Our Founders Interview this month is with Francisco Roque, co-founder and CEO of Nortech AI.
Nortech AI, a Norwegian-Portuguese tech innovator, stands at the forefront of revolutionizing the maritime and other-asset heavy industries. With a firm commitment to fostering digital transformation, Nortech AI promises solutions that are not just groundbreaking but also environmentally conscious, driving industries towards a future characterized by smart, sustainable, and proactive operations.
First, can you tell us about your professional background and the path that led you to Nortech?
I started in 2005 by leaving my Masters in Biomedical Engineering at Técnico in Lisbon, and I went as an Erasmus student to Copenhagen. There, I ended up finishing my Masters in Bioinformatics at the Technical University of Denmark, and I continued to do a PhD in Data Science. So, my research topics were basically, how can we use data to extract value and what kind of methods and systems we use to extract value from data. After that, I worked as a consultant both for CapGemini and PWC, and also co-founded another startup UNSILO, that we had small exit from a few years ago. As part of my work as a consultant I met my two co-founders at Nortech, Anders and Halvard, and we worked on a large project for Rolls-Royce Marine. I was mainly responsible for building up the data science team and coming up with especially predictive maintenance algorithms, but I ended up getting involved in the whole data acquisition pipeline. I started contacting with customers and so on, and the idea for Nortech also came from there. So it wass a natural evolution of my professional background, you could say.
Can you elaborate on the opportunity you spotted when you decided to start Nortech?
Yeah, so when we were working for Rolls-Royce Marine we saw that there were customers in the market interested in becoming more digital in a more effective manner. So, the products we were developing for Rolls-Royce were targeting specifically Rolls-Royce equipment. It was not a cheap solution, and we did see a lot of customers declining taking in Rolls-Royce offerings at that stage because it was such a complex and expensive system that it priced it out of range for customers that let’s say lacked the digital experience for evaluating if this was a good choice or not for their business. So, we identified that there was a need in the market for more a effective solution to start getting digital faster and earlier without having to wait until someone else found the needle in the haystack. There was demand from customers to just get started in transforming their business into a more data-driven business and start extracting that early value. So, this is actually the concept behind Nortech, getting customers digitalized faster and realizing the potential value of their data faster
Almost like democratizing the access to this data, right?
What makes your offering unique?
So, we have spent 2 years in R&D in making sure that we remove the consultancy part of becoming more digital. We have a data collection stack targeting the industry, especially the heavy machinery industry. We started in the maritime business, but we see opportunities in other markets and other verticals. What makes it so special is that we are able to connect to any industrial equipment without having to spend man hours in configuration or reverse engineering the protocols coming out of the equipment. This makes it so that we have a 30-minute installation time on our equipment. We don’t travel to our customers, our equipment is sent via DHL. We say that we have a screwdriver installation, so basically a customer that knows how to use a screwdriver is able to install our system and they’re able to get digital faster, which is more cost effective, obviously.
You are currently targeting the maritime industry and later expanding into others, but how do you plan on making a sizeable impact?
We see that our customers in the maritime industry are focused a lot on the saving the environment message. They’re really focused on the green side of things, they are transitioning to green propulsion sources and they are looking everywhere in their business to make their operations more efficient and obviously simultaneously benefiting their bottom line. We see that they’re heavily interested in adhering to the new EU regulations that are coming out, especially targeting emissions in the maritime market, the new carbon trading system coming into effect, etc. Traditionally, they haven’t really used data very effectively before. Business has typically been more based on guesswork and guesstimates on how much we would use in terms of fuel, or what would be the best strategy for minimizing that fuel consumption. We are now giving them a way to really find out where are the bottlenecks in their business, where are the worst offenders in terms of energy consumption, and then helping them in the green energy transition by starting now, incrementally doing small reductions until the new propulsion sources are in place. Will it be hydrogen, will it be ammonia? The market is still uncertain what is going to be the fuel of the future, but they can already now start saving the environment and start saving in energy costs themselves by doing small incremental changes by being more data driven.
Small incremental changes that in a cargo ship represent vast quantities of fuel.
Yeah, absolutely! To give you an example, we’re working with a customer — they do transatlantic voyages — and per week, they use 250 tons of fuel. We have now started helping them in reducing their energy consumption and we have achieved 2–4%, depending on the vessel, reduction in fuel consumption. An amount which out of 250 tons, do the math, is still quite a few tons, and every little bit counts. This is a lot of money that they save, and this is a lot of CO2 that we’re not emitting, while keeping the same effective operation. We’re not talking about cutting down anywhere, we’re just cutting down on fuel costs. That’s it. So, it’s a win-win for everyone.
What can we expect from Nortech now that you have raised a €2.5M seed round?
We started as the founders selling to the maritime market. We saw the maritime market in need of our technology and our help to become more effective, and similar to the maritime market, we identified a number of other industries that are also slightly lagging behind the frontrunners in terms of digitalization. So, we see a huge potential in trying to penetrate parallel industries where our value proposition is strong, and this is something that we will be focusing on. We’re expanding our sales within new verticals, and we have recently started expanding to the mining sector in Europe, which is a sector that is due to increase more and more as new mining operations are opening in Europe, but we have to be more conscious of the environmental impact of these operations. This is where Nortech can really help. So, its the same value proposition, we’re just bringing it to new industries. At the same time, we see that there’s a huge opportunity for delivering value-added services to our customers, so new applications on top of the data. Oftentimes it’s not just enough just to capture data, we need to do something more with the data. We have done more towards Performance Management, we’ve done a more towards the reporting of carbon emissions, but we want to do more towards effectivizing our customers operations. So, we are investing now in R&D, we are making more AI derived products, to make sure that our customers use as little energy as possible in operating their business and thus save costs.
What has been the most challenging part of growing your startup?
Okay, maybe we can start with the hardest part. I think the hardest part has been access to talent. We started in Norway, and it was very hard with its relatively small labor pool. As a startup, you need people that are like-minded, so they need to be a little bit more willing to take risks. This further reduces the available labor pool for us, and us coming from a small city in Norway, we have difficulties in hiring. This is why we have opened an office in Lisbon as well, and we’re very lucky to have access to a much larger labor pool. We were able to hire excellent people that are now contributing immensely to our product development, but we definitely still struggle a little bit. Sometimes certain key positions are hard to hire,
and I think this is going to be a trend moving forward. If you want to hire the best you have to work hard for it and you have to convince them that they get value out of working with you as well. So, by far this has been the biggest challenge for our side.
And in contrast to that, what’s been the most fun part?
For me, this whole thing is kind of like solving a puzzle. This is by far the most rewarding part of being in a startup. There are so many things happening, there are so many micro decisions you have to make with limited information, and you just have to surround yourself with the best people that can give you the best insight, so that you can choose the best way of moving forward. You then see the puzzle slowly growing and shaping itself into something that you are proud of bringing to the market, and you feel pride in being a part of it. This is by far the most fun and exciting part of not just Nortech, but I would guess any startup that is successful.