1. Data preparation to ensure that the dataset is appropriate for model building. Common pitfalls such as missing data, insufficient variation, and data anomalies are investigated and resolved.
2. Model building using multivariate analysis and its intuitive plots that help subject matter experts interpret their dataset highlighting key correlations and trade-offs.
3. Simulation using the model to predict the outcome of potential experiments without running the actual physical experiment.
4. Constrained numerical optimization to calculate the ideal formulation and processing conditions required to achieve a targeted quality or set of qualities.

Introduction

Coatings are commonly used in a variety of industries to enhance the performance, durability, and finish of painted surfaces. Coatings manufacturers can address rising raw material costs, unwanted inventory costs, supply chain shortages, and process complexities by reformulating existing products with fewer, cheaper, and more readily available ingredients. However, coating formulations are complex; formulators must carefully select numerous ingredients in hopes of achieving multiple performance targets in robust application conditions, while balancing cost and ingredient availability, and adhering to environmental regulations.

Product Development Data

Typically, a product development dataset includes three types of input (X) variables:

• Formulation ratios—how much of each ingredient is used (measured in percentage, fraction, or other quantity, such as kg)
• Ingredient properties—physical or chemical properties that characterize each ingredient, such as molecular weight or density
• Process conditions—the manufacturing conditions under which the ingredients are combined, such as temperature or mixing speed

The output (Y) variables in a product development dataset include any measured quality or performance properties, such as viscosity or hardness.

While a large number of X and Y variables may exist for one product development dataset, there are typically much fewer degrees of freedom due to the underlying chemistry. In other words, not every X variable can move independently of all other X variables, and not every Y can move independently of all other Y variables.

Predictive Modeling

Owing to these chemistry complexities, product development activities that follow a conventional approach (involving trial-and-error or design of experiments (DOEs) with numerous physical experiments), tend to become iterative and resource-intensive. By contrast, building a predictive model on historical formulation data, interpreting the model, and performing simulations (applying the model to predict the outcome of new formulations) can drastically reduce the number of required physical experiments and, ultimately, accelerate the time required to develop a new or reformulated product.

PLS for Product Development

The AI framework for a predictive model should be carefully selected. PLS (partial least squares) is well suited to product development applications because results are visualized with intuitive plots (explainable AI), and the models can be inverted in a constrained optimization framework. In addition, models can be built on both large and small datasets, and missing data and correlated measurements are handled.

The ability to interpret PLS models is a significant advantage over black-box methods because formulators can:

• build trust in the model by verifying existing domain knowledge;
• uncover new learnings from the intuitive plots; and
• use the identified correlations to more intelligently and efficiently plan physical experiments.

Constrained Optimization

The ability to invert a model in a constrained optimization framework represents a further advantage of selecting PLS for product development applications. In this framework, the PLS model is used in conjunction with a relevant objective function as well as bounds and constraints to determine the required ingredient and process combinations that will achieve specified performance property targets.

Examples of typical constraints for a product development optimization problem include:

• availability of each ingredient
• upper and lower bounds for how much of each ingredient can be used
• limits on the number of ingredients used per formulation

The optimization objective function for a product development application typically includes terms to:

• minimize overall formulation cost
• minimize deviation from performance property targets
• minimize extrapolation from historical design space

Coatings Case Study

The goal of this project was to reformulate existing high-performance coatings to use fewer ingredients while maintaining existing performance property (i.e., quality). The available data included:

• 450 historical formulations
• 81 unique ingredients from 5 ingredient classes (resin, solvent, catalyst, additives, isocyanates)
• 116 ingredient properties (not all available for each ingredient)
• 6 process conditions (such as ambient conditions and film thickness)
• 4 performance (quality) properties, including viscosity, hardness, glass-transition temperature, and gel fraction

Assemble Dataset

An important first step is to assemble the dataset. The goal is to evaluate the suitability of the structured data for predictive modeling and to calculate advanced input features such as mixture properties.

Examples of data assembly tasks include:

• correcting common anomalies (such as outliers, inconsistent measurement units, inconsistent nomenclature, etc.)
• calculating ingredient class use (summation of formulation ratios for all ingredients in a single ingredient class)
• assessing variation in ingredient properties, ingredient use, process conditions, and quality properties
• evaluating the amount of missing data

Mixture Properties

Mixture properties are a key concept of the PLS model structure. Mixture properties are calculated by combining ingredient properties and formulation ratios using appropriate mixing rules.

When mixture properties are available and sufficiently characterize the ingredients, formulation ratios can be excluded from a model. This variation of the model structure is very powerful, as it allows for new ingredients to be considered in future formulations, so long as the ingredient properties are known.

Mixture properties can be calculated per ingredient class or globally (across all ingredient classes). This flexibility is helpful in cases where some ingredient classes have more missing data than others, when the ingredient property measurements differ between ingredient classes, or when the formulator only wishes to consider new ingredients in specific ingredient classes.

In this dataset, 4 of the 5 ingredient classes contain ingredient properties; therefore, mixture properties were calculated per class, using a linear weighted-average mixing rule. This resulted in 58 new input (X) variables that contained sufficient variation for use in the model.

Build & Interpret PLS Model

With the assembled dataset, the next step is to build the PLS model. The PLS model structure for this dataset is shown in Figure 1.

FIGURE 1 PLS model structure.

I have recently had several conversations with extremely experienced technical scouts and investors who told me that the best source of new technology in their years of practice has been the startup community. For the CASE market (coatings, adhesives, sealants, and elastomers), this typically means sourcing material science technology rather than the novel software, social media applications, information technology, artificial intelligence, financial technology, etc., that are readily available through many startup accelerator services.

In fact, it is more difficult to find new material science technologies because so many fast-moving, potentially lucrative markets are luring startups toward early investment and quick financial gains. Investors see material science startups as having a greater need for capital investment over a longer period of time during the scale-up phase. Luckily, there are several notable events that material science scouts will find are worth their time.

The TechConnect World Innovation Conference and Expo is the largest technology conference in the world and brings together government funding agencies, military, industry, universities, and venture capital groups, among others, to present the status of current technologies like advanced materials, advanced manufacturing, energy innovation, sustainability innovation, biotech and medical, defense, and e-mobility. Universities and startup companies have the opportunity to showcase new technologies, pitch sessions allow scouts to view not only the technology but how well the information is delivered by the presenter, and military funding agencies present their latest needs. TechConnect holds events throughout the year focusing on different topics (e.g., Defense TechConnect and Smart Cities). Each provides an opportunity to meet top innovators with visionary thinking across many technology areas in one location. For those who want to find cutting-edge technology and potentially breakthrough commercialization opportunities, these events present a target-rich environment.

Many other events also have a high potential for finding new material science technology. These include:

• The Rice Business Plan Competition is organized by the Rice University Alliance for Technology and Entrepreneurship. The competition supports entrepreneurship by offering a multiday event for student startups from across the world that mirrors a real-world experience. Student founders pitch to investors, receive feedback, and advance their startups. The event features significant interaction with judges and sponsors, providing valuable access and experience with both early- and later-stage investors.
• The Florida Venture Forum is Florida’s largest support and networking organization for entrepreneurs and venture capitalists. The organization helps startups and high-growth companies connect with the capital and services they need to grow and scale. Many of the startups are focused on the growing aerospace industry, and their pitches are often focused on material science. Events are held multiple times each year.
• The Lawrence Berkeley National Lab Pitch Competition is held annually for scientist-entrepreneurs who participate in the National Science Foundation I-Corps™ program, providing them with the opportunity to practice pitching their ideas. The winner advances to a U.S. Department of Energy pitch competition to compete for cash prizes supporting market research. Most of the technology pitches involve material science, such as cool building technology and sustainable chemistry.

Each year, thousands of pitch competitions provide startups with opportunities to share their technology and seek collaboration with corporate sponsors in every area of technology. Having dedicated material science scouts gives each company a higher likelihood of finding a technology breakthrough because scouts are continually focused on the future needs of your business. Successful scouting means eventually finding the very thing that will differentiate you in the market.

About the Author

Victoria Scarborough, Ph.D., is vice president, collaborative innovation, at The ChemQuest Group, Inc., and the ChemQuest Technology Institute. Email: vscarborough@chemquest.com.

For decades, original equipment manufacturers (OEM) have used specially designed robots to paint automobiles, all types of parts, and heavy equipment in a factory environment. To accommodate customer needs, coating chemists have created multiple coating formulas and techniques for each robot and the corresponding substrate.  This helps address robotic painting problems on the OEM factory floor. As software expertise has grown, so too have robotic capabilities that expand to painting outside the factory environment. Now, paint bots and drones are currently at the cutting edge of paint application technology.

In 2019, AkzoNobel held its annual Paint the Future contest, seeking new technologies to fund for collaborative development. The contest was won by Apellix LLC, a startup company in Jacksonville, FL, whose patented tethered drone technology was developed not only for painting structures, but also for measuring dry film thickness on the substrate. The technology has sophisticated algorithms that allow it to build a surface “heat map” to tell the asset owner where paint is too thin and may fail prematurely. In addition, the drone can also be used for cleaning surfaces prior to painting.

Another robotic painting tool is being developed by HausBots Ltd, in the United Kingdom. Here, the HB1 robot is shown climbing rough surfaces and can overcome obstacles such as wires and bolts. The robot is used for painting and doing visual inspections of a building. It sticks to the surface using suction and can climb up to about 100 feet. In 2021, the HausBots staff was recognized by BuildWorld as some of the best new talent designing robotics for the built environment. In addition, HausBots has been selected to conduct a trial of its innovative wall climbing robot for the removal and prevention of graffiti on highway roads by Highways England.

Transforma Robotics Pte. Ltd. is located in Singapore and sells a line of robotic painting devices. The PictoBot is an autonomous system developed for industrial applications. It can paint large wall sections using a typical spray nozzle to apply paint to building interiors. According to Transforma, there is a 25% time savings over using two painters for the same job. It reaches up to 30 feet inside and can easily paint high walls and ceilings using its extendable and retractable spray nozzle arm. It stores about 10 gallons of paint. Transforma also sells a line of robots for exterior use and one that uses electrostatic spray to dispense disinfectants.

While some of these technologies are in the early stages of development, the benefits of using drones and paint bots are evident, especially when it comes to improving worker safety. Commercial painting often involves the use of scaffolding and ladders in elevated positions that puts workers at greater risk. If painters can stay on the ground and monitor the drone’s performance, they face fewer hazards.

Drones could apply paint in enclosed spaces such as mixing tanks that usually require special breathing equipment due to exposure to hazardous fumes. In a time when skilled labor is scarce, robots can perform repetitive tasks, which allows experienced workers to focus on more complicated painting duties. Making painters more efficient at their work will reduce the overall cost of jobs and optimize the painting process.

About the author: Victoria Scarborough, Ph.D., is vice president, collaborative innovation, at The ChemQuest Group, Inc., and ChemQuest Technology Institute. Email: vscarborough@chemquest.com and phone: 330-998-5483.

My recent keynote presentation on megatrends given at the Paintistanbul Turkcoat Congress generated significant interest in electric vehicles (EV) as a driver for coating innovations. Given that every major automobile manufacturer has announced plans for conversion to electric vehicles in the next decade and global sales of new EVs are rising significantly, it is no surprise this market represents new opportunities for growth.

While the net number of cars being sold may stay relatively constant, the coating types per vehicle will grow based on the increased number of EV components per unit that require coatings. For example, there are at least 100 more electronic control units per EV than found in gas-powered cars.

While each model may look different, the overall design of an EV has three basic areas where coatings are useful:

• Battery packs
• Power conversion components
• Electric drive systems

Each manufacturer has its own battery pack design, with a unique set of needs and challenges. Regardless of the construction of the pack, they all need fire protection, corrosion and impact protection, temperature management and electrical shielding.

Temperature control is essential to maintaining battery efficiency and durability over time. Innovative thermal management coatings can provide a partial solution by helping to control temperatures, whether they are too hot or too cold.

Battery packs also require protection from electromagnetic interference. Coatings with dielectric properties can help prevent arcing between metal parts. Intumescent coatings may protect from fire damage if batteries fail, overload and start a fire. The battery pack environment contains polyelectolytes that requires coatings that resist corrosion. EVs are also designed with hundreds of sensors, all of which need protection from wear. Clear protective coatings can be used but they cannot diminish signal tranfer.

In addition to the EV itself, developments in autonomous-
vehicle technology have demonstrated the need for road improvements, particularly in the requirement for consistent, easily visible pavement markings. If not properly marked, it is harder for an autonomous vehicle to know exactly where they are on the road. Here, coating manufacturers can play a role in providing traffic paints that can potentially communicate with the EV. Photonic pigments can be added to coatings to help provide guidance on road postion. Thus, smart traffic coatings can be formulated to help talk to the EV.

Autonomous vehicles are also programmed to read road signs. Similarly, coatings that contain NIR transparent or reflective functional pigments can deliver a signal response back to the EV and improve object recognition. Several pigment manufacturers already have products available for this purpose.

Obviously, the coatings industry has been serving the automotive market since the introduction of the Ford Model-T. Many traditional coatings used today can be used on electric vehicles. But EVs represent a major engineering pivot from mechanically driven to chemically driven vehicles. As climate change pushes further regulatory changes to reduce fossil fuels, electric vehicles will eventually dominate the market. This requires the coatings industry to respond quickly with new products and innovations to address the needs of electric vehicles and their vastly different architecture.

Deciding which technical projects to advance to commercialization is often complicated. Individuals can understandably become attached to projects with unique but unproven ideas or innovations that are not tied to business growth.

To be completely unbiased, the ChemQuest Group regularly uses a tool called the Porter’s Five Forces of Competitive Position Analysis (PFF). Created in 1979, Michael Porter developed the tool to evaluate the intensity and attractiveness of a market shaped by five forces that influence where the power lies in a business situation.

By understanding where power lies, the tool can show areas of strength and highlight weaknesses to help avoid pitfalls. At the end of the evaluation, it is the data that point to the best opportunity for a technology to succeed in a chosen market. It takes some practice to master and interpret the theory, but numerous online resources are available for best practices. The five forces in the PFF process include:

• Supplier power. An assessment of how easy it is for suppliers to raise prices. This is driven by the number of suppliers of each essential input, uniqueness of their product or service, relative size and strength of the supplier, and the cost of switching from one supplier to another.
• Buyer power. An assessment of how easy it is for buyers to push prices down. This is driven by the number of buyers in the market, importance of each individual buyer to the organization, and the cost to the buyer of switching from one supplier to another. A few powerful buyers are often able to dictate terms.
• Competitive rivalry. The main driver is the number and capability of competitors in the market. Competitors who offer many undifferentiated products and services will reduce market attractiveness.
• Threat of substitution. Where close substitute products exist in a market, it increases the likelihood of customers switching to alternatives in response to price increases. This reduces both the power of suppliers and the attractiveness of the market.
• Threat of new entry. Profitable markets attract new entrants, which erodes profitability. Unless incumbents have strong and durable barriers to entry such as patents, economies of scale, capital requirements or government policies, then profitability will decline to a competitive rate.

Each element of the five forces is scored 1-10 using an Excel spreadsheet template. The resulting spider chart shows where the scores rank in each of the five forces. In the example here, a single spider chart, embedded in a larger chart, shows the comparison of several innovation opportunities and how they ranked by the market compounded annual growth rate (% CAGR), projected gross margin, and individual Porter scores.

Here, the innovations highlighted in green appear to be the best opportunities for future growth. This chart is backed by several other matrices, but it clearly shows how a combination of tools, and most notably PFF, provide effective differentiation of multiple innovation opportunities.

Understanding which innovation opportunities and potential obstacles provide the highest future growth is key to making your innovation program successful. Using the PFF model at the beginning of the new product development process may help a business team learn what industry to target, which industries may give the best or least chance of success, provide an understanding of product demand, and recognize market risks.

Having a detailed grasp of multiple markets is key to making the most of this tool. Once mastered, using tools like PFF is a transparent and unambiguous way to judge which innovations may provide the best opportunity for growing your business.

Innovation is a risky business. About 1 to 3% of new technology product ideas make it to the marketplace. Having a high tolerance for failure is not only necessary but also a major prerequisite for any innovation program.

Still, failure carries a negative implication in any fast-paced, success-driven business, and people are reluctant to admit failure on projects in which they have invested time and resources, especially where they may fear job repercussions for poor performance. But when your rocket keeps falling over on the launchpad, it is time to find another way to get to space. It is time to kill the project and move on.

Terminating a new technology project is difficult when people have strong feelings about the value the technology may bring to the company if successful. Seasoned formulators have a difficult time letting go of a proof-of-concept project when they believe in the technology but cannot “make” it work. In addition, upper management may have significant investments in the technology and a strong desire to beat the competition. The pressure on the innovation team to deliver results may affect their ability to stop working a project. While these complicating factors are problematic, there are some clear warning signs that help make it easier to terminate a project, including:

• Purpose. Deciding to stop a project requires a good understanding of the current market dynamics. Any shifts that may have occurred during a technology evaluation (such as a pandemic) may require a pivot to dropping the evaluation to move on to more market-driven projects.
• Cost. Technology evaluations can be costly especially when they involve the purchase of new equipment, large field studies or expensive raw materials. When evaluation failures occur repeatedly, the costs can be out of control. Knowing the limits of your budget provides guardrails for knowing when to stop a project.
• Availability. Sample availability from small technology companies is an important factor when conducting studies that may fail repeatedly. If the startup company does not have the capacity to meet your needs, it is better to transfer the internal project to a university research setting where time is not as critical and sample use is smaller.
• Regulatory. The regulatory environment for emerging materials is changing rapidly. If new regulations negatively affect the technology that is being evaluated, then terminate the project quickly. It is likely there are other technologies that will address the market need.
• Throwing it over the wall. Lack of communication with the technology provider is the leading cause of project failure. Startup companies have no understanding of what larger companies need when they are left out of the evaluation process. Corporate innovation teams will not understand how the startup technology was created without becoming intimately familiar with its development process and inventors. Conducting lab studies on samples without provider input will prolong evaluations and most likely lead to failure because of a lack of understanding of the nuances of the technology. The tighter the collaboration, the better the outcome. If there is no collaboration, it may be better to move on to the next project on the list.

Terminating projects is the key to maintaining a robust new technology pipeline. When resources are constrained, it frees up money, people, and facilities to go on to the next set of technology evaluations. Conducting more frequent technology reviews with all key stakeholders can be used to score winners and losers, including a detailed analysis of why a technology is not meeting expectations. Failing fast but learning faster from each analysis will keep the pipeline moving forward, de-risk the process and make that 1-to-3% new product idea a commercialized reality.

CoatingsTech | Vol. 18, No. 9 | September 2021

In March 2019, the Inside Innovation column examined “How Megatrends Drive Innovation.” Considering the COVID-19 pandemic and other recent events, major shifts in many of the previous megatrends require a reexamination of how they have shifted.

Global megatrends represent changes in our world that have a sustained impact on everyone. Understanding the impact of global megatrends can drive innovation and the need for new products and processes that respond to these changes.

Global Health—While the aging population was previously a primary focus of much research and development, the COVID-19 pandemic put everyone’s health and well-being squarely in the spotlight. The National Science Foundation quickly responded by accelerating approvals of proposals to develop antivirus technologies. Paint and coating formulators submitted a record number of applications for funding new innovative approaches to antiviral formulas. These will hopefully address the needs created by the current and future viral pandemics.

Reshoring for Economic Stability—The global shutdown associated with the pandemic put paint manufacturers in the position of trying to locate domestic sources of raw materials to fill their sales orders. Just-in-time and lean manufacturing processes only work when materials are readily available to make products. Thus, more than 80% of North American manufacturers are reshoring to bring back domestic sources of production and operation. It is estimated that this effort will drive $443 billion of economic value during the next 12 months (Thomas Insights, June 2021). Coatings manufacturers are currently working through their supply chains to ensure their sources of supply are stable.

Global EV—Every major automobile and truck manufacturer has announced plans for conversion to electric vehicles in the next 10–15 years. Thus, battery technology development and its associated heat management, light-weighting, new charging station infrastructure, and transportation and delivery of goods will all be sources of new technology development and innovation. Drone technology is being used for last-mile deliveries, and developments are underway for electric air taxis and short-distance electrically powered airplane flights. These changes will affect how paints and coatings are delivered to the customer.

Less Hydrocarbon, More Carbohy-
������ٱ��—Every day, new articles discuss the replacement of petroleum-based raw materials with carbohydrate-based raw material offsets. Consumers are concerned about the wellbeing of the planet and desire safer products in their homes that do not carry hazardous warnings. Packaging, cosmetics, food, homecare, and personal products are all being reformulated to contain less harmful ingredients. Paints and coatings are difficult to fully reformulate with these offsets, but as many raw material suppliers are providing solutions, formulators should remain aware of newly introduced biobased materials.

Climate Change—Still a strong megatrend, climate change has produced the need for products, services and technologies that address issues related to increased environmental temperatures, water shortages, devastating storms, floods, and fires. Innovations in paints and coatings that can help reduce surface temperatures, provide cooler interior buildings, restore damaged homes, and provide resistance to water, mold, and mildew, and UV radiation continue to be necessary to address these adverse conditions.

����������𳦳ܰ����ٲ�—Technologies that enhance the security of the Internet and its users are needed to address the increasing number of global cyberhackers who have taken advantage of the heightened dependence on the Internet during the pandemic. Business and utility shutdowns due to ransomware have created the need for faster responses to these threats. All businesses must remain vigilant and have a plan to address potential cyberattacks.

In a fast-moving environment, we have seen that megatrends can change quickly in the face of drastic global events. Being aware of these changes and keeping in step with the trends can help you stay ahead of the competition by actively seeking new opportunities and collaborations that were not there before and addressing them with innovations that delight the customer.

CoatingsTech July 2021 | vol. 18, no. 7

University-industry partnerships provide an external source for early-stage technologies that feed the corporate innovation funnel.  Long-term strategic research led by industry innovators and academic teams regularly results in pre-competitive technologies, eventually leading to novel commercialized products.

While many companies hire nearby university staff to tackle special projects, engagement with larger academic teams within a specific discipline brings together a stronger, more diverse group of entrepreneurs that can deliver breakthrough innovations.

The National Science Foundation (NSF) supports a program called the Industry-University Cooperative Research Centers (IUCRC) which has a mission to bring industry and multiuniversity academic teams together to conduct impactful research that directly serves industry needs and generates commercialized products.

The IUCRC program has funded centers of excellence throughout the United States formed around emerging research topics. For a fee, industry partners join as members of a consortium to identify and guide research.

Consortium members benefit by accessing knowledge, facilities, equipment, and intellectual property in a highly cost-efficient model while leveraging center research in their own proprietary projects.

Sustained engagement with a center provides industrial partners greater access to pioneering research and scientific talent at a time when corporate research and development budgets are increasingly under pressure and more skilled workers are needed.

There are numerous centers focused on many research areas, but some are directly engaged in subjects of interest to the paint and coatings industry shown below.

Companies that join a center consortium consider it a smart investment toward accessing and influencing cutting-edge research. To learn more about participating in center research, visit www.iucrc.nsf.gov. Envision participation with IUCRC as part of the foundation of a long-term innovation pipeline within your company.◊

Industry-University Cooperative Research Centers

• Center for the Integration of Composites into Infrastructure—accelerates the adoption of polymer composites and innovative construction material into infrastructure and transportation applications
• Center for Advanced Research in Drying—assists U.S. manufacturing industries in becoming more environmentally sustainable by improving the quality of their products using advanced technology in heat/mass transfer processes, such as drying, heating, cooling, freezing, dewatering, and baking
• Center for Atomically Thin Multifunctional Coatings—develops advanced two-dimensional coatings engineered to solve challenges that include corrosion, oxidation and abrasion, friction and wear, energy storage and harvesting, and large-scale synthesis and deposition of novel multifunctional coatings
• Center for Bioplastics and Biocomposites—develops biobased products from agricultural and forestry feedstocks that are compatible with current industrial manufacturing systems, including plastics, coatings, adhesives, and composites
• Center for Science of Heterogenous Additive Printing of 3D Materials—conducts research on different additive printing and manufacturing methods, new material feedstocks, understanding of material properties, and development of new 3D printing methods for novel materials and composites
• Ceramic, Composite, and Optical Materials Center—develops leading-edge ceramic, polymer/ceramic composite, and nano materials and processes
• Concrete Advancement Network (in the planning stages)—enables resilience and sustainability of concrete materials and structures through innovations in materials and processing by leveraging use-inspired research and collaborations
• Center for Translational Innovation in Macromolecular Engineering (in the planning stages)—translates macromolecular engineering processes to industrial relevance to achieve commercial implementation

May 2021 | Vol. 18, no. 5

The need for energy-efficient buildings has never been higher or more important, and coatings can play a major role in maintaining their efficiency. Since the 1980s, Earth’s average temperature rose more than 2 degrees Fahrenheit. According to the National Aeronautics and Space Administration, 2020 was the hottest year on record, tying the previous record from 2016. As a result, the United States is experiencing prolonged droughts, more frequent and intense storms and floods, and unprecedented forest fires.

Our energy infrastructure has come under tremendous strain with regular blackouts, as more energy is directed from the grid to the built environment as thermostats adjust for extended temperature extremes. Beginning in 2016, the U.S. Department of Energy (DOE) developed a strategic plan to improve the energy efficiency of homes, buildings, and industries. After working with the National Institute of Building Sciences and a broad group of market stakeholders, the DOE developed a set of national zero net energy (ZNE) building standards.

DOE states, “ZNE buildings combine energy efficiency and renewable energy generation to consume only as much energy as can be produced onsite through renewable resources over a specified time.” Typically, a ZNE building uses a combination of active renewable energy sources, such as solar panels, in combination with a passive energy-conserving building envelope to comply with the standards.

Federal government agencies and state and local governments have begun to establish targets for ZNE buildings. Private commercial property owners have a growing interest in developing ZNE buildings to meet their corporate sustainability goals and comply with certain near-future regulatory mandates.

The state of California has developed an Energy Efficiency Strategic Plan with the goal of achieving ZNE buildings. According to the plan, all new residential construction shall be ZNE in 2020. All new commercial construction will be ZNE by 2030. Half of all commercial buildings must be retrofit to ZNE by 2030, while half of new major renovations of state buildings must be ZNE by 2025. Oregon, New York, Colorado, and Washington state have similar plans in development, as well as other municipalities throughout the United States.

The ZNE construction market is large and complex and includes architects, building developers, general contractors, subcontractors, energy raters, utility companies, property managers and owners, as well as high-performance building suppliers who actively seek new energy-saving products specifically for this market. While there has been pushback from some builders who believe ZNE compliance will reduce their profits, there are a growing number of ZNE-specific builders who hope to gain higher profits ahead of those who lag in accepting these regulatory changes. The Home Energy Rating System (HERS) Index is the industry standard by which a home’s energy efficiency is measured and its software programs consider multiple factors, including construction materials, to produce a HERS score for a home.

In 1998, Leadership in Energy & Environmental Design (LEED) criteria were established to help save building energy, but they did not specifically measure energy performance. In contrast, ZNE-mandated requirements establish measurable goals. Energy-saving paints and coatings play a major role in reaching ZNE compliance by facilitating lower HERS scores when applied to the building envelope.

Existing cool-roof coatings can reduce internal building temperatures by including thermal-modulating paint additives. Heat-resistant/reflective exterior wall paints as well as attic barrier coatings can also contribute to lowering building energy demands. However, it is important to emphasize that while coatings already exist for thermal management, they must be re-evaluated for compliance to ZNE building targets.

Understanding how much energy these coatings can save is critical to their success in meeting these goals. To determine the energy efficiency of coatings on buildings, several organizations provide testing services, including the National Energy Renewable Laboratory, Lawrence Berkeley National Laboratory, and the Building Technologies Research and Integration Center at Oak Ridge National Lab. Innovation is needed right now to help our infrastructure meet the critical demands of the growing ZNE market. The coatings industry and, specifically, energy-saving coatings, must be a part of that solution.

MARCH 2021 | Vol. 18, NO. 3

Startup technology companies frequently ask how they should approach negotiations with larger companies who are interested in their patented technologies. Understandably, startups are nervous, excited, and extremely cautious at the prospect of licensing or selling their work to large multinational companies.

It appears to be a lopsided situation with large companies holding more leverage over companies with very small staffs. But it is important to remember that each side has something the other wants, so reaching a mutually acceptable outcome is the key to a successful negotiation. It is a dance that can be learned through practice, but it helps if you know a few steps to get you started.

Here is some advice to smaller startup negotiation teams:

Know Their Position—Do your homework. Study available information from websites, press releases, annual reports, and so forth to learn about the company’s current business position and history. Past business deals can tell you if there are areas that are sensitive to discuss. What are the biggest priorities and objectives? What are the plans for growth? Who are the decision makers? Who are the company’s customers for your technology? Is your technology the only likely solution to the challenge it addresses? What might be the company’s opening position? Attention to detail builds your confidence when you are armed with background information at the negotiating table.

Know Your Position—Understand your goals from the start. Your intellectual property (IP) is your asset. How valuable is your technology solution to the market? Is your solution unique? Are your funding partners placing any pressures on the negotiation and what are their concerns? Are you seeking to license your technology for one market or multiple markets? Is your technology a platform upon which to build a line of products? Working with IP valuation specialists to determine the fair market value of your technology can provide insight into the strength of your position going into a negotiation. From there, you can decide on your “must-haves” and your “nice-to-haves.” Create a list of questions to ask and proposals to suggest during the negotiation. For example, how willing is the company to work with you on an ongoing basis to develop the technology? Is it willing to share its commercial test data with you to help improve the technology? Is the company willing to use a brand name associated with your company? If asked, are you willing to assist in potentially time-consuming technology scale-up and implementation activities? Will the company promote your technology or kill it?

Flexibility—Check your emotions at the door. On one side of the negotiating table is you, a group of passionate entrepreneurs who have transformed an idea into a patented technology. Your startup company was built from sweat equity and its resulting IP. But it does not mean that millions of YouTube video views translate into a commercial success. On the other side of the table is a multinational company with brand awareness and customer access. But even a major player in the industry needs to stay ahead of the competition. Technology acquisition means negotiating with startup companies who can accelerate their timeframe to bring a product to market. Each side must remain flexible but respectful of their positions. Be prepared to pivot when negotiations begin to stall, which usually happens at some point. Approach the discussions with a willingness to change to get to a satisfactory arrangement. If emotion impacts your judgment, it will interfere with the outcome.

Deal or No Deal—Concessions on both sides of a negotiation can help clinch a deal without compromising your positions. It can strengthen the relationship and create goodwill going forward. Pressure tactics can force the negotiating teams into uncomfortable positions and scare either side into retreat. Negotiating fairly will eventually create a win-win arrangement. However, if you reach that predetermined line in the sand, where no deal is in sight, you must be willing to walk away. While that sounds like failure, it was likely a bad deal for you. Learn from the experience and wait for a better, more suitable arrangement. If your technology is good, they will come!

CoatingsTech | Vol. 18, No. 1 | January 2021