Startup Capital: Mark Powell of HWind

Mark Powell is a meteorologist and former NOAA scientist who took his passion for weather mapping and hurricane predictive analysis and turned it into one of Tallahassee’s most successful startups.

His company, HWind, is the world’s leading provider of tropical cyclone wind field data, with observation-based data products for both real-time and historical wind field analyses in the western North Atlantic, Eastern Pacific and Central Pacific basins.

In 2015, HWind was acquired by Risk Management Solutions (RMS), a company that helps financial institutions and public agencies understand, quantify, and manage risk.

We met up with Powell at Catalina Cafe in Tallahassee to chat about the story behind HWind, and his story moving from decorated scientist to successful tech entrepreneur. Keep reading below.

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How did you end up in this field, did you always want to go into meteorology?
I grew up racing sailboats up in Long Island, and I saw it as way to get a competitive advantage, so I was always interested in the wind and the water. And I decided that I would study meteorology to learn more about it.

Tell us about HWind
HWind got started about 20 years ago after Hurricane Andrew hit South florida. I had been working as a specialist on hurricane wind fields, working on a way to map out the damaging part of the wind, and trying to do it in real-time.

I had a long career as a scientist with NOAA, the National Oceanic Atmospheric Administration. They have a hurricane research laboratory in Miami, and so I used to actually fly on the Hurricane Hunter aircraft collecting data.

Hurricane Hunters - Tallahassee Startups: Mark Powell

The NOAA Lockheed WP-3D Hurricane Hunters

We collected all kinds of data. It would usually take year or more to analyze it and publish it, but I noticed that there was an aircraft-satellite link sending data to the National Hurricane Center. After flying a few missions, my internal navigation system did not really deal with all the ups and downs and turbulence of flying with a hurricane, and the ten hour flights with lots of vibration – it did a lot on my system.

I saw a way to contribute a lot more by utilizing that data that was being sent off the aircraft in real time, and was very not really being utilized very well. So I set up a system to ingest that aircraft data as it was being sent off the plane, and then add to that a lot of other types of data that would come in to help us map out the worst part of a hurricane. So I started that as a research program in NOAA and it was originally developed for The National Hurricane Center (NHC) . It was research that I could see would help them do their job better.

But what I didn’t see was how difficult it was to get an organization that’s really set in their ways to modernize and do things differently. So ultimately my project did not make it through what they call “the valley of death,” the chasm between research and operations.

“If you’re passionate about something, there’s no one else who can substitute for you.”

The NHC does the day-to-day forecasting of hurricanes and tropical cyclones, where they’re going to go, how strong, for the Atlantic, the Gulf of Mexico, and the Caribbean. And then there’s another organization, the Central Pacific Hurricane Center, who takes care of that around Hawaii.

So we didn’t make it to helping improve operations. They’re handling wind data the same way they’ve been doing it for the past thirty years. And I saw support within NOAA dwindling, there were fewer competitive research opportunities to get funding to continue developing the project.

So the only way I saw to keep this going, and I firmly believe that it was the right way to map out how bad a storm is, was to commercialize it. So I started taking courses at the Small Business Development Center (SBDC) at FAMU.

I should mention that I moved up here to Tallahassee back in 2008, mainly to help my ailing parents, so I was able to have an office with FSU’s Center for Ocean-Atmospheric Prediction Studies (COAPS was a NOAA Applied Research Center at that time) as a NOAA employee. So I was up here, the SBDC was right next door, so I started taking classes on how to operate a business.

Then there was the Entrepreneurial Excellence Program. I found out about that program and enrolled. It’s a fantastic program. It’s pretty intense, for about a month, you meet a couple times a week and you have people come in and talk about different aspects of starting a business and sharing advice with you.

Around the time I wanted to start the business, Domi came along and they had space available. In fact, before Domi even opened we had clients coming in from California to meet with us about possible partnerships. So we carried some of the furniture from the warehouse storage into the conference room at Domi. The building had been finished up but the furniture wasn’t there yet. So we brought it in and we arranged for a portable coffee service company (that I had met at the SBDC) to set up on site.

We ultimately did not go into partnership with that company, but it just shows you that if you had a good idea and talent, people will come from outside to Tallahassee to meet with you.

So we started the business in April 2014.

Where did the technology behind HWind come from?
I developed the technology at NOAA, it’s based on a series of publications I authored, and those publications spanned several years. The government still owned the IP for HWind, so I had to petition the government for the commercial rights to what I developed. It took about a year to get the clearance from NOAA. They basically had to ask “Is there any need for the government to hold on to this?”

But they don’t like to see technology sitting on the shelf, they want to see it commercialized. So they actually helped me out quite a bit. Even their lawyers, NOAA has this technology transition partnership office, and they were a tremendous help to getting through the red tape. They assigned the commercial rights to me back in 2014, and HWind was started in April.

Eventually we had a small team and a handful of clients. Some of the higher profile clients we signed up were RMS, Swiss Re, the Institute for Home and Business Safety, and a large insurer that I can’t reveal.

So just a handful of clients, but very prominent clients. RMS saw the value of what we were doing and approached me for an acquisition. We were acquired almost a year ago.

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A satellite view of 1992’s Hurricane Andrew

What was the biggest challenge in transitioning from HWind the research project to HWind the business?
Probably the hardest thing was figuring out how to focus on products. Which products are going to have the most commercial value, and then figuring out how to price those products. You really need to do market research. I didn’t have much to go on figuring out how to price things so I had to base it on research projects. One of our clients had actually offered a certain amount of funding for some research, so that was kind of a data point for me.

I said, “Ok well if it’s that important to this entity, that’s probably a reasonable price for someone else to expect to pay.”

The other thing is that we’re based on episodic events. A hurricane can be a big deal in a particular area if it hits, but you’re not guaranteed to have a hit every year. So you really need to have a subscription model so you have some cash flow coming in whether you have a storm or not.That’s a tough obstacle for some clients to get around.

And then there’s the fact that up through 2013 it was free. When it was at NOAA, we put our products up on the website and anybody could use them. That’s kind of what led to it being so well known.There were hundreds of citations in peer-reviewed scientific publications that used our data for other work — storm surge modelers, wave modelers, scientists conducting remote sensing research for organizations like NASA and the European Space Agency, people doing ecosystem research work on how an ecosystem responds to a hurricane…

We had people studying endangered species, how manatees behaved during a hurricane, sea turtle nesting following a hurricane, the oil and gas industry, the insurance industry, even FEMA was using our products – so all these groups were used to getting this stuff for free, and then when we set up the business, it was no longer for free.

What was done when it was a NOAA product, that archive is still free and we still actually host that on the RMS website for free.

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Mark Powell in his Tallahassee office

What made you leave NOAA and become an entrepreneur?
Well I worked for NOAA for a long time, and I always knew this had some commercial potential. When I saw that my lab had lost interest in supporting that anymore, I said “I have to do it commercially.” I was lucky that I had invested well while I was at NOAA, I had funds available that I could use to support the company. But it was almost a desperation play. I saw the value in it but unfortunately my organization did not, and that’s the time to take something commercial because the government doesn’t work the same way. [laughs]

Do you think enough is being done to identify opportunities like that inside these research institutions?
Probably not enough. Most of the technology transition offices are pretty small and there’s a lot of research going on in laboratories. I know NASA has a similar sort of thing, they’re looking for people to commercialize technology, but not all of the technology can be commercialized.

Some of it is years away from being ready for the market, and it’s also a challenge identifying the technologies that are ready and which one’s take more time. It takes a big effort just to do that. Even at FSU they’ve got the office of commercialization just trying to identify which technologies have some potential to go there.

Would you say most of these departments are under equipped to find things that could become sustainable business?
I think a lot of them are. At NOAA it’s a very small operation. To really know what’s going on you have to send people into the field and they have to be knowledgable people who understand the technology and talk to the different lab directors to figure out what’s going on in their labs and talk to the scientists. So it takes a while to get out and talk to everybody. You almost have to focus on individual labs, just become an expert in what’s going on in one lab to figure out what has potential.

And a lot of stuff is basic research. Most of the research at FSU would fall into that category. It may be many years before it will have any commercial potential. But it’s still needed. A lot of the ideas that have commercial potential were founded from basic research many years earlier.

Do you think there are a lot of commercial opportunities sitting on the shelf?
Yeah. I know the Startup Quest program in Leon county was a program where there would be teams set up to work with a mentor and there would be a list of different technologies, and they would go through the exercise of developing a business plan for this technology, and I think some of them have actually gone to the point where they can license the technology and start a business out of it.

Back in 2013 the idea was that people who were not currently employed, this could be something where they could work on their job skills. These were highly trained people who didn’t happen to have a job at the time. That would involve engineers scientists, different aspects of building as business, have them team up with a mentor and with some proven methods to go through that whole exercise of, “what do you have to do to start a business?”

What was it like being there for the start of Domi?
It was pretty exciting. One of the things that happened at the SBDC, Christine Urban was my mentor there and when she left, she gave me a referral who worked with technology companies so I started meeting with him, Richard Benham, and he’s actually now at the college of law working as their entrepreneur in residence. So I got a lot of really valuable insight and assistance from him.

Then at Domi, I remember the first time I came over to Domi to look around, John Vecchio was there and he started grilling me. He basically forced me into an elevator pitch without me even knowing what I was doing.

“Even if you didn’t have a relationship with a particular business, you still had a relationship in common. No matter what the business, you could talk to people and share ideas.”

All of the partners at Domi were so helpful, Jake Kiker was my attorney on the RMS acquisition, I used to chat with Micah all of the time, and Lucas.

I was usually the first one into Domi. I’d make coffee and be sitting there reading the Tallahassee Democrat and people would start filtering in and sit down and we’d chat for a while. Or it would be new people coming in and I’d ask them about what they were doing. That’s one thing I really enjoyed about Domi. Even if you didn’t have a relationship with a particular business, you still had a relationship in common. No matter what the business, you could talk to people and share ideas.

So yes, Domi is a great place for that – sharing ideas with people of all ages. That was something I really valued at Domi. All the different events they have, they had NASA come in for technology transfer, they had the 1 million cups where you can practice pitching… I don’t think Tallahassee has ever seen anything like that level of activity that they brought into Domi.

As you found yourself having to pitch this new business, did you find it difficult to transition from research scientist to entrepreneur?
I didn’t find it so difficult. It was interesting, going through the entrepreneurial excellence program, the last day where we had to give our extended pitches, like a ten minute pitch on our business as if we were asking for funding, I got some feedback from one of the judges who said “You really shouldn’t be doing this.”

And all I could think of was [laughing] “Who the hell are you? With my experience? I’m the only one who could do this for my business.”

If you’re passionate about something, there’s no one else who can substitute for you. So I’ve had the opportunity to practice pitching since. That’s one thing that really helped me a lot. I had to do it at the EEP and I’ve had to do it so many times afterwards, Domi had an investment night down on top of Madison Social, and they actually had some venture capitalists there. We did practice and everything, and the people before me were talking and nobody could hear them, they had the microphones like way out here [gestures away from face] and nobody could hear them.

So I immediately came up and put the microphone right up to my mouth. That was a great experience. I didn’t get funding but I wasn’t looking for funding. I was looking for practice. Since then I’ve gotten a chance to pitch at the Tallahassee Chamber of Commerce event, where they have that retreat out of town.

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The RMS HWind Lobby

When HWind was acquired, RMS opened an office here. What was the story behind that happening?
It was an important part of our discussions. To me it’s a no brainer to have an office here. The Office of Insurance Regulation is here in Tallahassee, the Florida Hurricane Catastrophe Fund which invests about $18 billion to help back up the insurance industry here if there’s a big hurricane. FSU has a Center for Catastrophic Storm Risk Management in the College of Business. FSU has great departments in meteorology and oceanography, the Center for Ocean-Atmospheric Prediction Studies is here, it’s home to all of these different state agencies…

There’s just so much here in tallahassee that the commission that regulates the models developed at RMS (and our competitors) is here, anyone in the insurance industry dealing with regulation is constantly coming here, so it really made sense for RMS to have an office here.

So that was an easy sell for you to bring RMS here, but that’s something that a lot of people would like to see more of: larger companies acquiring local startups and then keeping the business here.

Yes, and I’d like to grow the company here. We only do the modeling here, but there’s the whole interacting with clients and sales that is being done from outside of Florida. So for sales there’s people flying down from Minneapolis and interacting with clients, people from Hoboken, I’d like to grow enough so that we could have that side of the business here as well.

Are there any challenges you’ve experienced specific to Tallahassee?
The biggest challenge is finding office space. To me it’s a no-brainer. If you have a corridor between two universities, that’s where you want the technology companies to be. And there has been absolutely no planning in that direction.

They have Innovation Park way the hell out, and there’s nothing there. It’s great, I worked there for several years, but it was a big deal when the food trucks show up because if you wanted something to eat you had nowhere to go.

As Lucas called it, the Innovation DIstrict – the area between the two universities paralleling the railroad – it’s just perfect for having space for technology companies. But all of the planning has been for retail space on the bottom floor of these student housing centers.

When we were first looking for space, those places weren’t interested in us, they just wanted retail. Now, they love us. They would love to have us in there. We’re probably going to be choosing one of them because we have to move pretty quickly. If we had more time, I would love to help develop an older property or a new property in that district. But I’m not sure if we have the luxury of time for that.

There’s a lot of office space downtown, but downtown has parking issues and it isn’t convenient for students. So I think the area around here is ripe for development. You go to other campuses and that’s what’s going on. You go to UCF and they have Siemens right across the street from campus. That’s the kind of thing that should be happening here, and there’s land to do it.

So what’s the missing piece? How can we help to bring in these larger, anchor companies?
I think we’re pretty close, Orlando is a really big market so that’s why UCF has got it going there, and FIU in Miami is another example of a really large city. Tallahassee is getting there, we’ve got around 250,000 people in the tri-county area. Tallahassee is not quite there yet but I don’t see why that couldn’t start happening pretty soon.

It sounds like you’ve developed an effective talent funnel from the university, but has talent been a problem at all for you?
Well, data scientists are in high demand. Handling very large data-sets, understanding and finding where the data sets are coming from in a timely fashion, and then being able to manipulate them or do calculations on them – it sounds very specific but it encompasses a lot of different disciplines.

You can have a computer science degree or a scientific computing degree but it may not give you all the tools you need to get the job done, so there’s a lot of on the job training and learning. So if we have people coming in part-time and that discipline, it takes them a while to get up to speed and sometimes we’re losing them before graduation.

“They make everybody feel that they’re really special because they’re being contacted by Google and then they make them go through these tests. So that makes it a little tough. It’s tough to compete with Google.”

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Catherine Stauffer (FSU undergraduate in Meteorology) and RMS full time employee Chana Seitzwork together tracking the wind field of Tropical Storm Julia

Has retention been a problem?
It’s a mixed bag. We advertised for data-scientist and we had over fifty applicants and we narrowed it down to ten, but there’s different issues that come up. Sometimes you have really talented foreign student but it’s really difficult for them because of the visa requirements and everything.

Because we’re so small and just getting started, we don’t have the ability to hire full-time people yet. There’s a lot of competition out there. We had one really sharp student who was recruited by Google. I think Google just recruits everybody and gets them to take their battery of tests. They make everybody feel that they’re really special because they’re being contacted by Google and then they make them go through these tests. So that makes it a little tough. It’s tough to compete with Google.
So it seems like you’re able to find the talent but it’s difficult to keep them here long term.
There’s advantages and limitations. There is a lot of talent here but you still have go through a process to find out if they’re going to be a good fit for you. Even if you think you know what you’re looking for, stuff can happen that makes it not work out.

We do pay our part-time employees. I guess there’s some places in town people will work for just to get experience, but we pay everybody. We see it as an opportunity for the student to get some really valuable experience and for us to hopefully get a talented individual that we can help train, so it goes both ways. The pay isn’t fantastic, but the pay is good, and we’re putting in time to train the students. So it’s working out pretty well.

And FSU’s Undergraduate Research Opportunity Program (UROP) is a research program where the student will come in periodically to come in and work with a mentor on a research project. Because of our connection with Domi, we were able to get into the program and we’ve continued to be a part of it. We come up with a research project description and the interested students contact us and then we interview them. Two of our current part-time employees came from that program.

Any last thoughts on Tallahassee?
I think it’s a fantastic place for just about everybody. I like to be on the water, and here you’re thirty minutes away from the Gulf at Shell Point Beach Park in Wakulla county. I do Masters Swimming so at lunch I go over to the FSU aquatic center over by the golf course, there’s fantastic mountain bike trails all over town – they’re getting to where Tallahassee is more friendly for the bicycle community.

There’s some really cool things happening with microbreweries. That’s a good recruiting tool, I tell the students we’re surrounded by breweries. Proof and Brass Tap and Grasslands and Fermentation Lounge – all these places have started up in the last few years, that’s all great for attracting people here.

It’s a vibrant community, and It’s a pretty big community now. It looks like we’re moving in the right direction. I think good things are coming.

A big thanks to Mark Powell for giving his thoughts on Tallahassee startups, and to the RMS HWind team for letting us interrupt their storm-tracking duties to take pictures of the office.

As we move forward with tech and entrepreneurship here in Tallahassee, we can look to success stories like Mark Powell and HWind as inspiration and as validation. His story shows that if you have the right passion, the right idea, and the right ecosystem, you too can make it as an entrepreneur.

You may also like: Startup Capital: Dominick Ard’is
To view the rest of the Startup Capital interviews, visit the Cuttlesoft blog.

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Photo Credit; Karla Galvan