Young OTR company is already exceeding expectations with its space-age insulation products
Oros' Solarcore is taking off
Kevin Eigelbach | WCPO contributor
8:00 AM, Nov 2, 2016
6:19 AM, Dec 27, 2016
CINCINNATI -- Over-the-Rhine startup Oros makes a product that attempts to answer a deep need in the human psyche: the need to dress warmly without looking like the Michelin Man.
Oros manufactures and sells jackets and outdoor apparel made from material used by NASA to keep astronauts warm in temperatures near absolute zero.
This insulation is only one-tenth the thickness of natural insulators such as goose down.
Who started Oros?
Two friends, Michael Markesbery and Richvik Venna.
Markesbery was a pre-med student at Miami University when he learned about something called aerogel, which was originally created in 1931 by an American scientist and was later used by NASA in the space program.
He saw an opportunity to make warm, thinner outdoor apparel, something that he'd seen the need for while climbing a mountain in the Alps his sophomore year.
"I was thinking, 'This is miserable. It's the 21st century, but I'm still using animal byproducts to keep me warm,'" he said.
During his senior year, he and Venna took a $10,000 NASA scholarship he had received and put it into creating a product. Their initial problem, he said, was that aerogel was very brittle, and they needed to figure out how to make it more elastic.
After they found a way to do that and create their Solarcore insulation, for which patents are pending, they found a manufacturer who would make a prototype jacket without charging them in advance.
In April 2015, they conducted a Kickstarter campaign that they hoped would raise $100,000 in 10 days. If it had not done so, Markesbery said, he would have gone on to med school.
But in the first 36 hours of the campaign, they raised $125,000, which Markesbery said was mind-blowing.
"We didn't expect that in the least," he said.
The campaign raised a total of $320,000, he said, and that was the start of Oros, which means "mountain" in Greek.
Three months ago, the company raised $1.2 million in its first venture-capital campaign. The founders used the money to hire a team of eight full-time employees (including themselves), and move to new office space at 538 Reading Road, the former home of fellow startup LISNR.
Are they making money?
In the past 12 months, they've sold $1.2 million in goods from their website. They project that over the next 12 months, they'll do more than $3 million in sales, Markesbery said.
Their goal is to have more than $50 million in annual revenue in five years, he said.
How will they make that happen?
They're working on getting their fall 2017 line into sporting-goods and outdoor-wear retail stores, Markesbery said. He declined to name them.
They're also licensing their technology to companies that don't directly compete with them, such as boot makers and makers of water bottles.
"Licensing keeps investors happy because they see revenue coming from multiple areas," Markesbery said.
They also continue to invest in research and development to create new products, he said.
What's their biggest obstacle?
That there are so many competitors already established in the outerwear industry, including widely known brands such as North Face.
"They have entered a market that's full of well-funded, large, branded companies like Patagonia," said Timothy Holcomb, a business professor at Miami University.
Holcomb, who holds the university's Cintas Chair in Entrepreneurship, is one of Markesbery's former teachers, and is now a member of the Oros advisory board, but not an investor.
"Oros has extraordinary technology with tremendous potential, but they're selling to a market that doesn't know who they are and doesn't know what their new technology does," Holcomb said.
The challenge is to do the best job they can of telling their story to the marketplace, he said, a challenge that most startups face.
Oros has helped move that along by securing partnerships with key suppliers, he said.
What's owning a business like?
"When you do this, you get into it," Markesbery said. "You know what I mean? You are in it, and you're hustling and you don't get to go up for air."
But when you finally do come up for air, he said, you can look back and see how much you've accomplished.
"It's amazing what you can do with the right team and the right people," he said. "It's crazy how fast things can move."