“Buried Infrastructure’s Last Line of Defense”
Excavation Alert Systems, LLC.
Damage Prevention Systems for Buried Infrastructure
Ryan Dunn
660 Hunters Place, STE 102
Charlottesville, VA 22911
ryan.c.dunn@gmail.com
518.312.2443
“Buried Infrastructure’s Last Line of Defense”
3,000 Pipeline Companies:
500,000 mi. Transmission & 2,100,000 mi. Distribution
• Growth (Shale):
• $187B in new pipelines.
• 24,400 mi/year transmission.
• 50,000 mi/year distribution.
• High Consequence Areas (HCAs):
• 35,000 miles transmission (7%).
• 2,100,000 miles distribution (100%).
“Buried Infrastructure’s Last Line of Defense”
PROBLEM: Excavation Damage
• Leading cause of
significant pipeline
incidents.
• 2007-2011: 318 incidents
– 27 fatalities.
– 114 serious injuries.
– Cost: $1.9B.
• 57% of excavation
incidents caused by:
–Failure to call a locating
service (32%).
–Failure to correctly
mark utility (25%).
“Buried Infrastructure’s Last Line of Defense”
Protocols & Proactive Devices:
Passive Visual Indicators:
Monitoring and Sensor Systems:
“Buried Infrastructure’s Last Line of Defense”
ExcAlertTM SOLUTION:
• Directly warns excavation
crew, PREVENTING
accidents.
– Visual (colored smoke).
– Sound.
• No proactivity required.
• New and retrofit
installations.
• Inexpensive: ~1% of
pipeline cost.
• Safe for use near natural
gas pipelines.
• Long life, no maintenance,
weatherproof.
“Buried Infrastructure’s Last Line of Defense”
Product Details:
• PVC Pipe with designed
breakpoints.
Sound Producing
Diaphragm
• High longitudinal
strength for installation.
Smoke Generator
• Easily broken with
excavator shear force.
Retrofit
Installation
Vehicle
• Clear path to surface for
signal when broken.
• Small hole diameter
required for retrofit.
• High effective area when
installed at angle.
GPR Image
• Easily produced in
varying lengths for
pipelines at different
depths.
• Multiple configurations
in pending patents:
PCT/US2012/071096
“Buried Infrastructure’s Last Line of Defense”
Innovative Business Model:
System Cost
Pass
Through
Reduced
Insurance
Premiums
Improved
Triple
Bottom Line
5 - 10
Year ROI
• How to create a pull in a regulation driven industry?
– Create a 5-10 year ROI for pipeline companies.
• Strategic relationships with leading pipeline insurance companies to offer
reduced premiums on ExcAlertTM protected pipelines.
• Utility companies can pass system cost through to rate payers.
• Improves “Triple Bottom Line” initiatives: Safety, Health & Environment.
“Buried Infrastructure’s Last Line of Defense”
RYAN DUNN
FOUNDER & CEO
BRYAN WRIGHT J.D.
IP & INDUSTRY EXPERT
ROBERT TOBEY C.P.A.
OPERATIONS & CFO
MAJOR PIPELINE EMPLOYEE
BUSINESS DEVELOPMENT
•
•
•
CEO, ElectraWatch, Inc.
Successful product commercialization.
Electrical Engineering & Engineering
Management, Dartmouth College.
•
•
VA Bar & TX Bar Oil and Gas section.
“Super Lawyer” for IP law, VA Super
Lawyers magazine. AV Rated.
•
30 years experience in operation and
management of IP based companies.
Resident Advisor & Entrepreneurial
Mentor, Darden / Batten Institute.
Financial Expert.
•
•
?
•
•
Strategic first hire.
Significant experience at major pipeline
company.
Leverage experience and connections
for business development.
•
INVESTORS & ADVISORS:
LEN WOLOWIEC
GEORGE PHILLIPS
President, Universal Steel America
Pipeline Connections in Houston, TX.
Senior Vice President, Rutherfoord
Pipeline Insurance Industry Expert
“Buried Infrastructure’s Last Line of Defense”
Company Information:
• Virginia LLC. headquartered in Charlottesville, VA.
• $65k in seed funding from founders.
• Functional Prototype Stage.
– Strong IP (PCT/US2012/071096 - pending).
– Initial strategic relationships.
Series A - $1.6MM of $3MM Raised:
$1.6MM
$3MM
• Awarded $1.5MM in VA tobacco commission funding on 9/16/13.
– Equity capital at significantly below market rates.
– Requires $1.5MM in matching funding and manufacturing in VA tobacco region.
• $100k Charlottesville based Angel.
• Funding Use:
–
–
–
–
Strategic hires from pipeline industry: Business Development & Sales.
Design improvements: improved performance, mass manufacturing.
Statistical Testing: soil types, freeze thaw cycles, longevity, large test bed.
Working Capital.
“Buried Infrastructure’s Last Line of Defense”
BACKUP SLIDES
“Buried Infrastructure’s Last Line of Defense”
Commercialization Timeline:
VOLUME
MANUFACTURING
$3MM
INVESTMENT
BUILD
TEAM
2013
FINAL DESIGN
COMPLETE
2014
FORM
COMPANY
FILE PATENT
2015
PHMSA
DEMO
INSURANCE
ACCEPTANCE
SALE OF
COMPANY:
RETROFIT
INSTALLATION
VEHICLE
2016
2017
PIPELINE
INSTALLATIONS
MONITORING
SYSTEM
COMPANIES
OIL &
NATURAL GAS
COMPANIES
PIPELINE
INSTALLATION
COMPANIES
PIPE
PRODUCERS
“Buried Infrastructure’s Last Line of Defense”
Proforma:
Projections:
Revenue & COGS:
•
Revenue:
– Devices: $30k/mi
– Installation: $20k/mi with vehicle
– $50k/mi = ~1% of $4MM/mi pipeline cost
• COGS:
– Devices: $7,450/mi
– Installation: $6,786/mi with vehicle
– Gross Margins = 72%
Sales Example:
•
40 mile ExcAlert Installation:
– Revenue: $50k/mi * 40mi = $2MM
– COGS: $14k/mi * 40mi = $560k
– Gross Margin: $1.44MM (72%)
“Buried Infrastructure’s Last Line of Defense”
• United States Pipeline Market:
– 3,000 Pipeline companies.
• 2010: $9.7B profit on $31B in revenues.
• $930MM annually on preventative
technologies.
– 500,000 miles of transmission pipelines.
– 2,100,000 miles of distribution pipelines.
• Target Market: Pipelines in High
Consequence Areas (HCAs):
– 35,000 miles transmission pipeline (7%).
– 2,100,000 miles distribution pipeline (100%).
• Target Market Growth (Shale):
– $187B investment next 25 years ($7.5B/year).
– 24,400 mi/year trans. (1,709 HCA mi/year).
– 50,000 mi/year dist. (50,000 HCA mi/year).
• Secondary Markets:
– 35MM mi of buried infrastructure in U.S.
– Power transmission & fiber optic backbone
lines.
* Use of potential customers trademarks does not indicate a
relationship with or sponsorship by the potential customer.