Business is fantastic when you bottle drinks in plastic

May 6 2009 by Rachel Cooper, Liverpool Daily Post

Rachel Cooper meets the American owner of chemical engineering firm ColorMatrix

WHEN facing a life-changing decision, not many people would turn to an Excel spreadsheet.

But that’s exactly what Detroit-born Bill Ravenna, managing director of Knowsley-based ColorMatrix, did – and the formula paid off.

“I’d gone back to the States after studying at Manchester Business School, but I’d met a woman – an English woman – and we were trying to work out a way of being together,” he said.

“My friend, Mark, was keen to start a business in England and wanted me to start it with him, so I drew up a spreadsheet and put down what I wanted to get out of life and ranked the opportunities I had at the time against those ambitions.

“Starting the business with Mark always came out top. I didn’t really want to believe it at first, but then the other opportunities started fading away so I thought, what the hell, let’s go for it.”

Sadly, the romantic relationship didn’t work out, but the company the two men started became ColorMatrix, which produces colourants and additives for the plastics industry.

Their liquid dispersions are used to create colour in products as diverse as plastic bottles, computer parts and piping for customers that include major multi-national companies.

And, 17 years after drawing up that first spreadsheet, the business now boasts a £40m turnover.

But such success never crossed the minds of Ravenna and his business school friends, Mark Frost and David Nuttall, when they first discussed starting a company over a pint in Bolton in 1992.

“I was working for a chemical company in the States at the time and ColorMatrix was one of our customers,” said Ravenna.

“When I told them I was leaving for the UK, the owners of ColorMatrix said: ‘Why don’t you see if there’s a market for our product?’

“So I told the others that I knew of this technology in the US and the owners were interested in expanding.

“We thought it sounded a good idea so we went for it.”

It certainly did prove to be a good idea.

Sales went from £365,000 in 1994 to £1.1m in the second year and then grew by at least a £1m nearly every year thereafter.

“I could tell you some of the success was due to pure genius,” said Ravenna. “But there’s always a bit of luck and we were lucky that we began when PET was a niche plastic.

“PET – or polyester – is now a major product and we’re experts in polyester and polyester models,” Ravenna explained. “It really took off when Coca-Cola decided to put their product in PET and then everyone followed suit.

“Now we’re seeing the market for PET bottles in beer, juice and dairy really take off, too.

“We don’t just put colour in the bottles, we add value to it – we put things in that make the plastic perform and put additives in the plastic that protect the contents of the package.”

The relationship between ColorMatrix and PET didn’t, however, always look so auspicious.

When the company first started out in a basement in Chorlton-cum-Hardy, near Manchester, Ravenna, Frost and Nuttall – all chemical engineers by trade – were struggling to rid the plastic of imperfections.

“It was desperate,” remembers Ravenna, “more like alchemy than chemistry.

“I would run trials and try to get people to buy the products, Mark was in charge of the accounts and Dave was working at Cap Gemini, trying to keep us solvent.

“But it was much more fun because you could have more impact on the day-to-day running of the business.

“Now, we have to focus on profitability, effectiveness, efficiency. We’re not just three guys out for a jolly in Chorlton-cum-Hardy any more.”

That they are definitely not. The trio still run the business, which moved out of the basement into its Knowsley premises in 1994. In the ensuing decade, the company has been through a series of changes that have turned them into a global operation.

“One of the biggest developments was the move from colours to additives in 2000,” said Ravenna.

“We won the Queen’s Award for innovation for our acetaldehyde scavenger that takes acetaldehyde, which gives water a bad taste, out of the bottle. Then we purchased Amosorb from BP Chemicals. It’s a technology that absorbs oxygen and allows products to stay on the shelf for longer.”

Amosorb is now more necessary than ever as plastic bottles are increasingly used to store beer, juice and dairy products which can degrade in the presence of oxygen.

“It’s our best-selling product,” added Ravenna.

Then three years ago came a significant development in the company’s evolution.

Ravenna said: “In 2005, it reached the point where we had five shareholders – the two original US owners and us three. It was time for us to buy them, them to buy us or to put the company up for sale.”

They took the latter option and, in 2006, ColorMatrix was sold to a private equity group, Audax.

“It’s made us a better company,” said Ravenna.

“We’ve had to define our roles better and we’ve got some fantastic technologies coming down the pipeline.”

Despite the seismic changes, the trio are still friends, even though their roles now mean they’re often on different continents. “We all complement each other,” Ravenna said. “I have the most visible drive, I’m very clear about where the business needs to go.

“Mark is an excellent strategist, he’s really good at identifying opportunities and the technology to create opportunity and Dave understands the process required to deliver those drives and technologies.

“We never thought it would get this big. If you told us we’d be a £40m business, we’d have never believed you.”

rachel.cooper