From the Outside In

For many small companies, doing business with the government is a labyrinthine affair. And contracting with the Homeland Security Department is particularly mysterious.

Intecon was one such company. In the late 1990s, when most of the venture capital that had flowed through Southern California in the dot-com boom was drying up, the company faced a familiar dilemma, says founder Ralph Sias: "We were out of money and had a great concept."

That concept was a novel way for disinfecting "clean rooms," the sterile environments used in electronics and pharmaceuticals manufacturing. Sias developed a technique for passing hydrogen peroxide through a stream of plasma at low temperatures. The theoretically simple technique also was highly effective.

But with no funding, Sias and his colleagues nearly abandoned hope of turning their idea into a product. Then, in early 2000, Sias found an online ad for a new organization, the Center for the Commercialization of Advanced Technology (CCAT) in San Diego, which was looking to connect innovative tech firms with the Defense Department. Sias figured that his plasma device could be applied to medical use and that the military would make a good customer. "But with our tiny, limited resources, we hadn't been able to do any work at all defining that market," he says.

CCAT, a congressionally funded consortium of Defense contractors and universities, put Intecon through rigorous screening to determine whether its technology was feasible and marketable. CCAT gave Intecon $60,000 for market research, which confirmed there were prospective customers in the medical industry and the military.

With Intecon's technology and market validated, things started to snowball. A friend of Sias' put him in touch with Jaycor Corp., a well-established government technology contractor that was looking to get into the decontamination market. With the backing of the well-respected heads of CCAT, Sias says he could prove to Jaycor that he and his colleagues weren't "snake oil salesmen."

Jaycor agreed to fund Intecon's research and development. Three years later, Jaycor was acquired by Titan Corp., an even bigger Defense and technology contractor. Then, all kinds of doors started to open, Sias says.

"It was hard to get any serious attention paid to us [by the government], until we got into the mix with Titan," he says, describing the new level of interest as "kind of awe-inspiring." Titan has an extensive track record of developing technology and combat systems, and was able to bring Intecon into the game as few others could.

New attention also coincided with a macabre opening of a new market. The October 2001 anthrax attacks proved there soon would be an even larger market for Intecon's decontamination technology. The company has since conducted a number of studies showing the plasma spray is highly effective at killing anthrax and other toxins.

As Intecon continues to develop and perfect its device, Sias is keeping close watch on the Homeland Security Department. There, officials have signaled that some of their top priorities for new acquisitions will be chemical and biological agent prevention and cleanup devices. With its new network of contacts Intecon is a perfect example of a small outsider that went from Nowheresville to a sweet spot in the burgeoning homeland security market.