The CEO of a US mining technology firm coming off a breakthrough sales year and seeking new equity funding sees maturing of financial and end-user markets boding well for the company as it attempts to scale rapidly over the next few years.
Mike Smocer, who joined Mine Vision Systems in 2021 and became CEO of the Carnegie Mellon spin-out a year later, told InvestMETS.com the search for a replacement cornerstone investor for long-time backer, Rockwell Venture Capital, had put him in front of numerous venture fund providers.
“Not everybody understands the importance of mining, but I was pleasantly surprised by how many are focused on mining in the US, especially in the Silicon Valley area, in which I’ve had a lot of conversations,” he said.
“They’re very focused on decarbonisation [and] electrification. They know that this is an essential problem to solve in order to achieve net zero; to build electric vehicles and have enough materials for batteries.
“It doesn’t hurt that you have Breakthrough Energy Ventures … Bill Gates and others that are investing in the [industry]. It derisks it for those that wonder whether or not they should jump into mining.”
Large US silver and zinc producer, Hecla Mining’s publicising of its use of Mine Vision’s FaceCapture portable, underground mine face-mapping product provided a visible marker for the tech company’s business development progress. First Majestic Silver has since provided another. Smocer says various other commercial arrangements have resulted from hundreds of mine visits and about 50 “engagements” with mining companies over eight years or so.
Mine Vision’s delivery of its broader robotics-as-a-service business model hinges on expanded penetration of the lightweight hardware/software package currently travelling around mines in the hands of geologists and other personnel going about normal tasks. The tool, with its embedded georeferencing and multi-image analytical capabilities, is clearly going to work and potentially generate greater value with more automated carriers and the increasingly sophisticated communications networks making their way into underground mines.
For now, though, says Smocer, Mine Vision and its foundation customers are advancing down the road of “frictionless [or non-invasive] mine digitisation” and the supplier is generating recurring revenue from subscription-based, “scan on demand” contracts under which it supplies devices and support.
“We’ve been doing non-recurring revenue and non-dilutive R&D since our inception,” he said.
“The starting gun really went off for us in August [2023] with the initiation of the recurring revenue model that I was brought in to help grow and accelerate. It’s been very busy since then.
“You never really know what you have and how close you are until you get a product out in the market. I’ve been around a lot of new products in a 30-year career doing this and sometimes little things get missed. The good news is we didn’t seem to miss any of them and a lot of that can be credited to the partners that we’ve had [including customers] basically guiding us.
“We’ll continue to work on usability and experience and all those types of things; we want that to be as perfect as possible.
“But getting the product out and putting it in the hands of a very good go-to market team has been a major milestone.”
New equity capital is expected to be deployed to help Mine Vision expand international sales channels and ramp up recurring revenue considerably – based on its projections – over the next 2-3 years. The company will also maintain its active R&D program.
“The expectation is that we will raise an amount of money that will get us to cashflow positive within a couple of years,” Smocer said.
“We’ve managed our cash, both before and since I’ve been here, exceptionally well over the years building something that is incredibly complex but well packaged, such that it’s very simple to put in the hands of a customer and, after only about 30 minutes of training, be put to use.
“If you look at the investment in technologies that ultimately fit in this space, I’d say that we compare exceptionally well in terms of how productive we have been with the cash that has been [injected into] this company.
“And that puts the next investor in a very strong position.
“We’ve also of course de-risked the next step for our next lead investor considerably by being in a position where we actually have a product that’s now selling. We have referenceable customers already.
“That product launch and getting to what you say you’re going to do is probably one of the biggest risk points early on for a company.
“We’ve checked that box and we’re off to the races.”
Smocer, a veteran of non-mining technology and start-up development over three decades in and around his beloved home of Pittsburgh, Pennsylvania, suggests Mine Vision’s portfolio of proprietary technologies from Carnegie Mellon’s renowned National Robotics Engineering Centre can become a more important differentiator for the company as they are translated into commercial, automated geotechnical and geological analytical tools.
“We’ve got an incredibly smart and rich background in technology,” he said.
“But the beauty of what we’ve done is to take that technology, understand the application by working closely with customers, and building basically a sensor fusion system for geologists and for mining engineers underground.”
Carnegie’s robotics and computer vision R&D hubs – which have been integral to Caterpillar’s mine automation product development and which spawned IBM’s Deep Thought computer – have tended to punch above their weight against America’s Ivy League universities and other globally recognised producers of robotics and AI technologies and people.
Smocer says turning the deep local tech development well into major commercial enterprises based in his home town is part of the opportunity he saw with Mine Vision.
And he’s not surprised other mining-tech leaders are similarly enthusiastic about the future.
“If you look at any [recent] market report … smart mining is roughly a US$10-to-12 billion business right now. It’s expected to double in the next 10 years,” Smocer said.
“With just the baseline technology we have, with some variations, I think we have the ability to access 10% of it. By taking the next steps in our product roadmap, and with this new investment round that we’re chasing right now, I think we can move up to over 20% of that overall market.
“There are a lot of different applications for mining technology, and a lot of room for improvement and opportunity for the best and the brightest mining companies, the ones that are at the leadership levels, to adopt those technologies in pragmatic ways.
“The starting point is getting good and accurate data in the hands of the best and brightest people, so they can make better decisions.
“We’re taking somebody who is already walking around a mind, a geologist or a mining engineer, who’s making certain decisions in that mine, to enhance productivity, to minimise dilution, to increase the viability of that mine and the output of that mine. We’re saying that you can collect better data, faster to make better decisions, without spending as much time in the most dangerous part of the mine.
“Kind of a no brainer.
“Now we’ve accomplished that, what if we do this next thing?
“That’s our approach to partnering with our market, and it’s directly aligned to our go-to-market strategy.
“It’s how we discuss building the business with investors.”
