Drilling diagnostics startup gets Chevron's help to tap investment
An Edmonton company that helps drillers get deep insights — literally — is getting investment-ready by participating in an accelerator run by Chevron.
"It gives us validation in the market to say we are working on things that Chevron finds valuable," said Jonathan Prill, president of RECON Intelligence Corporation. "It also gives us a lot of exposure to the oil fields in general, because Chevron is a very large company, and part of this program they have is essentially to gain access to newer technologies within their own ecosystem."
RECON's sensors attach to drilling equipment to gather data far below the Earth's surface, and the company's software delivers insights from said data, whether it be time spent on projects, environmental monitoring, asset tracking to detect servicing needs, or the like. For example, RECON's technology was "key to capturing the immediate response to changes made on the rig floor while testing new automation technologies," client David Forrest of Precision Drilling said in a testimonial.
Chevron approached RECON last year to participate in the Chevron Technology Ventures Catalyst Program. Prill speculated that was the result of graduating from Creative Destruction Lab, a program to help technical founders turn their inventions into scalable businesses.
Chevron's accelerator began in December and runs for 18 months, during which time RECON must reach milestones that demonstrate it is ready for investment. RECON reached its first milestone last month when it announced participation in the program. Further milestones may include reaching revenue targets, appointing an external party to the board of directors, or forming an advisory board, Prill told Taproot.
The milestone model can also save Chevron time on deciding whether to make investments in accelerator grads, Prill said.
"Instead of them doing due diligence after the fact, they try and identify companies that they want to work with early on, and then they work with them for a number of years," he said. "At the end, they've already done their due diligence, and they've already got a relationship with you, so it makes it much easier for them to make a decision to invest or not invest — or to recommend investment to other portfolios."
The Chevron seal of approval comes with a certain prestige that may help attract future clients, Prill added. Right now, RECON's clients are mostly on the downstream of oil and gas, with many either building tools or working in research and development, as opposed to upstream companies that work on extraction. Prill wants to attract more upstream companies into RECON's portfolio.
"We really see benefit in our technology helping oil companies make their drilling programs more efficient and more cost-effective," he said. "We've had a few clients in that area, but still, the majority of our clients are … more downstream."
