Overall Salvo Technologies’ strategy to foster innovation to accelerate organic growth as well as their commitment to build synergistic collaborations through acquisitions with a strong emphasis on the consumer, medical, security, and industrial markets will drive the organization forward.
Salvo Technologies Inc. was created in 2006 to fund and develop manufacturing companies in the defense market with a strong focus on soldier safety. Initially, it functioned as a value added reseller of optics, coatings, and industrial equipment. Very early on, however, leadership began looking to the future. Their goal was to create an organization with a philosophy of developing products that offered better performance, functionality, and quality than those currently available.
SALVO COATINGS LLC
The team began by building upon their core competencies with the launch of Salvo Coatings LLC, a separate division dedicated to thin- and thick-film design and manufacturing. The new business unit started out serving the defense market, but Salvo Technologies established it with the specific purpose of advancing coating technologies across multiple markets.
To form the new division, Salvo Technologies purchased the assets and customer list of Georgia-based supplier MK Coatings in 2008. Launched in the 1990s, MK Coatings started in the area of low-VOC marine coatings but subsequently broadened to specialty offerings like epoxies, enamels, and optical thin films for niche customers. Those custom capabilities made its IP and personnel a good fit for the larger Salvo Technologies strategy.
The new division did well, developing innovative products like a direct-to-metal colored paint for conduit manufacturing and a family of unique corrosion-blocking lubricants for the metal forming industry. Meanwhile, it inked a supply agreement with DaeHwa Paints in South Korea to enable it to fulfill large thick-film orders and a separate reseller deal with PPG that gave it the freedom to customize PPG coatings for specialty applications. Salvo Technologies leadership’s vision of a company that produced what others couldn’t was beginning to take shape.
SALVO ELECTRO OPTICS
The next step was to move up the value chain by adding another division, Salvo Electro-Optics. Salvo Technologies developed the organization by combining its in-house expertise with another acquisition, this time buying the equipment and facility of Global Systems Inc. (GSI). Specializing in optical components like those used in rifle sights and lasers, GSI provided Salvo Technologies with the right fabrication capabilities to act as a supplier to tier-one defense contractors.
With the assets and core engineering talent of GSI, Salvo EO progressed from fabricating discrete components, which were finished by Salvo Coatings, to producing value-added subassemblies. The company added another accomplishment organizing its operations to achieve ISO-9001 compliance. This introduced the third prong of the Salvo Technologies growth strategy Quality or better phrased: focusing on quality and on lean manufacturing as well as Six Sigma principles.
Adding a class 1000 cleanroom gave Salvo EO the space it needed to pursue electro-optic assembly contracts. The Salvo Technologies portfolio now included equipment and personnel to fabricate, coat, and assemble optics, but the organization was missing one essential element—a design team to develop products at the systems level.
SALVO DEFENSE & SHEPHERD SCOPES
To address this issue, Salvo Technologies established a new venture, Salvo Defense, to act as the engineering group for the rest of the organization. With the addition of Salvo Defense, Salvo Technologies was positioned to design and manufacture systems-level products from start to finish. The combination of products and services created a whole greater than the sum of the parts. This was in fact the genesis of creating a vertically integrated organization.
Around this time, Salvo Defense team members began collaborating with Shepherd Enterprises, which specialized in high-performance firearms, rifle scopes, and other fire-control optics. Early on, it became clear that Salvo Defense and Shepherd could bring their combined skills and experience to bear on key industry problems. The hunting market is a demanding one with highly specialized, often conflicting, requirements. Balancing effectiveness with yield and cost leads most vendors to compromise on performance in the name of manufacturability.
The Salvo/Shepherd team was unwilling to accept this. By combining their technical insights, the two companies managed to improve the performance of rifle scope assemblies while increasing yield on a difficult component from 10 percent to 90 percent compared to conventional approaches. They also developed techniques for producing ultra-robust components able to stand up to the punishment delivered on the battlefield and in the woods. They specialized in solving the customer problems that other suppliers ignored. They built a product line that took the best of what was around and made it better. Shepherd Enterprises ultimately was purchased by Salvo Technologies and the groups were combined officially.
In 2014, Salvo Technologies began strategic discussions with Mil Aero Solutions (MAS), a supplier of high-reliability electronic components. MAS directly served the US Defense Supply Center Columbus (DSCC), as well as many tier-one prime contractors. The synergies between MAS and other parts of the Salvo Technologies organization such as Salvo EO and Salvo Coatings were obvious.
Also of significant potential were MAS’s connections and distribution channels. It became clear to the Salvo Technologies management team that MAS could play a vital role by contributing to growth and generating market access. From the MAS point of view, the company could now offer custom products. Perhaps more important, it could assure its customers of product quality and delivery schedules because it had direct inside knowledge of the manufacturing process every step of the way. In 2014 Salvo signed a distribution deal with MAS. Ultimately Salvo Electronics was formed after making the relationship formal.
At this point, things began to happen quickly. Eager to leverage the synergies among divisions and facilitate collaboration, Salvo Technologies purchased a new facility in Seminole, Florida. In addition to corporate headquarters, the structure housed Salvo Coatings, Salvo Defense, and Salvo EO. The organizations shared laboratories, test facilities, manufacturing space, and offices. Gone were the days of telecons and Skype. Suddenly, collaboration was as easy as walking down the hall.
Meanwhile, the organization worked top to bottom toward the goal of being AS9100 registered, starting with achieving ISO 9001 compliance. By this time, Salvo Technologies encompassed a design group, a fabrication and assembly group, a coating group, and a group dedicated to PPE. The organization could design and build one-of-a-kind rifle scopes and sell the owners the firearm to mount it on and the PPE to wear while using it. Of course, this vertically integrated value stream in optics and electro-optics could also be applied to other industries, like medical.
When the U.S. Congress invoked sequestration in early 2013, it shut down US Department of Defense spending, which had a ripple effect in the industry. That experience underscored the value of diversification to Salvo Technologies management. Luckily at this point the various divisions sold into multiple markets. Salvo Coatings produced industrial products while 4D Tactical sold to recreational hunters, medical, and even bull riders.
Salvo Technologies management recognized that in order for the company to achieve its potential, their efforts to expand into other markets needed to be strategic in service of a greater goal. They assembled an advisory board that included members with decades of expertise in life sciences, analytical instrumentation, medical devices, industrial manufacturing, and defense. As they explored the company’s IP, it became apparent that the greater Salvo organization could develop robust product lines for many of these sales areas, as well as other targets of opportunity like agriculture. This approach will help insulate Salvo from downturns with minimum additional investment.
Mergers & Acquisitions
At Salvo Technologies growth through acquisition remains a primary goal, as seen in the acquisitions of Next Phase Optics (2015) and Shepherd Enterprises (2016). However, the growth is understood to always come in the context of strategic planning. Next Phase Optics brings with it unique processes that multiple groups within Salvo Technologies utilize. The synergy with Shepherd Enterprises is even more apparent. Salvo Technologies now has a direct link to the consumer hunting market. In 2018 Salvo Technologies acquired EOITech. EOITech has deep knowledge and competency in the sensing and imaging arena with deep penetration into the medical and industrial markets. Following the EOITech acquisition, Salvo Technologies acquired the manufacturing portion of Pixelteq from Ocean Insight in 2019 and this manufacturing organization was absorbed into Salvo Coatings.
The combination of EOITech and Pixelteq now means that commercial sensors can be modified and spectrally shaped in house. For example, a Sony sensor available in mass production can be taken in by EIOTech, coverglass, and microlenses removed, and a pixelated custom Bayer filter produced by the Salvo Coatings group can be placed on the sensor creating a custom snapshot multispectral camera.
With all of this new capability Salvo Technologies felt the need to begin to partner with and distribute other organizations’ technology. One of the first partners was Raptor Photonics who specializes in SWIR and low light imaging solutions. The relationship noted the need for more partners and more solutions for the toolbox so in 2020 Salvo Technologies purchased Flash Photonics.
Flash Photonics was a specialized distribution group for some of the most up and coming instrument companies. These include Spectral Industries, Spectral Engines, Custom Sensors and Technologies as well as Ocean Insight. Now with the reach of a global distribution organization and the product portfolio that allows the team to solve almost any optical sensing problem Salvo Technologies has become a go-to problem-solving organization and solutions provider.
Overall Salvo Technologies’ strategy to foster innovation to accelerate organic growth, as well as their commitment to build synergistic collaborations through acquisitions with a strong emphasis on the consumer, medical, security, and industrial markets, will drive the organization forward. Pair that with continued excellence in Quality and the ability to solve even the toughest customer problems and you can clearly see Salvo Technologies is an exciting dynamic entity with its best years ahead.