Voice of the Modern Manufacturing Economy Since 2013

HotEdge

by Eric Peterson on June 20, 2016, 02:01 pm MDT

www.hotedge.com

Denver / Glenwood Springs, Colorado

Founded: 2011

Privately owned

Employees: 25

Since moving manufacturing to Colorado, President Andy Elson has seen dynamic growth with his company's innovative ice-mitigation technology for residential and commercial roofs.

Former an attorney with TCI and AT&T, Elson acquired HotEdge, originally launched internally at Illinois-based Martin Engineering, in 2013.

"I was looking for companies that had a niche in a marketplace, a fragmented marketplace, that could use some innovation," he says of the deal. "This hit the spot on all three."

The product, an ice-mitigation system for roofs, was originally invented in Colorado for Martin Engineering's chairman, and Elson moved the company to Colorado, with its headquarters in Denver and its factory in Glenwood Springs. The production team has more than 50 years experience making ice- and snow-melting systems.

The status quo is zigzagging cable systems that are "not effective solutions," argues Elson. HotEdge's panels, which can be retrofitted onto existing roofs, are based on a patented "raceway on a roof edge." All of HotEdge's products employ metal plates with heating elements aimed squarely at the valleys of roofs where ice and snow tend to collect.

"Anywhere water is going to run is where we put our system," says Elson. "They all have a three-sided angular raceway that allows for heat transferral."

HotEdge's products are the only UL-listed products and the industry, he adds, and they are also notably energy-efficient. "We maximize the amount of heat we can apply to a roof to melt ice and snow with a minimal amount of energy."

Besides a good talent pool of people with experience in ice and snow mitigation, Colorado also has a good climate for HotEdge. "The move to Colorado has done wonders for our business," says Elson. "Our test facility is Aspen Sundeck on top of Aspen Mountain."

Since the acquisition, HotEdge has expanded its catalog from two products to 12. Different products are designed for different kinds of roofs, including, metal, cement, wood, and shingles.

The ability to retrofit and ease of installation makes for 25 to 50 percent lower installation costs. "They essentially just snap on," says Elson. "All of our jobs are custom and ship out in five days."

This makes for notably easier maintenance. "With other systems, you have to tear up the whole system and maybe tear it off the roof and replace it."

All of these features and benefits have catalyzes rapid growth for the company. "We doubled our sales each year, 2013 to 2014, 2014 to 2015," says Elson, forecasting 2016 growth north of 50 percent. Customers include Lambeau Field in Green Bay, Wisconsin; Eagle County Airport in Gypsum, Colorado; the Xcel Building in downtown Denver; and numerous condo complexes, military facilities, hospitals, and malls.

Elson relays a story of window washers removing ice from the Xcel Building in Denver before the HotEdge system was installed. "They were closing off the entire street and letting it drop," he says. "A chunk of ice hit a Chevy Tahoe and totaled it."

At home, it's not so dramatic, but ice and snow collecting on your roof is still problematic, he adds. "It's just a matter of time before it finds its way into your home." He says the HotEdge system extends the life of a roof "significantly."

Challenges: "Right now, it's educating people, including architects, builders, homeowners, and business owners," says Elson. "Ice is likely a significant part of their roof problems."

Part of the educational process involves finding the right distribution channels, including electrical supply houses and roofing contractors. But Elson points out a secondary challenge with roofing companies: "Some roofers would rather get up there and shovel the roof. They say, 'I like your solution, but you're going to lose revenue.'"

Opportunities: "There's a tremendous opportunity for expansion," Elson says. "The insurance companies are beginning to deny ice claims” -- which topped $1 billion in 2014. Sales are currently evenly split between the residential market and commercial and industrial customers, but Elson hopes to grow the latter two to 80 percent. "Commercial is the big opportunity," he says. "We've only scratched the surface."

Needs: Acceptance from the insurance industry. "We're trying to have discussions with insurance companies," says Elson. "We want this to be treated like a smoke detector. . . . It saves everybody in the long run." Manually removing snow and ice is a dangerous job, he adds. "Having people on the roof is a serious liability."

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