Radical Innovation: the new department of Crystal Lagoons® with innovations in food, medicine and ecommerce3 August, 2021 / News
Ever since the success of Crystal Lagoons®, its founder Fernando Fischmann, is planning a new department of “Radical Innovation”, that will have a series of spinoffs in the areas of food, medicine and electronic commerce.
Diario Financiero, one of the main economic newspapers in Latin America, published in its anniversary edition an extensive interview with Fernando Fischmann, highlighting these new businesses, the success of the Public Access Lagoons™ projects worldwide and the innovative DNA of Crystal Lagoons®.
The dean of the Chilean “unicorns” seeks to expand his business and prepares a pilot to desalinate water without energy
In the last two years, the Chilean executive began to venture into new businesses, opening the department of “radical innovation” at Crystal Lagoons. He also created the ZeroDesal firm, which promises energy-free desalination technology.
By: Mateo Navas | Published: Saturday July 31 2021
Fernando Fischmann is in Chile. He hadn’t visited in over two years and decided, due to the low rate of contagion, to visit the country for a few days. He left Florida’s heat and arrived to Santiago. “I hadn’t come in a long while. The weather is tropical, but I miss the fresh air sensation”, says over the phone.
Despite the fact that Crystal Lagoons, the multinational that he founded more than ten years ago, is already a consolidated firm, the executive is still busy with the company’s next projects, which he details in this interview with DF MAS.
“During these last years I have marginalized myself from the commercial area and I am essentially dedicated to developing new technologies, some related to lagoons and others that have no link and that can generate a high global impact,” he clarifies.
And adds that the Coronavirus pandemic didn’t’ had any direct impact in his company, which has over a thousand projects operation worldwide. “While Miami beaches were empty, our lagoons where full”, emphasizes. “I haven’t gone to the office in eight years, I understand teleworking. For that matter, I do not know our offices in Dubai, Amsterdam or the ones we had in Barcelona. I think I went to the Miami offices when we bought them, despite the fact I live there.” confesses.
In this interview, he talks about the recent unicorns, the next projects of Crystal Lagoons, the situation in Chile and the decision to keep the 100% of the company’s property. “It has been a personal decision. A very tough one. Because maintaining the 100% of control and not incorporating external capital makes financing difficult. Funding innovation is always complex, because traditional media say: ‘OK, I will risk it, but I want part of the property’. Traditional banking does not like to enter this area, the like to bet on sure things. Is not easy”, remarks.
Orlando, Dubai and Pakistan
Fernando Fischmann can talk a long while of the projects of Crystal Lagoons. Especially now that they have a new business model, baptized Public Access Lagoons (PAL). “In the beginning we dedicated to licensing of our technology for the real estate sector, where we charged a percentage of sales. However, in the last two years we have moved to PAL, which are not necessarily linked to a housing development. These are lagoons where people pay a ticket and can enjoy beach life in cities.” And adds: “The income generated by a PAL are, on average, 10 times higher than those of a real estate project.”
This change, explains the executive, allows them to receive income perpetually because they obtain a percentage of all the sales of the venue. ”This will change life in the cities. 200 years ago, when someone wanted to commune with nature, went to the forests. Until a British architect asked, why don’t we bring the woodlands to the city? Now every town has parks. I think the same will occur in the future with PAL projects.”
One of the projects that cheers him up is Orlando. They will build five PAL thanks to an association with the American asset manager ADELÖN Capital. “I visited with my family and used to think, this city has everything. Theme parks, hotels, but not an ocean view. We will bring the beach to Orlando, a city that receives 70 million visitors annually.”
He also mentions a mega-agreement with the US giant Mattel to develop the company’s first amusement park in Phoenix, Arizona. The total investment for this initiative is US$ 400 million. “We plan to do 15 similar projects in the United States. It should be open in conjunction with the 2023 Super Bowl, at the Arizona Cardinals stadium, which is right next to us. The idea is that the Super Bowl events take place around the lagoon” Fischmann anticipates.
Outside the US they have projects in Korea- in association with Hyundai-, Pakistan (through an agreement with ARY Group 15 Pal will be developed) and Dubai. “It will be a 40-hectare lagoons and the most expensive square meter of that city is around the lagoon. It’s an oasis in the desert,” affirms.
Taking the offensive in business
Fernando Fischmann has been thinking about new business areas for two years. He affirms that he realized that the area of the lagoons could generate new commercial opportunities. It was there that he first thought about desalination.
“We are programming the first desalination pilot without using energy. We apply what is produced by industries, such as thermoelectric or data centers. It is an idea that is protected under patent and that may be interesting because the cost of this process is one third that of reverse osmosis”. For that, he affirms, they have already created the ZeroDesal firm and are evaluating their first project. It could be in the United States or Chile.
The executive explains the details: “In reverse osmosis you have seawater and a membrane. Then you apply pressure to the salt water and only the fresh water passes through. Our technology has a temperature difference. It’s called membrane distillation. Although it is an old practice –which is not used because it is expensive- when we cool down an industrial plant, such as a foundry, we obtain pure hot water. There one could obtain fresh water without using energy”.
They also continue to develop Hot Reef, an innovation to increase the temperature of the water in their lagoons. This technology is complemented by domes, which are heated in a sustainable way. “A lot of data centers are being built and they require cooling, and we use the lagoon to cool them, but in turn the water in the lagoon is heated for free without using energy. That same heat is used for the dome. So you have a lagoon at 30 degrees all year round without using energy”.
Eighteen months ago, Fischmann created a new investigation area, called “Radical Innovation”. “With a group of young people, which I lead, we are developing technology in the area of food, medicine and ecommerce. Within the next few months, we hope to give interesting updates. We are going to create spin-offs with all these new technologies that have nothing to do with lagoons,” he says. “It is something new in which I have put a lot of effort, because that would allow us to lead different areas that have a lot of potential.”
Why did you took that decision?
In these more than 10 years of Crystal Lagoons, we have generated a research, technology development and intellectual property capacity. Then I thought, “Well, why do not use this capacity to approach other areas of economic development”. We have done quite well. In addition, we are in a diversification plan to different areas. If we do well in around five years, under the umbrella of Crystal Lagoons, a group of companies in diverse areas of high global impact will hang, which will generate an impact in the future life.
Barbecues, Asech and unicorns
“When I started in the world of innovation, I wished for more actors. I remember that they invited me to give conferences and in the end, I found the same faces. I thought, ‘I really want more examples to exist, and especially young people, who inspire new generations,” he says. “At one point I would gather entrepreneurs in my house and make the ‘the innovator roast’, which started with very few. Some of those who went to those gatherings today are unicorns … Daniel Undurraga (co-founder of Cornershop), for example. He was eating at my house”.
In parallel, when he was still living in Chile, he was invited by the government to provide advice on different initiatives. “One day I invited innovators and government people to San Alfonso del Mar to spend a full day, to see what could be done together. And that’s where Asech came into being”, he recalls. “The Executive asked: ‘Why don’t they come together in an organization so that they can be a unified voice that can interact with us?’
How do you feel about the new unicorns, like Cornershop and NotCo?
What is happening now I find spectacular. It fills me with joy. This is what people need: examples of people who are getting results. That is the best print run. There is nothing that can produce more enthusiasm than seeing successful countrymen. This is exactly what I missed eight years ago. Hopefully this is an explosion of startups and innovations.
Regarding this, Fischmann affirms that only in recent years has there been a growing interest of entrepreneurs to go out into the world. “The Chilean perspective has changed. I remember that these roasts, even the most successful ones, were very local. When they thought abroad, they thought of neighboring countries. Even the big businessmen: at most they made a subsidiary in Peru, Argentina and Colombia”.
Some say that Crystal Lagoons was the first unicorn…
Technically, we were the first Chilean unicorn. A short time later, we were valued in US$1,800 million by Boston Consulting Group. However, there is a difference, because we have never been open to third parties investment. What the startups in Chile are doing is opening to financing rounds that displays the worth.
How much are you valued?
I do not give financial information because it is a closed company, but there is public information in the United States, which is the book value of intellectual property, around US$ 3.3 billion. It is the only thing I can give, because the rest is not clear, because we have not opened ourselves to third-party financing.
What are the main challenges that Chile has?
Without going into purely political issues, I perceive that in Chile many issues are being discussed, such as values or social issues. It seems good to me that things that are concerns of the population are debated. But hopefully we don’t forget that the horse that pulls everything in the end is business. From there come all the resources to be able to finance the social plans, needs or aspirations that people want. I hope that the changes in Chile do not lessen this side.