THE BIG SANDBOX

An inside look at how Koch Labs helps churn the parent company's ideas

Inspections of a Koch fertilizer plant using drone technology are one of many innovations being aided at the company by Koch Labs.

By Daniel McCoy - Reporter

In 1927, Fred Koch developed a thermal cracking process he believed could greatly boost gasoline production and decrease costs for independent oil refiners. 

While that was the genesis of Koch Industries Inc., there was still a hurdle.

“Before he could sell his new process, he had to prove it worked,” his son and company CEO, Charles Koch, wrote in the company newsletter earlier this year. 

Fred Koch convinced a refiner to try the process and did prove that it worked, creating the launching pad for what is today the largest privately held company in the country. 

It’s a concept, Charles Koch wrote, alive and well today in what the company calls Koch Labs — a kind of entrepreneurial accelerator for Koch companies and companies it invests in. 

And, while it’s a concept that’s been alive and well at Koch throughout its history, Koch Labs has become a formalized engine for driving new ideas and processes at the company. 

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