Paces demo day- E112

Download Podcast Here: https://plinkhq.com/i/1518148418

Remember, If you want to support the podcast please rate and review 5 stars on  Apple, Thanks so much! 

James

The unedited podcast transcript is below

James McWalter

Hello everybody this is going to be a bit of a shorter episode and just me this time. Basically I want to take an update everybody on how things are but going with my startup called paces. Basic. Someone would let everybody know how things has been going when my startup paces and to kind of fill you in on how things are going to go with the podcast for the next few weeks we’re going to have a couple changes and then we’ll be back to normal starting in October. Um, first of all in terms of um. Paces so we’ve been going through what’s called wide combinator for the last couple of months and started beginning of June and in the next couple of days around the time you’re going to hear this podcast with something called demo day and so for those who aren’t aware. Combinator is this program. 1 of the first accelerators for startups and has you know a pretty great reputation for being the startup accelerator which airbnb and Dropbox and stripe and companies of that it came out of now. There’s not a ton of climate companies that have come through I see. Um, that seemed to have changed a couple years ago although the current batch doesn’t have that many at all. But I’d long wanted to get into Yc and it actually tried with 4 previous ideas to get into Yc and applied and was never even able to get an interview whereas this time we not only got an interview but we also got in.

And haven’t gone through Yc I think that there are certain things that people should know. Um, overall the experience has been amazing. I’m very very happy. We did it I would say though that it’s more valuable to people earlier in their career or people who have less experience starting. Or working at early stage startups. You know I’m 38 this week and so yeah, I’ve made a lot of mistakes I’ve been involved in a lot of failed efforts and a lot of the lessons that Yc gives on a very frequent basis are the kind of things that you learn after making a lot of mistakes. Ah. And so what they’re trying to do is have you as you know early stage founder not make those mistakes or make them faster so that you can learn from them and move on to the next thing. So for me if I had done my c in my twenty s I think it would have been even more profoundly positive. Then what it is now that yeah a lot of the kind of advice is something that I kind of figured out after making all the mistakes myself, um, now having said that I think that the number 1 thing that’s great about y c and I’ve said to everybody who’s asked me about it is the absolute obsession with getting to revenue interaction. You know there’s a lot of. Silicon Valley type startup perception where everybody just talks about their valuation or the number of employees that they have and those are not important things but those should just be proxies for is your company solving the problem enough to make reasonable revenue and ideally exploding revenue.

Where you’re just dramatically going up in terms of the amount of money you’re making and that is why c’s focus. They make you really think through what it means to have a company and a company solves a problem and makes money doing so and so we got you know everybody at yc has a um. Yeah, this kind of smaller group because there’s over a hundred companies in it I think it’s closer to 200 in our batch but there was closer to 400 in the previous match. So you’re slightly smaller than previous batches but still larger than maybe what wise he was five years ago and we’re in a with a group of about 10 companies and every week or every two weeks we have to. Talk about how we’ve done from mostly from revenue point of view and then explain how we’re going to hit specific targets in the knock next two weeks and the Wei Partners who you’re assigned to um, yeah, they never tell you what to do but they say hey could you be more ambitious or is it reasonable. You’ll get to that point. Um, why not go even further and those are ways of just adding a bit of competition and adding a bit of um, you know I guess friendly. You know, friendly pressure to you know really excel because the big thing do I see is it’s only three months and really it’s like can you get to a kind of regular ah can you get to a fast iterative cycle so that you’re building launching getting revenue or getting feedback to direct you towards revenue as quickly as possible. Um, so all that part has been great. Um.

We started off during covid there was no um in-person ycy whatsoever previously that Weisi had always been in San Francisco so people would fly there for a few months um this time it’s a bit of a hybrid so it started off somewhat in person with this retreat in San Francisco and then um, some major cities like New York or we’re based have regular meetups so it’s good to kind of chat to otherwise he partners or founders even that are in your space. 1 big thing I’ve noticed is that a lot of the startups in yc pivot quite a bit and so. Pivot is you are working on an idea and you can either do a hard pivot where you just start working on something completely different or you can do? What’s called a soft pivot where you know you’re basically working ah in the summer space or you’re taking a different approach to a similar problem. It’s very surprising to me the number of hard pivots I see um and so far. Because a lot of the people doing the hard pivot are honestly doing them fairly late into the program. It’s very hard to know whether they’ll be successful or not um, in our case, we definitely did not do any sort of hard or even much of a soft pivot. We did slightly change the direction of our product development though and by doing so we actually went from. Having lots of trials and nobody willing to become a paying customer to our first three pain customers and we did this by basically changing whether we were a map forward interface to something a little bit different and by going to a slightly different approach. Um, yeah, we the first 3 companies.

Ah, that trialed that new approach all closed as customers and now we’re working through trials with another half dozen and so it’s it’s been really, really exciting to kind of see after lot of building for a few months actual paying customers getting that real feedback from somebody who’s willing to give you hard earned money and we’re also not you know a. Super cheap $20 a month product product. You know we are a for figureer monk product and so having people willing to put over their you know hard earned money and their company money is incredibly validating. Um, and so yeah, so the other big thing for us is that we’re trying to show that our approach. Will not just support so developers when they’re trying to find the best places to build projects but will support any sort of green infrastructure developer whether that’s utility storage wind electric vehicle charging stations all the way through to things that are more climate. Neutral. But. Let’s say a renewable energy-based carbon neutral data center and so um, we have multiple verticals now trialing and the big thing for us is kind of working through those trials making sure the product is as good for those other verticals as it is for those initial solar customers and really showing that our approach makes sense. And may not right? You know one of the benefits of being small and nimble is that you’re learning from the market and so we have a hypothesis about what the market needs and we’ll see if it works and we should know pretty quickly because we’re very very fast. 1 big thing in terms of.

How fast we’ve been able to move is that throughout Yc the only 2 full time people are my cofounder Charles and I you’ll have heard charles on a previous episode a couple weeks ago a couple months ago and basically we are moving very fast and so um. We do our growth meeting on a Monday which I lead. It’s just the 2 of us and then we do a product meeting on a Tuesday morning which he leads and it’s just the 2 of us and in the growth meeting. We’re like okay you know we’re going to add this amount of revenue in the next week not months or quarter but like week. Um, and to do that we need this many demos. We need this many trial starts. We need this many trial closes and then on the product meeting the following day um we’re basically ideating and saying okay, what are the things that we would need to do from a product point of view to close existing trials or to attract more people trialing. And 1 really good example is there might be a feature that a customer will be willing to sign a contract if that feature is in the product and so 2 of our first 3 customers. We basically have contracts that structure and say hey if you sign today we commit that the product you need or the extra. You need will be in product within let’s say two weeks otherwise you get out of the contract and a lot of our product development is based around you know commitments that the customer has made to us from a revenue point of view and then commitments we make back to the customer in terms of shipping product that meets our need and so this has worked really well for us. Um.

We have hit the point where things are not super scalable. Um, we have some great interns helping paid interns of course startup shows paid interns helping with things around data collection as well as a little bit of sales research and then we also have a couple of ah contractors software engineers helping Charles with some aspects of. Ah, data integration. Well, we definitely hit the point where we are really struggling to keep up with interest which is two full-time people and so now we are heads down hiring. We’re hiring our first 2 ah full-time people. Um one is a data engineer and 1 is a software engineer um, those would both be founding engineers. With appropriate compensation from an equity and um salary point of view and so if anybody’s listening to this and knows anybody who are a software or data engineer who would love to be the founding on the founding team of a company really working hard on climate change like paces. Um, please reach out I’m going to include my email address on the show notes of this particular podcast would love to chat to people and we’re really really pushing to have those hires done in the next month or so and you know we have a very very high bar in terms of the the kind of level of talent and cultural fish. Um, but it’s also very very important to us that people bring you know they’re true and full selves to the office and so on because we have our own blind spots and we’re definitely trying to build a company that has um you know a huge amount of diversity throughout. It.

The thing I guess is ah I kind of touch upon a little bit but on the product side. Um, yeah, one of the things we really realized and we we knew this kind of going in and starting paces but the importance of data and so as part of the inflation reduction act. Um, there are concepts like things called energy communities where identifying. Places where energy communities exist as per the text of the bill has not become very very valuable to the types of customers that we talk to and so we are rapidly integrating that data probably it’ll be ready in the product by the time this podcast comes out and not just this but other datasets that are very very important things that are related to the grid like interconnection data. Ah, things that are related to zoning that we’ve been collecting for a few months but we need to do even greater job to have a world-class dataset in that front. So for us data collection being just the best source of data to identify the best place to build projects is absolutely their our real focus over the next few months um we continue to build out the software in the interface and improve on that. But basically if we have the best data we feel like we’ll have amazing service and product for the customers that we try to serve and that builds us also a competitive mode over time. Ah, the other thing I want to talk about is raising capital so we had raised as. People probably heard. We’d raised 7 figures of funding as part of our preceded in April of 2022 so you know four or five months ago and that’s the first time I’d ever raised money myself. Um I’ve written a pretty lengthy article on my own blog about that process.

Um, you know it’s a massive numbers to game talk to you reach out to hundreds and hundreds of people to get sixty seventy meetings and to close 10 or 12 investors and I would say we probably had a pretty easy time of it relative to a lot of folks who try for a very long time and certainly a ways your time than. I’d experience as part of other founding teams raising money even though I wasn’t the 1 directly doing the raising I’d probably been part of teams that had struggled to get anywhere as close to what we ended up doing and I put that down to a couple of factors. First of all I think you know we have a really really strong team on the technical side through my cofounder Charles. Um, you know former. Ah, Ai guy out of Facebook ah, but also I think we’ve really identified the problem and have a kind of a wedge into something that’s going to be a very very large industry in the next few years and I think that if I had 1 bit of advice and actually give this advice to a few friends and and even family members in my close circle. About what type of startup to build It’s try to find a market that is just starting to explode and just like try to grab a whole of that market. It’s so much easier than trying to summit a market out of nowhere or to you know, try to build something in a market that’s static or shrinking um like for us. You know, even if we had 100% market share. Um, we’d have a so solid size company. But what’s great is that the market share like the market’s going to double next year and double or the next over the next couple years and then double again and then double again. Um, and so that’s very very exciting because that allows us to just.

Do a great job and execute well but we know more customers are going to continue to flood in and you know have problems that we can potentially solve for them. Um, and so yeah, back to raising capital. Um, so coming up to the end of Ycombinator, there’s something called demo day and during demo day. You basically give a ah 1 minuteut pitch. About your company and there’s this whole interface where accredited investors and I think there’s usually a couple thousand of them can watch the pitch and hit the button that says they want to potentially invest and that means I’ll basically set up a meeting with the with the founding team. In this case, it would be with me. Um, one of the dirty secrets that a friend of mine who’d gone through y combinator last year told me was ideally you shouldn’t you should have all your money raised before demo day try to have your meetings in the couple weeks before on the lead up to demo day close those if you can at all and then demo day doesn’t re have of a ton of pressure on it. Um.

Luckily and I think there’s a couple of factors for this and we were able to close our entire round before demo day. So we’re about ten days from demo day right now we closed another round of funding just in the last week and there’s a couple of factors for why I think we were able to close so fast I mean first of all just to mention. We had about 90 investor meetings booked and all except 5 were inbound. Um I e I was getting an email from an investor introducing themselves saying hey like like what you guys are doing would like to talk. This is very different to our preet where I was doing a ton of outbound. Um, the main reason being that we’re in y combinator and there’s a y combinator directory that shows all the companies in the current batch and people can look that up and we’re on that of course, why were we getting that because I talked to other y combinator founders and they didn’t they got a lot of inbound interest but maybe not quite as much. Ah, generally think it’s just because there’s not that many climate companies in the current batch. Um, so there’s I believe there’s 6 or 7 out of you know a couple hundred companies as I said um and there’d been a way higher percentage in previous batches and so as more and more money goes towards climate tech. They’re looking for high quality startups that are solving problems in that space and so I think we’re just quite lucky to be right place right? time and not honestly have a lot of competition in terms of climate companies solving big problems in the climate space and so I think and that was honestly a lot of the inbound emails. We got refer to that directly. So I think if you are.

I’m interested in getting the y combinator. Um I’m not saying it’ll make it easier to get in. But if you are a climate company and y combinator. Um, our recent experience would indicate that raising capital as long as you know you do all the other things right? Um, might be slightly easier than other companies who are maybe not in the climate space. Um. And so yeah, so we um, we raised boat from a combination of existing investors increasing their investment as well as a couple 2 new investors coming in. Um, we actually closed around about three days after starting it which is very exciting and then we canceled most of those 90 meetings. We kept some of those meetings with like very very. High levelvel or or high tier vcs who might be interesting people to build relationships with for subsequent capital raises down the road. Um, but the big thing for us now is to kind of get through a lot of the meetings that have been booked and get back to work and for us get back to work again means getting new customers. Making the customers. We already have incredibly happy. Um, yeah, know making charging people money make generating revenue expanding the product to have a really really great moat and then between all that also obviously making hires building up the team. Um, so yeah, so over the next twelve months um we hope to hit our series a milestones. Um. Talked to a few investors now about what they think of as series a milestones and that ranges from a million dollars in recurring revenue per year. Um, all the way to no hard milestones but things like we want to see a replicable sales motion. We want to see the average contract size increasing. Yeah great team. Some people even.

Say that you should have good advisors so we take a note of all those things but we have our own internal idea of what we want to achieve um that would make us ready from our perspective to be series. Ah a investable um and our internal goals are probably much more ambitious than what an investor would want and that’s how we generally try to treat things we want to be better than what the market says. So that gives us a really really strong position when we do things like rate capital. So um, we’re not going to hire 30 people or anything like a lot of startups do who are well-capitalized like we are as say we’re going to hire probably 3 more full-time people by the end of this calendar year and then maybe another 5 or 6 ah, on the lead up into our series a ah most of those would be technical folks. We might have 1 marketing person I’m going to do all the company sales until we’re at least half a million dollars in annual revenue. It’s very very important I think for the founders to do most of the founder that sales or to do the founder that sales until you get to a decent amount of revenue. Because then you can basically develop a sales playbook and hand that off to you know salespeople that you hire in? Um, but I don’t think you should do that too early and that’s generally the advice. We’ve heard from bode Yc and elsewhere. Um, and yeah and in terms of the podcast. Um, you know we’re going into September when there’s a few different events happening. Ah, re plus which is this very very large renewable energy conference. Um, that will be ash as part of um behalf of paces so we’ll be at that I’m actually going to try to do a live interview while I’m there. We’ll see how that goes that’s be something a little bit different for the podcast. That’s the third week of September um I russset.

Actually also going to take a few weeks off um we’ve basically been on you know, weekly podcasts for 32 years outside of yeah, the occasional break around new year’s um, but what everything else that’s going on in startup. Um, basically we’re a little bit behind in terms of getting guest booked and so on so we’re going to take a bit of a break for a couple of weeks um and so probably the next podcast you’ll hear will be that live one at a plus and then after that we’ll get into a more regular cadence again with some amazing guests. So if you I guess my big ask is if you are somebody who is interested in. You know, working at a company like like pace’s you are a software data engineer. Or you know somebody. Um, we would love to hear from you and have a conversation and see if there might be a fish and yeah have a great end of your summer and looking forward to speaking to you again in a few weeks

Carbon Business Council – E110

Great to chat with Ben Rubin Co-founder and Executive Director of the Carbon Business Council! The Carbon Business Council is comprised of leading carbon management growth companies working to reverse climate change! We discussed carbon management technologies, the climate bill framework, voluntary vs mandatory carbon markets and more! 

https://carbotnic.com/carbonbc

Oath to Restore the Earth 

Download Podcast Here: https://plinkhq.com/i/1518148418

Remember, If you want to support the podcast please rate and review 5 stars on  Apple, Thanks so much! 

James

The unedited podcast transcript is below

James McWalter

Hello today speaking with Ben Rubin executive director and co-founder of the Carbon Business Council, welcome to podcast Ben.

Ben Rubin

Thanks! Thanks! so much for having me here. James thank you.

James McWalter

Great Um, to start could you tell us a little bit about the carbon business council.

Ben Rubin

So happy to yeah, the carbon business council is a nonprofit trade association with more than forty carbon management startups who are working to help restore the climate by removing CO2 utilizing cotwo and and just a range of other ways of how we can. Deal with this problem of all of the legacy emissions we have in the atmosphere and and rethinking how we approach co 2 We are a trade association of innovators. Ah there’s many early stage companies that are part of it because we believe that innovation and the approaches it terms bring to carbon management is going to be key for unlocking solutions for how we. Scalup to to gigatonn scale carbon management.

James McWalter

And you know trade association I think you might be the First Trade Association we’ve had on the podcast and so and they’re obviously like you know, very very strong levers for the spreading and the development of certain types of industry certain types of technology and so on. What drove the initial decision to start co two bc.

Ben Rubin

So yeah, yeah, well we see innovators in the space and early stage companies moving forward very impactful solutions but because policy is going to be so critical to getting to gigaten scale Removal. We We saw a need to bring these innovators to the policy table to make sure that the unique needs of startups were represented as as government policies are being developed to move carbon management forward and we did not want startups to be left out of the conversation so we had conversations with dozens of companies to understand would a trade association be helpful. What types of services would be most advantageous to early stage companies and across the board. There was a lot of excitement for for the types of services the approach we put together and and we’ve been pleased with with ah stakeholder support as well of just people recognizing that. Startups do have such an important role to play in how we had Gigaton Scal removal and and how there can be a benefit to coming together and having a stronger voice and.

James McWalter

And so when you’re having those early conversations you know, thinking about the none you know none None to twelve months as you’re developing the C O 2 Bc um what were the kind of main commonalities I guess between different startups because as I look at the list of your members. You know some are obviously very focused on. Yeah. A cultural based carbon sequestration. Some are more direct or capture. Yeah, a large variance in terms of the technological approaches and generally the business models as well. Um, so yeah so what what were those kind of commonalities you recognize early on.

Ben Rubin

Yeah, you’re picking up on a great point. There James one of the biggest common nowities actually across every single person we spoke with was the desire for there business council to be technology neutral I think across the board companies felt like it was too soon in the game to pick winners and losers and that. We have to see what is going to be most successful where will the technology cost curve been the most and so there was you know a desire from folks to to not have any None technology favor too soon in policymaking I think without also recognition that. As we look towards 2030 when we are hopefully removing gigatonns of co 2 from the atmosphere that it will ultimately very likely be a blending of different approaches that’s going to help get us there both removing utilizing the c o 2 storing it and so that was a commonally commonality across the board that that tech neutral approach. And then a lot of the services that that we developed having companies come together to be able to network having companies better track the conversations happening in Dc to understand policy. There was just there was recognition that. Because the the carbon management industry you know is so locked into policy that there’s a benefit to to feed that Intel the startups and and to bring them to the to the table to interface with lawmakers directly.

James McWalter

And thinking about you know as you have like a new industry you often have like a larger in essence a b two b series of companies emerge to support that industry and so when you think about what a company that makes sense for the C O 2 Bc looks like versus None that’s a little bit adjacent makes that sense. Um, do you have any kind of firm delineations over what’s a great candidate to be part of the trade association versus something that might be a supportive set of technologies but isn’t core to your mission.

Ben Rubin

Yeah, we are working to represent the the full value chain when it comes to carbon management. So as an example, if a company is removing cotwo from the atmosphere and that could be through direct air capture or another type of technology. What is going to happen with with that co 2 and that’s where those types of b to b connections between companies is it being stored underground. There are companies rising on that challenge thinking through geologic sequestration and how to make that happen. There are also companies thinking through if that co 2 is not being. Stored underground if it’s being utilized. Can we help take that co two and turn it into jet fuel or turn it into a consumer product and so really we see a value and and think that we can help expedite the growth of the industry by forming these types of connections. Ah across and for us. It’s also included marketplaces folks who are helping to be a point of connection.

Ben Rubin

To to someone who might be wanting to buy carbon removal to help hit their net 0 pledges and then the the companies themselves who are who are you know who have those those carbon removal credits and they can sell.

James McWalter

I want I guess what about I guess ah, kind of carbon accounting companies and software where they’re basically going into often very very large fortune None companies and trying to measure the underlying carbon and they will often have some sort of ah you know offsetting. Ah, functionality built into their software would those also be a good candidate.

Ben Rubin

So Yes I I think they certainly could be for us. Generally you know, ah a litmus test is does The is a company early stage and and help fall into this category of and an innovator in the space which which tends to be early stage and growth companies and do they have. Either a full or part of their company that has a focus and emphasis on carbon management. There are some carbon accounting firms that might be squarely focused On. We’re measuring Scope 3 emissions of company but but there are others you know who are specifically thinking through where accounting for carbon removal and management comes into the mix and so I Think. The answer is yes there and and for us. Yeah, another litmus test is we were pleased when we rolled out that we released the ethical of to restore the earth for Us. We’re committed to both growing the carbon management industry economically but also responsibly and so we are looking as as members come on to. Sign on to this ethical oath or sortath similar to an ethical oath that doctor sign or lawyer sign we we are pleased to have our members supporting the responsible growth of the industry which you know includes affirming that removal should work in tandem with mitigation that is not a replacement to it and and some other tenins laid out in that oath.

James McWalter

Yeah, and I actually just have the oath up on the website and what well include that link in the show notes. Um, yeah, and and yeah, it’s pretty short but pretty comprehensive. It’s not None or None statements affirming the varying aspects of you know the carbon management industry as as you mentioned. And I guess when you’re kind of thinking through when you’re you know writing this and and partnering a folks to kind of get you know this list of None or None statements. Um I guess you know were there any predicted pieces that were more kind of debate worthy versus others.

Ben Rubin

Yeah, yeah, that’s a great question and we were fortunately able to workshop this with a wide set of stakeholders including startups in different groups in the space to get feedback I think what was great about it is there was broad-based alignment that there is a benefit to have the industry coalesce around a certain set. Standards to guide how the industry grows again invoking what lawyers have and and what doctors have when it came to carbon management it having this affirmation that removal is not replacement for mitigation for the carbon business council. We follow the the science in the ipcc science says that we need. Giga None of co 2 removed from the atmosphere but it does not say that that removal is a replacement to mitigation and so I think you know with an example like that there was fortunately a lot of alignment where these statements were. Great to have entshrined great to have written down great to have startups signing onto and affirming but largely you know they they made sense for folks to to back and stand behind.

James McWalter

So yeah, and the um you know, sorry just just so like a quick pause sometimes you slightly cut off a bit early Ben I I know you’re pausing but ah, you can give yourself ah like I guess a None after you finish talking.

Ben Rubin

So okay, great. Thanks James I will keep an eye on that when I meet myself and.

James McWalter

Ah, yeah, nowheres at all. Um, great and so you mentioned earlier that yeah this kind of focus on early stage companies and I mean that’s that’s partly due to the type of industry right? because it is such an early stage you know industry the idea of. Like a norri or you know director capture type technologies being deployed at scale. You know, even None maybe three years ago um was was pretty like surprising I think to a lot of folks and so you know things have come on in leaps and bounds over the last couple of years but I think one of the things that as you think about the growth of companies. Lot of startups that that I could interact with they don’t rethink too much about you know trade council councils as you go along from my own startup more the renewable energy space. We actually did did just recently sign up to one of the large scale solar energy. Um, you know trade organizations. Um, and it’s definitely not designed for. Companies of our size I would say and that’s fine. We like we are we are definitely getting value. Um, they’ have some good conferences all that kind of thing. Um, and so as you were kind of looking at other you know trade councils that are out there. Um and trying to build one that’s particularly beneficial to early stage companies who are generally fairly technologically advanced. I guess what were kind of things that you looked at and said okay we want to definitely incorporate these elements of other trade councils and we want to avoid these other ones.

Ben Rubin

Yeah that’s a great question James I think for us None of the goals is is as early stage companies know I mean time is one of the most precious commodities. There are so many time constraints when you’re getting a pilot up and running working on raising ah a seed round and so I think for us None of our goals was to. Work to be time additive for companies I think an example of that is something like tracking the latest policy developments or legislation floating or what is happening you know and in conversations that are taking place on Capitol Hill if we’re tracking that you know for for 1 carbon management company. We should be sharing and tracking that for more and that’s the type of thing that is saving a company time if if they can read our new see our digest and they don’t have to dedicate staff time to do that themselves I think it’s an example of how we want to try and fundamentally add time back into the day of startups and early stage companies and. Depending on where in the growth spectrum that company might be that might be actionable intelligence for them to want to engage in a policy conversation and and and have more substantial conversations. It might be something that they. Ah, fold into a pitch deck as they think about their business plan and and how they’re going ah to scale and grow and and nest this policy into their long-term business plans and so you know we startups might internalize take different steps based on the actionable info we provide to them but for us just generally. Time back in the day of companies was was a guiding principle for us recognizing the the time constraint that a lot of companies brought against and.

James McWalter

And going into that policy piece I think that’s a pretty meaty part of what any kind of trade association or trade council engages in and because this is again top of mind for anybody and. Industry right? like all people are thinking about the questions around measurement and verification and which technologies are moving faster or slower and how you price carbon and all these kind of things are just like very very yeah wealth developed in terms of underlying conversation. Um, but you know you mentioned Capitol Hill there’s been a year of ups and downs trying to get a climate bill through I mean just this week we did get a positive sign from senator Manchin but we’ll we’ll see you know I’m I’m not going I’ve been hurt before right? as we all have so I’m not going to kind of believe it until we kind of get to that point? Um, but as you think about you know some of those kind of larger legislative kind of movements.

Ben Rubin

I Think if he has if.

James McWalter

Um, how does the C O 2 bc see themselves or how are you kind of operating within that kind of larger you know climate bill framework.

Ben Rubin

Yeah, another good question James we want to bring fundamentally one of our primary goals is to bring innovators and strategiesups to the policy table because we think they’re so essential for bending that technology pass grid and helping us scale up to reach giga times scalele carbon management. We we want to make sure that they. Can be a resource to lawmakers to share information that that can be technical resources as well as understanding and and starting to hash out what types of policies are going to be advantageous for this tech neutral approach that can help startups to thrive and and grow and we’re seeing some of that in that. In that legislation that is being floated right now where there is just a breakthrough on if that passes some of the amendments to 45 q as an example, a tax credit where some of those amendments help more increase the eligibility where an additional set of companies working in carbon management can can be eligible and so. It’s examples like that where we’re pleased to see that the carbon business council as as an additional example of how we might engage or or the types of things we’re looking at we provided an endorsement to the bipartisan crest act and that is where we’re excited to see that that’s bipartisan. Climate legislation it it shows that there can that carbon management can be a bipartisan climate solution and we’re also pleased that it proposes expanding federal funding for multiple forms of carbon renewable again taking that tech neutral approach that we think is going to be so critical to help startups really scale and grow.

James McWalter

Yeah, it’s yeah know it’s like 700 pages of the bill were dumped this week and we actually like internally did do some reading of it. A lot of control fing like we didn’t actually like read anything close but but you know solar carbon. Um, you know these kind of terms that kind of see.

Ben Rubin

Yeah, yeah I.

James McWalter

Ah, how those things interact and I think one of the I guess somewhat hot topics when amongst at least some part of the environmentalist community. Um, which yeah is kind of surprising to me how this has become a hot topic but you know the. Use of carbon sequestration as some way of like maintaining. Um, yeah Fossil Fuel Dependence Now this is not something that I personally have much stock in I think that we need all of the above and then 10 X that to have any chance of really hitting these kind of longer term climate goals. Um, But how do you think about? you know some of those arguments that occur. Around ah carbon Sequestration Cc Us and and similar types of technologies as being things that potentially extend the runway of Fossil fuels and some of these other non-sustainable methods of fueling the economy.

Ben Rubin

Yeah, good question James I think for us that’s None reason why we think the ethical oath to restore the oath is so important that oath affirms that removal is not a replacement for the important work of mitigation and that ultimately can work in tandem with it and we see the issue you know as just that at that. Following the science that the ipcc has reached this conclusion that we’ve delayed reducing emissions for so long that that work of deep decarbonization continues to be more critical than ever and so many of the provisions in the inflationment inflation reduction act that was passed helped help get us there with electric vehicle tax credits. Renewable energy. So many of the other things that that it’s proposing of how we reduce emissions. But as we’re doing that removal also becomes this essential option and essential to be focusing on scaling it up today so that we can get to gigaton scale by the time that the ipcc models are showing that we need to be there and so. Ultimately I I think that it is a a yes and that it’s a working in tandem that we can have both and through one policy that the current business council supports is is net twin targets where in a net zero plan. We’re seeing how much someone is hitting net zero or net negative. Commitments through mitigation and how much someone is hitting it through carbon removal and so ultimately again, it’s that’s None example of how we can see this working in Tandem which is ultimately I think both what we’ll need. To stay within the goals of the Paris agreement and and what what can help ussuage concerns that removal is not a replacement for that important work of mitigation. So.

James McWalter

And you know we talked a little bit about the policy side of things. But then also you know the supply right? like the companies in that you work with those 40 odd companies they are providing a carbon removal or carbon. You know, carbon sequestration service of some sort and that’s you know the core product they’re building. But then you have on the demandd side. You know at the moment we do seem to have way more demand dens supply in terms of carbon removals and a lot of that has been led by ah rfps coming from the stripes and shopifys and Microsofts of the world. Um, and that I think has been a really powerful lever to ah kickstart this is like ah a nascent industry. Um, but not that many companies have done that right? We’re probably talking about none to a dozen companies who are buying up all of the you know quote unquote high-quality carbon sequest rated offsets over the last couple of years how do you think about how that’s going to evolve on the demand side. Um, I mean is it going to be world of marketplaces will individual members of of your council potentially start to build their own you know sales of marketing teams and they’re actually selling to the demand side directly? Um, yeah, any thoughts on that.

Ben Rubin

Yeah I Think how we can strengthen the business case for carbon Removal Offtake. It’s a great question and it’s going to be something that’s obviously vital to the success of the industry I Do think that we’re seeing some of the carbon removal happening through Marketplaces we’re seeing some carbon removal. Purchases happen through direct buys and we’re seeing you know the possibility that as we think about hitting Net zero targets that that obviously is going to be contingent on mitigation and reducing emissions but recognizing that that for that you know that that final mile or those. Um, hard to abate sectors in in ah in a net zero ah Pledge. That’s where carbon renewal will come into play and and we’re seeing that on both government side and private sector side and so I think as more plans are coming together for how they hit Net zero Targets. We will be seeing this increasing. Amount of recognition about where carbon removal and carbon management can come into mix.

James McWalter

And yeah, on that. So yeah, one of the things when I started looking into. Yeah the carbon space when I was looking at different ideas for my next kind of startup and again ended up going in in the clean energy space but went pretty deep on carbon offsets and all the varying technologies. Um, for about None to None months and. 1 of the things I I was kind of quite surprised by was there was this like massive existing industry of what’s called renewable energy credits or Rex that are traded mostly in California Canada and in the Eu and it’s what’s called like regulatory market for carbon. But it is in that this particular case dependent on renewable energy and then they have what. What are called the voluntary carbon market which is when an individual or like an entity will say I’m going to offset my carbon in a particular way I’m not actually required by anyone to do that I just want to you know either give directly back in a positive way. Ah, you know like a company like Microsoft right? who is committed to completely removing all the carbon. It’s ever emitted in the history of the company. Um, that’s not done for business reasons I don’t think that’s tiredly done through you know the kind of ethical reasoning of the internal company itself. Um, but. What you’re also seeing is people using offsets as a way to grow market share or retain talent and all these kind of things. Um, but that voluntary market is still very very small How do you think about how the voluntary market could potentially become a regulated market because the regulated market for Rex is absolutely. Massive I think it’s hundreds or none of x what the voluntary market is today. Um, can we you know will waste to have a voluntary market for the next 5 to 10 years and or should we be trying to get a regulated government run or state run market in carbon. Sequested credits as quickly as possible.

Ben Rubin

Yeah, good question James and I do think as we’re thinking about how to create business models for carbon removable. You’re you’re certainly thinking of something important with voluntary carbon markets. The carbon business council currently has a working group on voluntary carbon markets will be publishing a white paper in September with recommendations for how. Voluntary carbon markets can be strengthened to include more carbon removal options within those markets and for both I think in those voluntary carbon markets. There are open questions that you’re touching on around a common set of definitions. How to ensure verification. Removals that are entering into voluntary carbon markets. How to also ensure that that verification process is is somewhat streamlined so recognizing that voluntary carbon markets will continue to be here for the foreseeable future. We. We do think it’s important to strengthen and optimize those markets. Has been. It is encouraging to see some of the cases in the us in California with the low carbon fuel standard and some of the work that California Air Resources Board is moving forward some of the work happening in the eu with regulated markets that there’s growing possibilities on both the regulated. Market and the voluntary carbon market side of thing to help carbon removal scal up and grow.

James McWalter

Yeah, it’s It’s kind of like you know, especially large organizations right? They want a number and then they can build processes around that number and the more regulated that number is the more they’re likely to build the internal processes and so on to actually meet that. So. But that all makes a ton of sense. Um, one of the things I was looking through your website and kind of trying to better get but better understanding as I came across the institute for carbon removal law and policy which I believe is out of American University Um, could you speak? Ah, a bit to how um. That institute kind of interacts with COTwo bc.

Ben Rubin

Yeah, the institute for carbon and law policy is there. They are house head of American University and they are a wealth of resources for things on carbon remov have a lot of great explainers and None pages and reports on their website I am a research fellow with the institute. So. There’s. You know the line is open with them to think through. Are there research gaps within the carbon removal ecosystem that we should be thinking through and so that is a so have have a line open with them in that capacity and and they’re a partner of the carbon visits to come to working with them and and would encourage folks if if anyone’s not familiar with them to check out their website to read up on. Some of these just great. You know, different explainers 1 ne-pars of the resources they’re providing on what is direct air capture what is ocean-based Cdr and just some of those great resources out there. You know in the public domain to to bulk up knowledge around these complex issues and.

James McWalter

And what are the artor research gaps like where where would you love to see smart people doing more research in the space.

Ben Rubin

Yeah, yeah, there are certainly many research gaps within the the carbon remable ecosystem and I think that. And and they’re important to solve they’re they’re important to answer and I think it speaks to where there’s an opportunity for startups in early stage companies to be a resource for some of the research as it takes place. But there’s both the open research questions around hard tech. How can we lower the cost of certain carbon Removal technologies and and make them more affordable. There’s research questions around. Governance so that we can ensure that carbon Removal does scale up responsibly and and what that looks like what what the most beneficial forms of community engagement will look like when projects are being cited and built out and then there are research questions around what is that best verification system for voluntary carbon markets that is both. Rigorous but streamlined and so there there’s a host of of research and open questions to answer I think across different disciplines and I think. 1 that continues to be important is the the ipcc has a firm time and time again in multiple reports now the importance of carbon removable but continuing to understand how much carbon removable we need when that is obviously you know an underlying part of it that that helps underpin. How much carbon removal Are we talking about where the startups need to be going and and there’s similar alignment between different models that are being run by the ipcc or the international energy agency. But just again these wealth of open research issues. We’re pleased to see that startups can move forward on R and D on scaling up for projects on bringing projects to Market. As these important research questions are answered and addressed.

James McWalter

And I guess some of that research also intersects with the capital side of things. So there’s been a pretty decent amount of venture capital in particular going into ah carbon focused startups over the last two years and I’m talking a few of those vcs I’ve also talked to a few. Yeah, those kind of carbon startups and one of the things that sometimes there’s a bit of a struggle with especially on the vcc side is they often don’t have the ability in-house to confirm the science and so you’ll sometimes have something that’s like it makes sense right? So ah like there is an intuitive grasp of of the concept. But then in other cases, it’s like okay does this even work right? And so I think about things like enhanced weathering which is this kind of absolutely fascinating type of carbon squistering technology. Um, but yeah, I’m personally never done the research into understanding how it might scale what it might take. Ah, how much it sequesters relative to other you know, use cases all those kind of things and so how do you think about how startups can better. You know communicate ah display research chops and so on to investors who often will only give maybe None to 3 hours before they make a None figure decision on on a. Given startups investment.

Ben Rubin

I yeah I do it’s a great question and I think this speaks to efforts that are taking place right now to reach commonality around measurement reporting and verification and mrv having a clear set of standards in place for what. What we’re talking about how can we measure the CO o two how can we verify that that co 2 is be removed having those types of methodologies will be so important but that is obviously an immense and complex question to answer recognizing that There’s so many forms. Of carbon removal out there from enhanced weathering like you’re talking about to direct air capture to ocean-based carbon removal and in many other forms of it. What does that and mrrv look like but but moving forward on that having having data available that’s showing what what carbon removal is working what lessons are being learned. That will ultimately help to strengthen the industry and ensure that we are continuing to March towards this gigaton scale removal by 2030.

James McWalter

I Yeah, the M Mrv question is absolutely fascinating to me because because there’s so little emva ah particularly across certain types of carbon Removal technologies and generally those carbon startups are the carbon removal startups are like the most. Up-to-date cutting edge companies to do the actual measurement as well. But then you kind of get into a world where are we vertically integrating the sequestration the measurement and the price setting. Yeah the market piece which a few companies have done I could be understand why those companies have done that and I think it’s been so far. Net Positive. Do think as we get larger. There’s going to be have to be this role for independent and Mrv or ideally startups companies. Um, who are you know they are actually making money on the basis of the accuracy of their estimates um versus having all these things necessarily vertically integrated all with in the same company.

Ben Rubin

Yeah, yeah, I think that what’s great is how many bright minds are actively thinking through these complex issues right now around Mrb and and thinking through the different business cases if it will be vertically integrated within companies if it will be outside and and I think it’s it’s great to see how. Just how this is evolving I think there’s increasing recognition across the board that the sooner we can have good and and clear and streamlined sets of agreement around what and Mrb is going to look like the the faster or not the faster but but the faster and stronger we’ll be able to help scale up. Carbon management and.

James McWalter

Absolutely and then I guess the other piece is ah because we were talked a little bit about the the kind of capital side. So there aspects so some um startups make sense for certain type of funding and like the classic you know, quotequote software startup Silicon Valley company um yeah has tends to have pretty high margins right? So 70% plus margins they tend to be very very software based so low capital costs. Um, most of the costs are in the people themselves and that venture model is also built around lots and lots of bets and only if few shoot to the moon and the rest generally fail. And 1 of the things I think that as I look at climate tech in general and I think carbon removal and carbon sequeration companies are definitely part of this. We definitely need lots and lots of bets but often the technology and the novel use of a technology is contained within a single company. And if that company for whatever reason then most startups fail does fail. How does that affect actually that technology being set back for that particular you know direction versus just that company not working out for all to none of reasons those startups don’t work out and so one of the things I’ve been thinking and talking to a few folks about is what are other. You know capital allocation or capital. Um, you know investment structures that might make more sense for companies in climate tech versus traditional Vc and you know you have project financing. You have various types of debt instruments and so on. How do you think about the current landscape you know is it fit for purpose for carbon removal companies carbon secoration companies or do we need to start getting a bit innovative over the financing model itself.

Ben Rubin

Yeah, it’s a great question and obviously financing is such an important nut to crack for how startups can have the resources that they need to help hit Gigaton Scale. It’s been encouraging to see private investment coming into space both through vcs and also some of the corporates you were mentioning who are. We’re buying carbon removal to help scale and grow the industry. What the frontier fund is doing essentially with a model of advanced Market commitments a similar model that was used for vaccines for Covid Nineteen is another great way to help grow the industry and in addition to these private sector Dollars. We are seeing support from the government to help. Support research of technologies that’s coming through the department of energy through Arpa E and so it is also great to see the government investing in research to help answer some of these complex questions about again. How can we expedite the pathway to get to durable and strong carbon removal by 2030.

James McWalter

And if I think you know back to the C O 2 bc um, what are your kind of aims over the next year or 2

Ben Rubin

Yeah, well we are. We are excited to grow as the industry grows and so we’ve we’ve had many companies reaching out to us about joining the team and so excited to be expanding and and bringing out new members in the weeks and months ahead 1 of our central goals is to be bringing startups to the policy table and so we will be doing just that over the next several months attempting to weigh in and inform policies that can help startups to to scale grow and thrive. And in the process we will also be working to ensure again that carbon removal not only grows economically but also responsibly and so that will mean continuing to elevate and lift up that ethical oath to restore the earth and thinking through what responsible growth of the carbon management industry will be looking like.

James McWalter

And and then if I think about the the space. You know you have your 40 or so members today but we need um like lots more right um you if if some kind of smart potential founder early team member of ah of ah, an early stage startup is listening to this. We’re areas of innovation that we just need a lot more people building um, are there specific areas that are underrepresentative within the carbon removal space.

Ben Rubin

Yeah that’s a great question I think what’s encouraging about carbon removal right now is this idea and and this isn’t trend I think in the energy department’s carbon negative shop where they’ve set a goal to help have carbon removal happen at $100 a ton or less. By a certain year and and that is taking this tech neutral approach that’s emblematic of the carbon business council as well recognizing that there are multiple pathways that we can get there one. Great resource that I would point out is that lower carbon vc firm in the space who invests in carbon removal startups. Just put out a blog post recently highlighting some emerging forms of carbon removal that they are interested in funding and supporting and some of these you know are are probably newer news for folks who if they’re even if they’re tracking carbon removal conversations I think it shows how many promising forms of removal. Investors are looking to fund that might be scaling up and and it’s for you know a reason like that that we’re pleased to be taking this tech neutral approach where we are excited to see in the next few years are there breakaway solutions but we think right now at this juncction 2022 it would be premature to say you know that that one solution is going to be more successful over another than.

James McWalter

Yeah I think there needs to be a lot more kind of cross-pollination of talent between I guess conventional or traditional. Um you know, software and hardware startups and people who are in the labs developing these technologies um actually run a climate meetup in in New York City and it’s been kind of remarkable meeting some amazing research scientists out of Columbia University in particular who are working on carbon sequestration technologies and they’re like can I start a startup and and like and then they’re like talking to people who are you know, putting together ah like a slack competitor you know Zoom and they’re like oh these guys don’t know anything they’re like building a startup. It’s like oh. Yeah, you are one of the foremost domain experts in the world about this type of carbon sequestration carbon removal um, you absolutely can be building a startup if if you so wish and I think having more folks who are in that kind of startup world about trying to. Build at scale are interacting with people who actually know the science in a really deep way means we’ll start to get the best about worlds.

Ben Rubin

I But totally agree with that I think creating those types of points of connection and synergy can really help to unlock and accelerate the growth and.

James McWalter

I and just before we finish up and you know you’ve been working on the C O Two bc for a little while now. Um, what’s been most surprising that you found since since joining the and setting up the C O Two bc

Ben Rubin

So yeah, That’s a great question I Think what’s been most surprising I think really just seeing the the dedication that innovators or founders and companies have that they’re bringing into the carbon management ecosystem has been.. It’s been delightful surprising and inspiring to see we have some successful serial entrepreneurs who have started multiple successful companies not necessary and in climate who are now coming to climate but just seeing the level of talent and dedication being focused on this issue. It’s it’s encouraging to see. And it’s it’s ah it’s a pleasant surprise that so many people are are following this ipcc science and working the ride to the occasion. It is a tough nut to crack about what it will take to get to Gigaton Scale Removal by 2030. We think that innovators are are the ones who are going to be positioned to lead the way and help get us there and and it’s it’s great. To see them rising to that challenge and rising to that occasion and.

James McWalter

Yeah I Always tell people who are like pessimistic about our climate future to say if you want to feel a bit more optimistic every day directly work on these problems. Um, yeah I was kind of like in a bit of a funk about all these things and then actually sort of working on it and you know so far haven’t actually had a. Yeah, the profound effect on the climate that we all hope to have but just by working through the problem trying to improve every day. It actually has a massive. You know, positive kind of internal effect as Well. And so I think yeah for anyone listening to this who does feel ah you know, maybe a bit of despair a bit of hopelessness. Like actually working on these things in any place right? It could be a startup. It could be on the policy side Activism Whatever it may be is actually I think the number way to start feeling more optimistic and feeling like you’re making some positive progress.

Ben Rubin

I fully agree with that James yeah I think it’s encouraging to see what strives to do and and exactly what you’re hitting on. It’s to solve climate change. It will take multiple folks working on multiple issues whether it is on that policy side or some of those other areas you’re talking about. so so yeah doubling down that.

James McWalter

Yeah Ben it’s absolutely great and chatting and really enjoyed the conversation before we finish off is there anything I should have asked you about but did not.

Ben Rubin

So yeah, good question James I would say if folks are interested in hearing more about the carbon business council just that they can go to http://carbonbusinessconunsel.org to learn more. We put out a biweekly newsletter with updates and Intel happening in the space so would invite folks to sign up for that. But also invite folks working in carbon management to take a close look at the ethical oath to restore the earth signatures are not limited to members only we think it’s important to have multiple folks sign on to this ethical oath and so I just invite folks listening who are. Also thinking about carbon management also thinking about what it means to grow responsibly to to take a look at that and consider signing can be a good fit for them and.

James McWalter

So I will include the link to the oath and those other links in the show notes. Thank you ben.

Ben Rubin

Thanks, excellent! Thanks so much James thank much.

Creating Net Zero Buildings – E108

Great to chat with Peter Light, CEO and Co-founder of Lumen Energy, Lumen Energy enables commercial buildings to generate income from clean energy! We discussed decarbonizing buildings, shaping the direction of technology deployment, helping building owners to find cost-optimal clean energy solutions, financing cleantech and more!

https://carbotnic.com/lumen

Download Podcast Here: https://plinkhq.com/i/1518148418

Lumen is hiring: https://jobs.lever.co/lumenenergy 

Remember, If you want to support the podcast please rate and review 5 stars on  Apple, Thanks so much! 

James

The unedited podcast transcript is below

James McWalter

Hello today we’re speaking of Peter Light Ceo and cofounder at Lumen Energy, welcome to podcast Peter.

Peter Light

Thank you James thrilled to be here.

James McWalter

Great. Ah, could you tell us a little bit about lumin energy.

Peter Light

Sure so Lumen Energy is a technology company. We are creating a platform that enables commercial building owners to profitably decarbonize all their buildings swiftly and so what we do is really automate. Clean energy deployment. Typically starts with solar but it often cascades into batteries and ev charging and we see a future where there are a variety of clean energy technologies which are declining in costs. They’re getting simpler to deploy. Um, they’re getting finanable all that is good. It also means it gets ah really complicated for building owners to figure out what makes sense for them and as we as we look out. We find that many commercial building owners could save a lot of money today. Um yet, they don’t do it and they don’t do it because it’s hard. It’s complicated to figure out so that’s where we step in and really make it simple. Go from concept to assessment to action through a marketplace that we’ve developed which we can talk more about and I’m happy to happy to share more about how we got here, but that’s the punchline.

James McWalter

Yeah, and I guess it’s absolutely you know I think I heard about lumen and we spoke a couple of years ago and you’ve kind of come a long way since then but going back to that initial decision to start lumen. You know what drove that.

Peter Light

Ah, it was the initial decision. It was ah I you know it’s funny I can I vividly remember sitting in a cold brick building sort of the texture the walls when I would I had um. I couldn’t get away from this sense that there were you know I’d spent the the None 2 decades of my career commercializing breakthrough energy generation Technologies things like fuel cells or um, flying wind turbines or you know floating solar Yeah Non-lithium Ion chemistry batteries and.

Peter Light

And I really just sort just like wait. There. There are now technologies that are cost effective financiable proven and they’re not widely deployed and you know why is that and just even starting with rooftop solar. Um this this work came out of. So work I do at Google x when I was leading mv programs there. We were set out to you know model the global power grid and particularly the distribution grid think of it like creating Google maps for the power grid this is ah it was a confidential project now it’s public. It’s called tapestry. You can read more about it on the website. Um, but in that initiative started to work with some utilities and just got all the data for an entire city and and regions that utilities served and started to see that there were a lot of commercial buildings that could save money and they weren’t doing it and so um, that. That was the sort of founding story was just being bugged by that question. Um, like why you know the goal is Mas decarization on a timetable that matters meaning you know 2030 you know, 8 years from now really making a major dent and our carbon footprint that that led me to say well. A lot of things you could do to decarbonize in our society but like let’s start with mass deploying things that are already profitable because that’s going to be the fastest way to mobilize capital at at you know at gigaton scale um, so that was the starting point.

James McWalter

Yeah, yeah, it’s it’s so interesting and actually it kind of mirrors. Ah some of kind of my approach to climate tech in interesting way. So when I was none looking at you what part of the economy to kind of tackle from my kind of climate point of view. Initially for the first year of exploring things I completely ignored energy and transport because I was like well we’ve kind of invented most of yeah we’re going to evs are going to win and we have solar and wind and we’re just deploy that and the word just obviously is doing an incredible amount of work there and I basically dramatically kind of understated in my own head like what deploying the.

James McWalter

You know Terrawatts of energy that need to be deployed look like and not just energy but all the other elements of the decarbonization of of those kind of parts of the carbon pie and what I think is really exciting. Is you know I was kind of like attracted to carbon markets and like all all the things that were hot like eighteen months ago I’m now seeing this kind of reversal where people are already starting to dig in and like oh you know deployments? Yeah, any any sort of kind of step change in deployment of a new kind of global technology like that’s where there’s massive opportunities.

Peter Light

Well I agree with that I will say from a um as a you know member of society I’m I’m I’m in the all above all the above camp and you just sort of do the basic carbon math and it is you know it’s staggering and it quickly leads to you know across all the sectors. Um. We we need to mausly decarboize all of them at once? Um, so there’s a great news and that for anyone who’s listening who wants to get into climate tech. There’s something here for you. Um, and there are many you know across many different skill sets not just sort of deep tech engineering. But there know business development sales marketing and so happy to talk more about that software development. Big thing. But I think to focus on the deployment piece that is really what I have gravitated towards young I’ve spent a lot you know much of my career was working on things that I started with a premise that you know early two thousand s you go back in time I came out of the rocky mountain institute and you know. Coal was about 50% of the Us power grid solar and wind were good ideas and were sort of marching down the path but still really expensive relative to the power grid and kind of conventional fossil technologies and I thought like you know, but they’re just I didn’t see those converging anytime soon that mattered and that was you know. Sort of you know joke on me what I’m you know fast forward of what I’m doing now. But at the time I thought there has to be some technology breakthrough that can solve for being both. Um you know, cost effective low or 0 carbon and reliable and um. You know that led me to a bunch of early stage generation technologies I mentioned talk more about um but in that experience. Um I started to see there’s just there’s so much technical risk and in bringing forth a new device. And it has been done and it will continue to be done and it’s a great thing but it really forces the question like hey if there’s stuff that already works and is cost effective. You know my orientation is like let’s get that to the economic frontier and and masss deploy it as quickly as possible and. When you start to look into those issues. There are a lot of really complicated issues and topics around um making it simple and I think this applies to what we’re doing but it also applies to you know, ev adoption you sort of see this in many different sectors. So happy to chat more about that.

James McWalter

Yeah, and so you know once you kind of had that directionally. It’s going to be about the deployment piece and and kind of you know the importance of that there’s a lot of different ways to kind of think through the deployment. Um, but you kind of end up focusing on buildings. Was that thought process and I guess we’re you kind of consider any pivots along the Way. So.

Peter Light

Um, yes, there was a there was a color you know as I joked to some of my colleagues. There’s you know b none and just a very early version where um, again, you had to come back to the frame of looking across an entire city. Um, let’s say like Los Angeles you know all these buildings. Um there today serve by the electric utility which is on. It’s sort of you know, kind of slow decarbonization pathway. Um, you know what I started to look at was like well. That those utilities have their own decarbonization goals. You know, either forced upon them or you know or well-intentioned cost driven. Um, and if you sort of left alone if you sort of let all of these devices proliferate on the grid meaning electric vehicles. Thermostats solar Panels batteries just way too much complexity much more than utilities have ever been set out to to deal with and that really was the sort of founding story behind what is now tapestry that the Google x program is really to sort of build a better real time map and model of the power grid.

Peter Light

But within that same sort of lens I thought you know well hey like wouldn’t these utilities like to have a hand in shaping the direction of the deployment of even a rooftop solar and and onsite batteries that are just that is already happening. And so I started to reach out actually to see utility some of the most kind of forwardleaning ones that were in in California and um, you know and some that had ah that I thought had the most incentive to consider hey might we partner where we lumen would provide the data science on. And and build would talk the individual user data that utilities had where they had the billing and consumption data for each network building and then we could help go ah shape the deployment of onsite energy assets that would then help the utility so this is sort of a converging these you know bring these systems together. Co-optiming them and did a math look like greatd on paper seems like it would help them them be utilities you know and had None or 3 meetings. It started to go really well and it like wow this this great. We’re on to something and then when cold and just.

Peter Light

Didn’t return emails didn’t return phone calls and um, you know if anyone has been on a startup journey. You know who’s listening and you know are you James? That’s um, is so all part of it. But it’s certainly hard to sort of you know to to stomach that but then also it’s like okay this is a data point. Um, if you know some of the most forwardleaning utilities that this notion is just that you have to deal with it. That’s not they’re not wanting what I am seeking to offer them. Um and so it took so it took me a while and I had the great fortune and time of being. David Cohen who’s now my co-founder. Um, he was had been um, had had been a consultant fane and then later a software development and a product leader at stripe for many years and then it coming all snap dos in the you know automating lot of pieces in the mortgage industry. And we started to say okay, there’s there’s a huge market here with commercial buildings. But there’s some barrier and so let’s go find out what that is and it and I’d say together. It took us a while but it really crystallized like it is the building owner who is the decision maker about whether any of this will happen at their building or not. And so let’s work back from how people who own buildings think about getting their energy and so we set out to talk to many building owners and um, we heard again and again and in a sort of range of kind of scale of companies and ownership patterns so they get yeah, it’s great idea like I love. Love saving money that sounds good. You know I love going green that sounds good too and like great why you done it and you know surely you’ve looked into all of this and surprisingly but consistently. We got the answer well you know, actually like I kind of like I just like I do my day job like I you know I work with tenants and I work on. Buying buildings and making sure you know the parking lot is clean and you know working with my bank financing and so like I either I haven’t looked into this but I should. It’s kind of deep on my task list or you know the alternative we got was no, we looked into this a lot like we spent a lot of time on this and. We just got bogged down in the complexity and we like quote had to turn our attention to other things and so you know as part of our customer discovery we. We compiled all these interviews and the consistent pattern was people. It’s interesting. No one used this word but the theme was kind of intimidation or just. Overwhelm um or just I you know I feel like I’m gonna get quote I feel like I’m gonna I have this is too much brain damage. So I don’t get screwed so I’m not going to get into it so that all led us to say well.

Peter Light

What if we could make kind of like a zeestament for clean energy for every building and instantly price it so you could cut through all the data complexity of just figuring out does this make sense for me and provide that in a way that is investment grade and precise and verifiable for the building or and speak in their language. And that is led to led to what we’re developing today.

James McWalter

And what are those kind of I guess Inputs to you know that that kind of estimate type model. But that that you’ve built that is so overwhelming to the building owner. Um you know I’m sure they’re very familiar with you know, managing different types of documents all this kind of thing. Um, but there’s. Yeah,, there’s this extra thing There’s all the kind of associated benefits and incentives and all these things associated to clean energy electrification and so on and so yeah, so what were what are the kind of compounding complexities that ah I guess turned off those building owners and they’re looking for a solution that kind of.

Peter Light

Um, yeah, well, it’s I call it just like a None paper cuts and what I mean by that it’s it’s a many different domains of data that you have to sort of get comfortable with if you if you want to take this on yourself. You you can either just you know said look I just want to. Do something on None building. It’s like then a proposal from someone they I could to get the best deal but to be fine. Just go forward. Um, but if you when you start to say wait. You know I’ve got a none buildings or None buildings or a thousand and I see this as the opportunity to go deploy. What is really a new asset class. Um. And and there’s a real opportunity to um to create a new cash flowing asset and some and this is like the language of a real estate owner who’s who’s thinking about oh I like I I know about deploying capital and getting return on it but I have to do that smartly. And then I need to think through all the inputs and outputs of a financial model. So if you go on that list for let’s just say the simpler ah technology of of a rooftop solar um, you quickly get into okay well, what’s what’s the energy used today at that building. Um. And then what is that composed of and in energy charges demand charges fixed costs from from utility which by the way vary for every utility and about None utilities tariffs across the us. Um, then you get into well okay, what? what How much roof space. Do I have. Um, how much what is the equipment cost What’s the fair price for it, then? what are the incentives do I have tax you know do I have the the correct sort of tax exposure to take advantage of those are there local incentives. Um, what’s the degradation of the equipment. What’s operations and maintenance. How much should I assume over the 105 years and you know that’s that’s I I’ve just given a a sub list I will not boardre the reader with the audience with sort of the additional list but there’s is a long list of disparate domains to get good at and you can sort of is you start to poke into this. You see well.

Peter Light

You know as a customer recently described it to me. It’s like I have found myself digging through all these rabbit holes and I just get lost in them and then I just I switch on other things and so that that like this is touching the climate problem right now is people want to do the right thing and they see a financial opportunity. But it’s too complicated to really get to a decisive moment for them.

James McWalter

And I guess what’s even kind of compounding it is you know you places like New York City who will add some sort of electrification incentive which is great but it’s just now 1 more thing to worry about right? and so when even you have policy that’s trying to incentivize like.

James McWalter

Yeah, mass electrification additional renewable energy deployment all those those kind of things if it’s just like None other thing to to think about and it isn’t like digested in this consumable hole. Um that it actually won’t have like the positive effects that policymakers want and so that makes absolutely you know complete sense to me. Kind of going as you were talking to to those building owners. You’re kind of getting a sense of like this scatter of just like incredible complexity and yeah with your background complexity I’m sure and data complexity is exciting right? because you have worked and used tools like data science and machine learning and so on. That enable you to kind of make sense of that in ways that you know twenty thirty years ago might not even been possible and so I guess you know going from that kind of visual insight to what it like an early mvp in early product deployment. What was that like yeah.

Peter Light Light

Um, yeah, so um, what we what we set out to do in ah in an Mvp where we said. Okay there’s there. You know there are all these different you know, think of it visually like the pieces of the puzzle on a table like how do we? How do we stitch them together into. A a coherent picture for a building owner and um, we we found that? Um, what we started to do is like let’s just pick a city and let’s see if we can um, remotely price each and every commercial building for its clean, energy potential. And and deliver that to the building matters and so we picked Hayward California which um happens to be a place if you ever take off in an airplane out of San Francisco airport and you look out the window and you’ll see lots of big empty rooftops and a number of big warehouses there and we just. Kind of arbitrarily picked it for that reason. Um, and we got really lucky because it turned out the city of Hayward had an open data set about all the buildings and and permit history online which is great. Um, and what we did is we started to assemble um all these dis pieces that I started to describe. Um, we you know in in past lives I had also worked with various us national labs and realized that there was all this building energy data science that had been pioneered on supercomputers. It had been worked conducted by ph ds and and does incredible modeling. But that had been kind of stuck. In in the labs and kind of technically available but in practice not really tapped beyond kind of the academic realm and so we we dug into that and said how can we apply some of this work to really get the best handle on. Profiling buildings and and assessing without actually getting any data from the building owner. How can we get close at assessing what is the energy use in this building all the way down to each and every hour of the year and then getting into the electricity tariffs that were likely for that building and essentially. Simulating the electricity bill for that customer and software. Um, using that as a baseline to then run. Um, you know again in software to run in simulation. Well what would be the optimal the cost optimal clean energy mix for this customer. Um, and we did all that then just to simply produce a number like hey this is that these are the dollars you can save as a building owner and then we deliver that through direct marketing to those building owners and that’s how we started and we found um, you know we were wildly off in some places but we started to. Ah.

Peter Light

And we we we found um some warehouses that had cement garden gnomes in them. But you know, no electricity use you know, but we also found some that were you know food processing facilities that had a lot of electricity use that were very interested and we really got our footing that way and and started to sort of build our engen and and verify the. Data in our cycle and then along the way I’ll just say we were contacted by commercial building owners. Who said you know I don’t have None building but I have a lot of buildings and we have a you know essentially now a board level commitment to deploy clean energy. You know, starting with solar um everywhere it makes sense. But the problem is we just don’t know where it makes sense. We don’t know how to do this systematically and so that’s where we have found actually that there’s been a greatest uptake of of what we provide today.

James McWalter

Yeah there’s a couple areas there. The kind of touch upon. So for some of the data side. Um I said this to folks all the time who are you know trying to build companies that have like a a data component if you can avoid getting having to need data from your customer to build something like re avoid it at all costs. Data that you can collect yourself is to me 10 to None x more valuable than that you can get from the customer at least in the early days because it just takes so long to get data from customers and experiences across a lot of different industries and a lot of different customers and go back to your earlier. You know initial conversations with utilities that was probably honestly like the thing that. Froze some of that you know in those kind of internal discussions and and why they may not have kind of gone back to is okay, we have to go through such a rigmarole to try to get data which often is you know, stored in weird ways and all this kind of thing out to a none party and we have to go through legal and all these kind of things that slow it down. So I love this kind of approach to. Collecting your own data and just dramatically reducing the friction for the business owner and often when you do it this way people are shocked that you can find out more about their own business than they know themselves and it actually has this like ah and you know this really valuable kind eyeopening moment when you’re kind of doing that demo and and and that kind of thing. Um, so I think that. All makes a ton of sense in terms of the ah I guess you know real estate investment trusts and like these large kind of aggregations of commercial buildings I’ve actually talked to a few of those folks myself as part of other projects and they’ve absolutely said the exact same thing to me. It’s like they have this kind of triage approach to decarbonization. You know it’s like we’re going to offload the dirtiest properties we have. We’re going to add solar and electrify. Yeah the 80% like of yeah the 80% of the portfolio that that makes sense and then we’ll do some greenfield development on the other 5 to 10 percent and so if you think about just the number of commercial buildings United States and how many of those are kind of. Aggregated in reits and other you know, similar kind of ah you know, commercial entities commercial real estate entities like that’s to me seems like the massive opportunity and the most exciting opportunity for lumen.

Peter Light

It is I think it is 1 of ah 1 of multiple sectors and it is. It’s it’s a great opportunity for for lumen. But it’s also a great opportunity for these building owners and I think you know just to sort of take an example I mean there’s some um. You know, larger ones who own? Let’s just say many warehouses. Um, you know there’s a there’s ah, a company for instance who owns on the order of about None warehouses nationally and they’re a leader in deploying solar and it’s interesting. You sir just go look at their math. Um, you know I won’t won’t name them by name but just sort give you the example. Um, they’re like yeah we’re doing this. You know we we’ve got a plan and they’re therere thought leaders in it. Um, they’re deploying you in the order of like 40 or 50 buildings a year and that’s both wildly ambitious and yet. Way behind the the sort of scale of what’s possible be profitable. So what I mean by that is okay, that’s a you know none? their buildings would be. You know would get solarized in in 15 years um so that’s where it’s um. Where we think there’s just ah, there’s a chance to go do this. It should be 30 years um and so that’s what we see is the chance to um, really get out of kind of spreadsheets and emails and just all the painful back and forth that happens to coordinate some of these projects and really just. Make it happen at a you know ten x hundred x scale.

James McWalter

Yeah, and as you were saying None oh that’s so exciting like you know you get them running up and running in the next eighteen months and yeah and and for them internally they’re like hitting you know, maybe their internal targets and and taking you know that amount of time. Yeah, what one of the I guess. Levers to speed this up is making sure that the you know if if the demand is there from the business building owners the supply of the underlying. Yeah panels tech of various types are there as well as I’m sure financing is a piece and you mentioned like the the kind of marketplace dynamics that ah you’re kind of. Have as part of loom and could you speak to that.

Peter Light

Sure? Well I’ll say in you know in in general there. There are many marketplaces which we all as sort of individuals and consumers have interacted with today. Um that I think the. Yeah I think one of the stunning things that’s revealed whether it be you know airbnb or uber I mean they’re they’re so familiar. But what’s startling is just the the revealing of supply that the latent supply that existed and we didn’t know it and I think that is something that um that I see here where the um.

Peter Light

You know the ability to go deploy ons site. Clean energy. You know again, starting with solar they’re they’re um, a few 0 contractors nationally and um, this has been one of the you know fastest growing segments of of job industry. Um, that are qualified to do this so. There’s there’s still not enough people that are qualified but the point is that there are many many people out there that can do this. But if you go talk to them. Um, they’ll say look I you know I am a clean energy installer but I have to not only do I have to manage a team and go do get the permits and all that. I have I’m burdened with kind of sales and marketing and customer development and and walking these building owners through all these choices and so I do all this engineering work I submit None proposals 8 of them. Go nowhere. And so for them that is a real cost and that effectively inflates the the sort of total delivered cost because that’s all just sort of overhead for these um Epc companies or engineering procurement construction companies and so what we’re seeking to do with women energy is make it really easy for them to get to. Um, a known vetted project and really provide them digitally with the pieces that they need um to be able to quickly go bid on and act on a project and so that has a benefit for the local installers. Um, who who tend to be local and tend to know all the local building codes and and kind of all these these attributes that are kind of hard to make happen nationally or to scale nationally and then for the building owners. We find this notion of a the efficiency of a marketplace is very appealing because. They realize that they’ve looked at the math themselves where um, you know a whole bit of it out. A great post on the New York Times about this recently you look at the the cost of solar deployment in Australia is just a fraction of what it is in the us today and it’s you know the great news is that the harbor costs have fallen dramatically. Um, but the soft costs meaning the everything else profit overhead construction costs are very high in the us they can be over 50% of the project costs and they vary widely from project to project. So if you sort of put yourself in a building. Owner’s shoes as. You know as we did on some of our early projects in California we we did all the math got very precise about how many panels could fit on the roof. What is the exact optimal amount of onsite, clean energy solar batteries for that given load profile tariff all of that and then we set it out to bid and we got bids that were all over the place.

Peter Light

And it was startling to see how inefficient that process was so that’s something that we are really seeking to streamline through a marketplace in the None of 3 stages of our our product platform that we call act.

James McWalter

And so and then and you know I’ve actually talked to quite a few. Ah yeah, hchfac installers in New York as part of other conversations and so on and they’ve they’ve spoken to this exact issue where because they’re trying to move into a so yeah, know the skill sets are.

28:49.46

James McWalter

Identical to what they’ve been doing you know solving Ac units for 30 years um but moving to installing heat pumps. The tech is nerdy identical but the model and the structure and the components are a bit different. The supply chains are a bit different how to actually converse with the ah you know the owner of the buildings a bit different. And so because there’s all all those little frictions and it goes back to the frictions that the the building owner themselves. Also you know, kind of have to manage. Um again, directing and and reducing those frictions is like so core I guess to your approach. But yeah I’d love to kind of touch upon the the kind of none part of the product which I guess is the financing side.

Peter Light

Um, ah, yes, so and so financing is a key piece of um I think of of really deploying any any clean energy technology is it is that I was talking something of the other day that that you know structured finance or project finance is this sort of like. Poorly understood part of that just like runs the world of infrastructure deployment and um in in the case of um, you know energy you know energy assets let’s take this wind or solar in particular where there’s zero fuel cost. Um, and you’re you’re. your your sense you’re buying equipment that will generate energy for twenty thirty forty years upfront and you’re you’re paying for all that capex upfront. So it is um, it’s it’s amazing, long term but it really needs to be financed. Um and and especially for um. You know in our case, putting yourself in the shoes of building owners people are used to paying the utility month by month and it’s you know that that’s the grand bargain with with the utilities having a monopoly utility who can serve an end customer and there’s really just kind of a mostly non-negotiable price. But you is a. You know as a building owner you have the freedom to just stop paying and leave at the end of the month and that’s it um, and then you’re faced with this alternative which is wow like I see that you know electric utility rates went up None nationally in the last twelve months which is just startling. Um, you know above the the very high cpi. So people get there’s this economic opportunity. But then you get into well I you know I don’t I don’t want to use my own cash or rarely do people want to use their own cash to go pay for something that feels like outside of their business. Um, so you you know most roads lead to financing clean energy assets. Um, so there you get into kind of a you know, multiple different options and and I think this is again where people get high centered where um, you know particularly people in real estate who are very familiar with financing and want to understand all of the options. Um, there are the typical options of of cash purchase or a loan or you know the the conventional ppa which we can talk more about there’s also on bill financing called pace financing in some places but these you know each of these has has wiggles and turns and um, you know. Special considerations for for qualifying for the investment tax credit and it just it calls upon a specialty. So what we seek to do as a company is provide building owners with the options and is and just clear as transparent as possible.

Peter Light

Along with an easy button to say hey I just want clean energy Cheaperth and grid and so we have None party financing partners that enable us to do that. But we don’t We don’t sort of we’re seeking to give building owners the choice in a transparent way. Um, with the kind of answer upfront and they can go dig all the way down to to bare metal so to speak in in the models if they want to understand all the pieces behind the scenes.

James McWalter

And I would absolutely encourage any you know building owners to check out the lumen website like the actual flow and the ability to kind of immediately. You know, get insight over what’s possible I think it’s very very slick and better than ah I’ve seen on you know, a lot of products that are trying to solve similar types problems. Um, and so yes, so I guess where is luoman today and what are the kind of target over the next 12 to None months.

Peter Light

Um, yeah, well where we are today is um, we are a technology team based in San Francisco though we’re remote first we had people um in in Brazil Uganda um, you know we have teams overseas in India so we’re. We’re really already just as a company. We’re already you know around the world. Um, and then in terms of where we are commercially we’re working with a number of commercial building owners now who um, really have a bold commitment to decarbonize and they want to do it profitably and. And I think they’re starting to see the potential um to to realize that and they so there it’s it’s really interesting I mean yeah, I’ll share a conversation that I had recently um, with a a large industrial reit. Um and they had advertised on their website. You know you know. Many real estate websites have like big bold numbers and they’re they’re kind of their their flex numbers and None of them was um that they had I think one point one billion dollars of of basically rent every year from their tenants and we looked at all our buildings just kind of in our software did the math and like you know what you have. Your tenants are buying on the order of about $1000000000 of electricity each year. So you know so for your marquee number of what you see as your revenue as a company that today is being spent by your tenants and going out the door not to you. So. Wouldn’t you like to consider that as as part of your p and l essentially one day and do that sensibly like it’s not going to work everywhere. You can’t just go deploy solar and clean energy like you will you will waste money if you do that you have to do it smartly. But if you do do it smartly. It really is a new asset class commensurate with the scale of your existing business. And so I think there are companies that are starting to see that. Um we are we are quite busy as a team. We’re growing. Um and we’re we’re having a lot of fun doing that and I would just say from a the last thing just from a company building perspective. We’re seeking to be very deliberate and. Bringing people aboard who really loved the problem. You know, fall in love with the problem and want the responsibility to sort of own a key piece of advancing our company and I think you know like that sort of freedom and opportunity that that come along with that.

James McWalter

Yeah, yeah, I Love this example that that you mentioned you know, being able to go into any sort of sales call sales demo conversation with a potential customer and have something so specific to their use case that it’s nearly being crazy for them not to move forward I like is it’s such a kind of.

Peter Light

No.

James McWalter

You know a powerful way to kind of think through through and you know as any startup starts to build capabilities across their core problem solution Set. You actually do start to develop these opportunities to bring that directly into sales calls marketing. All those kind of things. Um, you know one of my kind of favorite marketing tactics that a lot of cool startups do is users. You know their tech to identify some sort of metric or number and then start running that metric against potential customers and say hey customer Yeah you think you’re X but you’re actually y would you be interested in trying to get to x. And that could be everything from you know your employee engagement score to your? Ah, you know how green you actually are from a clean energy electrification deployment point of view and so I Actually yeah, loved that kind of take and bringing that directly into the go-to-market.

Peter Light

Um, well that’s that’s good to hear and I think that’s something that that we’ve seen that has been powerful is that that reveal. Ah I’ll say also um, you know there are number companies out that um, that are doing a great job I say at making carbon accounting dashboards. Um, and then. Those dashboards often leads to buying carbon offsets which um I think is is in one sense progress. Um though I think I just have a I arrive at that scenario and I say you know those those offsets and person person and particularly you know. Carbon reduction offsets which I think as a society again we should have like we should be pursuing carbon removal but the you know the long run goal is that those reach kind of like a hundred dollars a ton so you just sort of stare at that. Reality and say wow that’s the long run technology goal with a lot of investment still to come and a lot of derisking still to happen. Meanwhile there are things people could do today that are carbon reducing and profitable for those businesses. So like let’s do all of those things none and I think that’s where you know we as a company are setting out to say how do we How do we reveal that in a way that almost it’s like creating you know you know, ah this sort of ah you know a tractor or this sort of know gravity field that makes it easy for capital to flow into um these places where where it actually wants to go.

James McWalter

And it it goes back to very beginning of our conversation and and you mentioned you know having like ah all of the above portfolio like mindset in terms of solving these problems and I also think and I agree with that. But I also think about that it kind of goes to the timing piece. It’s like yeah one of the reasons deployment is so important right now of what we have already. Invented and and have commercialized is to buy time for some of those other you know more moonshot longer range things to get to commercialization and so you know I personally think we’re going to need a ton of direct air capture. But it’s not going to be ready for 12 years potentially maybe longer and so everything we do now buys us years or buys this time. On the backend for when these technologies hopefully get get to the deployment they need to get to. Um Peter Light it’s not so brilliant kind of talk to you before we finish off is there anything I should have asked you about but did not so.

Peter Light

Well I will say that. Um, first. Thank you James and I say you know secondly that we are um we are actively hiring limited energy so you can check out our website http://gotlumin.com or or limit that energy one and you’ll you can see the careers page of you know, software development sales marketing. Um, a whole number of areas. Um, and ah you know I think something that I’ll I’ll leave you with is you know buildings are persistent and you know most of the buildings that will exist in 2050 or by you know, anyone’s net zero time horizon most of those buildings are have already been built and so. And further most of those buildings as vehicles electrify those buildings will become hubs or part of the system that can power our transportation and so I think that’s tremendously exciting but it also puts a lot of pressure on saying how can you find ways to. Decarbonized buildings and if you can do it profitably. That’s that’s phenomenal because that is going to be catalytic to make it happen at speed.

James McWalter

I couldn’t agree more um and a great message to end and will include ah the careers page in the show notes. Thank you Peter!

Peter Light

Thank you James take care.

Ask Me Anything – E100

Great to be interviewed by Bridget Hickey, Director of Marketing of Cloud to Street ! We discussed why I started the carbotnic podcast, my background, inspirations,the challenges and experience of entering the climate startup world and more! 

https://carbotnic.com/100

Download Podcast Here: https://plinkhq.com/i/1518148418

Please also find some great climate focused resources for roles below:

Remember, If you want to support the podcast please rate and review 5 stars on  Apple, Thanks so much! 

James

The unedited podcast transcript is below

James McWalter

Hello everyone welcome to this 100th episode of the Carbotic podcast and I’m joined by a wonderful special guest Bridget Hickey. 

Bridget Hickey

Hello. So excited.

James McWalter

Brilliant, um, and so today we’re going to do a little bit something a little bit different. We’re gonna actually turn around the mic and Bridget Hickey Hickeyis actually going to interview me and so Bridget Hickey, love to have you introduce yourself and get into it.

Bridget Hickey

Hi I’m Bridget Hickey HickeyI lead marketing at cloud street we do ah flood mapping with satellite imagery and a lot of interesting machine learning I I’m very excited to be here and chat with James.

James McWalter

Great. Um, yeah, we so we we we actually met at a ah climate meet up from my climate journey back probably about six seven months ago and we we hit it off and was like oh you know it’s ah it’s fun talking climate and it’s fun making friends at climate events.

Bridget Hickey

It’s very fun, very excited to be here. Very excited to learn about your journey through all this. Um, so I guess my None question for you is how did this podcast come about how did you start this? Why did you feel like you wanted to get into this.

James McWalter

Yeah, no, absolutely so I’ve always been like like podcast-obsesed you know like the friends family. My and my wife which just like ah he’s just like always listening the podcast three x speed minimum. You know. So for those who are listening 3 x speed I’m sure I talk quite fast. And so like I was always like into podcasts and like I learned so much from podcasts and so a couple years ago it was kind of early days of covid I was like all right I want to be involved in climate change from a startup point of view probably start something myself and I was like ah there’s probably a couple different ways I could do that right? So I could like. But sorry my background was nothing to do with climate change. It’s like where do you even start? you know, um and things are a little bit different now. There’s a lot more opportunities for moving across industries into climate. But at the time there wasn’t that much so I was like I kind of had. Ah yeah took a pen and paper out and I was like what are my options to move into yeah becoming. Somewhat knowledgeable some part of the climate change problem and and start a companying the space and so I was like okay I could go back to school I could do a masters I could get a job at a climate company but it might be more junior than what I’d been doing previously or I could start a podcast where I like just talk to lots and lots of people and find out what they’re working on and. I actually kind of weighing up like the different elements podcasts. Well, it’s not easy by any means it’s just definitely easier and faster and the learning cycle is way faster compared to those other options. So I was like oh let’s let’s try it out a couple of episodes see if I enjoy it and then kind of go from there.

Bridget Hickey

Great And how did you sort of slept the guess what kind of people were you interested in getting to know on the podcast.

James McWalter

Yeah, so you know the none couple of guests were very generous with their time like you know this is all just cold messages out from me to a few different folks working um at you know, climate companies of various types and so the the none 2 said yes. At the time it was I think monthly I was aiming for and then as those went well I moved it to every two weeks and then eventually I moved it to weekly and so really and then and then I took on Gabby who became my producer and she does most of the kind of you know, guest booking and so on. But really, what we’re looking for are people involved in solving problems through the medium startups. So are they on the startup founder or kind of leadership team side of things or are they more on the ah investment side and so we’ve interviewed a few folks on that side as well. And so yeah, pretty much any. Sort of founder who’s working on climate change and solving things in interesting way I’m interested in talking to we we have refused some guests over the over the last couple of years um yeah mainly because I I don’t think that their their approach is actually going to be effective for climate um hydrogen personal cars like. That that is one area that I’ve had a few people recently be like oh there’s going to be hydrogen fuel cell cars everywhere I’m like now evs of one. It’s just it’s just a waste of time for heavy duty vehicles. Maybe but um, but not so much for personal and passenger cars. So yeah, those people will will say no to. But in general we’re pretty open to talking to people working on lots of different. Parts of the climate problem.

10:56.20

Bridget Hickey

I Mean climate Tech is so big. Do you like how did you sort of build your own company. How did you decide where your interest lied within the very very wide and widening space of climate tech.

James McWalter

Whiteboarding lots lots ah lots of whiteboarding. Um, yeah like I think I think the that path is pretty similar to like a lot of folks who are coming from a more generic tech background into the space where they you know. They’ll get some sort of printout or pie chart of like the emissions in the economy and it’s like oh there’s transport and there’s residential and there’s whatever and then we’ll be like okay you know could I tackle that piece could I tackle this piece. That’s basically what I did um I actually did with a couple different folks like I was. You know, doing some pretty lengthy cofounder dating with with a few different people over the course of yeah, a year and went through that process multiple cycles of that process and some and some ideas we would reject based on like they just don’t tackle enough emissions or I would reject reject on that basis and some would be ah. Like it’s a really cool problem. It’s a really cool set of solutions. You could build but just it’s on a good founder fit right? Like if it doesn’t have a software component I’m just like less of a good fit because that’s my background like you know you could bring in a cofounder at school with hardware or something. But in general I was like looking for things that had a software potential solution. So. That was that was it I guess like I know Bridget you were also looking at different climate startups to to join you know because you also kind of come from a more generalist kind of tech background I guess how did you? you know sigh for yourself.

Bridget Hickey

I find I found the ones that were most interesting were the ones where there was I mean I’m I’m on marketing Side. So I liked the ones with like a real ah a bigger story. Obviously the entire climate story is pretty big but um, you know we do flooding right Now. It’s very relevant. There’s a lot of.. It’s affecting a lot of people in real time and there’s not a lot of people tackling it I think anytime a founder has like a pretty strong point of view on where they think the world should go and a specific sort of especially with climate I have identified a gap in which nobody’s really addressing the problem. That’s always. Sort of a fun thing from the marketing side.

James McWalter

Yeah, it’s on on that kind of strong view. But I mean I guess so the view that kind of eventually came to my cofounder Charles is that we’re going to like replace the entire built environment in the next thirty years like that’s a yeah there you go? um.

Bridget Hickey

Um, that’s a good line but.

James McWalter

And and outside of money I say outside of monuments like you know outside of statue of liberty. Everything else is going to be replaced the next thirty years to be like at an worse climate neutral but ideally climate positive in some way so it’s producing clean energy or it’s sequestering carbon in some way. Um, and that’s even like. Literally the residential building will be living and you know individuals are living in because we’re you know, starting to produce things like concrete that absorbs c o two out of the atmosphere and strengthens the actual concrete over time. Lots of like super cool things and some of those solutions might not work. But I think that you know that’s that’s the best where I’m like all right we’re we’re going to be changing everything. What are the kind of barriers to that mass change right? You know rep’re placing the and built environment that we we did it in Europe after world war None in like you know 8 to 10 years um where it’s going to take us longer because we don’t have something as acute. Obviously as a world war but that is the level of change that is.

Bridget Hickey

Um, yeah.

James McWalter

Required over the next twenty years and so there’s a lot of opportunities for kind of making that more efficient and uneffective.

Bridget Hickey

Cool all right? So I have a list of of a bunch of questions that your listeners have given so we might jump around a bench. We just get into it all right? Well None off, you are irish which I don’t know if anyone knows you don’t have this longest accent anymore. But you are we now living in New York doing a tech startup.

18:18.94

James McWalter

Ah, yeah, you go for? yeah, go None No.

Bridget Hickey

Like how did this happen. What was the sort of more generalist tech background you had Do you think that that being Irish has changed your approach to how you’re approaching this I’d love to know about how you got here.

James McWalter

Yeah, so yeah, so I’ve definitely mentioned the farm on the podcast in the past. Um, so yeah, so I was born in Ireland in the kind of mid 80 s ah we had a little farm but we immediately basically not immediately. But when I was 4 years old we moved to New York we lived in the Bronx for a year from age 4 to 5 and then we moved upstate New York to a place called wappinger falls which is like near pokeepsie it’s kind of halfway between New York city and Albany so not that far upstate. And yeah, I’ve lived a kind of classic american suburban life like what later I would like watch on Tv where you know you’re. Playing baseball games and teball and going to boy scouts and getting up to all sorts of you know mischief running and around so we did that um and for various kind of family reasons. My parents decided to move back to Ireland um, in 9095 and so we move back and onto a little rural farm. You know, fifty acre sheep farm on the west coast of Ireland and I sounded pretty american you know a yank as they’d call you back back home and I’m not going to say that it was easy I would ah you know, basically you know. My I guess childhood into my teens was pretty tough in a lot of ways mainly because you’re completely an outsider like when you when you sound that different in such a rural area. Um, and rural west of Ireland accents are incredibly strong, incredibly distinctive. So you know there was there was a kind of a lot to handle a lot to manage with that. Um, you also have this all other kind of culture element that um you know was I guess kind of awkward so in american schools and in american culture in general like success is generally a positive thing right? It’s like you know if you said how how’d you doing your tests. It’s like oh I thought it did pretty well right.

Bridget Hickey

Nice.

James McWalter

Um, that’d be like a reasonable answer to to give whereas in Ireland even if you know you ace the test. It is culturally unacceptable to say that you have to be like I probably failed it and so I did not get the memo as you know an none year old coming back to Ireland and so people will ask me this question and and I’d be like oh you know I feel like I did pretty well. And they’re like oh you’re so arrogant and so ah, it was literally so this was kind of literally the vibe and so I guess it took a kind of while to absorb and understand and kind of bring the you know those None different cultures together in my own head in a way that was satisfactory. And that didn’t really happen until I got to kind of university and you know started to find a bit of a tribe that that worked I worked kind of better with you know I started getting into philosophy and theater and like all these kind of the other artsy things that I ended up. Yeah, not not working in full time. but um but yeah, so yeah that was that was the kind of the message None thing I will say though that did definitely affect. Elements of kind of my focus on climate now is that we convert it to organic farming in 1997 and 98 and yeah and my mom who who Bridget Hickey Hickeyis a big fan of um, yeah, um, by Bob my mom who’s who’s you know.

Bridget Hickey

Pull up. Um, your mom.

James McWalter

Kind of launched a business in her in her early sixty s and and the british has been very impressed kind of looking at it from afar. But um, she was head of the Irish Organic Farmers Association um at the same time as my father was implementing you know, organic farming on our local farm and so you had this scenario where mam was basically like.

Bridget Hickey

People.

James McWalter

Setting up the criteria for the country um whereas his dad was doing it. You know locally and like those things are obviously in clashing right? because what you’re trying to do locally um has all these kind of local considerations that you can’t really take into account when you’re doing like a policy for an entire country. So yeah, so there was a lot of that that kind of stuff.

Bridget Hickey

Your mom continues to get cooler every time I hear more? Um, so you sort of had a winding path into this. But obviously there’s a lot of people who are trying to get into climate tech. We meet them all the time in our various communities in New York um what is what kind of.

James McWalter

Growing up. Yeah, yeah.

Bridget Hickey

Advice would you give to somebody who’s working in tech not working tech but really wants to get involved with the work that the climate tech crew is doing. How would you think that people can go about getting involved.

James McWalter

Yeah I mean I think with any we’re trying to move into any new space right? It can seem very ah restrictive. It can seem like there are various ways people speak or there are various kind of the rules of the of the road for any sort of group that you’re the outsider of and so the biggest thing is. Got to get into that group in some way as quickly as possible to realize that they’re all just normal people doing normal things and what does that mean it means just talking to to lots of people. Um I think it is difficult to break into any new Industry. You know for the true introverts out there but it has gotten easier because there’s a lot more. Slack communities and things that are more virtual that I think are are generally easier for for people who have that more of that approach. But yeah I would say like there is nothing better than hearing for somebody like a genuine interest in working on something that that you care about um I’ll semiregularly at least couple times a month get inbound from different. People who are like you know, looking for mentorship in some way and if I have the time to you know to be full on accessible I’ll I’ll give it if not I’ll point always point people in in the directions of people who might be more suitable to them and one of the great things about the climate space in general is like people are just like super welcoming like you know we’re all. Kind of joined in this incredibly large project and problem that um you know that it’s just it’s so mad. Madly big like how do you even kind of begin to cut a tackle it and so there’s never a sense of like oh we’ve got too many people working on climate like no, but the more the merrier you know.

Bridget Hickey

It’s also weirdly optimistic I Think despite the very big and large challenges people are very kind to friendly. Um.

James McWalter

I really love. Yeah I think that it’s great that you said optimistic None of the things that I think people get wrong and like in a particular way is that the people who are most negative on major problems are the people who work on it the least right? if you go online. It’s like oh you know. Climate change is terrible and like nothing’s gonna be solved and we’re all be living underwater and all this kind of thing none of the people who write that are working on climate change either in a startup or policy or like they’re assigned it like are activists. They’re literally just people complaining and that’s fine like it is a big thing and and you know and people have jobs to do and so on I’m not saying that everybody absolutely should be. Dropping everything to work on climate but I will say that if you do work on climate whether it’s startup or policy or activism. Whatever it may be you do start to feel more optimistic. You do feel more empowered like I think just from a pure mental health point of view like if you’re really worried about climate and it actually stresses you out. Start working on climate and it actually weirdly make you less stressed.

Bridget Hickey

I Totally agree I can’t believe how much I have calmed down about it because I’m I’m just surrounded by really smart people all the time who are so knowledgeable about the problem and it just makes me feel better that they are all working on it. Um.

Bridget Hickey

Okay, so you mentioned a bunch of different online group I Know you’ve personally mentioned my climate journey I think you did on deck as well. Can you talk a little bit about some groups that are available how you’ve how you’ve approached virtual versus real world communities and what you could get out of them if you’re looking to get involved.

James McWalter

Yeah, and we’ll include some of these links in the show notes. But ah, there’s pretty decent communities with pretty large amounts of activity for quite a few different segments of climate. So one is air miners. So my climate journey. It’s probably the most generalist it does have a I think it’s $10 a month fee which is a little. You know it definitely kind of blocks maybe like students and so on to kind of get involved in it but but it’s probably the the oldest and most kind of generalist. Um, so that’s well worth checking out and and paying the $10 for a month or 2 just to kind of get ah get a sense of it. And then Jason Jacobs’s podcast. My climate journey you know is obviously somewhat of an inspiration for this podcast is ah quite an even overlap of guests. So um, definitely checking him out in general. Um, the other piece is air miners so air miners is a great community for anyone trying to do carbon sequestration. So whether that’s through soil or direct air capture machines or something else. Um, there’s a lot of really smart people there. It’s actually probably the best place I’ve found for like genuine research scientists interacting with people trying to build companies and I’ve met some great people from there in person as well who who are kind of working on really cool tech. Um, and then moving things from the lab into. You know, commercialized use cases that have a climate effect and then the other one I would mention ah off the hand is the task force so they’re very focused on distributed energy resources and energy. Um, the 3 people who founded that they’re all based in Brooklyn I meet up with them pretty regularly now. Great great group. I’m really focused on you know, getting clean energy deployed at scale there few others work on climate I think climate base one is there any um missing british.

Bridget Hickey

I like work on climate they have they have interesting little like subgroups where you can do like learning hoops I’m learning about Kelp farming through them. They’re very cool cook consider a past hi.

James McWalter

Everyone goes through their Kelp phase with climate. It’s like ah it’s not even joking. It’s like I was like K solve it all and then it’s like oh it’s pretty tough. Yeah.

Bridget Hickey

It’s very very complicated but it’s still we should all eat more elp. Um, okay next question. Ah, what is the largest climate problem that you don’t think anyone is tackling.

James McWalter

And.

James McWalter

Yeah I mean I think that there I think basically the less sexy. The thing that the less likely to are smart people tackling it. Um I think that’s just like a general rule right? So I guess one experience I had ah on on the other side of this is. When covid started everybody started a Zoom or slack competitor right? So I was in on deck at the time you’re just talking to lots of founders and like honestly fifty sixty percent of people were working on Zoom are are slack competitors. And that’s fine. You know like there’s obviously a clear need for for those things now. Um I don’t think any of those companies really have have like done anything because Zoom and slack did a pretty good job for what they’re doing and like what else kind of you add from there and so those were cases where there’s this like kind of very obvious set of problems. But maybe it’s reasonably well served. And it kind of it was kind of sexy at the time it’s like everyone’s on Zoom quote unquote and so let’s try to solve that. But if I think about like just the economy in general There are so many opaque kind of hard to identify parts of the economy that I personally just don’t know that much about and a lot of them have to do with materials various types. So it’s like if you just look at any object around your home right now. It’s like you know, ah like I’m just looking at my desk some of dog food because the dog sleeps next to me and I have my laptop There are probably easily hundreds of materials going into each of these. Um they have all their own different supply chains and every single one of those supply chains have to be decarbonized. And new materials found either because we have an existing material that could be repurposed that has a more climate friendly like approach or it’s something that we have to completely invent from you know, whole cloth and like completely you know disrupt and like an existing material with something new and so to me like I would nearly. Start just looking at all of the different materials and these materials by the way like you think about cardboard you think about concrete like these are none or at least hundreds of none but none of dollar industries pretty low margin but like just absolutely massive and they do need to be decarbonized and while there are definitely some companies working on some of these things were like way way way. And like I would love to see just lots and lots of you know so smart business people talking to smart material science people and coming up with like new startups.

Bridget Hickey

Yeah, there is so much option there um more specifically on Decarbonization. What do you see? Obviously there’s been a ton of attention paid there recently it sort of seems to be the next big thing with the frontier money going into it. What. What do you see as the biggest barrier to decarbonization I Know you’re pretty involved with air miners. What do you sort of see as like what doesn’t exist yet what will make that scale and.

James McWalter

Yeah, so I guess like so it’s thecarization of existing industries and then just like taking carbon out of the air or getting the carbon removed from the economy in some way So I’ll kind of tackle the second one because I think you kind of touch on the None one already. So I would say that direct our capture. Is like a really really really exciting concept and there’s a reason why a lot of smart people are working on it and a lot of money is being put on it. Um, it’s probably pretty far away from scaling and so to me a lot of the focus on decarbonization right Now. Should be about all of the fastest low-hanging fruit things we can do to buy time for those more technologically advanced things that we’re going to need to finish out the Picture. So What I going to mean by that. So one is just pure clean energy right? Like we just have to decarbonize the grid like just has to happen as quickly as Possible. We literally don’t need to invent anything new for it like it’s purely a scale thing. It’s not even a financing issue from a scale point of View. It’s a lot of other issues that I’ve talked about before when I talk about Mo startup around permitting and interconnection and these kind of things so we also have like transport. That’s another massive segment like we basically have now invented the evs that are necessary. The biggest subject like a barrier to Eb adoption now is more supply chain driven than technology right? like we just need to get more the T Ion batteries built and into these cars. Um like so in general things are happening. It’s just the scale of new supply chains and kind of removing certain barriers around. Things like permitting and so on those are kind of necessary things but all those things need to be ah, sped up as quickly as possible to buy time for things that I think will still be necessary which are things like direct air capture of carbon and you know. Kelp or algae and other methods of like sequestering carbon soil carbon sequestration these kind of things which are somewhat unproven at scale but like we need all of those hits a goal and some of them might work but like most of them are not going to work this side of 2030 like they may be working in the mid 2030 s And by that time though we should have like everything else as optimized as possible up to that point. But yeah I Guess what are your thoughts on that.

Bridget Hickey

And I mean I’m kind of interested in. So Obviously these are big long-term bets and you’re a founder who’s going out and you know raising money in the markets which are obviously all over the place right Now. How do you recommend? A founder is going out with these big huge ideas that just take a lot of time. How should they be. Position that that to investors. How do you think Investors are sort of adapting to the climate Tech market.

James McWalter

So yeah I would say they’ve been adapting really really well until like two weeks ago so so we’re we’re talking and a may here of 2022? Um, so I talked to a lot of ah climate investors before I so even was. Really actually the early days of the podcast really just to kind of get a sense of like where like what is vc aable right? like you know Vc has a very specific type of time horizon they have a very specific type of investment and return investment. They’re looking for and with that. Not everything is. Going to make sense for a Vc right? So a chain of hairdressers is not going to make sense for a Vc but a software app like you know a calendar might because it it scales and has certain kind of elements of scale and and network effects. So when you kind of think about like all the different elements of climate like what’s. Kind of vc backable and what’s not I would say in general vcs ah are driven by the same sort of elite recent elite focus on climate change that a lot of people listening to these podcasts are so climate change is not a populist ah problem to tackle. Vast majority of people working on climate tend to be from higherd socioeconomic groups tend to be well-ed educatated so generally some form of a word elite and vcs are about as elite as you can imagine and so they’re basically going to dinners and cocktail parties and all the usual things. Ah you know, pre and post covid. Um, that necessitate like an interest in these things and so what we’ve seen over the last couple of years is just like a lot of vcs rudy folksing climate and it nearly became a joke you know bridge and I we we also kind of co-host this in-person meetup now in New York for climate folk and whenever there be like a Vc folks showing up. there’ always be like a Vc coming from an existing fund that was non-climate focused and now they’re kind of working to raise their own fund that’s climate focused and it just became me like kind of a semi- joke in my own head. It’s like oh another another Vc doing a climate fund which is great like I ah like we need more like evermore. Um, but it is the kind of world where um. That money is I don’t know if a lot of the money and that a lot of those funds are actually going to make a return for their investments because a lot of the investments going into climate tech startups are not probably Vc backable. They actually should be something more like project financing or some other type of of financing now again I’m not complaining because right now all the money should be diverted as much as possible. But I think we what we are going to see is a bit more streamlining over the next few years as some of the returns from some of those companies that were never really good for Vc in the none place. Don’t you know? don’t don’t don’t come to fruition.

Bridget Hickey

Yeah, he sense? Um, so you were a startup talk a little bit more about your startup. So your startup’s focused on the built environment I’d love to hear about sort of why you focus there here sort of the 1 line pitch and just sort of how you see that evolving and.

James McWalter

Yeah, so we’re um, basically so at the moment green infrastructure projects like solar wind hydrogen have just a really low success rate. So only 1 in 5 of projects that are being attempted actually get built and the reasons that are not get built are issues around. Zoning permitting interconnection and so on and so we’re basically trying to identify all the issues that might prevent a project from being built in a specific place right? because None of the interesting things about once anything is being built in the real-world. The physical world. Ah it has to be built somewhere right? and so the unit of measurement is the land itself and so what can you build there. A is it good for the climate b and can I make money c and so we’re trying to figure that out for every personalcel end ideally right now. New York safe but eventually the world. Um and say okay, yeah, this is a great place to build solar but it’s even better place to build solar for storage or it’s actually an even better place to build a dense residential like tower because that is. You’re downtown Manhattan and that actually makes more sense from a climate point of view because density actually helps climate at the margin. So you know that’s kind of what what we’re or we’re up to I mean so lot of data collection. A lot of figuring out data from lots of different sources making sense of it appending it down to the parsel level and then we’re mostly focused on solar developers. And some hydrogen folks to get up and running because those are the people who seem to have the most acute need. But eventually we do want to be that data source for pretty much any amount of building happening in the built environment.

Bridget Hickey

Me say how’s going. Yeah.

James McWalter

How’s it going? Um, you know it’s sort of world right? So like we we raised we raised money which was ended up being like really easy and now it’s very hard for everybody to raise money. So we’re happy that we got that in done before in time. Um. My cofounder is just incredible. So he built an amazing Mvp and and in pretty fast timeframe. We’ve hired some like interns to help with some data collection and the big thing right now is it’s all it’s all it’s all about getting that none page user so we have some trials outstanding. Um. We’re meeting those folks every week every couple of days in some cases and just converting them into paid customers and so right now everything is about. Can you get that first paid customer because if you don’t have a paid customer. It’s a of business I know historically in the last two years startups have just been able to raise money just on ideas time after time after time. But I think with the the recent kind of valuation downturn.

James McWalter

Well, the economy in general but in sort of some particular like you have to build a business and so yeah, one of the great things that are that that I’ve always been kind of aligned with with my cofounder is like look we have to build something that has real revenue because real revenue means we’re actually helping real buildings in the climate getting built and like it has all those kind of positive. Ah you know? Ah. Kind of additionalities as well.

Bridget Hickey

Yeah, all right somebody wanted to know what upcoming or current technology. Do you think will be a disruptive force in the future.

James McWalter

Yeah, um, coming ah the the so I think that touched a little bit about director capture. But I probably want to kind of paint how I think like director capture is going to actually happen. So director capture. It’s it’s a basically it’s a large series of fans think of it as a little factory but what it’s doing is actually it’s sucking atmosphere in it’s taking that atmosphere. It’s removing the C O two and then it’s storing it in some way either. It’s pumping it underground or combining it with some other material to be stored. We’re going to need like None of these right? like just like a lot. Um, if it’s going to have an impact but what’s interesting about that is they need they could be actually built anywhere because they’re just taking c o two out of the atmosphere and the C O T Two in the atmosphere is completely diluted right? So it’s the same you know x percent in. Your backyard as it is like in the himalayas like it’s it’s the same so you could build these anywhere and so I think one of the like fascinating pieces of like how that that gets deployed is going to be where they get deployed who gets disrupted like if you’re building None factories around the world. Like is there a world where certain countries are say we’ll build them all in our country because they can build anywhere and but the world has to pay us some sort of import export tax because we’re decarbonizing right? So could you have a country like Ireland or a country like Uganda. Yeah, I’m just making random countries who say look you know, put none of. Of dac factories here like we’ll take care of it but we need to be appropriately kind of compensated. So I think once you have something that like has that level of solving the problem if it can’t get cheap enough of course and there’s a lot of technological issues around it I think it starts to throw up some interesting and weird things around trade because one of the things where the. I guess the related aspects we’re going to see is that um I don’t know have you ever read ministry of the future. The the Kim Sandley Robinson book super super powerful book but None of the kind of concepts in it that ah they they kind of get into is when a particular country has this incredibly bad. Um, heat wave.

Bridget Hickey

I Literally just bought it I have not read it yet.

James McWalter

The country starts doing ah geoengineering so you start releasing suphates into the atmosphere and but they’re doing it over their own land and so what can other countries do to combat that I mean there’s not much you can do. But if you do a lot of geo-engineering at scale you start to affect every obviously every other country in the world right? because it’s. Geo. It’s the whole geography. Yeah, it’s the whole planet and so things like dac if they can get to scale I see as like a main way to help prevent some of the you know geoengineering of countries going their own way. Because it’s just incredibly like it’s just going to be outside of war. It’s gonna be incredibly difficult to prevent countries from actually doing geo-engineering because it’s actually pretty cheap to do like putting sulfates up in the atmosphere is not an expensive thing to do relative to other costs. So I don’t know so to me like. Dac if it actually happens is like probably the most most disruptive thing I can think of.

01:05:57.88

Bridget Hickey

Yeah, that are there companies that you think are sort of most likely to do it who are you watching and are really plus why.

James McWalter

I mean climbmeworks has the most money behind them so they’ve built their factor rate in Iceland to take advantage of some geothermal cheap energy. You also they’re their swiss company I believe there’s a few others I mean like there’s a lot of activity on air miners. Ah.

Bridget Hickey

Yep.

James McWalter

None interesting thing about the dak community is that they’re like it similar to like the fusion community I guess like they’re all just kind of like bullying up on each other being like oh that’s a stupid way of doing it. Um, you know it’s it’s the closer. You are to a particular frontier technology the more I guess arguments there are about which direction will work out. Um. Like the None guy recently and and he’s planning on something where they have the capability of stacking the carbon in like basically shipping containers and you can just like stack that I mean these are all super cool things but none of it’s been done at scale outside maybe climb works so climbwork has done it at some level scale. But it’s $600 a ton of carbon which just ah. But context like a carbon in a tree is like $12 a ton. So like we have a long way to come down from a price point of view.

Bridget Hickey

Yeah, um, speaking of sort of the geopolitical side of this. How do you feel about the Biden administration and how they are tackling climate.

James McWalter

So they started really good and then they’ve got progressively worse and worse. So um, so going into the none kind of 6 months of Biden administration obviously coming out of a pretty anti you know climate change solution administration in in the Trump administration it was yeah it was. It was a breath of fresh air. There were certain rules that were immediately brought in that were positive the bipartisan infrastructure bill while there was a lot of money in that for roads there was actually quite a bit of money for things like transmission for the grid that’s helpful for renewables. There was stuff for evs. It could have been more but you know it was all pretty powerful thing. Then there’s 2 elements that have shown the by administrations I guess you know have have been just not successful on climate. So one is build back better which is like a large bill that we proposed last year is a bit of a grab bag bill but there was a very very large climate component and basically build by pay editor was not passed. And I was pretty bullish on Bill Black ridter all the way through until eventually mansion said no and basically when you have a um, ah senate where you have you know a pretty conservative none vote in Joe Manschin you kind of just basically have to let him write the bill and. I think that exactly how it kind of panned out. There was an attempt to bring in other aspects into what in many ways is a climate bill which made no bill at all pass. So that was somewhat disappointing but you know I can kind of understand the elements of and the dynamics that kind of produced that. But at this point I’d be like whatever bill I mentioned be willing to write. That has at least some positive climate effect. Let’s just do it because like we’re running out of time for a you know we’re all likelihood going into republican senate in the next you know None to None to twelve months and in that model like nothing’s going to get passed in pro climate way the other piece which I think is absolutely more egregious and. Ah, yeah, and and pretty kind of infuriating is the solar tariffs. So the Trump administration had tariffs on solar panels produced in China the Biden administration last January extended those tariffs which are bad enough. But. All the tariffs are all these panels coming in to build solar pounds today are coming from southeast asian countries that are not China so Thailand vietnam etc those countries are now under a um department of commerce investigation because a domestic solar panel manufacturer called axion solar. Um. Basically said that those countries are secretly putting in chinese panels rather than producing them themselves and so that they should also be under tariffs I was at a conference for solar and storage developers in New York last week and they were just telling me person after person that nothing is being built right now.

James McWalter

We have stopped building story solar in the United States at scale. Um, basically this is the first year in 25 years that solar costs have gone up for and only in the United States nowhere other country in the world because these tariffs and the fear around these tariffs because one of the the aspects of the of the. Department of commerce’s investigation is that if they find some issues with you know these panels in in these thai countries. They’re going to backfill tariffs on existing solar panels that have already been installed and so this is freezing the entire industry so I talked to people at some of the largest renewable energy developers in the country people are literally. Directly building the things that are decarbonizing energy and they have stopped building like literally in the last three weeks they’ve stopped building because of issues around these tariffs. So I’ve been involved in some you know political wranglings in a small way on this? Yeah, but yeah, engaging your local senator all this kind of thing. But. Yeah, if anybody hears this please please please get involved in kind of getting these tariffs issue kind of resolved because ah, right now. Yeah I think the client like there was more solar being built in the last year of the Trump presidency than this year of the Biden predeency and there’s way more money to be spent. On it. We just can’t literally build it. So yeah.

Bridget Hickey

Well okay, great. Let’s really agree I find find all like like you know you hear these awful like climate news and there’s there’s just nothing people to do and it’s just so deeply frustrating like you know like college senators sort of where we get to. But.

James McWalter

No.

Bridget Hickey

Very frustrating. Um, despite that frustration despite everything going on where do you stand On. You know we touched a little bit about staying optimistic and working in climate Attack. Where do you stay on sort of how optimistic you are that we will stay below ° of warming and that we will be able to sort of collectively. Turn things around in the limited time that we have.

James McWalter

I think we’re going to do it like and again we’re just the pure like optimist. But I I think that there are now enough smart people who care about this I think that number is going up every day I think the resources are pointing in the right direction I think basically I think there are a lot of different levers. That we need to use to solve climate and so you know policy government activism like corporates like larges scale corporates Smalls Scale corporates like startups research science like all these things are different levers to accelerate. Ah, you know the solutions set that we can use and flighted climate. All of these are basically in motion ah to varying degrees of success as we said government as I just said government is is probably moving the slowest but that’s always the case but across the board like these things are generally pointing the right direction and that was not true. Three years ago it was not true. Definitely not true. Five years ago and so I don’t see any sort of large-s scale ah countervailing pressure to prevent that outside of like just like a series of large wars which knock on wood you know is not going to happen. Um, and so if we can you know keep a reasonable amount of geopolitical stability. When all these levers are now kind of pointing in the right direction or we got you know a few decades at least of some somewhat ge havepolitical stability and I know sometimes it can feel like things are very unstable obviously with the horrific things happening in Ukraine and so on but just like on a world historical level like things are still reasonably stable. You know compared to other periods in history. I think that we are in pretty okay shape to hit ° now one more ° is still terrible like don’t you know it still means that you have just terrible things happening to a large large parts of the world but it isn’t disaster and so ah so I’m I’m pretty optimistic. We’ll hit that and I think if things like.

Bridget Hickey

Yes.

James McWalter

Director capture dac that we talked about earlier that got to scale ahead of schedule then we have a chance of even beating that. But that’s more of a I think that’s completely depend on technology being better than what we what we plan for.

Bridget Hickey

It’s more optimistic view than I often hear it’s exciting to hear from you up. Um all right. We have a few more personal questions that we’ve gotten in for you. So None up, what is something that you have been wrong about.

James McWalter

Yeah, yeah.

James McWalter

Ah, self-driving cars incredibly wrong I I’ve like read this article by I called Kevin Drum about five years ago and he basically fully convinced me by this year Twenty Twenty two pretty much every car would be. Decently self-driving and it would just be a regulatory policy thing that was slowing it down but like the technology would be there and that is obviously not true at all. so um I yeah so I was I was very bullish about things moving very very quickly in self-driving cars but was could be wrong out.

Bridget Hickey

Who do you think’s gonna win it who do you think will do it.

James McWalter

Um I I actually do think that it’s the companies that have the most access to data because in the end self-driving cars is like a machine learning data play and so there’s a couple of companies that spun out of Google Google itself has some efforts. So I would say companies that have spun out of or have access to like None of the big tech companies data mapping data in particular like they have the highest odds so all things being equal like I don’t think Google itself because Google itself is just not very good at building hardware. But I think people coming out of like Google kind of you know. Frameworks there’s a few companies who who have that kind of profile. It’s probably most likely I think the least likely are like uber and lyft I think they’re really good at certain type of logistics and I don’t think they’re good at this type of thing.

Bridget Hickey

Yeah, um, what is the biggest challenge you faced over the world.

James McWalter

Yeah I mean probably probably all to do with like immigration of various types and so I probably briefly mentioned in the past. But ah, you know I spent the last few years and in Mexico um hiing on my green card to come through. Um it was. Like I guess like if we’d gotten into it. My wife and I knowing that it would take 4 years it would’ve been fine but like you think it’s a year and it’s another a year that’s another year under a year and so I would say that kind of trying to manage yourself to that when you’re yeah, you’re trying to move forward on certain parts of your life personal life business life work life. Yeah know family friends. All those kind of things.

Bridget Hickey

Well.

James McWalter

But like you just don’t have full freedom I mean that’s obviously something that a lot of people experience. Maybe the majority people experience in the world. But you know someone who is westerned you know english speaker fella who can usually move through spaces in a particularly easy way like everybody kind of brought home like how. But restrictions really can be on you on on your decision making and so on. So finally finally getting through that like it was a year pretty much a year ago this weekend that I did my immigration interview in Juarez Mexico um involved getting completely naked and explaining tattoos that I have and making sure they’re not gang tattoos um during my medical it. It involves even other things that were you know and I will say like everybody involved like I work like like the doctor and everybody I was involved in. Just incredibly like kindhearted generous generous people. It was just the system itself was just pretty. You know, um, like dehumanizing and again and I was by no mirror the nowhere near the like the worst affected person like yeah, you’re doing your interview by all these little windows. And like as you’re talking to the person doing your final interview like um, you’re just hearing people crying like around you because they’re getting denied. Um, and so yeah.

Bridget Hickey

Oh no, um on the immigration note I mean with the world of remote work and obviously there’s booming startup ecosystems in Europe. Do you think you need to be in the us for for building a startup or for building a climate startup.

James McWalter

I I don’t think you do I think that? um, what I guess what does like a place give you so so I personally have worked remote for nearly six years and and now I’m yeah I have an office with my cofounder because I like I like being in a space. Um, after so long kind of remote. So so ah, you know I’d done a few years previous to covid and I would say that covid was incredibly powerful for me in a positive way. Obviously it was horrific for most things but from a kind of leveling of the ground. So everyone all of a sudden was on the Zoom call. So you could get access to investors and and people for this podcast and so on in a way that was just way more difficult to precod like you had to like fly into San Francisco and do the tour and meet all the vcs in person. All that kind of thing with covid and the kind of adoption of so much remote work that made things a lot easier. Having said all that though. I think it is very very difficult to build a company when you’re not surrounded by other people who are building things I think that building something out of nothing is just so so difficult that even if you’re around people who love you and people who you know appreciate what you’re doing all those kind of things. Um, unless they’re. Like builders kind of are people building things and not just in startups. But in general people who are building something new like they tend to like push each other in various ways that are kind of subtle and I think that my time down in and puto verto I had amazing friends and some of people were definitely you know building different things and and so on but the general atmosphere of this place was like. Pretty laid back. Pretty chill. Lovely place to spend some time but not some place to kind of build something and so I don’t think you have to be in the Us to build things. But I do think that San Francisco and New York Boston and a few other places are like known as startup hubs for a reason because there’s just a lot of people building and I think you do have network effects around that and so if you are in a country other country. Like where in your country are other builders building like I would gravitate to that in general is.

Bridget Hickey

All right last question what sort of predictions. Do you have for a climate tech space. What are you excited about what kind of advice would you give someone like what do you think is sort of the next thing that we’re going to be seeing a lot of.

James McWalter

So I think there there’s going to be more fractionalization of ah the climate space right? So you know my climate journey iron miners like these are are yeah these are somewhat aggregated ways of like approaching climate. But. Because of climate is the entire economy. You’ll eventually have trade publications and all these different kind of segments that will be very specific to something and so whereas before you might have to go to yeah my climate journey to talk about you know, electric vehicles. There are if not now there will soon be just like. Online and offline communities entirely devoted to not just electric vehicles but you know electric vehicles that are replacing ah Ford trucks right? that are replacing that like the pickup truck segment of the market and so I think like 1 of the things that will happen is again much more specialization much more focus on those things. Um, it will mean that. Will be a period where it will be kind of hard to find these things and generalists will maybe start to struggle to get the the clear kind of you know, like know exactly where people are kind of congregating online or offline. Um, and so I think that’s None kind of opportunity for people in climate tech we’re thinking about building some sort of collaboration software platform and so on is like continuing to make it easy to direct people into the right directions and so you already mentioned. Ah you know work on climate. That’s a great you know. Product for that like terra terra do is is another like there’s a few of these that that do a good job with that. So I think ah more specialization and then also hopefully in in tandem people who are helping other people navigate that specialization. But how about you.

Bridget Hickey

My connections. Ah I’m actually quite and I mean I work in a B Two B company but I’m I’m really interested in sort of the consumer marketing angle of things I mean I Even just like I feel like a lot of things are starting to get marketed with a bit of like.

James McWalter

Yeah, yeah.

Bridget Hickey

Environmental Guilt. Um, and I don’t think that’s terribly effective and I think that more and more we will just see really solid environmental options that are just marketed as like the best option on the market I think I’m kind of excited for that to get away from all of the The. The shame and the doom and gloom and the guilt and just start ah marketing solutions just because they’re the best cheapest most convenient option on the market.

James McWalter

I Love that and yeah, we actually had somebody talking about solar punk on the podcast a few months ago you and I and and other people at in-person and meetups have talk about this complete like I guess failure on the kind of climate tech community to do a better job of describing this like super exciting future like not just.

Bridget Hickey

Um, one yeah I think there is a lot of gloom and doom and it ah you know it definitely gets clickbait and um, you know people will will read it but I just don’t think that’s.

James McWalter

Mitigating these things but like it’s actually better.

Bridget Hickey

Future I think like everything that I’m seeing that you know a lot of the D to C startups that are popping up are just like really brilliant options but they you know they don’t have like the blue and Green Earth Water Montage There will say just like really great ah branding and marketing. So I mean I look at everything from the marketing and but I’m very excited for that.

James McWalter

Love that? Um, well Bridget. Thank you like? ah you’ve you’ve asked some great questions like it’s it was great.

Bridget Hickey

Have on ah episodes I’m thrilled for you I’m very excited to listen to a None more fight.

James McWalter

Thank you so much. Cheers Bridget.

Monitoring Electrical Assets – E95

Great to chat with Priya Vijayakumar  Co-founder and CEO at WattIQ! WattIQ connects thousands of unconnected electrical assets, enabling better utilization and energy usage of any electrical device! We discussed silent energy consumption assets, the ups and downs when starting a company, how to build customer trust, the issues with manufactured obsolescence and more! 

If interested in speaking to WattIQ, please email info@wattiq.io

https://carbotnic.com/wattiq

Download Podcast Here: https://plinkhq.com/i/1518148418

Remember, If you want to support the podcast please rate and review 5 stars on  Apple, Thanks so much! 

James

The unedited podcast transcript is below

James McWalter

Hello today speaking with Priya Vijayakumar cofounder and Ceo at WattIQ, welcome to the podcast Priya great to start. Could you tell us a little bit about what iqueue.

Priya Vijayakumar

Thank you James lovely to be here.

Priya Vijayakumar

Sure So You know we formed what Iq with this mission to enable enterprises to be to become more um asset efficient and energy Efficient. We live in a world that were very resource intensive. Many industries are very resource intensive. And we believe it’s sort of the lack of data into understanding how your existing assets are utilized. Their condition. Their energy Consumption. You know, sort of their overall management throughou throughout the entire life cycle those inefficiencies. Obviously combined with sort of an over-consumption model that’s driven many industries right? I think that’s created tremendous inefficiencies in businesses as well as just the burden on our resources right? and we think by closing those data gaps I think we can. Transition to a far more efficient industry.

James McWalter

And I guess when did you first kind of start encountering those data gaps and thinking that oh this might be something. That’s so a potential startup right.

Priya Vijayakumar

Yeah, well actually you know I started my career in traditional manufacturing like aerospace right? So which is you know there are so many data Silos or lack of data even in very traditional industries which is really was. Big driver behind this industrial internet of things right? that was supposed to be sort of this next industrial revolution that was really intended to happen fell a little bit short of expect far short of expectations in many cases. So I think I’ve always seen the inefficiencies that have existed in traditional industries.

James McWalter

Right.

Priya Vijayakumar

Um, but how do you kind of close that chasm that’s existed between Silicon Valley and the industrial world right? So overcoming some technology barriers and I think years ago when I was when I started out in this internet of things space. We did things like asset tracking. You know everyone needed to know.

Priya Vijayakumar

Where their assets were and there was a lot of value behind that. But really the bigger problem that Cisco themselves had valued at two point one trillion dollars of economic value was understanding asset utilization. We couldn’t solve it.

Priya Vijayakumar

And so it was always these elusive use case and I think a few years ago sort of you have this aha moments right? You come across a technology that’s being applied for a different purpose in this case, the technology was being applied for energy monitoring I mean you see smart plugs in the home people were just trying to power off shut up. Shut down equipment when they were not in use but you always have to find the balance between great technology solving a problem and delivering value right? You need that combat you know that perfect storm to happen in order for something to take off and so sorry, go ahead.

Priya Vijayakumar

No, and that’s sort of what brought this along is I think there was this use case at the back of my head that I had not been able to solve in my early days in Iot and it just sort of nagged at me all along and then I came across this technology that that’s what kind of spawned this whole thing. Um, and to take that original technology application and form a new business that could you know go solve these problems that had been elusive.

James McWalter

And so once you kind of were like okay this is a interesting technology to to focus on this particular problem set. What did that kind of first you know step look like was it starting to build an Mvp was it talking to users something else and.

Priya Vijayakumar

Yeah, you know I think I come from a product background right? So My pet peeve has always been building a product without understanding the problem you’re solving and understanding the end user so you can either go down this extreme path of not being able to make a product. Vision until you know every little thing about the end user but it’s usually a good balance right? You have to understand the problem you’re solving find an end early adopter who’s willing and we were fortunate to have one of the leading Pharma companies be an early adopter. They were planning to do a lot of things manually and we’re like.

James McWalter

Fifth. Wreck.

Priya Vijayakumar

I Don’t think you can do this manually I think we need a product for this. So that’s how we began our journey right? So um, and and the way we worked is I think we focus on delivering value to the customer. What is then you know what we people say minimum viable product. But.

James McWalter

Right.

Priya Vijayakumar

How much confidence can you have in solving that problem. You know you want to try and solve it at least 70% of the way because your product is evolving so it gives users the confidence. Yep, you’re 70 % of the way here to solve my problem and you’re going to keep building the rest of it right? because if you aim. I think um as our cto likes to say perfection is the enemy of good right? So if you aim for perfection on your and Mvp. You will never get to mature your product and our product matured tremendously because we’re able to get it to a point we could deliver value to the customer and.

Priya Vijayakumar

You know you don’t want to do a half -baked product either. That’s really important because you’ll frustrate the customer. But then we worked very rapidly to continue to evolve the product and even expand our solution offerings just within like the first eighteen months of want you and so that I think. Being obsessed with delivering value to the customer is what helped us evolve our product really quickly along with like an amazing team behind it that makes the magic happen.

James McWalter

Yeah, no absolutely and and in in that kind of iterative. You know as you were kind of iterating on the product were there any you know, kind of I guess pivots along the way as you’re kind of working through those different product iterations.

Priya Vijayakumar

Yeah I can tell you I mean we started the company by acquiring sort of the technology from a company called Ibis Networks right who were using this technology to monitor and shut off equipment. The first evolution was how do we do this remotely. And fortunately that happened just before the beginning of the pandemic because a lot of hardware solutions especially in the enterprise you end up having to go on site to do deployments is a complexity around that and we knew we knew we had to create a consumer like simplicity still meet all the enterprise.

Priya Vijayakumar

You know, security reliability requirements but still I mean the end user experience has to be very consumer like our first It’s not a pivot. The first evolution I would say is we had to go and make this incredibly simple for the end user. The second was we actually had to go build. Software to now build out all these algorithms because all we had was power data before I mean collecting data is a first important point so having a stable system that can collect the data to enable you to do machine learning. That’s a second piece right? The first piece was to make sure that we could collect the data. Um, with completeness. Yeah that’s how we began and then we rapidly expanded our solutions. You know we started out just trying to give insights into how equipment is used then we started expanding to additional sensors and now we could tell you the health of your freezer. You know this freezer looks like it’s going to fail. Um, so kind of starting to get into equipment condition monitoring and that came because we worked closely with customers. We tested concepts and they would tell us why are you guys not offering this in the marketplace even in a very crowded marketplace right? So I think that was really important you focus on delivering value to the customer.

.

Priya Vijayakumar

And keep up with evolving your product then it just kind of takes a natural path from there right? as opposed to building a product and throwing it over the wall and selling a widget.

James McWalter

Yeah, absolutely there’s there’s a framework that I can’t remember who came up with it. But basically if you describe the current method of solving a problem and have that user rank it. Yeah between 1 and 10 and they may say something like this is like a 3 out of 10 you don’t need a 10 out of 10 to actually solve that you. Basically you need to be 3 subjective units better and the classic one is you know getting a cab a taxicabb is like a 3 out of 10 experience and an uber is like a 6 or 7 out of 10. It’s not a perfect experience by any means but still that was enough to kind of have this kind of booming company.

Priya Vijayakumar

Yeah, oh who right? right.

James McWalter

And I think like that that’s a lesson that it sounds like you guys kind of ingrained as part of that process.

Priya Vijayakumar

It It is and you know the product development is a very imperfect process right? I think the mistake a lot of early stage startups do make is they get too far removed from the customer too early because they’re selling through a channel. For example. So They lose visibility to how the end user is actually using the product particularly when you have a hardware component and that can make or break how you grow your business right? Um, and so we find that to be really important for us to stay close to the customers. And make sure we understand how they’re using the product how we can continue I mean some of this is very intuitive when you live in a purely software world right? Everyone’s like oh I know how many times somebody has used a feature. It’s not so obvious in an Enterprise world where there’s also a hardware component involved. Ah because there are a whole set of new challenges.

James McWalter

Absolutely and you mentioned this like data collection piece and I think it’s something a lot of startups who focus on the enterprise struggle with is the data collection right? And in previous companies I’ve involved in you know you go the the company’s very excited like oh this is a great product and then it’s like we’ll spend six months trying to.

Priya Vijayakumar

Yeah.

James McWalter

Navigate the company’s yeah, internal you know rules to be able to get some sort of data that we can actually do something with um I Guess how how do you kind of have that approach you know and and any kind of insights along the way.

Priya Vijayakumar

What who who? yep. All right, you’re gonna let me share my secret source now. Okay, so so the first thing is like I said I’ll take a simple example, you know when people talk about predictive monitoring and you know I worked in aircraft engines where you could put.

James McWalter

Ah, ask nicely? yeah.

Priya Vijayakumar

Every sensor you can imagine on an aircraft engine right? and people collected tons of information. They missed the most basic point if you don’t build that engine straight and round it’s going to fail pretty quickly in the field right? So what is the data that you can get with minimal friction for the customers. So we started by making sure that we didn’t touch any proprietary data. We solved this problem by staying off customers wi-fi networks not touching proprietary data to enable us to deliver that first level of value once you do that. Then it gets easier to now say can I go have all your historical data on this right? because if I can’t demonstrate value until I’ve collected six months of data. That’s the fastest way to stop a sales cycle. So and when we started this we didn’t um, start out because we knew. Sea level and all these big enterprise companies who were just going to give us a free pass right? It didn’t happen. We had to do this purely on delivering value to the end customer. So. It’s a much bigger challenge when you don’t have somebody just opening a door for you. You know whether it’s a channel partner or whether it’s you know. Somebody higher up in the organization and that forces you to be innovative right? because you go how can I deliver value to the customer with minimal friction and once you do that then they get I mean customers now ask us to get propriety data from the equipment and so it’s a different conversation right? once once you’ve. Established value and built trust then you can expand into more complex solutions that classically would be much harder to sell as an initial solution.

James McWalter

Yeah I love that you know one of the things having had that experience if we’re trying to get data out of different enterprises. Um, yeah to very much focus on what are other sources get creative as you say there might be public sources. There might be ah you know various Apis that you can kind of plug into.

Priya Vijayakumar

Um, will.

James McWalter

And honestly, what a lot of problems. You know, especially large enterprises when people are reliant on you know 30 year old Erp systems and excel like ah the ability to just pull some stuff together often will solve a problem. Not again for the whole organization like eventually you need these very complicated deployments.

Priya Vijayakumar

Over.

James McWalter

But in the early days as you said you know you can actually find that little that little kind of wedge really solve it well and then and then you’re basically just building trust in the organization as you kind of kind of move through it. Um I guess like you look at. But.

Priya Vijayakumar

And we made it very I was gonna say make but made it very simple for customers to experience the technology we would use cellular Modems to send data to the cloud right? So we don’t even need to get on your network and that way customers got to experience their data and and I know it’s not always possible with.

Priya Vijayakumar

Every type of solution. But these are things that we did differently instead of saying and we would do it as a free pilot for some of our larger customers right? because we felt confident in the value that we were going to deliver and that also makes it easier for the businesses to justify making these deep. Investments in it security reviews and so on because you know that is an investment The company’s making and so it’s It’s a you know it’s a partnership right? anytime you are a startup working with large enterprises. It’s a partnership you have to be committed to. Delivering on what you say you’re going to deliver right? And you’re you’re building a long term Relationship. You’re not making a transactional sale.

James McWalter

And no absolutely um, and yeah, right and like any large relationship has to be built on trust right? and and and kind of go set that kind of core element I guess in terms of like where what iqueue is today. Let’s say I you know listen to this podcast I be like oh this is something that would be great for my for my organization.

James McWalter

What are the kind of steps to kind of get get somebody set up with your product.

14:01.67

Priya Vijayakumar

It’s actually very simple right? typically somebody would reach out to us and we would look at sort of the types of equipment. We focus on the use cases I should backtrack a little bit. We have multiple use cases that we support with the data everything from optimizing throughput. Ah, you know analytical labs to driving procurement decisions or service contract decisions and all the way to space planning right? when you have lots of electrical equipment. So we always start with what’s the use case. That’s most pressing for the customer our european customers space is a big deal. Energy is a big deal. Right? So the priorities can shift depending on who the customer is and we start with that then figure out the right assets that we should put on an initial pilot or an initial program for them to get the data because we might support 9 different use cases. But for that customer. There might be 2 on that list. That’s most. You know, critical today.

James McWalter

You know when would a you know customer start seeing that kind of early value get and get very kind of excited about. That kind of yeah the problem being solved in that particular way.

Priya Vijayakumar

I jokingly and affectionately tell our customers in thirty days if we can’t show you value. Dinner is on me I haven’t paid for dinner yet. So and that’s because I think here’s another important thing. Um, you know we do use machine learning. But.

James McWalter

Yeah, sure. Yeah.

Priya Vijayakumar

Um, without disclosing too much. We use machine learning models that let us give us insight within seeing equipment kind of being active within a couple of weeks right which is another important piece. We’re not telling customers wait six months before you can start seeing inside. So while nobody’s necessarily going to make a business. Vision based on thirty days of data they start seeing the trends of oh somebody’s actually not using this or I can see that this piece of equipment is demonstrating a lot of anomalies. You know that we thought there was something happening here and with every single customer within the. 30 irty days we have shown them something that goes I had no idea this was happening um and that is important right in technology adoption. There’s no consumer product today that we buy that we don’t have a reaction within the first fifteen minutes of using that product even less. But in enterprises, it’s sort of taken for granted like oh you just have to live with a crappy product for six months and just power through it and I think that and that can change I think we can have take philosophies from consumer product development and apply it to the enterprise world to create a whole different experience.

James McWalter

Yeah, absolutely that the kind of consumerization of ah of I t right? like that that phrase around our consumerization of the enterprise. It’s something. Yeah, younger listeners might think everything you you know, looks like slack or something similar, but these are all very new, very emergent and um, you know.

Priya Vijayakumar

Um, urges none.

Priya Vijayakumar

What.

James McWalter

Using some of these ah very old school windows 95 things at the beginning of my career those are still being used and many many companies like kind of across the world and you know as I kind of looked at at your website you know and there’s this mentioned of the you know the key element of the smart plug and how that kind of interacts as you know.

Priya Vijayakumar

Who.

James McWalter

Basically the the conduits to this information and and all those kind of things as you’re kind of deploying those and and starting to pull in that data and you’re seeing that thirty days data and then eventually the six months data. What are the I guess have it the customers been very surprised by some of the insights is there. You know, particular insights that. You know you don’t maybe find that as surprising right now but the customers typically do yeah.

Priya Vijayakumar

So obviously the first one is they might have theories about how frequently equipment is used and they tend to be sort of blown away when they realize it’s not even in the 10% range. You know there are weeks that something is not used. We’ve sometimes done deployments where that equipment that we’re monitoring is not even turned on during that entire period right? So that’s you know that’s from a utilization perspective I think people have been shocked from an energy perspective when you take things like minus eighty freezers right? which everyone heard about for storing vaccines.

James McWalter

Yeah.

Priya Vijayakumar

Some of these freezers consume more upwards of 30% of excess energy as they age because they’re not always maintained properly right? and they’re just sort of blown away by the energy consumption. You know a new freezer with certain equipment oems. There’s also a big difference between equipment. And oems that data was not always visible people. Sold you on a datasheet not actual field data right? Very few people sell you on field data and so what they would see is some equipment oems models were consuming two and a half x what the datasheet was claiming to do.

Priya Vijayakumar

In other cases you could have a minus eighty freezer that’s only consuming Eight Kilowatts Kilowatt hours per day and another one that’s consuming you know upwards of 20 even though comparable models. So. I think having that data you know because there are certain pieces of equipment. You can’t turn off like a freezer you can’t turn it off but knowing that you’re using those assets efficiently or maintaining it properly has huge energy implications right? and space utilization implications. So I think usually those and we always.

Priya Vijayakumar

You know when you put some of the aging freezeers. It always makes her an interesting story in terms of how recovery to set point temperatures are happening and so that’s sort of how the some of the initial astonishment comes because they’ve had a hunch about some of these things but they’re still amazed at how much opportunity there is to. Share equipment right? The kind of the shared asset economy and and and and know a lot of our customers are in in Pharma Life Sciences Biotech so they’re very data driven and so to be able to see the data behind this makes for a much easier conversation than What I would call like an emotional procurement decision I have budget I don’t want to lose it. But I really don’t understand the implications of buying a product that now has to be housed in an area with very demanding hvac requirements people are going to be coming on site to maintain that piece of equipment.

Priya Vijayakumar

Need reagents or consumables to maintain that equipment. So there’s a whole cascading carbon impact throughout its lifecycle that most people don’t even think about right? We as consumers. Don’t even think about it because we just we consume.

James McWalter

Right? Absolutely and even thinking of about the example of the piece of equipment that wasn’t turned on in thirty days and I’m sure some you know some facilities operations managers like do we need a second one you know and and that that could potentially be bought as as well.

Priya Vijayakumar

Please.

Priya Vijayakumar

Right? Oh the ability to go ahead now I’s in the ability to sell a lot of this equipment right? So you would never buy a car that you didn’t know the mileage on the car imagine trying to resell equipment saying well trust us this was used by a big pharma that doesn’t mean anything.

James McWalter

Ah I think it got good none of no.

Priya Vijayakumar

Right? So you can actually extend the life of a lot of these products by providing what I call like a lab fax inside right? This is how it was maintained. This is a mileage on it and that could really go a long way for somebody buying it as ah, um as an after market or you know.

2

James McWalter

Yeah, and absolutely and as you’re talking there i’ kind of thinking through like what does a company see today when they don’t have what likeq and basically the only signal I get is the energy bill or some related something where there’s no granularity and it’s like oh energy bill seems to be going up or.

Priya Vijayakumar

Product.

James McWalter

Energy bill is like fluctuating in a weird way but there is thousands potentially millions of inputs into energy bill. Especially if you large facility that that’s manufacturing you know vaccines or or various pharmaceuticals and so on and being able to actually get to the ground your level of like oh.

James McWalter

Most of the increase is accounted for by these 3 freezers in the corner. Um, because we just didn’t maintain them or whatever it may be um I think that is ah yeah I think a lot of the problems around inefficiency are often. You have a fairly opaque process. And transparreency is often brought in as a way to kind of just for sake of doing it but it nearly always just makes our dramatically increases efficiency because like oh actually we were just like kind of stumbling Along. We didn’t really know what we’re doing and then all of a sudden. It’s like okay now we have some very very clear action items that we have if we want to. You know hit the bottom line in a positive way.

Priya Vijayakumar

And and it’s sort of shocking right? because in the manufacturing world data has been so critical to improving processes in manufacturing right? It’s it’s just inherent in good manufacturing. It’s not the case outside of manufacturing right? We people do capital expenditures. They buy. How do you justify today. Let’s even take an office space somebody comes and says I need a new printer. How do you justify you? You don’t know it’s just you’re relying on the person saying yep we need it and we’re going to believe you that you need it now multiply that. By hundreds of millions to billions of dollars that these industries are spending and these industries are growing very rapidly so they also need new space. So yeah, if you if I mean our data shows us we could probably take 20 to 30% of equipment.

Priya Vijayakumar

Away and nobody is going to cry. You know this is not a scarcity mode. This is this is what cracks us up because we’re trained to have this scarcity mode if you take things away but there’s just so much waste in our system right? Whether it’s food whether it’s fast fashion. There’s just tremendous waste in the overall system.

Priya Vijayakumar

And so when you take a lot of this away. You don’t really as long as you have the data to get to what you need. There is no scarcity right? and I think some companies are better than others are doing it. But as you know when lots of money floods into a certain industry.. There is no consideration I think there’s a lot of emphasis. Now being placed because of the lots of conversations happening around climate change and definitely some of the companies are leading the space in not just buying their way out through carbon credits. You know, actually taking meaningful action. Um.

James McWalter

You you like you’re you’re still admitting guys. You actually have to do something.

Priya Vijayakumar

Yeah, and and so I I think the changes are starting to happen and but part of it is. We’re also fueling industries whose business models are built on overconsumption right? So I’m a big believer in a product as a service model. Our job is not to sell more plugs. Right? So if we want to increase value. We better figure out another big problem to solve for the customer if our model was just to sell more hardware. We would figure out how to obsolete the hardware that we’ve sold to you in eighteen months which is what happens in a lot of industries right? Whether it’s infusion pumps.

Priya Vijayakumar

It’s not like infusion pump technology in Hospitals has like gone through some dramatic you know curve like the chip industry but they’re replaced every year you know.

James McWalter

And all the Nobel prize winning infusion cur you know awards we’re giving out right.

Priya Vijayakumar

Right? But yet they’re replaced every twelve months oh because of a software upgrade. What is such a travesty right? So this is where I think you know you need regulation to happen. But you also need industry leaders to change that behavior because yes it doesn’t mean that we don’t we stop. But we can consume more responsibly shift the value proposition from you know, vendors and I always come back to the aircraft engine model in the early days they would give away an aircraft engine and make all their money on off to market right? So they were happy to have.

Priya Vijayakumar

So a ferrari like engine that constantly needed repairs when ge came in with this model of power by the hour well guess what? you don’t want to build ah an engine that needs repairs all the time you want it to stay on wing as long as possible. So it changed design philosophies right. So I think that’s also an industry shift that has to happen but that happens by the end users changing their buying behavior as long as we keep buying whether it’s plastics or whether it’s electronics people keep selling because that’s. What the business model is they’re counting on us to upgrade our product every year

James McWalter

Yeah it’s so interesting. You know we have this manufactured obsolescence. Yeah model across across the board right? and you know people upgrade their phones every you know every couple of years Um, because you know I’ve definitely gone through periods where my phone is like 3 years old and it just yes, it just stops it just. Just can handle things in the same way and like I haven’t changed my use like I’m I’m just doing you know the same 10 boring things on on my phone as I did for last few years. Um, but it does eventually stop. You know we do we definitely on on the positive side are seeing more subscription models kind of coming in. But even just this is slightly different. But even ah, there’s some utilities in the United States who are working toward subscription pricing for their energy bills right? and figuring out through getting lots of data that like okay, let’s just charge somebody $50 a month or $100 a month or whatever it is and they will absorb. Yeah, the spikes and so on that that occur and as we’re seeing with you know. And dramatically ah variant energy bills today you know that model right now I think would be like something that that people would actually love right because it’s kind of like an inflation hedge and so I think as you said like as we are if we can shift business models. You actually start to have these kind of positive feedback loops around. The the wastefulness of the industries that were kind of switching around in the first place.

Priya Vijayakumar

And ultimately you’re going to deliver more value to your end customer right? because you have to understand how your end customers using your product. What’s the difference between a tesla and the early days of the car manufacturers right? remember when you get a. Ah, a warranty notice months after it was issued right? and they have no clue how people were actually using their cars. It was just there was this huge separation between the end user and the people who actually manufactured the cars Tesla knows far more than you want to about how you drive your car right. But you see but then they built a whole different business and industry because of it right? because of that Data. So I think we have it on the flip side. We have a responsibility for using data Correctly, right responsibly. But I think it helps you deliver more value to the customer when you do focus on delivering a. Service as opposed to selling a widget I think it’s a very it’s um, fundamentally a mind shift change within a lot of these big corporations that have historically sold a widget and I think you’ve you’ve probably heard for years right? Everyone’s trying to move up the value stacks. We Want to stop being a. Selling a screwdriver and we want to sell you a smart screwdriver to do what right? So it’s It’s just you have to change your mindset.. It’s not just you make something smart and all of the sudden you’re delivering a service. Um.

James McWalter

Yes.

James McWalter

it yeah, it yeah it has to go back to again being our conversation like you have to solve an actual an actual problem and I guess like in terms of where what iq is today you know where where things and what are the kind of you know next 1 or 2 year goals for for what iq.

Priya Vijayakumar

Problem.

Priya Vijayakumar

I think you know we’ve we started initially kind of heavily focused in research labs right? We are now expanding in Europe I think the insights that we can get obviously the first part is get your foundation right? right? No, he wants to build on top of a crummy foundation. So we.

Priya Vijayakumar

Hunkered down got a foundation right? and we’re now expanding the solution capabilities in the coming and we’ll be announcing some of that in the coming months but right now a lot of growth happening in Europe primarily driven by energy. But I think for the biggest thing for us really at the end of the day is for. Consumers within the enterprise or you know consumers at home to be better educated about what is the carbon lifecycle impact of a procurement choice I’m making so we’re hoping for more transparency from the industry on what the carbon footprint of products they’re making. And feed that into the whole life cycle right? and to really start seeing the needle move in a significant way and that’s really the big thing for us and we’re starting to see that we obviously want to see that at scale. But I and I think there’s lots of opportunity for collaboration in the industry. It’s a huge problem right? I don’t think we need to be the only ones. Working in this space to solve it. So I think it’s a huge problem and it’ll be great to see more emphasis on you know, optimizing our resources. We. We talk about a lot of futuristic things which are also important but we just cannot continue to. Be as wasteful as we’ve historically been It’s just not viable. It doesn’t matter if you have the greatest renewable technology down the road.

James McWalter

Yeah I think what’s one of the really fascinating aspects is how the portfolio of sustainability is shifting in the enterprise especially over the last couple of years right? It used to be the sustainability department was like this little kind of corner. The 3 people.

Priya Vijayakumar

6 walking line.

James McWalter

And when I first started of getting into this space a couple years ago I was talking to some sustainability people actually in the fashion industry and they’re also so lonely they’re just like sitting in corners and I was like there should be like ah kind of like an a group of sustainability fashion folks now. It’s amazing right now there’s like all these organizations and then there’s a lot of collaboration and community happening.

Priya Vijayakumar

Of when.

James McWalter

Um, but even just a couple short years ago. It was like oh just I’m the only 1 working you know, working working at the firm to try to improve things. But now we are definitely shifting into you know, basically right now I think it’s now on the side of the Cfo right? The Cfo now cares about these things in this kind of interesting way and.

Priya Vijayakumar

Name.

James McWalter

You know the Ceo does at larger enterprises in some degree because if Cfo cares the Ceo does to a certain degree but it’s still not like the primary like focus of the Ceo and I think that is the shift over the next decade we’re going to continue to see you know as both the risk and reward are risk and return elements of. These various kind of sustainability and climate impacts happen across these enterprises. It’s just become more and more central to how things are run.

Priya Vijayakumar

And then I I also think sustainability was always There’s always been this approach like oh we’re going to save the planet There’s really no benefit to the business right? And so I think it’s a combination of reframing what your responsibility as a business is. It’s not just to be profitable but also have a societal impact right? So I think that’s 1 thing and and the and the younger generation that’s important to them when they join a company right? that you will have something more meaningful and it’s not just the younger generation to be fair I think there’s a mind shift. Change. That’s happened through ah through multiple generations right? where it’s not purely profit driven as the only metric for a company but I don’t think they have to be mutually exclusive right? So we have great sustainability benefits from delivering our solution but even bigger benefits from an operational efficiency perspective right. So I think there is lots of solutions out there that is a win-win for the business and also meeting your sustainability goals.

James McWalter

Yeah, no absolutely and couldn’t agree more and I guess in in terms of you know for yourself. Um, you know building a company taking a technology that existed and and divert. Yeah moving it into this new direction over the last few years I guess anything that surprised you about you know trying you know, becoming a Ceo leading a company. Ah you know any discoveries you made along the way.

Priya Vijayakumar

Um, you’ll have lots of days where you what we’ll probably be the only the co-founders that the once really only once convinced because you know you’re taking technologies that have existed and to demonstrate that you can deliver value. Sometimes it feels pretty lonely right? until you start getting that momentum which we’re seeing um, but I I think it’s exciting because what makes me get up every day is solving a problem hearing like amazing feedback from customers right? that we’ve solved a problem for them.

James McWalter

Is it.

Priya Vijayakumar

Um, seeing us evolve as a company. We’re a pretty small company. You know, solving some really big problems and so that’s what makes me get up every day is just that conviction that we can do this and and I think as you know for most founders will tell you in the early days ah if unless you’re part of a main bandwagon right? You’re like on the crypto bandwagon. It’s going to be a pretty lonely journey until you start demonstrating that products market fit and traction and so I think that’s probably been the most exciting part for us is that we have the conviction that we could solve these problems and now that’s.

Priya Vijayakumar

Being validated by all some of the large customers adopting large customers who are typically very conservative with tech New Technologies adopting our solution right? and so that’s that’s the most exciting part.

James McWalter

Yeah there’s there’s a big mindset shift from me personally and I’ve heard it from a lot of other kind of entrepreneurs through the podcast about moving from a feeling a know as rejection to curiosity right? where it’s like okay you. Every day as a founder you just especially in the early days just like a no no after no no from customers. No from investors no from potential hires. Just no, no, no, no, no and exactly it’s like I’m just going to hear a lot of dose today and then you know in previous kind of things I’ve worked on I but like oh I’d feel like a little bit I’d put my bit defensive.

Priya Vijayakumar

Yeah, yeah.

Priya Vijayakumar

Ah, it’s like your middle name.

Priya Vijayakumar

Ah, yeah, with.

James McWalter

Have my backup a little bit and be like okay that no is a reflection on me or it’s sort you know and then now it’s much more like oh like I I Absolutely thought that this would be a perfect yeah product for this particular customer and they said no, it’s like why and it’s like it’s so exciting to find out and it’s like.

Priya Vijayakumar

Um, why exactly.

James McWalter

And sometimes it’s it’s ah it’s a really good reason. Sometimes it’s like we just we dont need you know byproducts in January right? that or whatever it may be. You know.

Priya Vijayakumar

Yeah, um I think I always take every no as an opportunity to evolve either your narrative right? or it’s your product and and it’s because at the end. Day when you when you begin this journey as a founder you are the one who believes in what you’re doing right and people mistake investor investment as validation that you have a viable idea that’s complete Crap. There’s lots of like garbage startups that I Wealthf funded like.

James McWalter

Yeah, it’s like youre you you raise a sort of money. It’s like now I have actually have to build a company I.

Priya Vijayakumar

Yeah, exactly So. No I mean I just said to somebody last time I said we wanted to build a viable business. Not just a venture backed business right? That’s different because you have to deliver value in order to build a viable business and have cost structures that can scale. It. Easy to create the illusion of one day I’ll figure out what this business model could be right? So um, and and so it it is a journey.. It’s not and it’s as everyone knows being a founder is a bit of a rollercoaster right? There are these amazing days and then there are Days. You’re like why am I doing this again, but. I Think overall for us. It’s just we have amazing customers. They have been I mean we’re very fortunate. They’re amazing collaborators. They they’re very encouraging. They let us experiment right? and expand our portfolio. So. And that’s very enriching right? because they don’t treat us like a vendor. It really is a collaboration and so I think that’s been a big part of culturally who we are as a business right? We obsess about delivering value to the customer and I think that just naturally comes out in our interactions with customers. And I think the customers have reciprocated even though they’re really big. They’ve been very supportive of us so and that for me is very fulfilling right? and I see the team growing in their capability and I would have moments I’d come back to the team and go I didn’t know we could do that. So ah.

James McWalter

You Yeah that that the pleasant surprise is I like that’s always that I saw you come in here like Wow like I was at home and this happened without me. You know.

Priya Vijayakumar

And they’re like you can’t sell it yet.

Priya Vijayakumar

It is pretty cool. We have an amazing team and I have an amazing co-founder I’m very blessed.

James McWalter

Absolutely well Priya this has been such a great conversation really enjoyed the chat before we finish up is there anything I should have asked you but but do not.

Priya Vijayakumar

I think you’ve been very good about covering sort of the broad spectrum. You know we’re probably excited maybe to highlight that we’re going to be. We’re growing significantly in Europe and so we’re definitely looking for some great channel partners to work with who who. Finally have share similar values in terms of solving the customer’s problems. That’s really important to us. So I think that’s kind of the next exciting phase of our journey and this has been a great conversation as well. So thank you.

James McWalter

Thank Priya and we’ll include some contact information in the show notes have a great yesterday.

Priya Vijayakumar

Thank you you 2

The Future of Energy Delivery – E94

Great to chat with Jason Huang, Founder and TS Conductor, TS Conductor has developed a conductor that outperforms all current transmission & distribution conductors on the market! We discussed improving a 100 years old technology, bottlenecks in the power grid, building a strong company culture and more!

If you would like to contact TS Conductor please email ​info@tsconductor.com

Remember, If you want to support the podcast please rate and review 5 stars on  Apple, Thanks so much! 

James

The unedited podcast transcript is below

James McWalter

Hello today we’re speaking with Jason Huang founder of TSconductor welcome to the podcast Jason! great to start. Could you tell us a little bit about TSconductor?

Jason Huang

James thank you very much for the opportunity.

Jason Huang

TSconductor I would argue it is the best conductor that has been developed in history. It reflects the ultimate combination of best materials that is available today. To be able to conductor in the technology we use the most conductive aluminum type and we also feature a carbon fiber composite that has all the attributes. The industry has been looking for extremely high strengths lowest way possible. And it does not have a so more expansion problem which creates sag when you are able to combine the 2 mature together. You basically have that ultimate combination. What material science offers on top of that. We have a design that is enabling I would call that a breakthrough design we leverage aluminum to protect the carbon composite and we leverage the carbon composite to provide all the strength technical characteristics that protection from the aluminum. That is unique to us that provides guarantee for safety reliability longevity that has been missing in the industry for the past century.

James McWalter

And why and this might be a basic question but why are and conductors so important and.

Jason Huang

Yes, when you think about you know electricity. It’s about electrons we generate electrons from Generation site nowadays. It’s ah um, it’s all about renewboard generation and these are normally in the remote places. Our consumption side which is called Load Center These are the cities you have to move the Electron and that is where you need the pipeline for the Electron that is the conductor that we have power grid the power grid. Ah basically. You have towers you have conductors that are supported by the towers or poles and it’s the Conductor. That’s the ah pipeline for Electrons. You know when you talk about other forms of energy oil and gas you have pipelines when you talk about. Transporting humans and goods you talk about automobiles roads and it’s the same thing you have to move it. That’s why conductor is important and it’s a critical piece of power Grid Power Grid is also the critical piece for our. Energy infrastructure and you could also argue Electricity is the blood or energy is the blood of our economy without that you cannot run.

James McWalter

I go farther I’d say civilization right? We don’t have a lot if without electricity and the way we’ve completely constructed. Um the economy and civilization and in general and I guess like thinking back to the beginning of of Ts conductor. You know what drove the initial decision.

Jason Huang

Um, yeah.

James McWalter

Ah, to kind of go on this path and start this company and.

Jason Huang

Yeah I left my prior employer in 2017 and I had the um I would say the opportunity to acquire this technology. This was invented by someone else who is not. Affiliated with the industry because the technology’s uniqueness actually calls for outsider to be the innovator. It kind of looks to be a little bit impractic or stiff. But when you actually do it. They’ve learned that you could actually make it even more amenable to. What the industry need. So I had the fortune to acquire the technology and I I would say part of the reason is due to my um, my understanding of the industry my understanding of the prior technology which I had the fortune to lead as the. Ceo of the other company and so I know what is missing and I know you know when you see a great solution. You just get excited about it that you jump on it with all your heart and soul and your resources.

James McWalter

Yeah, and absolutely and so was it. You were looking for something better and you kind of came across this this research and development that this other person worked on or did it just kind of.

Jason Huang

That’s what what I have done.

James McWalter

You know you came across their research and were like oh this is like an amazing application of their technology.

Jason Huang

Yeah, yeah, that’s a good question I was aware of it but I was not involved in it and when I had the opportunity to act I basically seized the moment and made a decision to commit myself rest of my. My career and put all of what what I have on the line to to help take that technology forward and with everybody’s help. We can make this technology mainstream and we can make a tremendous difference in climate change or just give you a simple example, the efficiency this technology brings We can potentially cut about half of the greenhouse Gas emission associated with.

James McWalter

Please.

Jason Huang

Composory generation. What is a compository generation. You might ask today based on doe numbers. There is about 8.3% of the electricity that is lost due to resistance heating we call that line loss.

Jason Huang

Because whenever you have a conductor you have resistance and you pass current through it. There is a simple high school physics I square times r which is a resistance heing and that is always there when you have a conductor that has lower resistance which is basically more efficient. You’re gonna be able to cut. On that loss so globally 8.3% of the electricity. That’s generated is lost to line loss and it is about two Thousand Terawatt hours of electricity wasted every year to make up for that loss. You do composatory generation basically means. You generate far more than you need just to make up for that compository generation using today’s ah the power generation mix 30% renewable 70% traditional. We are creating about 1000000000 Ton of greenhouse gas every year every year and if you can improve efficiency by half you are basically cutting out 500000000 ton of greenhouse gas every year

James McWalter

It Yeah,, that’s that’s phenomenal I mean I think there’s this ah phrase within the kind of climate tech community of the your products that have Gigaton impact something that actually can go to that level of scale and then have that level of ah you know effect. On the carbon emissions and so when you’re talking about that level of numbers and because electricity is ubiquitous around the world and we’re just building more right? like the world population is Larger. We’re electrifying more and more of the world and so that Compenseratory energy loss is actually just going to increase on Net unless we have technologies like this to.

Jason Huang

Yeah, and to other data points I think it is not well known out there in the community one is the renewables we have today a lot of these projects whether it’s solar or wind.

James McWalter

You know mitigators.

Jason Huang

90% of them in our country here are not able to be integrated to the power grid because we have bottlenecks in the power grid. The average weight is about 3.5 years and in some other countries. It’s actually even longer. So.

James McWalter

This is.

Jason Huang

If You are able to deep Autoneck The power grid for example with our technology using existing right away in existing structures like the towers and the poles we can bring the capacity to 20250 even 300% of the Baseline capacity. And that’s going to transform how the renewables can be Integrated. You know we’d love to have more support from the community in terms of you know, asking utilities and asking our regulators to give advanced technology like ours. You know a closer look. In terms of faster Adoption. We do work in the industry that is slow and this is why all the support from all the aspects of the society would be very beneficial. Um.

James McWalter

Yeah, no absolutely and I would love to kind of dive into some of those kind of elements of the bottleneck in a moment but I guess coming a little bit back to that. Ah, earlier part of the story. So You yeah you recognize this technology and you’re like okay this this is going to solve this massive problem of. You know energy loss that is occurring on the grid today. What was the process of going from there to basically making it something that is a product that could be actually be deployed and utilized and I guess what were the kind of steps and were there any pivots along the way that.

Jason Huang

Yeah I think there are quite a few one of them is manufacturing one um, manufacturing the industry slow for a reason they expect reliability at any cost we actually put safety in the reliability as.

James McWalter

And.

Jason Huang

1 of the 6 core principles at Ts and in our manufacturing process. We’ve developed x-ray machines that allows you to ensure integrity of the composite material inside the conductor you can argue that every single inch of our conductor get inspected. Ah, nondestructively and we also deploy smart manufacturing in our system you have lot of video monitoring smart monitoring technologies today. The cloud storage is very cheap. We we basically. Ah, create a environment like a restaurant you have open kitchen that people can see through the glass we can provide that to our customers to to give that level of certainty to our customer base. So the safety reliability longevity. Not only you have to design it in. Which is what we have done but also in the manufacturing phase making sure they’re made properly then you can provide that safety reliability longevity performance that is expected by our ah utility customer in the other part I think it’s equally important. It’s often ignored. We have new technology getting adopted that is the user experience. For example, if you have a new product in the field when they’re being put to use like it deployed you have lineman and these people they put their lives on the line. You know they work with your product. Um.

James McWalter

And.

Jason Huang

How readily can they work with your product does it require new tools. new equipment new trainings we purposefully design the product to be compatible with standard way of working for the past century by the way though. The the conductor that is dominating in today’s power grid was invented in 198 so people were in the industry who are used to do things the way it has been for the past entry and if you suddenly change their practice. Require new tools new equipment that’s going to make it little bit more challenging for them to consider and adopt your technology. So we also took care of that part and you don’t get it right? The first time so in the manufacturing process. Um, we being. Doing the manufacturing actually the mentor was evolved since 2016 so this is not like you’re building it from scratch the noctar technology has already been deployed in both distribution circuit as well as in transmission circuit.

Jason Huang

So it’s a proven technology ready to be deployed at all the voltage levels.

James McWalter

And when I hear things like ah you know the the existing conductors that are in the overhead wires that you know the audience walks by every day. Um, probably have a copper basis or something similar and they’ve been basically were invented in the early twentieth century and have not been. You know majorly improved for 100 years what were the main barriers to the innovation in this space because I can definitely see understand how some industries are pretty slow to move. You may have a generation you know a few decades even of ah, kind of stagnation in innovation. But when I hear something like something did not change for 100 years is that because we just didn’t have the material science. Ah you know innovation itself to make changes or was it mostly down to some of these barriers to adoption when you have a very kind of risk versus organization like a local utility. Okay.

Jason Huang

I would say already above and and plus some other factors. Let me see if I can summarize it in a way that your audience can’t understand one is related to the the overriding need for reliability safety.

Jason Huang

You need a product that can provide the assurance of reliability safety longevity and that has not come along I would argue until Ots is is is available and there’s also that element of mature science. Um. What we feature in the ts technology. We have the a Neo aluminum which has the best connectivity that was actually featured in in the 1970 s technology called acss it has the steel technology combined with a need aluminum and steel by the way it is. Ah, you know higher Grace Theore with greater strengths compared to what was used in the nineteen what was developing 198 and that’s a niche product. It is only used for high temperature use typically because they’re little more expensive and then the composite piece. Ah. That you could also argue. It’s becoming a mature technology carbon fiber composite has been around since the 1970 s so it’s also about 50 years so it did take mature science evolution to make what we use in terms of the foundation or technology available today. And a proven technology by the way. Um, and I think the third element had to do with regulations the environment. The utilities are operating for example in today’s regulation um, you know, utilities. We have many you know there’s the western only utilities there are munies and the co-ops. You know there are thousands of them. They’re all regulated either by especially the io the emestinol utility by Ferc or by the state energy commissioners. And there is no mechanism today to Motivate Grid Power grid to improve on efficiency for example and um, you know the utilities are encouraged to make investment.

Jason Huang

And then they’re allowed a coupon rate to basically collect the return on their investment. There is no mechanism to to motivate them to let’s say use a more advanced conductor more efficient cut the loss which will ultimately benefit the ratepayers benefit the environment as well.

Jason Huang

Because you are generating less waste and yet there’s no mechanism for them to retain some of that benefit. Um, and sometimes when you use the more advanced conductor. It’s going to cost you a little bit more in the in the first cost.

But we we actually are able to reduce the overall capex cost but some people don’t look at that way and if you look at the life cycle or cost benefit. It is a total absolute. No-brainer that you should look at a more advanced conductor because they’re more efficient.

Jason Huang

In addition to providing you far more capacity than that you need in today’s environment

James McWalter

Yeah, on the on that capex point I’ve talked to a few folks at yeah various utilities from connnadison pg ah Pg and e and and and so on and um and as part of conversations I was having with potential startups that I might start myself and you know talking about like. What what would it take to sell to utilities and like what are the various elements and 1 person was like no matter what you do try to focus on capex because there’s often not the money for the opex. You know if you want to go in and pitch some sort of nice cool software solution right? because that’s the kind of world I’m more coming from ah rather than the hardware side. It’s like can you make it a capex expenditure on the software in some way because otherwise you might often struggle to actually get funded um by these kind of customers and so I think it’s something that’s quite opaque to to people on the outside just how things like how they spend money how they kind of deal with vendors. Has such a kind of ah artificially constraining um aspect of you know the kind of environment of people trying to sell into these organizations the utilities and so on and so it’s it’s absolutely something that that needs to be revised and and worked on I guess one other element is the regulatory state and so. When we’re dealing with ah things that affect critical infrastructure like the the grid often you have various kind of regulations that govern what can be done in in that case is the regulatory state ready for innovations like what ts has um and how can we improve the speed of regulation when we do have these new step change technologies like. The ts conductors and.

Jason Huang

that’s ah that’s a great question. Um on the regulation side I think even Ferc and the state commissioners. They recognize the massive challenge we face in terms of climate change. Ah, in terms of the need to integrate to facilitate the integration of all the renewable generations in our power grid is how do I put it. It’s it’s old on average in the us the power grid is about transmission grid is about thirty years old you know it’s it’s. It’s into the second half of its design life um to to address that regulation can play I would say enabling role and 1 aspect For example I just talked about. Is the efficiency. You know you you think about automobile department energy has guidelines set in the place may not be mandatory in the beginning that that you you have a kind of ah improved target for fuel economy and that has I would say made a huge difference in terms of How efficient the motors are the cars are I think the same thing can be done related to grid efficiency. We spend far more time and effort to improve only efficiency in our refrigerators microwaves dishwashers and you get insamitized for it but yet. The power grid system itself. We don’t pay attention to the efficiency aspect. Um I would also ask that the utility themselves in the past has always been conservative risk averse you have employees who are really you know. Got a job for life. Um, they don’t necessarily get rewarded for being innovative step out in the box and if you if you do let’s say do things the old way nobody will challenge you or ask you right? And that’s that that.

Jason Huang

That creates an environment to to be risk of worse as well and granted you know power grid need to be reliable need to provide that electricity. You know whenever you need however much you need, but we’re in the twenty first century we need to use twenty first century solutions for our problems instead of relying on ah early twentieth century technology to solve our pressing problems today. So I would really urge our regulatory um agencies. And also I would say environmentalal activist can also play a role and bring awareness to them people by by nature wanting to do good. You know for the community for society for humanity for our environment. Ah, many of the. I think even the regulators and commissioners give them a lot of credit because they face a monumental challenge. Um I think with time they will see it. But it’s going to benefit by creating more awareness of technologies like Ts that is available to deploy. You don’t need breakthrough innovations to make a difference. We can make a difference a huge difference today by having a environment that allows utilities to be a little bit more bold in also to think outside the box in them.

Jason Huang

To kind of force a mechanism that advanced technology are also looked at at least as a option and I could argue that we can reduce capex we can certainly reduce operating expense. Ah let me just give you a specific number when you think about building a new transmission line. Sometimes in in this country. It takes about 8 to 10 years from the planning phase only five percent of the project is spent on conductors 25% is on the structures when you use the right technology like ours. We can hugely impact the structural cost like fewer towers shorter towers. The foundation will be a lot cheaper as well. You have less encroachment of the of the environment and that 5% expenditure in the entire project by the way dictates the throughput.

Jason Huang

Dictates the agency of the line and we should certainly do far more and you know when you talk about leverage that is where the leverage is. That’s where you can spend a little bit more money so that you are impacting the overall project expense and you also have 50 years of line loss saving benefit that is available to you so that’s the kind of thinking process. We should have we should encourage our regulators to consider should encourage our utility operators to consider as well.

James McWalter

Yeah I think there’s a lot of like really fascinating kind of thoughts in there I mean one way I think about risk and risk aversion I guess is that I think we’d want you know people who are running critical infrastructure to be risk averse. But it’s down to the timeline that they’re risk averse on right. If you are if we’re kind of barreling into a you know future of electrifying everything where the grid itself just needs to massively you know, increase in size like moving into a world of just regular brownouts and blackouts is something that we should be very risk averse about right? like and not enabling that. Versus I guess the risk aversion of an individual and an organization like utility or a regulator who might be risk averse about you know, doing everything doing anything new at all, right? and it’s like if you we can lengthen the timeline for that risk aversion where it’s like okay, let’s not have the grid collapse in 4 years or 8 years or 12 years I think then there’s more of an appetite to explore these new technologies because I think what’s definitely I think is now accepted is that the status quo will not work right? like that that I think has that message has been definitely delivered as we’ve seen things like what happened in Texas you know last year as we see you know, um, and and those events are going to. Occur more more often and so it’s like can we get out ahead of those things by um, you know, improving process like that’s number 1 right? improving like the nature of things you mentioned the the interconnection queue taking three and a half years right now. Um I think pgm which for the audience covers Pennsylvania and a few states kind of close to Pennsylvania. Ah, they just announced a change their queue but it’ll take 2 years to like make the change that will actually slightly speed it up and that means you basically just have all this clean energy which is basically funded like the moneys there just sitting on the sidelines just waiting to be deployed and that combination of factors means that we’re just moving way slower. And for once it’s not money. That’s the issue. It’s all these other structural elements that are in place.

Jason Huang

Yeah, um, James I wanted to add 2 points like ah it’s it’s like a myth one is new technology will add more risk. It’s actually the opposite when you look at a technology like ts. We actually help to improve resiliency while you are modernizing your power grid or just give you an example I was in Florida meeting with Fpo and nexttera and they have challenges with hurricane wind becoming more intense and their power grid. Ah, need to be prepared to handle that type of load at the same time you needed more capacity. It’s a paradigm you know you you need more capacity. You’re going to need bigger conductors, a bigger conductor with a stronger way is going to put your towers and infrastructure at greater risk with ts technology. We don’t have to go bigger in size to give you more capacity. We can use the same size conductor give you 2 x capacity and our conductor is compact that minimizes the wind load and our conductor is a low sag so that you can also reduce tension to the you know to the towers to the poles. Ah, when you when you when you install it so that you have less tension to the top so you can actually have have them all without having a compromise the other part I would argue is the myth about okay when you go green there is a green premium you know in some cases that’s true. Ah, with ts you could actually go green and get green. What do I mean by that when you are able to leverage the massive line loss saving benefit and make that available to the rate pairs. Because by and large the rapier are financing the um you know the the power grid expansions or modernizations because they optimally pay for the electricity if the line loss is included in the analysis. They are actually getting a. Better deal out of the investment or they could actually start with a lower capex if they use ts technology in far lower operating expense because you don’t have much of a loss to speak of so you can go green and get green as well. And but you do that with ts technology. You’re also helping the environment and so we you know these? ah myths they need to be demystified. You know for for the for the truth to be known for everyone.

James McWalter

No absolutely and and I think yeah, somewhat whatever what we’re trying to do on on the podcast. But I think in general the anything that touches the electrical grid has been so just the water we swim in as a society for so long that we just don’t really think about it. You know I click a switch the light turns on. You know I had a button my microwave works those things are just such a fundamental element that all the kind of elements that allow that to happen because they’re all being changed because of the nature of moving to intermittent supply and demand as we move to renewables as we electrify more and more of the common world. I think demystifying those elements I think brings about the kind of more rapid change. It brings about you know consumer change it brings around regulatory change brings about utility change and and also the companies that changed and adopt and kind of develop new innovative kind of approaches in order to kind of solve for those different problems. Um, and I guess. You know, thinking about you know Ts and and kind of next steps I was reading about. You know you recently had this kind of very very large rates of capital to start building out your first kind of manufacturing facility in the us but some big you know, quite famous investors like breakthrough energy and so on. Where where’s kind of that today you know what? what are the kind of process to kind of get that that first factory and up and running so.

Jason Huang

Yeah, thanks for actually asking that question. First off, we are very blessed with our investor group breakthrough is a visionary investor and um, they know the global challenges they have patience. They invest in hard tech like ours they have to build factory to make a difference and we really appreciate them for their leadership. We’re also very grateful for utilities like national grid nextera fpl. These are thought leaders. These are early adopters of technology in the industry. You know I do remember you made a comment about how you get new technologies adopted in ah in a conservative industry. Um, you know, even even in the conservative industry. You have some players that are. Progressive that our thought leaders early adopters you wanted to focus your energy with them. We’ve been very fortunate to have a national grid and also next era to invest in us and they also have shown us a tremendous interest. In taking our technology forward as well. Um, and I also think that they speak volumes on behalf of the rest of the industry and the others are just not used to do things the way they do national grid and next era. So what. National grid nextter is is working with us is going to help the entire industry as well. In terms of the facilities we have. We’re building our first facility in California and there’s a massive need for fire remediation effort and you mentioned about p and e I just needed to bring a point. We our technology have been selected by Pg and e in its open space challenge sometimes you look at a massive utility p and e you know they’re not very progressive but when you are faced with challenges. You know they being very creative. Ah, soliciting solutions worldwide. So we’ve been very fortunate. We do have ah enabling technology for them and we’re working with some of our partners in industry like prismian to bring technology solutions for them and um so you know these are. These are things that will help the overall industry. Um, we are we should be in production phase in our facility here by about midsummer um I would say before August we will be making products.

James McWalter

So very exciting.

32:41.20

Jason Huang

Out of our facility in California and that is very exciting. That’s a milestone event and our team has worked really hard by the way we have a great team culture in case I didn’t mention it. We have a great team. Um, our vision. For our company is probably a little bit different than most of the other companies we care about our employees and partners. We care about their happiness fulfillment in not just material sense but also spiritual aspect. We believe that is important.

Jason Huang

And we also believe that as a company. There’s an obligation to society to humanity especially in today’s environment you have this massive climate change and we’re committed to make a difference for the world and lastly we like to. Get our technology to the phase that we can be the choice to rewire the world with our technology and and when we do that we can improve capacity ah capacity throughput in our power grid to accommodate all the renewables and. To improve efficiency that has been ignored in the past century as well as providing that enabling self-monitoring capability which is not possible in today’s wire today’s wire are dumb wires. Um, these are things these are missions of ts. And we’re really excited about what we could do for the for the world.

James McWalter

Yeah, ah, but ah, it’s absolutely fantastic I Guess on the um on that kind of cultural Piece. You know one of the things that we’re seeing right now is a move of the you know the most highly skilled you know workers and in the economy moving to things that have more of an impact right. Um, it’s started. You know when the the great resignation. Although so supposedly looking at the research. The great resignation was not quite as great as large as as if kind of seen initially, but you’re definitely seeing. Ah yeah, people who might be working at ah companies that are large tech companies. Maybe they don’t like the direction of those. They’re looking at climate Tech they’re looking at other areas where they can have more of an impact in their kind of day-to-day. Yeah, and you mentioned that this kind of you know the spiritual flourishing element. How does that I guess ah you know appear within the kind of company culture in a direct way. Um, because I think that it’s something that a lot more teams are trying to cultivate and maybe are struggling to do So yeah.

Jason Huang

Yeah let me expand a little bit about the 6 principle values at ts we at the very top. It’s a pyramid. It’s customer first without customer there’s nothing there. We don’t have to explain that right below it. Have 2 values that are important one is teamwork that is within and also with partners with customers. You know you mentioned about the culture. Um the spiritual aspect teamwork should be simple because we trust each other. And the trust is not easy if you have egos in the middle when you are able to see through the egos and really understand who we are as a being um, you’d be able to have a much greater appreciation for humanity.

Jason Huang

We actually are one. You know that oneness um I was impressed I saw a picture which is comparing the human lawng with the tree. The tree takes in what we breathes out and we take in what the tree breathes out.

Jason Huang

You know that code dependency that harmonious one is. It’s really amazing and we need to think it that way and teamwork is also just like that as well and then we have safety reliability. It is not just thinking about what.

Jason Huang

We locally as a team you know in our in our company but also the extended team that includes alignment that includes the utility workers that they work with our product and and then right below that we have 3 values that are important one is continuous improvement. I’m of the view that even with our technology I would argue It is best in the world. There’s still room to improve and we have a smart conductor in the works that will change the world again in the conductor space. Um. You know with continuous improvement I’m going to share with you. My perspectives about putting the effort having passion by the way The the fifth value is you have to have passion and energy to you know to to come to Work. It’s like um, you got to love what you do and do what you love. And if you’re stuck in a place if you still needed to make a living at least learn to like your work because otherwise life is too short. Why why choose to be miserable. You can make a difference in that selection in the last wise commitment.

Jason Huang

So back to the continuous improvement. Um, it’s a compounding fact I urge my colleagues and and and you know people I’m I meet I observe I’m a mature scientist by training so you can see my passions about Ma material science.

James McWalter

Absolutely yeah.

Jason Huang

Why I am excited about ts technology if we aim for one hundred point one percent what does that mean every day we have about 1000 minutes that we manage you know rest of it. You sleep and you eat and you know just nonproductive hours necessary minutes by the way. If every day we squeeze the 1 extra minute that is the one hundred point one percent effort if you do the compounding because the effort you put in today. You know that effect is compounded by next day’s 101001 ndred one thousand one minute if you do it for a whole year six three hundred and sixty five days that extra minute every day is 1.4 x compared to someone who’s just doing 100 if you do it forty years on a continuous basis that is 2000000 times if you are not successful. Something is wrong. Okay, so you are putting in basically the 1 minute extra effort that’s creating a 2000000 times compounded impact. Why shouldn’t you be successful and then the other point that I wanted to make about the continuous improvement is the 100 % principle the way I look at the 100% is you do need to pursue perfection in products in manufacturing as well. Just imagine you know we make products you make a conductor.

Jason Huang

You start with carbon fiber resins and then you do protrusion and then you do encapsulations and so on so forth if we screw up especially toward the latter stage the manufacturing step. You’re not. You know you are only 99.5 percent there. You might be scrapping the entire lot. Just think about all the wasted material wasted labor and effort wasted resources. We have to pursue the 100% as well and if if nothing else if your audience can take in the one hundred point one percent principle the 100% pursue for perfection I think it’s going to do them well for their for their lives.

James McWalter

Yeah, and I think it also goes to the core of even the technology itself and we talked a little bit about this at the beginning of the conversation. Ah, where technology makes a massive change is where it is a new point of leverage and this word leverage when you’re trying to leverage that extra point one percent or that extra minute a day. But you’re trying to leverage. You know a new type of advanced material in this new way that affects like a very large existing problem that nobody else was solving and all the way down through all the different ways that we kind of interact with the world I think searching for leverage is like something that that. I think more people need to talk about and there’s a mentor of mind. He says you know most people say don’t work harder work smarter but he also has he’s like there’s actually a better one. Ah further which is work braver right work would more seek things that have more leverage. Um, because again, even if you’re working smarter. There’s always maybe some. Other form of leverage whether there’s risk whether it’s kind of identifying areas of even greater productivity and so on that you can kind of capitalize on. Um, but Jason this is this has been a great conversation I I love kind of finishing off on on those kind of elements of culture. It’s’s super exciting before you finish off is there anything I should have asked you about but did not okay.

Jason Huang

Yeah, um, you did ask and I probably didn’t have time to respond we are looking for employees and colleagues and partners in ts on the world stage. We look for agents distributors. Representative of our technology in the product because this technology is not just us technology. We wanted to benefit the grid of the world basically everywhere so we look for partners that way if anybody’s interested in that let us know we also look for. Employees partners with cts that that can help us ah in manufacturing technology development finance business development. We have needs across the board and we do have a precondition you have to. Respect and like the 6 principal values that I mentioned about customer first teamwork safety continuous improvement passion and commitment and we have the commitment for you. Ah, we also like you to have commitment for us that is. You come to work bring your heart and mind with you as well to work and in the process. The company will be able to provide that fulfillment of what you wanted in life in both material as well as spiritual aspect and includes your family as well. So. It would be a great journey if someone were to join ts we. We need more talent and we could use more support more partners in the world.

James McWalter

Thank thank you Jason and we’ll include all those links and contact details in the show notes. This is great. Thank you so much.

Jason Huang

Thank you very much and I really appreciate the opportunity to speak with you and be you know, let more people know about advanced technologies like Ts and the difference they could make for the for the world. So thank you for that.

James McWalter

Like thank you Jason.

Sustainable Waste Streams – E91

Great to chat with Joost Kamermans Co-Founder at Seenons, a platform that connects waste chains to new use cases as part of the circular economy! We discussed the ups and downs of startup life, balancing supply and demand within a circular economy, waste policy and incentives, differences between startup cultures and more!

https://carbotnic.com/seenons

Download Podcast Here: https://plinkhq.com/i/1518148418

Remember, If you want to support the podcast please rate and review 5 stars on  Apple, Thanks so much! 

James

The unedited podcast transcript is below

James McWalter

Hello today you’ speaking with Joost Kamermans Co -founder at Seenons, welcome to podcast Joost brilliant to start? could you tell us a little bit about Seenons. Yeah.

Joost Kamermans

Thank you Very much happy to be here. Yes, of course and so senance is a software company that’s helping other companies to reduce their waste and and we do that by yeah, helping them monitor their waste helping them engage with the whole network Of. Ah, different logistical companies and waste processors and and ultimately we also help them with procurements to really lower their yeah their waste.

James McWalter

That very good and what drove the initial decision to start cnons.

Joost Kamermans

Um, very good point and so we started about two and a half years ago yourre and I were working at an office. It was a go working space and where yet we were and got by the amount of. Ah, waste trucks that would pass through a street on a single day. It’s it’s based in Amsterdam and it just made no sense to us that we saw all these garbage trucks passing by all the time and at the end of the day our our own garbage container was always filled. They intrigued us. It was like why is this happening. It makes no sense and and that’s when we started looking into this whole waste problem and and found that there’s way more wrong to it than just these trucks right? that there’s and huge garbage belts that we are creating all over the world. it’s in the ocean ah it’s it’s literally everywhere and and that there’s yeah big competition between waste management companies that all sent their own trucks to collect waste because they want to have that as their their input for their machines mostly incineration plants at the time and and still today. And and that therefore it could happen that if I have a brand of of waste management company and my neighbor has a different one and yeah that we have multiple trucks going through the street on a single day and this is the case in most places at least in the Netherlands. Um, yeah.

James McWalter

And.

Joost Kamermans

This could definitely be from an ecological perspective. This obviously makes no sense but also from an economical perspective. 

James McWalter

No absolutely and and I guess in terms of your relationship with your cofounder your and were you already kind of thinking about starting something was this like an idea as you’re trying to ideate or was it. Oh you already had an existing relationship and you both kind of were like oh this is the thing we both want to work on next right.

Joost Kamermans

Um, yeah, so I guess we both had a separate journey. There. So for me I had a started before in the Us. Um, this was a throughout my studies there and we had a. Course that was called healthcare entrepreneurship and we had to yeah the name already says it we had to start a company and there I really learned on how to not do it so we we somehow got funding. Um. With an idea which is in the us way more common than it is here in the Netherlands and we see we built the product for the Netherlands out of the us to then find out that in the Netherlands. The the system was so different that there was no market for it. So we built something and we were really proud of it. Was really pretty really advanced. But there was no demand so why did we do that and then I started working at the Boston Consulting group to then learn. Okay, how do these markets work. How how does it even work and how do you really research an industry in a very brief amount of time. Um. And after that I decided to give it another go and and especially throughout my work at Bcg I was exposed to some projects in big energy company turnarounds there I found how difficult that is if you have a very big company and turning it around. Especially if you’re you’re sitting on a lot of assets that make the turnaround difficult so to give you an example if you are a big oil company and and you’re trying to become. Ah yeah, green and and rely only on green energy. You still have one hundred billion on your balance sheet of oil fields.

Joost Kamermans

How are you going to do that. Well you don’t because economically it makes no sense and we saw the same happening for for the waste industry. There’s a lot of companies that that have invested in assets such as garbage trucks such as incineration plants other other type of um of yeah processing facilities. And if then the the tides change and then you still have these assets so it’s really difficult for you to move with that and that’s when I realized okay this cannot be changed from within so it has to be done from outside then I met yourn and Jon had already something like 40 starteds. He was very good at. Um, at platforms especially matching. He’s also done that in for dating sites so in a way that’s also matching and so with my sorry. Oh yeah, yeah, finding a good fit is probably more difficult indeed and then with all the.

James McWalter

Even more difficult, even more difficult than waste matching.

Joost Kamermans

And yeah, with his knowledge about ah platforms and the technology side and my strategic and commercial side. We figured. Okay, let’s ah, let’s give this a go together.

James McWalter

Fantastic. And so then you know you have this kind of nugget of an idea around waste. The inefficiencies associated with it. What was the kind of early efforts at you know, an Mvp you know first what that first kind of version of the product looked like and then also were there any kind of pivots along the way. So.

Joost Kamermans

Um, yes, and yes, no absolutely And so when we first started out. Um we had to do everything by experiment as I said I learned from my last endeavor where we built an entire product to then test if there was a market for it. This time we really did it the other way around. So We asked a lot of customers what they wanted So We really did a yeah customer research very and yeah, very much with boots on the ground so we really went shop by shop asking them how they would deal with their waste. But not only to customers. We also went to waste companies and we went to processors and we went to the whole ecosystem to understand why this problem is is the problem and what could be a potential solution and eventually we had an hypothesis on what people would want so we built a website and we said this is what we’re going to do are you in. And to our own surprise We. We actually had a lot of Sign-ups really quickly and then we called these companies we’re like this what we’re building but we don’t have this yet if we actually built this do you then would you become a customer and they would all say yes of course I would and that’s when we knew. Okay.

James McWalter

Right.

Joost Kamermans

Now we have to build this and that’s when we sat down and started really yeah, developing an Mvp which initially yeah, really didn’t mean much because it’s just transporting waste from a to b and over time that he had to e evolve into an an app that would work for you as a.

James McWalter

What I love about that story is you know you mentioned this early startup that you worked on a few years ago where you made something that you’re very proud of and very very beautiful, but there was no users or is this time around you did classic lean startup where you’re like oh it’s just a landing page with some signups. Don’t build anything on the backend and then you just go to the other side of the market.

Joost Kamermans

Um, as a business.

James McWalter

Place and say hey we have signups. Do you want it and you are kind of testing response directly without spending a ton of time you know making a beautiful widget and so on and I think this is something I’ve also you know, learned over the years when I tried to build something for a very beautiful actually also in a marketplace situation and then. You know wasting a lot of time and then later it’s like oh I’m not building anything unless a customer is basically forcing me to to build it and it’s just it could be kind of changed the trajectory of those early days of the company.

Joost Kamermans

It does it does’ and I I think that’s also very important to tell starting entrepreneurs like what what we tell each other a lot is that and there’s somebody in a garage who one day wakes up under the shower with a great idea. Sits down in the garage build something and it’s it’s happily scaling ever after and that’s not true. That’s what they always say put in newspapers. That’s never how it went and I know for example, this is a story that goes about Amazon no.

James McWalter

It. It’s never been true. No.

Joost Kamermans

Very often. It does not state that he was already a millionaire working at Goldman Sachs before and then renting a garage to start this company so and very often that’s something that people don’t don’t hear and I think entrepreneurship is definitely something that’s in you. Being opportunistic and also seeing opportunities. But there’s also tricks to it that just apply and that you can learn and that these are definitely best practices that can prevent a lot of headaches and and also financial hardship because if you invest all your own money into building your product before knowing. That anybody’s interested that can really cause big problems.

James McWalter

Yeah, yeah I mean one one kind of emotion I think is something that is under talked about especially those stages of the entrepreneurship journey is embarrassment. It’s like you have to be really comfortable. Be em parissed to buy poor versions of the product poor versions of your pitch you know and venture here talking to investors. Ah, you know it’s not easy, but you have to like continuously put it out there and as long as you’re refining it along the way you know getting comfortable with that level of of embarrassment or you know I’m not.. It’s not great because in by definition. Whatever you’re going to build is bad to start like that’s just the nature of it and I think that’s the bit that that’s the kind of dirty secret that people don’t talk enough about just like be.

Joost Kamermans

Um, yeah.

James McWalter

Like like lean into embarrassment in order to kind of get through those early days and I guess you know as you’re kind of going through that you know that Mvp P iteration kind of process. Ah you you mentioned this kind of you know you you kind of have these 3 set sides sort of market in essence right? So you have the.

Joost Kamermans

I Couldn’t agree more? No absolutely.

James McWalter

Producer of the waste right? consumers or there might be also kind of enterprises and so on Absolutely and then you have ah the the kind of waste you know processors of various types I’d love to get into both of those sites in a moment but you also have the people transporting the waste.

Joost Kamermans

Um, businesses. Yeah.

Joost Kamermans

Um, again.

James McWalter

How do you kind of engage those people. Um because I believe that’s nearly like a third side to the marketplace and.

Joost Kamermans

Yeah, and I think that that also brings that extra. Um, yeah dimension and difficulty to the business because you have to do quite a lot in order to help a customer I think that was one of the main challenges we faced like if you are going to serve a a business with. With their waste and you’re gonna help them with it. You have to do the whole circle before you truly add value and typically as a startup you want to do as little as possible really well and because that’s just way more manageable. But for us that was super super difficult because if you’re gonna be my customer you expect me to take care of all of your waste because. Otherwise why am help am I helping you so that means I need both logistical solutions and processing solutions for all your waste and yeah that that made it difficult.

James McWalter

Right.

James McWalter

Yeah, and so how how did you again in those kind of early days Initially you know did you ever consider doing the delivery yourself or ah, you know because I guess one of the kind of principles is like you have this excess cap capacityities so already existing on some of these you know transportation and and waste companies and how do you kind of? ah.

Joost Kamermans

Um, yeah.

James McWalter

Identify where there are places that you could actually kind of redirect some that waste and so what was that kind of process like and.

Joost Kamermans

Yeah, so I think that was fairly simple for us. So as we did all that that market research in the beginning we found that there’s a huge access capacity capacity specifically in processing there in the Netherlands we are importing waste because we don’t produce enough. Can you imagine so that.

James McWalter

Wild.

Joost Kamermans

Definitely a big problem so that also made it really clear from the start we are not going to build processing capacity because if we do that we become the problem you always start out with the best intentions when we first created incineration plans and it was a big upgrade from a dumpster.

James McWalter

I but.

Joost Kamermans

So the idea of building that was very was ingenious, right? Why would you not get electricity from waste now we know that we’re running out of these precious materials that we are therefore creating additional c o two at a time when this all started. This wasn’t the problem at that time so it would be naive to think that whatever you build today. That that’s not going to be the problem in the future if we in the future decide that we have to consume less for example, even if you build a plastic processing facility and it could be a problem and maybe in the future plastic is just wrong. Material. There’s a new super material. That’s then the the best solution. We as a platform want to be agnostic. We we want to have no vested interest in the way of processing so we always want to be able to switch and and in terms of um, yeah transportation I think you were spot on we if we were to do that with their own vehicles and the point is that theyre. Is way. There’s in literally every place in the world. There’s enough logistics capacity because everything that comes into the city that we consume has to come into the city somehow by transportation that means that by definition. There’s also capacity for this to go back. We simply don’t do it because we don’t want to because it’s and It’s financially it’s more interesting to drop off packages than to pick up packages and so that’s why we don’t do it but everything that enters the city either leaves the city through a garbage truck or it leaves the city through the seeward because some of the food we can chew. And yeah, it’s going to go out of course and so there’s. There should be enough capacity and it’s always most efficient if we do more with reverse statistics so we were like why would we then introduce additional vehicles. It makes no sense.

James McWalter

and and I guess then if I was a consumer or a business wanting to cut onboard onto sceneons. What’s that experience like today.

Joost Kamermans

Yeah, also you um so how it starts is you? yeah you you get our app and with the app you tell us this is the waste I have please come pick it up and we can pick up your waste with the best form of logistics. If you’re in an inner city of Amsterdam that could be a cargo bike. It can be a boat. It can be many ways and if you are more in an industrial area typically it is a garbage truck it very much depends on the size. The quantity, the volume what we would send and then we match your waste with whoever can best upcycle it.

Joost Kamermans

So that it’s being processed over there and then ideally you buy that product back. That’s made of it. Typically these chains are very complex very much dependent on the Stream. So There are streams that are very that speak to the mind such as orange beals that you pick them up with a gargo bike. You can turn them into Orcello which is a drink which then gets back sent back to the restaurant where the orange peels came from and they sell these to their customers and you have the full circle with so other streams is is way more complex and but this is what it’s looked like and then all the waste that’s left. So the residual waste that we don’t want to that We can’t do anything With. We’re going to help you get rid of that because that’s our Mission. We want to get to a world without waste meaning no more residual waste because that’s really stuff that we burn. Ah, if there’s cardboard going back and forth. There’s no problem with that. If. There’s glass jars going back and Forth. That’s fine as long as we can reuse it at least.

James McWalter

And I guess the one of the kind of major difficulties with anything to do with waste is the sorting component right? So obviously it’s be perfect if the restaurant put all their orange peels in 1 specific container and then you have this beautiful back and forth as you mentioned? Um, but how do you kind of think about that.

Joost Kamermans

Um, yeah, yeah.

James McWalter

The the kind of work to be done around sorting should that lie at the producer of the waste should that lie you know more upstream into the the waste facility. Is it a mix. How do you think about that.

Joost Kamermans

Um, I think the last the last thing you said it should be a mix so the way we look at that is ah ideally you would have some magic machine that would sort everything afterwards because then that’s the least amount of effort for everybody. So why wouldn’t we do that. Definition. That’s never going to work because organic streams they go bad if you have cardboard that goes wet. It’s not the same anymore and so you can’t do that if you then say? Okay, so if we can’t do that then we have to separate everything perfectly. If you tell people you have a hundred bins that they have to put stuff in ah, people are not gonna do it and even if they’re willing to They’re not gonna understand it because it’s way too complex so we’re gonna have a mix and that means that most likely and what you’re gonna have is.

Joost Kamermans

Cardboard class these type of things you always separate most businesses have those then depending on the type of business that you are you might separate something different. So let’s say you’re in the in the netherlandss a restaurant. It’s called the avocado show you have a lot of avocado pits. Ah, for you. It could make sense to do something with those but an average restaurant is not going to separate those because you don’t have enough of those and so very much looking at these streams. What really is worth the effort and and then you’re going to have some categories. So what we see in the Netherlands we call it Pmd which. Basically it’s packaging of food and this is a separate stream that is fairly simple. It’s fairly. It’s still difficult. But it’s it’s doable to separate it afterwards and and there’s also aluminium cans be tea bottles in there. Um, so these are the ones that that the machine can detect. Um, and if we can get it to a level that all the stuff that’s really valuable that you separate those yourselves and that cannot be mixed and the stuff that we can separate afterwards they can all go into one bag and then we sort it afterwards to still get the the value out then we get you to share your waste and that that mix. That’s what we’re trying to work towards. And that will both come from innovation at the at the the back end. So really being able to separate afterwards. We’re not there yet, but it looks promising and also yeah, educating people to do at the front having financial incentives and all like yeah like change in behavior and. And then with all these measures together. We think we can do it and we’ve seen businesses. Do it.

James McWalter

That That’s so interesting. It. It kind of brings to mind whether this is is there I guess more of a pull on the demand side or supply side right? So if a particular you know avocado based restaurant have a ton of avocado pits is that then oh which kind of waste producers are sorry waste Processors. And even you know Upstream consumers of something like an avocado pit is interested in this and then you kind of go seek out those or is it more the other side where you’re actually saying yeah the the waste you know converters the waste managers they’re saying oh we really need some more orange peels. Can you go find some orange peels out there. You know from a supply point of view.

Joost Kamermans

Um, yet are.

Joost Kamermans

Yeah, well what I always say is every waste stream and there’s hundreds has its own unit economics and it’s and it’s its own market and it goes up and down. It’s just like the ah gold or silver or anything else. So.

James McWalter

Or is it a kind of balance between the two and.

Joost Kamermans

There was a time when you would receive a lot of money for cardboard. So then people would go buy the doors little kids asking for your cardboard. Do you still have some old newspapers because it’s something. It’s worth something right? and then over time that price that’s reduced so it became actually expensive again. There was little demand. Then the pandemic hit ah and the the demand went through the roof and the supply really killed so now today and if I have like high quality cardboard or paper people really want it. So it’s very much a pool market will that still be the case next year I don’t know right? It’s always going to go up and down. But long term we expect pool always to increase because every material is decreasing typically at least the supply of it and if you then look at these are fairly old streams if you look at a new stream. So. It’s avocado bit nobody nobody ever did something with that. Ah, before that nobody wanted it right? Why would you want it then now there’s some people who said oh I’d like to have it to um, get to ininerate it. Why not? Then when there were some people who would like to um, um. Yeah, to extract the the gas out of it like for history I forgot the word in english and which is which is less bad than burning it and then there were some people who were like oh I could use it to make paint and mo if they this worked for them and if they actually set up a factory. Goingnna need a lot of avocado bits. So then that the whole economy flips around and we see this happening with all sorts of streams like we believe that in the future more and more things that are wasteted today that we just throw away that we don’t care about in the future people are like I want that stuff. We saw it with old phones but you get to throw it away and nobody won an old phone now we discovered that there’s more gold than the average ah trash pal than there is in a gold mine a per square meter of course. Ah so why are we not taking that goal out of these machines again. Why are we trashing it so all of a sudden There’s a whole market for used devices because there’s so much precious materials in it and we expect over time that every material becomes valuable both because of taxes and because of shortages.

James McWalter

So interesting. You know when I think about your business and when we’re researching sceneons it was like okay, the logistical you know backbone is like the core of this business. It’s like so absolutely important. But as you’re talking there. It makes me think of you know, trying to figure out the hundreds of waste streams. And the unit economics of each and the supply and demand balancing and all those kind of things to try to like you know, just grab efficiencies to make more and more parts of the economy circular. It’s like it’s ah very much a data play right? like you need to be able to understand these things to a degree and to a you know in a database that is updated on a very very high frequency. You know as we’re seeing with the the kind of struggles around supply chains right? now you know raw materials like are through the roof and so things that might make sense for the next like eighteen months might not not make sense from a certain type of waste collection after that and so I guess how do you think about that data component and you know are you. I guess how do you kind of track that how do you build out that kind of competence within the company itself and.

Joost Kamermans

Yeah I think it’s key at the end of the day we are a tech company where we’re a data company and we see that in the future in the netherlands at least and I think in all of europe and circularity is is key for 2050 the European Union has made that. Ah. Ambition that the full economy is circular and the only way to achieve that is if you have a very clear understanding of where all the materials flow and and because we have customers on the 1 hand who submit their waste streams we have logistical companies that are plugged into our system that drive on our app. And we have processors that that use our app to ah to forecast input and ah and quality and that type of stuff we know exactly and where what type of material type of quality. What type of quantity and where it’s flowing and where it’s going and that we can actually optimize for this. And and we can incredibly improve efficiency. So why would you bring if there is a cardboard plant in the south of the country and there’s one in Germany why would it go to Germany we so often see that there’s incineration plants in the Netherlands where. Stuff from the very south goes to Amsterdam and stuff from amsterdam goes goes elsewhere. It makes no sense but because they don’t communicate and they both need their input. They source it both ah without talking to each other having the full overview. The pie is simply smaller and. But if everybody would be able to see where what material is free in what quantity and what quality we could optimize for this and this would make the whole economy flow much better and would make the country much less dependent on um and and the continent much less dependent on. Um. Importing raw materials and we now see how important that is.

James McWalter

Yeah, absolutely and I guess only think about all some of those kind of other macro elements right? So course you know we’re we’re trying to kind of increase the amount of transparency you know reduce the amount of opaque relationships so that we can see where these inefficiencies are and improve on them. Um. And you also as we talked about like have those kind of hit by supply chain pressures and costs and so on in generally a positive way I think for your business One of the things that I wonder is maybe a a bit of a headwind is Covid itself. So I’ve talked to a few companies who had waste management going into Covid and as people became very much. Adapted to single-use you know types of plastics and all this kind of thing. Um it you know it definitely slowed down some developments of certain types of waste streams into things that are more circular or renewable in various ways. How do you think about how you know Covid has affected things in both the kind of short and long term. Trajectory of kind of waste management.

Joost Kamermans

Well I find that an interesting question like we actually started our business only a couple months before covid hit so we’ve only known covid and and in the beginning just like anybody else we were like oh what’s what’s this going to do. But. We grew from 2 to 50 people in two and a half years which has always been covid and at the the last latter 2 years at least and so it did not impact us at all the people I talk to they still care about it. But it’s not I think the transition that we’re making. Covid has much less of an impact I think what’s actually happening in the world. Ah regarding the effects of climate change. Um, that’s something that that keeps on happening and also the the effects that we that we see on how global supply chains get disrupted both because of covid both because of the. And the trouble in Ukraine of course and we see that nobody would want to import materials forever nor from an ecological nor from an economical standpoint so we see a huge push both in terms of economic push as in terms of legislation towards this this change.

James McWalter

Yeah, that that that makes a ton of sense and and you mentioned it’s kind of growth to up to 50 people. Um, so you know what’s the kind of goals over the next couple years from buddha kind of growth in terms of team but also company product all that kind of thing.

Joost Kamermans

Yeah, so I’d say our ambition to grow. The team are not so high because we are a tech company and I think you do something wrong if you end up with 10000 people in your tech company because then you’re not working more efficient and you’re also making the system more expensive. We want to create. Efficiencies and we want to make it beneficial for all users and that also means and not asking too much money and because then it’s not going to happen and and in terms of yeah ambitions well our ambition is to to save half a megaton of waste. By 2026 and for your reference that’s about a quarter. We do annually here in the in the netherlands that the country does so that means automatically because it’s not realistic. We have such a large market share in one country. So that by definition means that we would expand into the rest of Europe.

James McWalter

It no, that’s that’s incredibly exciting and I guess you know geographically it’s quite nice being in Amsterdam you are literally kind of in the center of a lot of you know large countries kind of around you. Um, and so what you know What’s the kind of timeline for that you know is this. You’re already starting to think about how do we you know incorporate France how do we incorporate Belgium or is that kind of a couple years from now.

Joost Kamermans

Um, so we’re definitely looking into expanding we are already a little bit in other countries actually and so these things are moving fairly quickly. But I think from a competitive standpoint I don’t think it’s smart for us to announce that before we actually do it.

James McWalter

I Oh absolutely no ors at all and you we talked a little bit about or touch upon you know some of the you know policy pressures in a positive way coming from the Eu in that um, are there more ah other things you would like to see that would help you know the kind of expansion of this industry.

Joost Kamermans

As well. But yes, we will for sure.

James McWalter

Um, either on the incentive side for you know you know waste management that kind of thing or even on this this incentive side. You know more penalties for bad waste management or you saying look the actual policy framework right now is pretty good. It’s purely about execution now for companies like yourself. So.

Joost Kamermans

Um I think even in the curen environment. We can move. We can definitely do a lot and and at the same time I do think that the government can help with that like a lot of the incentives and. People talk a lot about true pricing but in a way for waste. That’s really really true if you design a product and and it cannot be repaired. It can only be trashed you cause and a big debt to future generations and I’m not even talking only about the contamination that it might cause. Ah I’m also talking about some materials. We’re just running out of so if you are using those materials without the ability to repair it reuse it or recycle it then then it’s lost which is total waste and so we think that what you is doing that you. Um, sort of force a producer to think about the end of light stage I think that is amazing. That’s what we need. That’s the 1 thing that we cannot force ourselves what we can do is we can help companies separate their waste. We can help processors and upcycle ah certain streams. But then there’s always some products some. Some streams that nobody can actually do anything with and those have to be redesigned either. They should be forbidden either. They should be ah yeah, they should just not be necessary or that’s something we have to work towards of course that’s way more complex than the way I say it now but that. If we really want to get to a a circular society which I truly believe in that’s the way to go.

James McWalter

And then thinking about getting to that circular. Yeah Society Circular economy. Um, you know there’s a lot of people starting to kind of work on climate tech startups and different ideas and so there’s a ton of innovation going on and in some areas more than others. You know if you could like wave of magic wand then say hey. Want the next kind of group of innovators to come and focus on this particular part of the pie where are you not seeing enough innovation where smart people should be kind of more focused and.

Joost Kamermans

I see smart people but I see that there’s still that they don’t always have to push that they need to succeed and then I’m talking specifically in in terms of processing capacity. So what we see now is that there are certain startups that set up a ah processing. System for for example, coffee residual they are turning this into ink I think that’s amazing and they just got funding 4000000 I think that’s great. Ah, but that’s really a drop if you look at the amount of coffee residual we have annually and in Europe so they’re going to meet money more the same applies for. And these orange peels the same applies for really dedicated type of plastic facilities. So I see people with ambition I see people doing it but I I think that as long as we’re talking millions. Yes, it’s a lot of money for an individual but for an industry of. Of hundreds of billions and it’s not going to do it. We need people. Ah banks we need governments investors. We need people who are bullish and we don’t need those that funding I think we’ll be fine. We’re take company. We grow fast I’m talking specifically about those people who start now in their garage. With their first experiment for ah, processing, upcycling, whatever if they show that it can be done and don’t then I I need investors that are willing to jump in before it’s fully proven. Typically you need scale in order to prove it and that’s yeah, that’s a chicken of the or the egg story and and that can only be solved by by taking the risk.

James McWalter

Yeah, it kind of brings to mind this divide of 2 types of capital that I think generally people who are very kind of venture focused of which I think you and I both are kind of fall into thatca. Um, we generally just think in terms of like our next round of financing from yeah on the venture side. But if you’re trying to build a big processing plant. You basically need 2 lines of capital. You need you know let’s say a couple million dollars to pay salaries and so on. But then you also need project financing to build the thing. Maybe that’s based on dash. Maybe it’s some other kind of form of of capital that isn’t purely kind of equity based and I’ve talked to a ton of people who. You know they’re building factories on the basis of equity financing and it just doesn’t make sense because it’s just like ah you know it’s the wrong tool for the wrong job kind of thing and I actually think there is a big opportunity for you know some innovative. Maybe they’re just even consultants that then necessari be a company but people who can start kind of working with founders and. You know equity investors to be more open to these other forms of financing in addition, not replacing. But in addition to the equity financing piece because as you say like 4000000 is great. You can pay salaries for a few years but you need 40 to 400000000 to actually build your couple processing plans.

Joost Kamermans

I’m fully with you there and I must say that I’m optimistic of what I’m seeing now in the market that there’s for example, here’re in Amsterdam there’s ah af which is the amtradam climate fund ah that actually gives loans to these type of facilities. highly yeah highly risky of course you have a you have an asset underneath it this factory. But if the factory is not going to if it’s not going to work. What is it worth so. They take a lot of risk but I think it’s really good that they do it. Regardless they therefore also have to ask of course significantly. Yeah in my opinion high interest rates but it makes sense because it’s high risk. And I think also from an and a founder perspective. It’s fine because if it works you can pay off the debt and you can still repay those those interests and if it doesn’t you lose your asset but it but it was worthless anyway, so it’s I think it’s win win and if they spread it well if there’s a hundred of these projects I’m sure some will fulfill some will succeed. Ah. As a society. We’re better off and I think financially it also yeah, probably makes sense as long as they do good due diligence. So I’m really positive about that. Yeah development.

James McWalter

And you you know, worked on starting this startup in in the us in the past that obviously you’re building you know a very successful company in the Netherlands as you think about the different kind of work and startup cultures between yeah, working in Amsterdam and working in the us what are the things that you learned in the us that. You know more local dutch you know founders could could learn from and also vice versa like what do american you know founders what could they maybe more appreciate from you know, Dutch and european founders and.

Joost Kamermans

I really like that question and I actually thought about that a lot. So for me personally what inspired me most and I went to Wharton University Of Pennsylvania so ivy league with a lot of super super ambitious people and when i. Before I went there I was really nervous and I thought okay I’m really going to be by far the dumbest guy in the class and I don’t want to say that that might still be true, but it wasn’t I wasn’t flabbergased by how smart people were because they were definitely smart, but there’s also a lot of smart people here in the Netherlands. But what. But stood out to me is that they were bold and then I’m not talking about just just crazy or yelling stupid stuff but they they really dare to dream big and and there were people in my in my class I would say. Yeah I I’m not I don’t think I’m gonna finish a semester because I’m trying to raise 20000000 to to solve this disease or something and some of them would actually drop out and do it and in the beginning I really thought they were yeah hallucinating and some of them didn’t succeed of course. But at least they tried so I think that really trying to. Really daring to dream out loud ah that to me is a big american talent and and the other thing that I noticed and that um when I did that built that startup we did that with the horizon school of technology which was a summer program and that was. In the University Of Pennsylvania it was not from the University Of Pennsylvania but it was in the same building and and the founders of that academy um, they were really really driven ah to the point that. I recall we were gonna learn how to code because that was part of the program they were gonna teach us how to to build our own Mvp and that the program was 9 to sleep and I didn’t understand what to wind and it really meant at 9 you start and you work till you sleep and one of the I’m dutch to us.

James McWalter

Price.

Joost Kamermans

I mean we we’re not like that. That’s really a culture of difference and they would do this six days so only and I think only on Saturday they wouldn’t do this and and one of those guys even ah when we went for lunch he would combine it with going to the toilet to save time for for last walking and. I really thought that’s just outrageous right? and and he always spoke about I just I really want to be successful. Be far in 30 and what what I found most inspiring inspiring is this actually didn’t work out for them super well I think it succeeded but not to the extent that they wanted it to but he started 2 other things into.

James McWalter

Too much. Yeah.

Joost Kamermans

In the years after and 1 of those actually ah was valued over ah ah, $1000000000 within 2 years of starting it. Super yeah, super inspiring but to me if you’re talking about merit based this guy was willing to do whatever it took and really put in the hours and really grind it. Keep on perfecting it and killing all his darlings. He would work on something for months ahead and then just throw in the trash and start again if it didn’t work and that to me like I have never seen anybody in the netherlands do this and it pays off. Um so hard work does pay off and I yeah I was really impressed.

James McWalter

I yeah I absolutely love you know that those kind of past stories and they completely align with myself right? like you know and I started working on on startups in the us I was kind of flabbergasted. You know you go to these founder events and there’s like a 19 year old telling them telling you but they’re a literal billion dollar idea and I’m just like you know 30 something like what? what are you talking about.

James McWalter

Like I wish I had that confidence at that age. Ah, but on the other side. Yes, like the work life balance is so difficult and you know there’s ah somebody who I kind of admire can’t remember their their name but I know I admire them but they have this kind of you know you have this expression of like you know don’t work harder work smarter but they say don’t even work smarter work bolder right. You actually have to take on those risks to have like the massive like upside from you know the leverage of you know because risk return are always you know related in whatever you’re you’re kind of working on and so their thing is like look just just work bolder. Um, you can kind of hit those heights in a way that you might have surprised yourself, especially if you do a couple things. You know over the course of your life and like literally every year when I have my kind of you know, look back in the year I’m like oh I should just take more risks every single year is my consistent message myself and like if people you know, similar it to yourself look at me taking ah taking a lot of risks. Um, and then the other I I suppose just taking that kind of anecdote on my side I track everything about yeah, the work I do. And my productivity at 45 hours a week of actual solid work and 65 hours a week of solid work are identical. So I just like save the extra 20 hours and like spend them with my wife my dog and friends and all those kind of things because I’m actually hitting the same kind of metrics at work and so I think that you know. You you live to work or you work to live like those dynamics between Europe and the us I think absolutely both kind of can teach other a bit more about the balance.

Joost Kamermans

Yeah, no, and and that spot on. So though. As to your question. What would the americans be able to learn from the dutch and I to me ah, a great example is always adjut the payment company in the Netherlands usually um, very successful and I think what they did and is they they did this to the max. So. I don’t think that they worked insane hours. They worked very smart. Very effective also making sure that if you work that you really work and if you don’t work that you really enjoy it. Um, and that leads also to a great atmosphere and that leads to a very large employee engagement and retention. And it has a lot of these benefits. So I I think that and I must I think that also applies to our own company like we are obviously touch based for me this very strongly holds for me if I work very long hours. My productivity doesn’t increase for these american guys I told you they could do both. They were both productive. And they could work 80 hours I I must just acknowledge that they are more talented in that respect than I am I I just can’t do it even if I wanted to ah but a looking staying close to myself and knowing where my talents lay and also knowing where the culture where where I live and where I’m from. Um, what works best I very much believe in this about um, making sure that we work smart making sure that we work very efficiently if we work really work. Don’t just sit there and then also make sure that we have ah downtime we really enjoy it. We’re not going to call each other into weekends or or send late night whatsapp urgent messages because it only causes stress and typically doesn’t solve anything.

James McWalter

I Yeah and I completely echo that um us it’s been fantastic. Already enjoyed the conversation. Um I suppose before we finish off is there anything I should have asked you about but did not.

Joost Kamermans

I Really feel like we Um, we talked about a lot of things already and but I guess um yeah, the last thing that you could ask me is if we’re still looking for some people.

James McWalter

Yes.

Joost Kamermans

Um, I’m actually not sure who’s who’s your audience but I’m assuming that there’s some talented people out there.

James McWalter

Absolutely yes, So yes, so you’re if you’re looking to hire at the moment and we can definitely include your careers page and in the show notes. Thank you just.

Joost Kamermans

Thank you very much bye.

Quantum Dots and Climate Change – E89

Great to chat with Hunter McDaniel, founder and CEO of UbiQD! UbiQD is an advanced materials company powering innovations in agriculture and green buildings! We discussed how the properties of quantum dots enable solar powered windows, how retrofitting greenhouses with quantum dots can dramatically increase crop yields, building a technical team and more! 

https://carbotnic.com/ubiqd

Download Podcast Here: https://plinkhq.com/i/1518148418

Remember, If you want to support the podcast please rate and review 5 stars on Apple, Thanks so much! 

James

The unedited podcast transcript is below

James McWalter

Hello today we’re speaking but Hunter McDaniel founder and Ceo of Ubiqd welcome to the podcast hunter. Very good to start. Could you tell us a little bit about ubiquity.

Hunter McDaniel

Thanks James Happy to be here.

Hunter McDaniel

Sure so we’re a deep tech advanced materials company spinoff from Los Amos National Laboratory we’re also licensing some technology exclusively from mit university of Washington and Western Washington and we’ve pulled in some team members from those institutions we kind of argue or spin off from several. Um, but really, our purpose is about leveraging nanomaterials to make lasting positive impacts on society and as a team we’re most passionate about trying to address issues related to climate change and the the core technology is material. That’s effective at manipulating light. You can change one color of light into another. Very high efficiency makes it a platform but primarily we’re focused on deploying that into the facades of buildings essentially to make the building more efficient at leveraging the power that’s coming from the sun.

James McWalter

And I guess whenever you know I talk to people who are working out like real kind of frontier tech and moving that into kind of commercialization. There’s often a kind of a question around you know timing is like you know when when is the good time to take something that’s like this remarkable step change in technology and and bring it to the masses as it were.

Hunter McDaniel

If.

James McWalter

Thinking back to the kind of founding story of ubiquity like how did you kind of think through that process when you’re like okay we have something really exciting here that yeah we could potentially build a company around.

Hunter McDaniel

Yeah I mean that’s a great question. Um, so I was a postdoc at Las Ama National Laboratory if I completed my ph d university of illinois and then had an opportunity to come to Los Alamos in the chemistry division and um. Yeah, there were there were a couple kind of aha moments in the lab where I would recall looking at the data coming from one spectrometer just being shocked by how bright the material was how efficiently it was emitting light in the infrared part of the spectrum near infra part of the spectrum and.

James McWalter

And.

Hunter McDaniel

So that was just kind of from a technical perspective I felt like there was a breakthrough there you know I had I had a foundation in material science engineering and felt like I knew what I was looking at and there was kind of an aha moment there but it wasn’t really ah I didn’t appreciate it. Um, how much work would be required from that point to take that. Um. Material that and invention if you will into commercial products and sort of figured that out the hard way to in the school of hard knocks after starting the company in 2014? Um, just um, yeah, just just kind of like spending a lot of time out there in the marketplace trying to understand what the market needed and. How we could provide solutions and you know so-called customer discovery type activities read a lot of books talked to a lot of smart people. Um, as far as getting at you this directly to your question when is the right time. Um, you know I think Peter Thiel has has said a lot of smart tings over the years and he’s indirectly an investor in our company. And 1 of the things that he told me when I met with him um some years ago was I think this might be in his book 0 to one something along these lines of you don’t want to be the first mover in a space. It’s too much heavy lifting too much sort of plowing the field. Um, which can be just long and arduous and expensive. Really want to be the last great advancement in a field and so I think we we kind of embody that with with respect to quantum dots. Um, there’s been a lot of hard work in terms of validating that that quantum dots can be useful in products and the first startups were all created back in the early 2000 raised a lot of money. And a lot of years trying to figure out what the first product would be. You know, clearly this technology this material is very interesting and useful for something but it took them a long time to get to the point. Maybe you know arguably about 14 years before the first real commercial products came out with the Sony line of televisions and then the amazon kindle fire. Tablet in displays and but those those materials had some fundamental issues that were limiting them from going bigger and beyond the display space and I feel like that’s what we stumbled upon you know in that lab and in Los Alamos was kind of the next. Um, iteration of quantum dots that now enabled them to go big where we could leverage all of the hard work that had been done. Um, the the you know the the methods of manufacturing the analytical techniques processing just understanding. These materials took a long time both in academia and in in the industrial sector. And we had kind of ah come across sort of the the final big advancement that was needed to then take quantum dots. You know, broadly speaking to all these other applications and that was the idea behind the company ubiquity is short for ubiquitous quantum dots with the idea that now quantum dots can become ubiquitous now that we’ve.

Hunter McDaniel

Resolve these toxicity cost and reliability issues kind of with one fell swoop with this new composition.

James McWalter

Yeah I guess just you know I suppose a general question then about quantum doubts and kind of nanomaterials more generally. Um first I’d love to kind of get a bit of more of an understanding around. Ah the how these are created. Um, you know, maybe both at the lab level and then later. You know at the kind of a scalable level and then also when these kind of materials are you know created um, you know they obviously have these kind of phenomenally kind of fascinating properties but were these properties being sought for and this is like 1 mechanism to figure out how to display these separate properties. Or which sounds like in the case of your particular company. It was kind of surprising that there was these properties that were emergent from these types of quantum dots.

Hunter McDaniel

Well in the early days. It was more of a physics experiment. Um, so folks were seeing that there were there were different colors from the same composition of matter and that was kind of novel in the past if you wanted to make a new color of material either absorptive which be like what we call it pigment or fluorescent. Um, you would need to make a new composition. A new dye molecule or a new phosphor composition etc. But with quantum dots. It was kind of discovered that you could tune the color by the size and it’s actually a quantum mechanical effect. Um, you know just to go back to ah the the basics there. Um, when you confine. Um, an electron when you squeeze it you can change the energy states and so when you make a particle small enough. You’re basically confining the electron and you shift those energy levels and so you can control the colors basically that way and so for a long time in you know forty years ago it was more of like a physics thing like. We’re uncovering some quantum mechanic quantum mechanics here some interesting properties and materials and then can we control it and over time it evolved into well yeah, maybe we can actually make these from the ground up and there were some big advancements from Paul Vasada Muji Bewin in those early days. This are you kind of famous professors in the field. Where they were controlling in a liquid reaction the size of these particles from the ground from the bottom up so you you start with precursors that nucleate in solution form clusters of atoms and then those clusters begin to grow and as long as you can control that nucleation moment so that it. It is sort of arrested it happens over a short period of time then all the particles will have roughly the same size because they created. We’re all created at the same moment and then they grew roughly at the same rate and then you can sort of stop it when you get to the size of particles that you want at least that’s the most rudimentary sort of approach to doing it. And it became clear that this could be very useful just to be able to make any arbitrary color with very high precision and this is kind of what I mean about leveraging the past um, many many years thousands and thousands of papers have been published probably more than that maybe 0 papers have been published on.

James McWalter

And.

Hunter McDaniel

To make these particles and different techniques but tuning the reaction kinetics and the precursors and the temperature and all these things to really precisely control the size of the particles and then you know along the way. Um, all sorts of applications were envisioned and you know some patents were filed a lot of papers were published. And different cool Things. You could do with Quantum dots but it took a lot longer than I think everyone expected to actually translate that into commercial success and the success was somewhat limited in terms of there’s really only one maybe a couple tangent markets around you know prior to ubiquity that were. Actually getting traction in the market related to Displays display and lighting I Guess just making a very accurate light source and that that can be used in the back of a display to make a very color accurate Accurate More efficient display. Um, if you just have to use. Basically. Ah, you can only you only need to use a blue led at that point because you can use Quantum dots to convert the blue into very pure red and green and then in lighting those are primarily red Quantum dots but you can sort of dabble in some red Quantum dots into a traditional white led and you can make it a warmer spectrum with relatively high efficiency.

James McWalter

So.

Hunter McDaniel

Um, because you can sort of add in the red without compromising light that you can’t see normally phosphors would be very broad emitting and they’d emit a bunch of light that you can’t actually see by eye and so that’s a loss mechanism Both Quantum dots. You can very precisely dial in those colors. Those are the markets that have been successful. Ah so far I mean there’s.

Hunter McDaniel

There’s There’s quite a bit of a product on the market for in the display space in particular. Um, but people have talked about using Quantum dots for sunscreen and therapeutics and diagnostics and solar and you know, really any application involving light. There’s probably a way you can use Quantum dots to make it more efficient.

Hunter McDaniel

But those just didn’t quite make it and our argument the thesis was it was really the toxicity of those compounds traditionally cadmium-based those early quantumdoalcadmium selenide or cadmium sulide. Um, but then also the cost. It’s very difficult to control that nucleation step so you can’t. You couldn’t for a long time make very large reactors. You’d have to mix together 2 things very fast and so there’s another company that ultimately got bought by Samsung called Qie Vision out of mit that was founded around that time in the early two thousand s and they at far as I know hadn’t. Scaled beyond five liter reactors but they had to run those in parallel and they were supplying quantum dots to Sony for Tvs using five liter it’s pretty small reactors just because of this mixing issue. So with with our technology. We don’t have to mix things together at high temperature rapidly. We just basically heat up.

Hunter McDaniel

And mix and then we don’t have any of those toxic heavy metals present. We get kind of lucky with some of the other properties that were emergent that aha moment was just seeing how bright it was just that that was saturating this detector in the lab and it was kind of like Wow that’s way brighter than anything else that that we’ve ever looked at before by order of magnitude.

Hunter McDaniel

Um, so something special must be going on here and it’s not even fully optimized or anything. It’s just super great.

James McWalter

And then with kind of then trying to bring that to the sustainability lens right? and I would love to kind of get into the couple of applications that but you’re kind of you know, developing right now. So one is around you know windows I believe and and glazing could you speak to that.

Hunter McDaniel

Yeah, this is something that I’ve been working on longer than ah sort of our first market which is in agriculture I can tell you about in a minute. Um, but this material has some some properties that are very well aligned with what’s called a luminescent solar concentrator kind of similar to quantum dots. Technology that’s been around a long time was first envisioned back in the 70 s and the idea was that solar cells were at that time very very expensive maybe what we can do is make a fluorescent panel that’s glowing in the sun and then that glow can can. Harvest light you basically cook a harvest light over a large area like like a window but didn’tly have to be a window be just a way of lowering the cost basically by collecting light over ah energy over a large area with a fluorescent material and then that fluorescent excuse me would get guided to the edges of this wave guide. Where you put solar cells so you could basically use very small amount of actual photovoltaic material to harvest light over a large area so it was originally about just lowering the cost of solar but none of the materials that were fluorescent at the time and even so many subsequent years where people were trying to develop this further were. Adequate for for doing this either. The dyes would degrade in the sun. They wouldn’t hold up long enough or they have this fishy where they would absorb their own luminescence. So. It’s kind of a ah deeper topic but the absorption of the material and the emission of the material overlapped very strongly which didn’t really matter and. Other applications. But if you’re trying to propagate the luminescence through a large distance through the same material. It gets reabsorbed and it’s a loss mechanism so you couldn’t really scale it and then this material um that that that we’re working with’s caught called copper andium di sulfide primarily and there’s in some related compounds. Has this um property where it doesn’t have much if really any overlap between its absorption and emission so you could really propagate the light through a long distance. Um it. It is ah an actual crystal and material. It’s inorganic material. So it’s much more stable in the sun. And then we can tune the color um into kind of this sweet spot which is where it absorbs over the whole most of the visible spectrum and then a midslight and the near infrared and that’s what I was describing on this detector this this light emission. Um, so that makes it very efficient for harvesting sunlight basically and then. Scaling it to a large area and then you check these boxes around the toxicity and the cost which are going to be critical for any energy application and pretty quickly. You’re like oh wow, this is like ah all these sort of critical properties are converging together around this use case in.

Hunter McDaniel

Um, what’s called a luminescent solar concentrator like I said you don’t have to use it as a window but 1 of the most interesting properties of this is that it’s partially transparent you can sort of make it darker if you put more quantum dots there but you can make it lighter just like any other window tent would look and then that really enables you to harvest sunlight.

Hunter McDaniel

From glass from windows and that’s probably the the biggest market that we’re pursuing. It’s a difficult product. It’s a difficult market when your value proposition is primarily around energy. Um, but it has the potential to really you know solve climate change if we can convert all this glass which is ubiquitous.

Hunter McDaniel

Around Austin right now and last everywhere and if we can convert that into energy generators at a low enough cost with a high enough efficiency then we can make these buildings no longer loads on the grid but assets for the grid. You know they could provide their own power but then even maybe power the buildings nearby everything worked out just right.

Hunter McDaniel

And that’s the vision. It’s it’s about reducing our the carbon footprint of buildings.

James McWalter

Yeah, and I I Love that you know I think I talked recently to somebody who works on kind of speculative fiction and solarpunk concepts in in his writing and we were kind of talking about how there’s kind of a bit of a lack of very big Vision. You know storytelling. Within the kind of climate tech space like a lot of it is the the current world with few more windmills or whatever it may be um, but I think one of the fascinating things with like the advances in material science in particular is being able to actually change the built environment in these kind of completely unique ways so that rather than buildings being. Independent structures that aren’t really doing anything to the world around it. Um, but moving it into something that’s more dynamic that you know is generating an energy or is maybe a store of energy for the gri at various times as we kind of have more ubiquitous like battery storage as well and so like ah you know the ability to kind of reimagine. Built environment in these ways where the materials of the environment themselves become this dynamic thing you know, carbon capturing concrete. Another example, um I think is incredibly exciting and so as you’re trying to bring that vision to those you know these massive you know realtors or ah, the construction industry who are. You know, have done things in a certain way probably for quite a long time. Um, how do you kind of I guess translate that vision into something that is like okay this is an investment we may want to make.

Hunter McDaniel

Yeah I mean it’s a great question it. It is tough. The built environment is ah an old industry a Slow-m moving industry very risk averse industry and windows in particular are kind of ah a source subject because they’re one of the biggest loss mechanisms for buildings. Just.

Hunter McDaniel

Compared to the wall in a bed order magnitude less efficient at keeping the the heat in or the heat out. However, you want to think about it. Whatever is needed and you know at the same time we’re naturally outdoor creatures and so we want to. We want to engage with the outside we want to have the view. We want to bring in natural daylight. So we. Obviously value windows and increasingly the window to wall ratio is is large especially in urban areas. Um, so it’s it’s kind of about you know, approaching the industry with you know, a little bit of a level head about what is setting some expectations that this isn’t going to happen overnight. But trying to demonstrate what’s possible and and help the industry rethink about ah rethink what windows are are about. They can be not just the problem but actually part of the solution and the window can be a central point. Um, our first product in this area is is basically a retrofit smart window. That is bringing we we provide the platform for that with a power supply. But then there’s all sorts of smart functionality that you can embed into the window sensors and automated blinds that could be tied to the hvac systems. Um and and actually being able to sort of be engaged with the the guest or the the. Tenant of of the building in a way that that wasn’t really people didn’t think of that before but there’s all sorts of sort of um old technologies there at the window like still most blinds are are you have to go up and manually pull a chain which is crazy. We have the technology to put a little motor in there. It’s very easy like why isn’t that already. It wasn’t weren’t there buttons that open and closed the ball I mean it it exists but very little market penetration of that kind of product. Um, although there are some examples of of hope where double paid windows for example are introduced in the 70 s and became roughly seventy eighty percent market share within 20 years there’s some codings now on the glass low in misssivity coatdings that are useful for energy efficiency that were rapidly adopted in the 80 s and 90 s and now have similar market shares something like 70 to 80% of commercial buildings so it can happen. Um, you know, but you’ve got to have a very simple cost-effective solution. And you’ve got to be engaged with the industry don’t try to disrupt the industry I mean I think disruption is a little bit overrated. Um, you know it it depends on what you mean when you say it. But I think we should be leveraging the existing channels to market manufacturing processes and and work together with the you know the market leaders today.

James McWalter

I Mean if you’re already disrupting like the the very material that the the product is made out of also disrupting supply chain supply lines and all those other things um is is biting off and it actually also even fascinates me startups who are like we’re also going to disrupt. You know the nature of hierarchical organizations at the same time we’re trying to build a company. It’s like.

Hunter McDaniel

And in the built environment.

James McWalter

So so much disruption you can do right? like you have to kind of lean on um the tools you have ah wherever possible. Um, you also mentioned this other application. Um that that sounds like yeah, it’s been going off for a little bit longer within agriculture. Could you tell us a little bit about that. So.

Hunter McDaniel

Yeah, so it was really something that came out of customer discovery that we’re doing for windows this goes back to maybe 2016 2017 where you know the story around windows was powering skyscrapers with boss a big vision but it’s pretty obvious that a small. You know 10 person so startup by person startup with very limited funding in those early days wasn’t going to start installing windows on skyscrapers as the first market and so we embarked on some pretty aggressive customer discovery to find you know beachhead market early adopter market. Um, that we could start on focus on initially and greenhouses came up as a possibility. There’s others you know automotive was another one that that people top and bring up. You know what about solar windows for cars. Um, and we looked at at a number of different markets and talked to people and in the value chain various stakeholders and. With the greenhouse one when we talk to the growers we. There’s definitely interest in a solar glass product I mean obviously greenhouse has a lot of often have have a lot of glass. We didn’t realize at the time that most greenhouses are actually had plastic film roofs. But um, you think of this glass house when you when you. When I say there were greenhouse. You’re probably imagining like something you’d find up in the Netherlands or Canada um, and there’s a lot of glass and energy is one of their biggest expenses and so if you could potentially generate electricity from the glass. Well that could be valuable but they kept coming back to us with the same question. How is this going to impact my crops. Ah, can’t compromise my crop yield at all that drives everything for us and so if you’ve got a solution that will save me on my overhead cost my electricity cost but not hurt my crops then that would be pretty interesting for us and so we said well. Okay, we you know we we have our our bread and butter is being able to tune this stuff. We can make any color we want. Maybe we can make a color of of glass that would be sort of not harmful to the crops. Let the light that they’re effective at at using pass throughugh but then generate electricity and then there was kind of this more of a commercial aha moment back in those days where like maybe we can just actually. Um, provide plants with the better quality of light period and forget about electricity generation and get more crop yield because clearly these guys care a lot about their crop yield and so that might be a more valuable thing to bring to to them than the electricity. So we started doing some very small scales.

Hunter McDaniel

Ah, trials I remember the very first one that we did was like literally a single tomato plant and we were able to make some very rudimentary films that had quantum dots and sort of surround the plant put it in a little research greenhouse and we were shocked. The thing was like twice as big underneath our our films which isn’t necessarily what.

Hunter McDaniel

How it works today at a commercial setting in a very small scale trial. You can see some big things. Especially if it’s not optimized, but anyway that was kind of like ah okay, maybe there’s something here kind of moment and then we started doing some math on like okay, well let’s say we could boost the crop yield by 10% what would that be worth to a grower.

Hunter McDaniel

And how would that compare it to the amount of electricity we can create for them and and actually it’s quite a bit more value that you bring if you can boost the crop yield and so that began kind of this effort in exploring this market more seriously and then at almost every turn we. Ah, we’re reinforcing it was reinforcing this idea that this could be a better first market for us. We’re not going to give up on the windows and we had some nondilluted funding from the National Science Foundation department of energy was helping out. We have have a grant from wells fargo that have been nondilluively funding the windows as it is a pretty heavy lift to get there. But the investors were more excited and and we were seeing more near-term opportunity simpler product stronger value proposition around just making the quality of light in a greenhouse better. So fast forward to today. We have a product line a brand called ubiro. Has its own website can check it out http://ubiro.com and it’s a retrofit film four foot wide any arbitrary length that you hang up in an existing greenhouse and it essentially makes your roof glow down on the plants and we can make different colors but across a range of Trials. We found that this orange color was kind of a catchall.

Hunter McDaniel

There’s definitely a certain spectra that work better in certain situations certain crops and that’s something that we’re studying pretty heavily. We’ll be launching a second color here in a couple months but this first product has been on the market now a couple of years and we’ve seen. Results as high as maybe 30 or so percent yield improvement for tomatoes. We’ve looked at cucumbers lettuce cannabis strawberries some other crops and or at least our our partners have or we don’t actually do much growing ourselves obviously but um, that has led through this. Product line that seems to be resonating with the market and you know we’ve got a pipeline of different products, different colors and form factors and things that we’re going to bring to the greenhouse industry. And yeah, so first to good that just turned out to be a good first market for us.

That’s so interesting and I’d imagine it demos pretty well if like the farmer can actually see the sparkle right? can actually see that that that improvement. Um you know I ah mentioned on the back before I grew I grew up on a farm in the west coast of Ireland and the um.

James McWalter

I would say that conservative in terms of the adoption of new practices is ah is ah you know is at the minimum you could say um of of how people kind of respond and we convert to organic and I think it was ninety ninety seven um and that was like madness I like the other other farmers in our our area and so as you kind of.

Hunter McDaniel

Head the fifth.

James McWalter

You know going to different growers like you know how? how are they kind of understanding the process I Guess a similar question to when we’re talking about the buildings before um I guess because they are having a more immediate direct you know feedback? um, are they kind of bit more kind of open to it relative to building owners and the like.

Hunter McDaniel

Yeah I mean both markets are are fairly risk averse. There’s a saying don’t bet the farm for a reason you know the farmers understand that they have boom and bust cycles crop prices or you know drought and whatnot can drive things in wild directions and so they’re very.

Hunter McDaniel

Ah, very conservative often in terms of making changes and they all feel like they have sort of the secret sauce secret secret you know, special approach a unique approach and so when you go through a grower particularly the larger ones they often will like want to see the results for themselves. They want to do a test or a trial a pilot. And we don’t necessarily subsidize those but we can sometimes do discounts but the takeaway would be that they will not go fully all in on their entire farm in most cases we have had a couple do that. But it’s more of an exception to the rule and I heard one. Investors say that they’ve seen this in the farming industry as well where they’ll start with 1 % of their acreage testing something out and then they’ll go to 10% if that looks good and then they’ll go to 100% so we’ve definitely seen that and plants unfortunately grow flow. You know I come from the material science space where you. Make a material. You can just go in the lab and take measurement and you get the answer like it worked. It didn’t what the efficiency was but with plants you know there can be pretty fickle. There’s a lot of inputs and things you have to make sure you water them if you don’t water them then you’re not going to get any useful data and if something goes wrong with your irrigation system. Well throughout that dataset and. Ah, and commercial settingnings. It depends on the crop but the cycles can be very long for tomatoes. It basically runs the full year when they will cut chop it down and do a new crop lettuce would be much faster. Um, some number of weeks. You know a month or so to get a cycle on lettuce depending on the variety. Um. But yeah, so they want to they want to see those results for themselves. It certainly helps just simply see the material see it glowing in the sun. You really kind of get it at that point you’re like oh okay, so it’s actually converting light a lot of times people think that this is like a filter and they ask why do I need quantum dots I could just put some sort of. Orange-colored plastic up above my plant. But once you see it. You can really it looks different. There’s like a sheen to it like an orange kind of glow to the product and that that does resonate with the growers and depending on who you’re talking to that. Can you know be communicated different ways. Um, growers typically will see the best yields in the northern hemisphere in the late summer and there’s a lot of reasons for that. But um, the sun sits lower than the skies is kind of a hand wavy argument in the late summer and you get more of a red orange spectrum kind of like the sunset is lasting longer. And that can be a triggering mechanism for the plants. The plants have evolved to respond to that because it’s telling them that hey winter’s coming and you better get your reproduction going and in other words produce fruit so we’re we’re kind of gaming that evolution in the plant. A little bit. Um, so that those growers that that are growing outside are using natural light. It’ll resonate with them to talk about this is.

Hunter McDaniel

Sort of mimicking the late summer Sun year round. Um for growers that were growing indoor before and they’re moving into greenhouses which is becoming common with electricity prices being high and competition especially in the cannabis space. You can sort of talk about the lighting and how this is a way of making a similar spectrum then you would make if you could design it from the ground up lighting. And particular in particular, what’s called high pressure sodium lamps like your street lamps. They have this orange color those are very common in indoor agriculture and that seems sort of color looks very similar to the film this orange glow but you’re getting that without having to use any electricity or buy those lamps.

James McWalter

And.

James McWalter

That that super that’s super interesting and yeah I guess if we kind of look out over the next couple years like what? what are some of the kind of Milestones you’re you’re hoping to reach ah in that kind of timeframe.

Hunter McDaniel

Yeah, so I mean with ubigrow. It’s really pedal to the metal. We’ve got um a sales and marketing team like to see that double or triple in the next year so we’ve got a new website that we just launched and so we’ll be more aggressive with sort of educating the market that this technology exists. And then we’ve got some new products coming in that line. Um I mentioned that we’ve got ah another color. It’s a little bit deeper red um that we’ve developed over the last couple years in collaboration with University Of Arizona and we’ve got some other colors that are and under development but probably won’t be launched until next year um but then maybe the big moment is launching the next generation of the product moving towards actually integrating it into the roof of the greenhouse right now as I mentioned it’s a retrofit you can add it on which is a great place to start because it’s a very low barrier to entry for the grower. They can just sort of go hang it up anywhere. You know in small area or big area of their greenhouse and then for us, it’s very manageable in terms of manufacturing but then the second generation product is actually integrating the quantum dots into the the roofing facade materials starting with a greenhouse film or polyethylene film. It’s made by an extrusion process. So this can actually be up to about sixty foot wide and that actually gets draped over and it’s lots of different kinds of greenhouses. But think of like a hoop house like this semicircle sort of shaped structure. Um. And then you have ah a plastic film that gets draped over the top of that and so we’re aiming to offer an alternative to what’s on the market today that it looks very similar. It feels very similar but just has this orange blow to it so those are the big mileusestones for you to grow expanding the team more aggressive on the marketing and then some product launches. Um. For windows. It’s really about getting our first commercial product into the market. We’ve been doing pilots and installing windows in the buildings now for about a year and getting to the point where folks are really demanding this that they want to buy the product and yeah, we we want to make sure that it’s ready for for that sort of a stage. Um. And it it is ah ah a manufacturing cross that requires a little bit of tweaking not too different than how you make windows. It’s fact that’s one of the big advantages over our competition but we need we need to really need to get our quality control down and the engineering. Um. Steps in place to have that it’s you know it’s electronic product but we’re able to have that launched by the end of this year and it’s going to couple the window with a window unit that can be retrofitted into a building with the use case which is around um, smart functionality. So there’s a printed strickckate board that has sensors and.

Hunter McDaniel

Controls a motorized blind and then could be a platform from there to do all sorts of different things.

James McWalter

Very exciting. Um, you know that’s yeah, having all those kind of different lines kind of going at the same time. Um, yeah, definitely is exciting. But also you know brings us challenges and you mentioned kind of like expanding out the sales and marketing team and you know for I guess a company like yours I would imagine you had a ton of. R and d very technical folk I’m sure there’s a lot of ph d especially in the first few years and maybe not a lot of those other kind of sales of marketing and maybe other functions. What have you kind of learned you know about building like a high performance team that tries to merge like those different elements in ah you know and in a company that is.

James McWalter

Bringing such a kind of advanced degree of science to to market.

Hunter McDaniel

Yeah, well some advice that I’ve had from several folks over the years was to hire. Ah a sales director earlier rather than later even before you have a product that person can help you help guide you or you know towards something that the market would want to buy and start doing some preliminary work in terms of. The seeds in the marketplace where that the technology is coming and maybe it’s frustrating for a season sales guy because there’s not a lot of volume there in terms of selling so you need the right kind of person for that role. But um, and maybe it’s more business development if you’ve got a b two b type of technology. You’re not going to be selling directly to an end user. Is something. That’s a little bit unique in terms of our business model compared to traditional advanced materials companies. We could talk about in a minute but um, yeah I mean I think in our case, you really have to you really have to get out there and engage with the end user because it’s something completely new. We want to understand how it. How it’s being used how it might be used how it would go up and what kind of um, ah, simple things like how do you attach the film to the greenhouse structure. Um, what kind of roofing do they already have if they have something that’s filtering or changing the spectrum. You know, maybe not in the visible but a lot of roofing materials or remove uv for example. And we would harvest the uv so just understanding how the product would be used what the needs are of the grower. How what? the growing techniques are that sort of thing the the sales and marketing team can focus on that part. Um, and I think we’re just like any other kind of ah deep tech sort of company and in the early days we were all ph ds. Think the first 5 employees all had ph ds and I have a ph d as I mentioned and so we’re thinking about things in terms of the performance and the materials and the chemistry and less about the product and how to market it and the unit economics and the go-to-market strategy and who those. Critical stakeholders are in the value chain. Um, so yeah I just yeah, had some smart people around me that were pushing me to maybe get out over and out of my comfort zone a little bit in terms of marketing and sales and business dev in the early days and that really paid dividends.

James McWalter

So yeah, and you mentioned um, you know you try to differentiate a little bit around the business model. What I guess how has your business model compared to other similar companies as yourselves.

Hunter McDaniel

Yeah, so traditional advanced material company is seeking to supply an additive into a supply chain. Um quantum dots are actually a good example of this in the early days and even today quantum dots are being manufactured and supplied into the display space and. So quantum about manufacturer like the leader nanosist doesn’t make the Tvs and I don’t think they have any intention of making Tvs. It would be very challenging to go create a new brand and compete in that space. It’s a difficult market. So what? What do they do? they license their technology to companies like Samsung and supply quantum dots to. Downstream partners not necessarily directly those oems but some of the tier one suppliers to them that supply the the components of the tvs to them. So the business model for them is they manufacture quantum dots and then they supply technology. They license technology and that’s very common for advanced materials. Um, very high margin business because you’ve got that licensing component. Um, but it’s limited in terms of your ability to capture value. The value of all those Tvs being manufactured and sold each year um you know something like 10 to $15000000000 but the revenue. Ah. Of of the companies that are supplying the dots significantly less and the reason is that they’re supplying an additive that goes into you know, supply chain. There’s markups and then ultimately there’s value created in the market. You know they can sell those tvs for some hundred dollars or whatever hundreds of dollars more than they would otherwise but the ability of that. Additive supplier to capture that value is more limited so we recognize that early on um and that was sort of a concern um and some vcs didn’t like it. You know they want to see um more revenue potential and and also the timescale can be longer right? because you’re. Relying on these downstream partners to go do something you know hopefully they will get excited. Hopefully they will go fast. Hopefully they will create the brand with you know, a quantum dot related brand like samhsung has q lid and keystas for quantum um, but you’re just sort of hoping that those things will happen and we didn’t really have the time. Um. Weight and you know and and also we were doing something very different than what was existing in the marketplace with the the greenhouse film and so we decided to have those films initially toll manufactured um, which is where you pay someone to have the product made we we supply the toll manufacturer with dots. But then we buy the films. From them and so that enabled us to go faster and then we were able to go directly to the grower from there. So um, you know, initially just to get some data some trials and understand how it would be used. But then we realized well why not just flip the switch and start selling to these guys and so that that is our model now we manufacture the dots.

Hunter McDaniel

We organize the manufacturer of finished products through contract manufacturing toll manufacturing in some cases that maybe looks more like distribution but we pull it through the supply chain. So we don’t have to wait and then we go directly to the and user and sell them the products we capture one ah hundred percent of that revenue on the final sale and that is much more venture backable type business model because you know your addressable market is essentially the entire um, you know market at that point not just the additive and then we don’t have to wait and we don’t have to raise a ton of money either right? because we are. We’re using existing supply chain. We’re using existing manufacturing capacity to make the product that’s going pretty well for you to grow and the plan is to replicate that with windows. Even though it’s a bit more complicated product and longer supply chain air value chain to get to that finished good but you know so far so good I guess the the initial.

James McWalter

Yeah, yeah, no that that that makes this one of sense and you mentioned a little bit earlier that you know it was a kind of long journey. There was a lot of you know ups and downs along the way I guess when you were kind of hitting into some of those downs those down periods. Yeah, when things may not like.

James McWalter

Might have seemed like the movie. Maybe not going in the right direction. How did you I guess kind of manage yourself in in those moments you know it’s just going to keep that commitment. Keep that inspiration through those tough times.

Hunter McDaniel

Ah, well it it does get very very difficult. Um, you know you just have to kind of um ah keep reminding yourself of the vision and and you know what?? what? The big goal is and in our case, it’s a very big vision right? It’s around helping humanity avoid extinction really. Um, and that keeps you going you know the the vision you have to really be a true believer and sort of quote unquote drink your old kool-aid if you will um for that to work. Um, but you know prioritizing your own family and health I’ve got two young kids that you know are very. Very motivational for me. Um, and help take me away from the daily grind just just you know spending a little bit of time with them is like the best medicine for any kind of ah, a bad day if you will. But it’s tough. You know there’s not really, um, a good answer there you you just kind of have to have some grit developer your sleeves and. Be willing to work hard.

James McWalter

Yeah, not and I mean having those kind of other support and mechanisms as you said you know having a family and and sometimes even they’re not, you’re as much their support mechanism and so ah, like I said you know a friend of mine always says you know happiness is solving problems for other people. And so like if you’re doing that kind of constantly. You know, put in the kind of local within the family unit within friends and all that kind of thing and then like also working on these massive problems I think there’s a balance to be had there and you know a lot of the people I think who are working on climate from a startup point of view or a company point of view are incredibly excited and I think generally like a better life. Work life balance than a lot of other startup founders where it’s a bit more of a grind to to do the 80 hours with something that might not not have as much impact. Very good hunter. It has been amazing I really appreciate the time is there anything I should have asked you about but did not.

Hunter McDaniel

Um, no I think you you hit hit all the the points I mean we we are looking to expand the team aggressively. So folks are are you know wanting to get involved feel free to reach out that can include partners. Um. Ah, you know obviously customers if if you’re interested in the ebigro technology. You can go to the website it is for shale online in small quantities and we can work with you on got kind of ah a larger project or a unique kind of greenhouse. Um, and of course investors were were always looking to connect with like-minded. Um, ah. Source of capital and you know having completed our series a in 2020. We look forward to the series b sometime in the next year or so and so you know any Bcs in the audience would like to get involved feel free to reach out. You can email me huntnter@ubiquity.com or you know, just find us online and if if you just want to be kind of ah um, ah, an armchair. Um enthusiast you can just follow us on social media. We’re pretty active there and see lots of cool pictures of glowing stuff.

James McWalter

Absolutely and we’ll include all those links into the show notes. Thank you hunter.

Hunter McDaniel

Thanks James this one.

Autonomous EV Сharging – E86

Great to chat with Desmond Wheatley, CEO at Beam Global. Beam is provides products for electric vehicle (EV) charging, energy storage, energy security and outdoor media! We discussed the electrification of transportation, how self-contained EV solar charging works, the issues with the energy grid, pros and cons of running a public company and more! 

https://carbotnic.com/beam

Download Podcast Here: https://plinkhq.com/i/1518148418

Remember, If you want to support the podcast please rate and review 5 stars on Apple, Thanks so much! 

James

Electrifying Rural Africa – E82

Great to chat with Sebastian Manchester, Co-Founder and CTO at Jaza Energy. Jaza Energy is empowering the 1.3 billion people living without electricity, one solar energy hub at a time! We discussed the electrification of rural areas, the experience of working in Tanzania, the use of portable batteries instead of kerosene, the importance of building a good relationship with the community and more! 

https://carbotnic.com/jaza

Download Podcast Here: https://plinkhq.com/i/1518148418

Remember, If you want to support the podcast please rate 5 stars on Apple, thanks so much! 

James

The unedited podcast transcript is below

James McWalter

Hello today. We’re speaking with Sebastian Manchester cofounder and CTO at Jaza Energy. Welcome to podcast! Could you tell us a little bit about Jaza energy.

Sebastian Manchester

Thank you for having me.

Sebastian Manchester

Sure so Jaza was founded in 2015 we started in Canada after spending a few years working on rural energy projects around Tanzania. And the idea was to scale up some of the early projects we had built in Tanzania and build a company around it. So originally, it was ah a project that was part of a charity called community forest international. I was a grad student who was kind of looking for interesting projects to work on and my friend and co-founder Jeff who’s now the Ceo of Jazza was running a charity called community forest international in Tanzania and together. We kind of started thinking about. Really simple ways to provide access to electricity in some of the communities. He was already working in running his organization and the the basic idea that we came up with which is still kind of the fundamental. Business model that we operate on today is charging portable battery packs that customers can take home and use to power their electronics so we built one energy system that serves an entire community and customers can charge battery packs. That energy system and then walk home with the batteries. That’s what we built for the first time in 13 and that’s basically what we build today. The technology has come a long way how we run the business at scale has changed a lot but that’s the basic idea portable battery packs. Charged from solar energy at retail shops that customers can use to power their homes.

James McWalter

That’s so fascinating and I guess you know I think believe you and your cofounder are both from Canada. Um, and so I guess you know what? what led led to Jeff you know, focusing on Tanzania and its charity work there initially.

Sebastian Manchester

Um, so after Jeff and I grew up together. We’re both from a small town in Canada called Sackville New Brunswick and after high school Jeff took ah a nontraditional route and just started traveling the world. I went to engineering school and then we kind of met up later on in the summers and we would work together planting trees. It’s a typical job for Canadian students to make enough money to live through the school year. Um.

James McWalter

I Actually a good friend of mine used to do that and it was it was He was an academic and it was his most lucrative job. He I think he’s ever had.

Sebastian Manchester

Yeah, it can be very lucrative very painful but lucrative but fun anyway. So so as tree planners we’d meet up in the summer and then Jeff would continue traveling I’d go back to school.

James McWalter

And right.

Sebastian Manchester

Jeff ended up on a small island off the coast of Tanzania called pemba and while he was there some of his local friends were very interested in. You know this career he has as a canadian tree planter that affords him the ability to travel the world and spend time in their communities. And so they started pondering how can they do tree planning in in pemba which is which was like facing a lot of issues around deforestation and and obviously like there was ah there was a lot of good reasons to plant more trees. So Jeff with. Some local friends started an organization called community forests international and you know initially I think in the first year they planted a few hundred thousand trees just by collecting seeds building little nurseries around in different communities. Um, you know working a lot of working with a lot of. Local communities to understand what trees grow where how they grow really really leveraging the local expertise and then using his resources kind of in connections back in Canada to raise money to fund the organization and over the course of you know about a decade he scaled that organization. To plant. You know I think over 4000000 trees. They’re now operating across several countries in East Africa it’s very cool organization and that’s how we ended up in Tanzania was basically like the first projects we built that I described we. Built a small energy system on a small island off the coast of pemba so an island off the coast of an island. Um, that’s where we tested the model and initially it was just a 1 ne-off project. But after I finished grad school and. Had spent a few years kind of working in the energy industry Jeff and I kept thinking about these systems we built and like what could we do to make them better. We we found that there was definitely some potential there because people were still using the product years later. It was very cheap to install and very easy to maintain so we thought we should. We should see what else we can do with this and it made sense to to launch in Tanzania because we already had a network there. We Jeff had already scaled an organization there and it’s just like. Also. Incredibly beautiful place to work and live so like it’s good excuse to go spend time onto tropical island in the indian ocean.

James McWalter

Yeah, not not bad at all and I guess you know at that point you know you’re talking to Jeff you have done this you know this small kind of pilot project in essence but maybe hadn’t realizeed. It might be a pilot project to something larger. Um. You what was your kind of mindset at that point you’re like oh I want to start something and like this is a good opportunity or you’re like oh um, there is this existing kind of framework that gets me very excited and I’d love to continue working on that and.

Sebastian Manchester

Well, it was it was kind of a combination of both like on 1 hand. The problem was very interesting to me being 600000000 people living in Sub-saharan africa without access to electricity. This is sort of what got me interested. In in you know what eventually became jazz initially it was just as a grad student I was studying energy storage thinking about how to integrate you know, big commercial wind farms. Um, onto the grid using energy storage as a buffer and then at the same time I was you know. Doing some independent research and reading about how you know some of the some of the technologies available that were being proposed to electrify rural communities a lot of like micro-grids a lot of kind of solar diesel hybrid grids and it was pretty clear that. Ah, cost of energy storage was coming down the cost of solar panels was coming down the availability of kind of like that the the cost of personal electronics was coming down people were people were starting to. You know, use smartphones in a lot of rural communities but still have nowhere to charge them and so it just seemed like a very obvious big problem that could be solved with existing technology that just wasn’t really being solved I wanted to figure out why and so that’s when we started. Working on it just to to try and explore the problem and understand what what was preventing 600000000 people from having reliable access to electricity.

James McWalter

And I guess you know as you kind of dug into it like what were those reasons right? like you know it seems like jazz. It seems so obvious like in hindsight but you know why? why? Why were they’re not like 500 competitors already sitting there kind of doing something similar.

Sebastian Manchester

Well there there were a lot there still are quite a few I mean a lot of people have tried to build a reliable affordable you know, energy access technology for for sub-saharan Africa it’s been done. Um, I think I mean one one big reason why it was you know I think the time was right for us was because we’re kind of just coming in as the cost of of batteries is coming way down and the cost of solar had already been dropping quite a bit.

James McWalter

So.

Sebastian Manchester

Um, and you know it’s a difficult. It’s a difficult market to operate in. Um, you know our customers earn less than $2 a day. So it’s ah it’s a hard customer to sell to understanding the customer how they spend how they prioritize their spending and what they’re going to actually use energy for is is not an easy thing to figure out something we’re still learning. Think a lot of companies. Never really solved that problem and it’s very expensive to to learn those type of lessons. Especially if if you know you’re you’re building infrastructure. Like a micro-grid. Um, and the the reality is like our customers don’t have a lot of money to spend on energy the demand for energy is also quite low. So it’s a market that may be um. I think a lot of people will just ignore because they assume people don’t have money people don’t need electricity like why would we try and sell sell there and that’s just something we think is false. Um, yeah, it’s but but still like to this day like ah I’m not. I’m not sure why this problem hasn’t been solved because like we’re working on it and it seems like we’re getting there and I do think that you know Jazza will solve energy access and I hope that other companies can help because there’s a lot of work to do.

James McWalter

I.

James McWalter

No absolutely and I guess when you’re you know, implementing, you know a new project. Um, your product in a particular community who’s the I guess buyer for that like who are you trying to contact first.

Sebastian Manchester

So We sell directly to customers um customers Our customers are people who live in the community. So We Electrify. So Basically the way it works is when we select a site to build a hub. We recruit local women to kind of. Run and manage the hub that we call them jazz stars and then you know through the process of kind of onboarding them training them and equipping them with all of the technology know-how and and infrastructure to then like start serving customers. They’ve already ah got a. Relationship with a lot of the people that ultimately start using the service and so the the hubs themselves are like pretty interesting looking. It’s ah it’s like ah a small shop but it’s a kind of prefab building that you know we worked With. An architect friend to to help design and it looks really Cool. So people are interested in what what it Is. We get a lot of organic sales just from people coming up to the hub and seeing what you know what are we doing and once people start using the service. There’s a lot of word of mouth because it’s like. Very easy product to use. It doesn’t require any special setup like we don’t need to send a technician or anything to set your home Up. You can just walk home with the battery and a lighting kit that you get from us and on day one within you know a few seconds have electric light in your home.

James McWalter

Oh.

Sebastian Manchester

A lot of the times for the first time. So so it’s typically like our typical customers are I mean it varies a lot by region but customers who you know are frustrated with spending their hard earned money on you know Kerosene for a lantern. Um, you know we we recently launched in Nigeria and a lot of our customers. There are used to so to burning a diesel generator and that’s just not like a pleasant thing to have running in your home when you’re you know, just trying to relax like.

James McWalter

And raise a family kids inhaling that and everything.

Sebastian Manchester

So ah exit and it’s not good. It’s not good. Yeah.

James McWalter

And so the the hubs themselves So how how do you choose the specific community like you know there’s a lot of communities you I’m sure you could service us. But how do you kind of create that priority list. So.

Sebastian Manchester

It’s based on number of households within a specific radius from a location that we think would be good. So I mean we kind of take geospatial data sets about population. Um, we kind of overlay that with electrification data and find communities where there’s a lot of houses within a close proximity that do not have good or reliable access to electricity. And then typically that will generate like ah a prioritized list of sites. We look for regions where there’s a cluster of sites so we could serve from a single kind of anchor community and then we will do like. Field visits. Our team will go and kind of survey some customers try and understand what the situation is there if we could look look for suitable sites that we could lease to build a hub on and then based on a bunch of site selection criteria we can then kind of approve or move on find it. Better ah alternative for the community. Um, and that’s a process that we’re still refining and you know learning from hubs that we’ve already built what makes a good site what doesn’t because we’ve now got several years worth of operating data from. About a hundred sites in Tanzania so pretty good. Pretty good data set to learn from.

James McWalter

No, it’s amazing congratulations to get 200 sites that’s that’s that’s 3 it’s really exciting I guess when I think about the energy space in most of the develop world. It’s incredibly well regulated. Um, and you know basically the business that you’re building in Tanzania is probably not.

Sebastian Manchester

Thank you.

James McWalter

Legal in certain parts of develop world. Um, and in that particular way um, are there kind of local regulations. You have to deal with and and what’s a kind of general approach and I guess how are local agencies, governments etc. You know, responding to the work you’re doing.

Sebastian Manchester

Yeah, it’s a very good question. There are regulations typically regulations start to impact energy so providers at around in Tanzania’s ten Kilowatt threshold. If you run a micro-grid over 10 kilowatts. There’s a bunch of regulations you have to follow. We are quite a bit under that a typical hub. Um, it’s about three and a half Kilowatts of solar pv so it’s pretty small system but it can still serve ah that system can serve. And anywhere between 20300 customers depending on how they use energy. So we fall under the regulations for Tanzania um, that said it it is also like a purely dc energy system. So it’s all low voltage.

James McWalter

So.

Sebastian Manchester

So anything under 50 volts is kind of considered inherently safe. So that also helps in terms of government engagement like we do spend a lot of time engaging local government as part of the site selection process when we move into a new region. Yeah there’s a lot of you know steps to go through to make to you know, engage local authorities make sure you know we are following all of the the right steps and it’s it’s it’s. Important to like ensure that you know we are focusing on not only like communities where they I mean they they can help us identify communities where they think there’s a need and doing that gives them sort of ownership over the outcomes of the project. Builds kind of some social capital to be able to say like we brought jaza to the community got power and in terms of the like utilities. There are the electrical grid is pretty widespread in Tanzania and in Nigeria. But a lot of customers still haven’t connected because they can’t afford whether it’s like the connection fee sub places that’s subsidized but it’s also expensive to wire your home and then buy the appliances to plug in. So a lot of a lot of customers just aren’t connecting are choosing not to connect to the grid and so Jasa provides an alternative that where customers can get electricity. We do start to fulfill the electrification mandates of the the national utility. But without them having to spend money on expanding their infrastructure to to reach every single home because that’s you know at current electric electricity consumption rates for a lot of rural households. It’s just not economically feasible to build out that grid. Just because the amount of money people spend on electricity is so small that the capital costs are just will never be recovered and and most of the electrical utilities in sub-saharan Africa operate at a loss so anything we can do to increase electrification in rural communities seems to help.

James McWalter

Ah.

Sebastian Manchester

To be received well because it’s helping fulfill that electrification mandate.

James McWalter

Yeah there’s this kind of fascinating history around the electrification of rural areas. Um I know Ireland Best but also a bit of the us and the Ireland you know has a lot of kind of scattered small islands. You know you’re canadian there’s a lot of scattered small islands as well. And getting electrification across those islands you know was something the national government decided to do but still took multi-decades of of effort and at a incredible expense and I guess but there was also like the the kind of economic um ability to to spend that money. Um and and see that kind of return and investment right? because when you electrify a place. It starts being more productive nearly by definition and so yeah, it makes kind of complete sense that you can basically you know hand maybe not hand in hand be partners with utility but you know you’re you’re kickstarting the economic development of these areas in a way that would potentially be beneficial to the utility down the road when as these you know? um. Clusters of of communities become more economically viable for something more like a full build out off the grid.

Sebastian Manchester

Yeah, definitely I don’t I don’t think jazz is going to be like the the current model of energy distribution from portable batteries. It’s like it’s the fastest cheapest way to get electricity in homes right now. But I don’t think it’s necessarily. Future. This is just step one so we want to be you know helping get as many households on electricity as possible now and then we want to be part of that transition into the next the next phase of electrification of rural communities. Whether that’s building out micro-grids or connecting to a larger. Larger grids. 1 other thing that we’re doing is you know collecting a lot of data on household energy consumption that could help inform where and when it would make sense to build out some more more infrastructure.

James McWalter

That That’s Interesting. So in Essence you could down the road be um, you know like a kind of larger scale product developer and basically the energy company because you already own the that relationship right? with all these all these communities. Um in a way that you know they probably love you right? You know your jazz of stars running around. Um, you know, kind of building that like strong relationship.

Sebastian Manchester

Totally yeah, we so we own the hubs we own the batteries we own the customer relationship and besides just being and a network for energy distribution. We also see our network as a distribution layer for other types of services.

James McWalter

I.

Sebastian Manchester

Because we’ve built the retail footprint we’ve we’ve trained you know customer facing employees who know the community know their customer and so there’s all kinds of interesting add-on services. We could think about layering into our network beyond just energy. So. First step though is giving people power and the next step is is the is you know where where things get really interesting, but right now we’re still still just trying to electrify houses.

James McWalter

Not absolutely and in terms of that kind of growth trajectory trajectory over the next couple of years um yeah I guess what are the you know what? what are the kind of constraints from the speed of your growth is it people capital. Ah. Suitable community something else.

Sebastian Manchester

So we’ve been pretty been pretty deliberate recently about you know growth in that we want to make sure that we’re building business that’s worth growing. So we’ve been very focused on hub. Unit economics making sure. Yeah, every every hope we build is profitable every customer we serve. You know that there’s positive yeah unit economics because we have to not only build the hub. We also have to manufacture design and manufacture the battery ship it around the world. Um, deployed into remote communities. It’s like there’s a lot of it’s a it’s a complicated and expensive capitally intensive business to run so we want to make sure before we scale up, we’re doing it really? well so so currently we’re we have but hundred locations between Tanzania. And Nigeria we just launched the the we’re actually going to be raising our series a over the next couple months and so that’s going that’s one constraint that will unlock growth because we do feel very good about this that.

James McWalter

Exciting.

Sebastian Manchester

State of the business. We’re ready to grow. Um, people is obviously a constraint you know we need to recruit um a lot of jazz stars to run our hubs and so there’s a lot of you know, a lot of. Work to do there to to build the process to kind of onboard the next Thousand Jazza stars supply chain has been a constraint especially over the past year as kind of semiconductor shortages have impacted us the kind of global shipping container shortage and shipping network congestion. Slow things down and also kind of finding a factory that we can scale up manufacturing with but a lot of those challenges we’re working through were we’re comfortable with where we’re currently operating I don’t see that as the constraint right now. Um. And site selection. There’s you know about 2000 sites in Tanzania we think would would make good good communities to build the hub in and many more in Nigeria those are our 2 operating markets. But um.

Sebastian Manchester

Those will should keep us busy for the next year or 2 but we’re definitely looking at expanding into numerations as well. We’ve learned a lot from expanding into Nigeria this all just actually happened in the last three months so a lot of this is still fresh but we’ll take those lessons and they can. Systems. We’ve built to launch into a new market and and be looking at the next the next market market to expand to so with the right systems to to to recruit train Jazza stars a supply chain that can feed enough batteries into. Into hubs and the capital to to build it all I think right now we’re pretty well set up to grow. But again like we’re still learning and surely we we’ll find new constraints as as we. As we do grow because it’s um, yeah, we’re we’re always learning. We have spent time. There have been certain periods of time where we’ve we’ve like grown really fast like added 20 hubs in a month just to see what happened so I feel like we have worked out a lot of those kinks. But. Doing that month after month after month is going to be something new so it will be interesting but I’m confident we we can do it.

James McWalter

and and I would imagine retention is like close to a hundred percent once you once you build out a hub.

Sebastian Manchester

Um, it’s I mean hundred I wish it was 100% I mean a lot of people will try the service and and for 1 reason or another it might not be for them. We do have pretty good retention. Overall it’s about like all time retention. Yeah, after operating in a lot of these communities for. You know up to 3 years is like 60 so there’s a number of reasons why customers will churn but typically customers who start using the service stay with us and the lifetime um the lifetime value of a customers is well worth building. But hub and the battery pack to serve them.

James McWalter

Yeah, yeah I guess as Bor like referencing the hub itself right? like once it’s built it. It continues to be an like an asset that is like a positive producing asset ongoing.

Sebastian Manchester

Yeah, right? exactly? Yeah,. It’s pretty low maintenance solar panels are magic as far as I’m concerned and once that like once the hub’s installed. You know there’s a bit of. Bit of maintenance troubleshooting that needs to happen every now and then but largely the Hubs just keep working.

James McWalter

And you know try to manage. Ah, you know you I believe actually I think here New York right now you’re you’re spending your time I believe between ah Canada and Tanzania as is the rest of some of the rest of the team and then obviously you have a lot of people kind of on on the ground and in Tanzania now Nigeria um. What have you kind of learned about you know trying to manage a team across all these different time zones multiple cultures. Um, and you know things that maybe didn’t go so well. But now you kind of learned from over the last couple of years

Sebastian Manchester

So learned a lot about this I mean 1 thing I feel like we were. We were well prepared for the global pandemic because we had already been working as a pretty remote team for a few years leading up to that so it helped us kind of. Ride through the early bumps but it’s it’s a lot of work to run an international company. You know, especially where we have a hardware team basement Canada that’s designing the product very far away from the end user of that product. We have manufacturing going on in China and we have most of our operations like pretty much all of our operational team in Tanzania is Tanzanian and then it’s mostly just co-founders Jeff and I who who kind of. Bridge the gap between our like engineering finance teams in in North America our operations team in Tanzania and Nigeria and manufacturing in China um, 1 thing that we’ve learned is the importance of building. Good data systems. This is especially useful for the engineering team. It’s like the best way we can learn about our customers how they use the product because we can’t be there. You know it’s not as it’s not as easy for a hardware engineer and in Canada to talk to a. You know farmer in rural Tanzania besides the distance does the cultural gaps and the the language so we do we we built a lot of data systems both in terms of like how customers are using energy how they transact at the hub. And that’s helped us learn a lot about what the product needs to do how it’s helped us evolve the product. You know the product we started with is very different from the product we’re we’re we’re operating today. We started with the. Lead acid battery that was just um I mean it’s basically just flat acid battery hardwired to an led light bulb. Um, now it’s like it’s a custom lithium ion battery pack. That’s got a custom battery management system that does data logging.

James McWalter

And press.

Sebastian Manchester

You know control some business logic so we can we can meter energy on both you know number of you know Watt Hours units of energy discharged. But also we can meter it based on time we can see how much power people are using at different times of day. How much. Um. Much energy people use on on each different on each each swap and so we’ve learned a lot about what the product needs to do and that’s helped us build feedback loops between engineering and our customers and then on the software side too like. We we we rely on a lot of customer feedback that we can collect through the hub so finding building software tools to translate what jazz of stars are hearing and seeing in the communities. Turning that into actionable data that the rest of the team can use. So yeah, a big thing is building feedback loops. It’s also been really important to just give people ownership over their responsibilities because. A lot. Yeah, a lot of times people are working kind of extremely hard in isolation and they just need need to be able to make decisions and and you know follow their intuition on things and ideally were there to support and help them learn and develop. But. Ultimately, we want. We want people to be kind of accountable for their own work and in a remote setting that’s been super important and has worked well for us.

James McWalter

Yeah I think that I would also work remote and I was at a remote company when and Covid hit and you know a lot of the things that you can kind of take for granted when you’re all co-occated. Um, you generally in remote culture have to kind of define and structure very early on and so aspects of culture you know people. Kind of just like take the take the lead from the founders or the early employees on culture If. It’s all person. Um, but like you know, being very specific about like how we communicate asyctly how we kind of own our tasks and our roles like that. That’s just necessary. Otherwise the company itself just wouldn’t be able to kind of progress in a remote fashion and so um, yeah I think of. You know the big power of something like the word culture using startups is just allowing real alignment over how to solve problems and then allowing people to kind of actually solve them themselves Once there’s alignment over that piece of culture.

Sebastian Manchester

Totally totally? Yeah, yeah, it’s the cult. The the cultures is really important in how we build what we build and you know you know our organization. We’ve really put jazz tried to put Jazzs stars at the center of it and like keeping that in mind anything we’re working on should be like directly benefiting jazz. A star is kind of the core the core of the company if a jazzas star is doing well. Customers are doing well if jazz stars getting rich then the company’s doing well so that’s helped a lot and like you know, jazz stars are definitely the most important people in our company and personally inspire me and I know. That’s true across the entire company. It’s pretty It’s it’s amazing to see. Yeah the the confidence and the power that jazz a stars can develop themselves. And you know become leaders in the community with a lot for a lot of time. It’s the it’s their first job. It’s the it’s the first opportunity they’ve had to kind of really show the community what they can do and they always. Blow us away and they both community way.

James McWalter

And what about I guess kind of other types of kind of local development that kind of can occur. Are you seeing any kind of interesting. You know, commercial use cases you know now that you have some sort of electrification. Um, you know people people are are great at like figuring out cool new things. Um. You know with heavy constraints and so have you seen any kind of interesting projects businesses and so on kind of rise up alongside your hubs.

Sebastian Manchester

Um.

Sebastian Manchester

Definitely like some some of the cool use case I’ve seen for a product. It’s ah, a lot of barbers use the jazz pack nothing worse than losing power in the middle of a haircut.

James McWalter

So. Right.

Sebastian Manchester

So the the jazz a pack has become ah a staple in a lot of rural barbers because it can easily power you know set set of Dc clippers all day every day and then at the same time it can do like a boombox. So. You can you can get your hair cut and style the another one is um, people running basically like home theaters. They’ll use the jazz pack to power Tv and Dvd are you know. A Tv that you can plug a Usb stick in and just like charge people admission to watch movies or football game or whatever. That’s pretty popular use case and those customers will typically like be swapping a few times a day because they’re just running running nonstop and doing doing pretty well for themselves. Um, and then a lot of customers will just use who are using it for business. We’ll just use it for light. So for example, if they’re running a market stand while the markets operate at night and having light this having light is helpful I think we we understand that.

Sebastian Manchester

Um, it can also charge phones so people use it to do kind of chart phone charging in their business. But yeah, it’s a lot a lot of our customers are also like shop owners. So. It’s not just a product for the home and I think that’s is this is. Kind of the next challenge from a product perspective is for us to figure out how to kind of build on that Nigeria especially is interesting because a lot of businesses will be using generators to power fridges Tvs there’s there’s a lot more Ac loads in rural communities. Niger then there than there is in Tanzania so our current product focus is kind of building on the evolution of our jazza packs our batteries to build something that can serve customer that that wants to run their business but can’t afford. Both the like financial and you know environmental cost of running a generator nonstop.

James McWalter

So makes a to of sense and I guess you know thinking about ah people who are trying to you know, maybe be inspired by our conversation and like oh that’s that’s a pretty cool Startup. You know it’s It’s the kind of company that um, not enough people are building and we should have more of these you know if if somebody’s kind of you know. At the stage of their career where they’re interested in starting a company is there anything that you you know you’d like to advise them ways that they could kind of maximize their success starting a company some to yours.

Sebastian Manchester

Um. Um, my suggestion or advice I mean our company is a little bit unique because we operate in a part of the world that not a lot of people who I assume are listening to this podcast will have experience with like. You just kind of have to go there and like you have to be there to really understand how to um, you know, understand the customer that you’re trying to serve I think that’s the most important thing is like what what is the problem you’re solving um, who are you solving it for. And so for us like we spent Jeff and I both spent several years living and working in Rural Tanzania before we started to feel like we had a a good understanding and it’s still something that I’m that I struggle with so um, understanding the problem and then if you’re. Moving to a new country to solve someone else’s problem like make sure you have very good local partnerships to help bridge the gap. Um, but that’s the main thing like make sure that you’re solving an actual problem and ideally a big one that a lot of people have. But not necessarily if there’s like a small problem. You care a lot about that’s also probably worth solving if you care about it chances are someone else cares about it. Um, and also just like don’t. Don’t be afraid to just start like I didn’t have any experience in hardware I didn’t have any experience in software I didn’t have any experience in building a supply chain everything I do today is like skills I’ve had to learn on the job and so don’t let don’t let that be a barrier to just starting. The most important thing is to just start once you know there’s a problem just start working on how to solve it don’t like go to don’t go to grad school to learn how to solve a problem to start a company just like try and so try and start the company and try and solve it.

James McWalter

Yeah, yeah.

Sebastian Manchester

Maybe you need to go to grad school but chances are if it’s a big enough problem. You can hire someone who already has those skills or you can learn the bare minimum until then.

James McWalter

Yeah, especially because you know a lot of people who start something. It’s often their second or third thing that actually like you know they’ve learned the skills needed and so just get get the first one get this first one done I mean in in your case, the first one’s been very successful of course. Um, it’s not true for all of us. Not not true for me. Um, you know.

Sebastian Manchester

Yeah.

James McWalter

But I think it is very very you know valuable to to put yourself out there and you know I was talking to somebody else recently about the especially if you have the ability to take risks right? Not everybody does of course and so um, you know it’s obviously a great privilege to have the ability to take you know risky career moves and and so on and and for those people who don’t. Have that ability to take risks like I think there’s nearlyrdy. Ah maybe not quite as strong as a responsibility but something similar that if you have the opportunity to take the risk to solve the big problem and you are interested in that problem well go for it. You know, get on a flight you know take take the chance. Yes.

Sebastian Manchester

Yeah, or go like go find someone else who cares about that problem and help them do it because chances are someone else is trying to solve it too starting a startup is is not for everyone and like um. Think more people should should try it but don’t feel like you need to start a company to work on these types of problems. You can also find cool companies like Jasson and you know we’re we’re looking for people who are hungry to solve problems who might not know know where to start. Can just join us join us on ambition.

James McWalter

Absolutely well Sebastian Manchester has been great, really enjoyed the conversation. Is there anything I should have asked you about but did not.

Sebastian Manchester

Um, well I’ll just echo myself what I just said like jazz is growing. We need help. It’s a big Problem. We’re looking for people to to help us solve energy access and if you love big challenges you love Learning. You have an open mind come join Us. We will help you help you learn who you really are by working on very hard problems with people who are similarly passionate about solving big problems and. I Do think we have a very very impressive team I Love working with with ever in a jazz. Ah some some of the smartest people I know are working on this problem with me at Jazzos So if it sounds interesting. Please reach out.

James McWalter

Absolutely and we’ll add your career of page link to the show notes Sebastian Manchester. Thanks so much.

Sebastian Manchester

Cool. Thank you.