January 12th, 2013

A Simple Idea for Greentown EnergyBar Events in 2013 – Let’s Find Customers That Have Huge Budgets and Can Pay Us Lots of Money

BOSTON -

I’m back in Boston and loving it. Boston is smaller than NYC for sure, but this helps the city. The collaboration that I’ve seen in Boston is easier, more fruitful, and happens very frequently. The same buzz words are thrown around in both places, which is very annoying, but I don’t hold it against anyone. Here are my thoughts on how to get past buzz words and start generating revenue.

Please excuse any and all typos, I’m brainstorming here, and if I waited for everything to be perfect, I’d never write anything ;)

I’m looking forward to get back into hosting events, when Green Light District started we hosted ~12 CEOs to discuss real problems and opportunities that they were seeing. We went from the Green Roundtable on Chauncy Street (which doesn’t exist anymore) to Venture Cafe for the first Energy Bar, and then Energy Bar was moved into Greentown Labs right around when I went to Europe. Jason and the Greentown teamed turned EnergyBar into an event that is 10x better that I ever made, so I’m glad to rejoin the group and push things to the next level.

I want to push things to the next level with two themes in mind. One, stop the use of buzzwords. “customer devleopment” what exactly do you mean by that? “Value proposition” how about….how do you make more money than you spend. “Penetrate the market”, let’s call that making sales. Let’s stop trying to show how we went to super expensive collegues, we all know all the buzzwords, let’s stop talking in code and get sh%t done. Second rule, cut the genrealizations and let’s start talking with real customers that will pay us money. I’ll discuss a little more what I mean about real customers below.

You see, I get very annoyed going to the same events over and over again, hearing the same investors say the same things. Here’s what I’m always thinking “are you my customer?”, or, “are you the customer of anyone in this room?”. It’s safe that say that most of the time, investors aren’t customers. What does this mean? For most companies they’re not the bottleneck to growth. That’s not entirely true in all instances, but it is from a sales perspective. Unless I’m selling something to an investor, or I have reason to believe that they came from an operating role in a specific industry (that I already know is my customer, or I’m guessing might be my customer if I’m still working on figuring out who my customers are) and they still have close connections with said industry, their advice isn’t very valuable. The above two examples don’t happen much, due to the background of most investors.

Let’s get back to talking about speaking to real customers, and how this translates into events.

First, we should remember that cleanteach can generally be split up into three phase of a business which can apply across many different technologies and verticals (crap, buzzword! by verticals, I mean different industries).

Here they are.

  1. R+D of new technologies
  2. Commercializations of new technologies
  3. Deployment of existing technologies (no technology risk)

Now, let’s discuss in specific terms what these concepts means, what the business tend to need in each phase, examples of companies, and for the sake of this post, how events could be structured to help them.

1. R+D of new technologies

  • Typically involves research at a university or within a large corporation
  • Can be basic research, or advanced into a specific subject that might yield a technology specific breakthrough
  • They need talent in the form of researchers, money, and a lot of time, because no one knows when the next breakthrough will happen.
  • Hard for 2 hour event so help this crew.

Commercialization of new technologies

  • These are companies that have a technology that has been proven to be effective in lab or in a pilot site, and now they are looking to sell the product or technology to more customers.
  • Most commonly these are B2B companies, but they can also be B2c.
  • Also, they don’t need to be creating a technology, they could be repackaging existing technologies and positioning them for a different market and/or application.
  • Example of B2B companies would be:
  • 1) New Way to Make Fresh Water
  • 2) New LED Technology
  • 3) A new type of solar PV and solar thermal module 
  • 4) A new way to control steam radiators.
  • 5) Squirrel guards for solar PV installations
  • 6) New ways for supermarkets to compost their organic waste
  • 7) New ways for restaurants to harvest their grease
  • 8) New ways for cities to deal with trash collection
  • You get the idea, what is most important for these companies is GETTING SALES. If the problem that they are solving is large enough, and their customers have large enough budget, they will pay for R+D through purchasing the product/service with a downpayments. This happened with BigBelly Solar (#8) and Feed Resource Recovery (#6). SALES are critical because they provide 1) cash and 2) credibility at the same time. As opposed to investment, which only provides cash, i.e. is not as valuable.
  • Thus, how can we create events where CUSTOMERS can be found?
  • What are the best customers?
  • Here’s a group of customers I would love to talk with, so I’m guessing other will feel the same: They’re a business. They have an existing, large budget, they have a regular schedule for allocating said budget (so you can actually plan around it). They have huge problems that they’re looking to solve, and a specific person that spends said budget.
  • How then could we structure an event to help this? An event for this could be structure easily. Get 3 to 4 panelists, each in control of a budget of at least $1,000,000 that deals with an energy/cleantech related issue. The business itself should be worth more about $20,000,000 and have been around for more then 10 years. We don’t want to be selling to other new business (sometime’s called “startups”). Make sure that the person is currently looking for solutions.
  • Setting expectations in the event. Once the speakers have been found, the key will be setting the expectations of both the speakers and the attendees. The speakers need to be primed to come prepared to talk in specifics about their business, where they spend their money, and what they would be willing to pay for. As a moderator, this would mainly be my job. They key is to push them to say something specific to “I would pay $100,000 to fix this problem.” Because we’re trying to develop new technologies, it would be best to find customers that have tried to do research, but have not been able to find anything. The expectations also need to be set for the attendees. We’re not asking the attendees to sit and listen for fun, we want them to figure out how to sell to the panelists.
  • Another point about this exercise, is that we can create an event series for different industries, because each type of industry will have similar yet different problems. For example, super-markets, fast food restaurants, universities, etc.
3. Deployment of Existing Technologies

  • Deployment of existing technologies means that there is no technology risk at all, in that all of the risks are known and can be reasonably quantified. The challenge in this environment is also sales and project finance.
  • The most common examples of deployment of existing technologies is energy effieicny upgrades, solar pv installations, wind installations.
  • The challenge to this businesses are complex but come down to 1) finding customers 2) streamlining operations profitably and 3) finding project finance investors. With each of those subject there are obviously more issues around how long sales cycles are after a customer purchases, good vs bad investors, etc.
  • The other issue around finding customers mainly goes into the problem of 1) is the customer aware that they have a problem and 2) do they percieve it as a large problem. If neither are true, sales become difficult. In some case, the answer might be yes to both, but they are unaware of any solutions and don’t know where to start looking for solutions. This challenge becomes a match making dilema.
  • On the project finance side, the challenge is also that of 1) finding the right project, both in size and investment criteria and 2) finding investors that are willing to invest small sums of money. Small meanings, less than hundreds of millions of dollars. For typically project finance, let’s say a $2 billion dollar building with a develop that has 40 years of experience, the process and risks are known.
  • The problem with funding project finance for projects that might valued at $500,000 is that the developer might only be 6 years old, the technology has only be “risk-less” for 3 years. This compounded the impact of having a small project because it means there is less capital for due diligence.
  • The impact of small projects and a new industry compounds the problem for another two reasons. First, a pipeline may or may not existing. A $500,000 project is fine with a large investor, if there are 1,000 more of them that fit the same profile. If they are materially different, due diligence must be done.
  • The other issue that has a strong impact on small projects is transaction costs. $50,000 in legal fees is not much for a 10MW solar farm, it’s a lot for a 200kW project. The investment is being run driven through tax credits, the mechanism that is driving renewable energy deployment. The reason that this is a problem is that the trasnaction costs (the legal and acounting costs) are high. Cash, cash equity, debt, tax equity all need to be raised, legal structures need to be created with specific operating arrangements for partnership flips, lease pass throughs, O+M contracts established, the whole nine years.
  • The challenge for new companies looking to delpoy technologies, finding legendary project investors. These are project investors that get it. They have passive income (they can use the passive losses generated by the tax credits) but they also understand the renewable energy market place. Again, this is a match making excercise.
  • How could this be helped with an event? Similar to running an event for deploying new technology, the challenge we’re facing here is largely matching making. How do we find customers that are actively looking to invest a lot of cash in renewable energy and energy efficiency project?
  • Setting expectations. The key to have a useful event, once we’ve found panelists, is to have them go into the specifics of their research process and tell them what they’re 1) afraid of and 2) what is the criteria of projects that will go through.
This is just a brainstorm, I’ll be thinking and developing this more in the future, and creating some events at greentown. If you have any thoughts, or questions, as always, feel free to reach out. 

November 6th, 2012

Moving Back to Boston, Current Projects, and Goals in Boston

BOSTON -

After almost two whole years, I’m headed back to the hub. I last lived in Boston in March 2012. In 2012, I quit my job at Nexamp and started working with Brian Hayden at HeatSpring again. Since my work was virtual, I decided to go to Europe for a few months for fun and to research the cleantech space out there. My time was not as useful as it could have been (from a professional perspective) and I learned a major lesson. Research is very hard, and the more specific you goal, the easier it is to perform it. My research was very vague so it was hard to gather any specific information. Thought I made some great relationships while there.

This year was spent in NY. It was a good year, I enjoyed my time in NYC, but the city is not the lifestyle for me both personally and professionally. Don’t get my wrong, there’s great stuff happening in NYC but I also enjoyed the culture in Boston better, at least as far as cleanech goes, there’s both a sense of competition and collaboration that I noticed lacking in both NYC and SF. Boston is also still small enough, and people are nice enough, to help each other out, without being ridiculous. NYC has some weirdness, there were many times I met someone at an event and they told me they’re looking to invest XX millions of dollars. Let’s be clear, if you meet someone and they tell you about their XX million dollar fund in 4.67 minutes they don’t have an XX million fund. With that said, NYC is also a place where you can be offered a job on the street. That’s how I ended up working with Voltaic Solaire.

As I brainstorm what I’ll be working on and my goals, here are my thoughts.

What I’ll be working on.

  • Continuing to make sure that HeatSpring and HeatSpring Magazine are taking over the internet. Creating great articles, well cited industry research and opinion, interviews, creating new trainings, and creating really simple tools to give away. By that way, creating really simple tools is a great way to test our new business concepts.
  • At HeatSpring, we’re spinning of a software product called Cammpus. So, I’ll continue to close sales and develop it. We’re focusing on developing relationships with subjective matter experts that are working around the green building, energy efficiency, and renewable energy industry because that is where our existing relationships and track record is. After we’ve dominate this, we’ll move into new verticials.
  • Working with NEGPA on geothermal and renewable thermal policy in New England. We’re currently focusing on implementing the New Hampshire thermal REC program, I’m sitting on a thermal efficiency task force in Vermont and Massachusetts is releasing a new geothermal program
  • Advising Ground Energy Support. GES is a company that has developed a cheap and accurate way of monitoring ground source heat pumps in real time. I’m working with them to create a performance based contract for residential geothermal contractors because I believe this will reduce significant amounts of risk for property owners and help contractors SELL MORE JOBS!
  • Residential and Commercial Sales Consulting for solar thermal, solar PV, and geothermal projects. The name will remain secret for now because the details haven’t been confirmed, but I’ll talk about it later.

My Goals

  • Connect with businesses that are looking to sell B2B products or services to contractors that are selling and installing renewable energy products. I have a lot of relationships and contact with those companies through HeatSpring and it would be great to help those companies out.
  • Start working on EnergyBar events again. I want to start building customer centric and sales centric events for people that are not looking for investment and don’t have IP. Most of the cleantech industry industry in terms of renewable energy and energy efficiency is all about customer acquisition. This has nothing to do with IP. EnergyBar started as “Cleantech Kingpins” back in the day at the NEXUS Building Resource Center. We then had an event at Venture Cafe and moved in Greentown Labs when they had just moved. I went away to Europe and Greentown made the event 10 times more awesome then I ever made it. I’m hoping to build on what they made.
  • EnergyBar Event Idea #1. I’d like to get 4 people in a room that are responsible for at least $200k in energy spend per year and have them explain exactly what they’re looking to spend their money on.
  • EnergyBar Event Idea #2. Applying Search Selling to Cleantech. Too many people are focusing on pitching investors blah blah blah and not doing the hard stuff, selling customers and finding things that large companies will pay lots of money for. Read more about search selling here. 
  • Connect with the tech scene in Boston. I’ve always been somewhat annoyed by the tech scene, namely because they’re use of buzzwords, it’s focus on investment instead of sales and profit, for tech celebrities and because they’re spending all this brainpower to…sell advertising! But they’re not that bad, namely they’re creating tools, it’s up for another group of people to use those tools to save the world. With that said, I’ve learned a lot about developing and selling tech by spinning off Cammpus from HeatSpring. I’ve always been interested in the overlap of tech and cleantech and I believe there’s a new buzzword for it.
  • Doing a series of interviews with the investment community in Boston. I’d like to do some good angel investor interviews to learn what they’re seeing in the space, I’m less interested in the VC perspective, but I’m super interested in what project financiers are looking at. There are SO MANY projects ready to go, and they just need capital. Anyone with cash and a tax appetite should be killing it out there.

If you’re around, let me know.
Chris

October 19th, 2012

[Free Boston Event] A Homeowner’s No B.S. Guide to Investing in Renewable Energy

BOSTON -

Next week, I’ll be hosting an event in Boston for homeowners interested in renewable energy. There’s a lot of confusion around which technology is the best, the most efficient, and what exactly the incentives and financials actually look like. Needless to say, the answers to all those questions are “it depends”.

The event is specifically for homeowners. We’re have a few great event partners and contractor who will be there to answer any questions. It’s happening on Thursday afternoon in Cambridge.

You can RSVP for the event here. Thursday October 25th at 6pm EST.

Here are more details:

The goal of the workshop is to clearly and blunty address many of the questions that homeowners have about investing in renewable energy in Massachusetts.

The workshop is for property owners that are looking to invest in renewable energy and get basic questions answered.

The workshop will be capped at 20 people.

Focus will be on three technologies

  • Solar PV
  • Solar Thermal
  • Ground Source Heat Pumps

Technology

  1. How each technology works
  2. What are the best properties and homes for each technology. How do you know if your home works?
  3. What are the risks for each technology and how are they eliminated
  4. Top 5 questions to ask any contractor that is doing work
  5. Detailed construction timelines and project photos so you can see how each  technology is actually installed

Finance and Government Incentives

  1. A Quick review of government incentives available
  2. Rebates vs tax credits vs production based incentives
  3. Buying solar cash vs debt vs 3rd party leases. What are the pros and cons of each
  4. Typicall returns for each technology based on the property

Questions and Answer: Bring them all!

About your Speaker

Chris Williams will be your host. He has designed and installed 300kW of solar PV and plenty of solar thermal and geothermal systems as well. He’s the Chairman of the Government Relations Committee at NEGPA, a consultant at Voltaic Solaire in NYC that recently completed the cities first 100% solar powered building, the Chief Marketing Officer at HeatSpring, a leading national renewable energy training company and frequently writes and has been quoted in Greentech MediaRenewable Energy WorldForbesClimate ProgressCleantechies, and Alternative Energy Stocks.

Event Partners

You can RSVP for the event here. Thursday October 25th at 6pm EST.

September 16th, 2012

Why do Nordic Countries Top Global Cleantech Innovation Rankings?

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TOPICS: Oslo

Oslo -

What are the underlying factors and can others learn from the Vikings of the North?

The Nordic countries seem to consistently rank highly in global innovation rankings, topping the list Cleantech Innovation Index[i]. Although the report covers a wide range of indicators to arrive at this conclusion and indeed provides some explanatory rationale as to why the Nordics excel at cleantech innovation, it barely touches the surface. We’ve read several articles that try to dig a bit deeper, without enlightening completely. Amy Brown identifies 5 ‘explanations’ to why the Nordic countries are global leaders of cleantech in an article[ii] with the same title. High levels of general innovation, roots in creating major industries within engineering and technology, the desire to apply technological insight to environmental challenges, strong government backing and a high level of public environmental awareness are Brown’s justification of the strong position of the Nordics in the ranking. We do not disagree with these hypotheses, but they leave us with more questions than answers. We want to get to the heart of the matter: what are the underlying factors of Nordic cleantech innovation success? We set out to analyse the social, cultural and behavioural aspects of the Nordic countries that we believe contribute positively to inputs to general and cleantech specific innovation. This is what we found: Continue Reading >

August 17th, 2012

Launch of GLD University and Renewable Energy 101 Workshop for Students, Career Changers, Young Pros, and Entrepreneurs

GLD U -

I’m very excited to announce Green Light Distrikt University. It might look a little ghetto, but I assure you, it’s awesome.

Even though I’m not sure if everyone in cleantech is making money, I am sure that education and knowledge sharing of all sorts are in high demand in the cleantech industry. Technical training on a very specific technology, introductory trainings, workshops, peer-to-peer instruct and meetups to privately exchange industry specific information within and between cleantech clusters fluently are all needed. My goal is that GLD U can help in some small way.

There’s four forms of education that we’ll use GLD U to deliver:

If you are looking for a particular type of educatino that you cannot find access to please let me know, you can contact me here.

A few other cool events, and workshops I’m running

Here’s some more color and details about the purpose of the Renewable Energy 101 Workshop

In the past 2 years, I’ve done a lot of writing on the renewable energy industry and frequently people reach out looking for advice for their new products, exchanging ideas, and where the opportunities are for employment.

All of HeatSpring’s training are professional level certifications and continuing education on niche topics for experienced professionals. The purpose the workshop training is to boil down everything I’ve learned in the past 5 years to people looking for guidance that will be entering the industry. The focus will be on current students, recent graduates, young professionals, career changers or entrepreneurs looking to build a company in the industry.

The course will capped at 20 students to make sure I can connect with each person.

It will be split into two parts

Part 1 – Lecture and walkthroughs of the technical, financial and industry trends in solar PV, solar thermal and geothermal.

Part 2 – The second part will be Q+A. Be prepared with questions and when you sign up, I’ll send you a list of questions to prepare before the class, that must be prepared for the class. I’m prepared to help in every way that I can. The plan is to help you and provide introductions, further resources if you’re looking to start a company, or find an entry level position, etc.

August 12th, 2012

Badass (and 100% Solar Powered) Building Tour Sunday August 19th in NYC.

CleanTech Events -

My life is extremely random. Last year, I wrote about my interest in real estate, renewable energy and reducing a buildings utility costs by 75%, making it much more profitable. I’ve run the numbers and know it’s possible, it all really comes down to having the right client because the technology works.

RSVP for the Free Building Tour Here

Two months ago, I was walking by a weird looking in Brooklyn, see the above image. I noticed there was an array on the top of the roof, but that it wasn’t at the proper angle for a fixed tilt array in the latitude of NYC (it was around 20 degrees, a better angle is around 40 degrees). A hear a voice yell at me from across the street, “those are solar panels”. I looked down at him for a second, back up at the array and replied, “yes, I know. Why is the array so low?”. The man looked at me strangely, wondering why a young punk was questioning him about a system he likely designed and installed him on the street. He looked back up at the array and said “oh, height restrictions in NYC, the DOB won’t wouldn’t let us build any higher.” He came across the street, we talked for 30 minutes, and started working together.

The first thing I’m doing is creating a speaker series and monthly building door to show what’s possible in NYC with renewable energy and energy efficiency. The is two purposes of the event:

  1. I’ll be inviting speakers who are actively working on increasing the adoption of energy efficiency, renewable energy, and recycled materials in NYC. They will range from policy, to non-profits,
  2. The purpose of the building tour is very simple, to show that this technology works and frankly, it’s not hard. It you own a building in NYC, investing in using less energy is a riskless investment.
The building tour is targeted towards property owners, but anyone interested in the subject is free to attend. 

Again, you can RSVP here: http://thedeltatour.eventbrite.com/

Here’s the full desciption of the event:

Learn the ins and outs of integrating renewable energy in buildings in NYC. Join us on Sunday August 19th for at 1pm for a 1 hour tour of “The Delta” in Carroll Gardens, Brooklyn.

This is the 1st in what will become a free monthly speaker series in Brooklyn about green building, renewable energy, and energy efficiency in NYC. Each month, we’ll give a tour of the building and invite guests to speak about various topics related to green building.

This month we will be hosting

  1. Max Rubenstein from BIG!NYC who will be talking about using recycled building materials in NYC
  2. Max Joel from Solar One will discuss why solar power *hearts* NY and vice versa. Find out what it takes to get solar on your roof, what it does up there, and how government incentives for renewable energy work.

The Delta is 100% powered with solar and utilizes many renewable energy and energy efficiency technologies that significantly decrease it’s energy use by more then 75% compared with the average building. The building has extensive use of

  • Solar PV
  • Solar thermal
  • Small wind
  • Air-source heat pumps
  • Recycled materials
  • Super efficient building envelope
  • Super efficient appliances.

The tour is free but has limited space, you MUST RSVP for the event. It’s open to the public and it is for NYC residentis that are interested in learning more and understanding what it possible in the city when it comes to energy efficiency and renewable energy.

We’ll tour the building, have a simple presnetation to illustrate how the technologies work and will have plenty of time to answer any and all of your questions. Please come with questions :)

What you’ll learn

  • The challenges and possibilities of renewable energy and energy efficiency in New York City
  • How The Delta produces so much renewable energy and uses such a small amount of energy
  • How renewable energy technologies work, and how they integrate into existing building
  • Which technology is most efficient and provides the best financial return
  • How to utilize recycled matierls the most efficinctly in NYC
  • How to manage the demolition process to send the least amount of garbage to the dump
  • How NYC and NY state is supporting renewable energy technologies

About the Delta: The Delta is the 1st building in NYC to be 100% powered by solar. The Delta has been featured and numerous publications and you can read more about it here:

About your host: Chris Williams

Chris Williams will be your host. He has designed and installed 300kW of solar PV and plenty of solar thermal and geothermal systems as well. He’s a consultant at Voltaic Solaire, the Cheif Marketing Office at HeatSpring, a leading national renewable energy training company and frequently writes and has been quoted in Renewable Energy WorldForbesClimate ProgressCleantechies, and Alternative Energy Stocks.

About the Super Special Speaker: Max Rubinstein

Deconstruction Manager, Max Rubinstein, from Build It Green!NYC will be speaking about incorporating reuse and recycling in your next home renovation project. Deconstruction is the selective and careful dismantling of buildings to maximize re-use and recycling rates. Build It Green!NYC’s Deconstruction Team can professionally dismantle anything from a kitchen to a whole house, uninstalling the items carefully and removing the items as a tax deductible donation.  Decon is also your best environmental, and often financial, alternative to the landfill!

About BIG!NYC: Build It Green!NYC, is New York City’s only non-profit retail outlet for salvaged and surplus building materials. Our warehouse has everything from panel doors to high end refrigerators and shutters to movie props. Our mission is to keep these materials out of the landfill, while offering deep discounts on their resale. We are sponsored by Community Environmental Center (CEC)www.cecenter.org. Founded in late 2004, our Astoria warehouse opened in February of 2005. Our second reuse center opened in November 2011 and is now open 7 days a week in Gowanus, Brooklyn. Learn more at www.bignyc.org.

Speaker Bio: Max spearheads the Deconstruction program at Build It Green!NYC. The recurring scene of perfectly good building materials crushed at the bottom of a dumpster led him to BIG!NYC, and he’s never looked back. Born and raised in Brooklyn, Max attended Bard College where he received a Bachelor of Arts in film. Since then he has really cultivated his skills as a precision craftsman, having worked as a fabricator, cabinetmaker and carpenter, all in NYC.

About our Second Speaker: Max Joel, Solar One

Max Joel is the former Director of the Energy Connections Program at Solar One, a non-profit green energy, arts, and education center based in New York City. The Energy Connections Program develops education, outreach, and community partnership projects in an effort to make all New Yorkers part of our city’s ambitious efforts to combat climate change and develop a clean, green economy. Ongoing projects include Clean Energy Connections, a discussion series and networking hub for NYC’s emerging cleantech economy, and Whole Building Education, which trains the managers, staff, and residents of low-income housing in energy savings behaviors and management strategies. Max also served as a NYSERDA Energy $mart Communities Coordinator, helping building owners and businesses access incentives for energy efficiency and renewable energy projects.

Previously, Max was the Capital Projects Coordinator for the Queens Botanical Garden, where he facilitated the construction of New York City’s first public building to achieve LEED Platinum certification. He holds a bachelor’s degree in Urban Studies from Columbia University and a master’s degree in Environmental Management from the Yale School of Forestry and Environmental Studies, where his thesis explored emerging and innovative strategies for financing green community development. Max is a 2008 Doris Duke Conservation Fellow and serves on the Advisory Board of the Jewish Greening Fellowship. He is currently consulting with Solar One and launching his own consulting practice specializing in renewable energy and community development.

 

July 27th, 2012

Getting Bullish on Cleantech. Where Is the Opportunity for Me to Invest My Money?

Entrepreneurship -

Lately, I’ve been feeling very bullish on cleantech, from my perspective anyway. I’ve had a number of conversations with peers in the industry, property owners, and others to see what’s happening and if anyone is actually making any money. Don’t get my wrong, I still think there are opportunities. The question is:  are there opportunities from where I’m coming from? At this time?. Or, do I need to wait?

Here is my perspective and where I’m coming from:

  • 26 years old no kids or major responsibilities
  • No debt and some cash (~20k) ready to invest
  • Well paying consulting work that is 100% remote.
  • Amazing knowledge and existing relationships of solar PV, thermal, geothermal, air source heat pumps. I feel comfortable marketing, selling, designing or installing any of these technologies. Yes, I know, I’m a weird animal.

Back to the point, here’s why I’m bullish on cleantech.

It doesn’t appear that many people are making any money! All of the major solar PV manufactures are loosing money hand over first, and I’d say it’s 50/50 for pure play EPCs making money in the solar PV space. The volume for solar thermal is low so most of the manufactures and EPCs are making money because their margins are so high, to compensate for low and unsteady volumen.

I just got back from InterSolar and these days, solar PV is the darling of the industry doesn’t seem to be in a good place. Most are loosing money, and there’s only a few people that I’m certain are making money.

  • Small niche B2B companies selling to EPC contractors. They have high EBITDA but relatively low volumes. These business include the best racking manufacturers, site visit tools and other software companies. While these companies tend to be very profitable, they’re also starving for cash because they’re plowing it all back into growth, which is not a bad thing because they tend to owned privately with no outside investment.
  • Great salespeople are killing it. I residential or commercial sales person in the top 25% of their companies is making a nice income.
  • Electricians making prevailing wage. 40 hours per week @ $75 an hour in the Boston area isn’t too bad.
  • General contractors where solar makes up less then 30% (or so) of their business, so if they don’t get unbid because they don’t need to go lower just to win the job, which could cause them to lose money.
  • Tax equity investors investing in MW projects or creating large funds for commercial or residential projects. Private equity investing in MW solar projects are getting un-levered IRRs of 9%, which are almost risk free because the PPA is signed, they have no construction risk and all the other risk is dumped on other parties. The tax equity investors investing in residential projects are making ~14% in 7 years, and most of that cash is made through ITC, cash rebates and MACRS so they’re not very exposed to the actual performance of the projects.
  • Property owners that paid cash for their systems and can leverage all the tax benefits are also making good, 15% IRRs over the 20 year expected life of the system.
  • Investors that are providing bridge financing to small/medium solar PV EPCs against cash utilities are making a killing. At least 30% YOY returns without much risk. Volumes are also low, $20k – $50k might be a typical deal, but the transactions costs are minimal as it’s basically financing an accounts receivable which is a well known business transaction.

With that being said, here’s the type of opportunity I’m looking for

  • Not technology risk, sales oriented. I want to just assemble existing technology.
  • Able to test the market relatively easily.
  • I don’t care about “scale”, however you’re defining that.
  • Niche opportunities that have the ability to, maybe, become larger opportunities
  • Quick sales cycles and easy to find the decision maker. Critical for momentum when making the first sales and going from 0mph to 1mph
  • No outside investment need, it’s too much of a pain to deal with investors when you’re getting going.
What motivates me: 
  • My number goal is simply to not being bored
  • The second goal is building really cool sh%t.
  • I love the feeling when you put something in front of someone and ask them to buy it. I don’t want to be a consultant or investor, because they lack this rush. I need to be on the front lines.
  • Currently, consulting is ok, however, I’d like to build something myself. I want to get excited enough about a product that I can put all my chips into. I recently spent a lot of time thinking why this was so important and it has nothing to do with ownership, but of honing a skill set and pride. It would be like a apprentice carpenter then never became a master carpenter.

Potential areas of opportunity:

  • Cleanweb. Whatever this buzz word means. You could also look at it as tech that’s focusing on energy issues, or the overlap of IT and physical products to increase their performance. The only type of these opportunities I would look at are things that can tested cheaply, I’m not interested in dealing with the VC stuff. Running HeatSpring and getting good at customer acquisition, internet marketing, managing sales funnels I’m confident that I’d be able to work with tech companies focusing on cleantech. Also, I have intimiate knowledge of EPC contractor, distributors and manufacturers and strong technical knowledge of many technologies. The issue with ‘cleanweb’ seems to be 1) cutting through the bs of buzzword world and 2) figuring out how to charge money for a service
  • Customer acquisition is a huge issue. There a lot of lead gen companies, BUT leads are not valuable. SIGNED CONTRACTS ARE VALUEABLE. 1Bog did this well, but not well enough and they were just sold to an Ontario company. To acquire a solar customer for a typicall EPC costs between $3k and $6k, so the question is, how much is a signed contract worth? $3k?
  • Import. Some of the geothermal heat pump manufactures are charging an arm and leg for their equipment. I could get it in China for much cheaper.
  • Real Estate: Provide equity and cash flow. You can buy a 3 unit apartment building relatively easily, lump the utilities into the rent and upgrade the energy system = vastly increase net operating income. Also, the tax benefits of owning property almost equal the downpayment for the building within the first 7 years.

Principles that I’m keeping in the back of my mind

  • Continue to save massive amount of cash, and as much as you can. Forgoing weekends drinking and going on trips is worth it. Then, when you find an opportunity, you’ll have an extra $10k or $20k to plow into the idea and you don’t need to convince anyone for cash.
  • Put yourself where it’s slippery. Continue to keep your ear to the ground to learn what’s going on and create real relationships with awesome people and help them with whatever they’re working on. Why? When you need to really get something done, you need to be able to make personal phone calls to make sh%t happen ASAP. Never network, don’t throw business cards around and try to seem super important.

Flaws in my thinking

  • Right now, I can tell that I’m trying to make sure that plan 1 works even though I know that most business end up on plan 5 before they hit their stride. Here’s the rub, they can’t get to plan 5, before going through the first 4 paths.

I’m curious, where are you confident investing your money, time and resources within cleantech?