It’s not easy being a green founder.
Dozens of entrepreneurs affiliated with Greentown Labs, the new-to-Houston incubator for startups focused on the energy transition, were in pitch mode during a Nov. 4 event. The incubator hosted a Climatetech Summit at its space in Midtown, which drew in a higher-than-expected number of investors, consultants, researchers and others involved in the fledgling industry.
Greentown Labs also celebrated its 10th anniversary since it was founded in the Boston area, where its headquarters and only other incubator space are located. Amid pitch sessions from Greentown-affiliated startups, some founders also spoke about their experiences getting their companies off the ground, funded and into partnership with customers.
“I realized you have to lie to yourself — because if you ever admitted how long it was actually going to take to get started, none of these businesses would have done it,” said Neal Dikeman, venture capitalist at Houston-based Energy Transition Ventures, who moderated the Deploying Energy Transition Technologies panel.
Moji Karimi, CEO and co-founder of Houston-based Cemvita Factory, agreed with Dikeman.
“It’s almost like you put yourself through this torture,” Karimi said. “Even in our interview process, that’s what we look for: Is this person going to give up halfway?”
Here’s what the panelists had to say about their biggest challenges — and some of the easier parts — so far in founding and running startups focused on solutions for climate change.
Anna Dai, CEO and founder of Houston-based Varea Energy
Software-as-a-service company Varea Energy analyzes energy consumption data for commercial buildings and industrial facilities, which it uses to determine ways its customers can cut their energy and water use and solid-waste generation.
While passion drove her to start the company two years ago, Dai said that passion was tempered when capital started to run out and the initial product didn’t work out as planned.
“When we first started, what was easy was going forward,” namely networking, attending events and developing the new company, Dai said. “What’s hard is when your budget is dying down but you still have to put in the same amount of energy, showing up every day.”
Dai’s company is now on its third iteration of the utilities management software.
“I had no idea what the market wanted,” Dai said of Varea’s first product, which she said lacked a solid business model and revenue stream. “It’s a balance between what the market needs to do and what the market wants.”
Ben Jawdat, CEO and founder of Houston-based Revterra
Revterra is developing utility-scale energy storage that uses kinetic energy from novel magnetic technology, which the company says is lower-cost and more efficient than more widespread lithium-ion batteries.
Jawdat said the easiest part of starting Revterra was finding like-minded founders in Houston. But initially, finding resources and space to build the technology was not easy, he said.
After finalizing Revterra’s technology and swapping the lab for the office, the company entered what Jawdat called “the valley of death.”
“There’s not really many places or sources of funding that are specifically catered to that stage” prior to commercialization, he said.
“From the capital point of view, finding people who are not only passionate about what we’re doing but (who also) have the background so that we can really get through to them” was also hard, Jawdat said. “That’s an important part of how we got to where we are now — once you find those people, it’s really an excellent partnership.”
Moji Karimi, CEO and co-founder of Cemvita Factory
Cemvita Factory uses synthetic biological processes to genetically alter microorganisms to absorb carbon dioxide and other molecules as feedstock. These genetically altered microbes can then be turned into a variety of chemicals for industrial use, such as ethylene, which can be used to make plastics.
Karimi said he thinks of the company’s timeline in decades, not in years. But his concept of a future transformed by the intersection of biotechnology and petrochemicals, for example, has been hard to translate to others, Karimi said.
“With any of the founders, you have a vision, and you see a future,” Karimi said. “Then, when you’re talking to investors and customers, you’re describing this picture, and it comes off really fuzzy.”
Karimi noted that like other startups that deal with hard technology, it can take a long time to get started — but when the tech is ready to commercialize, things take off.
One of the keys to Cemvita Factory’s recent acceleration has been connecting with just the right people who understand the implications of the technology, Karimi said.
“Oxy did,” Karimi said of Cemvita Factory’s partnership with Houston-based Occidental Petroleum Corp. (NYSE: OXY), which was announced in April. “We talked with (Robert Zeller, vice president of technology for Oxy Low Carbon Ventures), and he asked, ‘Can you make ethylene from CO2?’ We said, ‘Probably.’ He said, ‘Here’s some money. Let’s go try.’ That (kind of conversation) never happens. That was a complete anomaly.”
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