This past February, eleven Wharton Energy Club members boarded a plane to San Francisco excited to visit a diverse set of entities renowned for their leadership in the clean energy sector. The trip’s festivities included eight onsite meetings, as well as a happy hour downtown bringing together Wharton cleantech alumni in the Bay Area.
The eight entities that welcomed us included five industry leaders (Tesla, Sunpower, Sunrun, Stem, and Google), two venture capital firms with cleantech as a primary focus (Obvious Ventures and Presidio Partners), and a nonprofit with a unique model for facilitating cleantech financing (California Clean Energy Fund).
Without fail, these meetings fostered thought provoking and educational discussions, and the trek’s attendees left the trip on a high about having received answers to their burning questions about the sector from some of the foremost experts in the space.
Below are highlights from each visit.
Industry Leaders
Tesla: The Tesla experience began before entering the door. We visited the Paulo Alto headquarters, where there’s valet parking to prevent people from exploring the parking lot and taking photos. Inside, the first part of the visit entailed a quick tour of Tesla products on display, including the framework of the first Tesla Roadster. The meeting itself took a Q&A format. Four Tesla employees focusing on various aspects of battery storage (business development, regulatory landscape, finance, etc.) answered Wharton attendees’ questions about utility business model disruption, vehicle-to-grid potential, and company culture. Employees’ commitment to the company’s mission was palpable, and there was a contagious rush from witnessing metal-covered desks and interactions of engineers and business leaders within Tesla’s massive, open floor office. As Tesla’s the highest profile clean energy company in the world, it was a pleasure for us Wharton visitors to put a face to a name, and to feel what many consider the center of the clean energy world for ourselves.
Sunrun: Sunrun is a premier solar company focusing on residential installations. The company’s Chief of Staff welcomed Wharton attendees and led a quick tour of their downtown San Francisco office before settling us in their conference room and presenting the company. Afterward, Sunrun’s VP of Finance joined for a Q&A session. Wharton students grilled him on questions related to current and future profitability, and he was always one step ahead of us. Next, we had a similar Q&A session with the company’s VP of Sales. What stood out most about Sunrun was its Silicon Valley-type startup feel. The culture was jeans and a T-shirt casual from the top down, and a critical mass of the senior people in the company were under 35 (or at least looked under 35). We learned quickly, however, that sharpness does not require a suit or grey hair.
Sunpower: Sunpower specializes in utility-, commercial-, and residential-scale solar installations, and it differentiates itself with its top quality panels; these panels are renowned for their high efficiency and durability. Sunpower’s waterfront office paired with its open floor and heavily-windowed walls and ceilings, which channel an abundance of natural lighting, set a California-chique atmosphere. Our meeting with Sunpower entailed a mix of presentations and Q&A from the company’s utility scale development, project finance, and regulatory staff. The discussion centered on past performance and future prospects for the company, as well as for the solar industry more broadly. Mirroring their product, the Sunpower folks exuded a professional, classy, and approachable demeanor.
(Also, note that Sunpower’s stock price increased 17% the day after the Wharton visit. Coincidence?)
Stem: Stem is a leader in the battery storage software space, and our meeting there featured a presentation followed by Q&A. It was eye-opening to learn about the complexity and quantity of issues that state of the art batteries account for in their design and deployment. Facilitating dynamic responsiveness and optimal, reliable power dispatch from batteries is a massive effort and the foundation of the future power grid; and, Stem solutions represent the cutting edge. Also noteworthy about Stem is the extent to which the engineering culture pervades; even the walls of restrooms are lined with jokes written in computer programming languages.
Google: A trend Google started and continues to lead is corporate giants powering their activities with renewable power. In fact, Google has pledged to power its data centers and offices with 100 percent renewable power beginning this year, 2017. To this end, Google has an energy team committed to purchasing renewable power through power purchase agreements and carbon credits, and Wharton’s discussion with Google entailed a presentation on Google’s work as well as Q&A. A particularly compelling statistic underscoring Google’s impact is that Google’s global operations consume an amount of electricity comparable to that of the city of San Francisco. Our meeting finished with a presentation of Google’s “Project Sunroof,” which utilizes Google Maps and satellite imagery to determine the solar viability of rooftops across the United States. We found Project Sunroof a fascinating embodiment of the creativity and practicality with which Google approaches its clean energy presence.
Financing Cleantech
Obvious Ventures: Obvious Ventures is a venture fund dedicated to making non-concessionary investments in businesses that unequivocally improve the world, and a primary sector of focus is clean energy. The fund’s General Partners prioritize entrepreneurial experience and approaching deals from the entrepreneur’s perspective. The fund opened up their office to Wharton before informally pitching itself and opening up the floor to Q&A. Topics covered included Obvioius’ thoughts on the future of the clean energy industry and rationale behind their optimism regarding cleantech’s viability for venture capital. We also learned about Obvious’ diligence process and the extent to which their belief in the entrepreneur factors into investment decision making. In addition, serial clean energy entrepreneur, Mike Miskovsky, joined the conversation and shared his experiences starting his past companies, as well as his visions for this next endeavor, InEVit, an electric vehicle infrastructure company.
Presidio Partners: Presidio Partners is a fund oriented towards making above-market returns through investing in three sectors, one of which is cleantech. Contrasting their approach to Obvious Ventures’, however, was enlightening. While Obvious approached investments with an entrepreneurial bent, Presidio Partners’ staff leverage their financial experience and deploy hedge fund-type strategies as they invest in companies. What stood out about Presidio was their proactivity in seeking and vetting potential deals. Their staff is constantly pounding the pavement on the premises of incubators and startups, all while maintaining a presence on boards of their broad portfolio of companies. Of note, while they deploy financial strategies as they invest in companies, their models for projecting future company growth are intentionally simple.
California Clean Energy Fund (CalCEF): CalCEF is a nonprofit with the mission to connect cleantech entrepreneurs with appropriate funding resources that optimize companies’ chances of success. To this end, they cultivate relationships with cleantech entrepreneurs and investors, as well as with government agencies, regulatory bodies, and NGOs. Wharton’s conversation with CalCEF centered on strategies the organization deploys to add value to California’s cleantech community, namely as a networking hub and community builder. The discussion evolved into an analysis of big picture energy trends and forecasted timelines and hurdles for clean energy transitions in California, the United States, and the world. Culturally what stood out about CalCEF was their level of optimism (grounded in complex analysis) regarding clean energy, as well as their work ethic. Our visit took place late on a Friday evening, and there was a full house of staff grinding away on their work!
Conclusion
The level of discussion, classiness with which entities hosted us, and camaraderie within the Wharton group made this year’s Wharton Cleantech Trek fulfilling.
Thank you to everyone who made this trip a success, and I strongly recommend Wharton students interested in clean energy to put together a similar trip next year.
