When our guest and her partners launched their business a dozen years ago, she had a vision, a technology, and the determination to stick to the mission. If you have a startup in the clean tech space or are just interested in really cool technology, listen in as Catherine Von Burg, CEO and Co-founder of SimpliPhi Power, shares the amazing story of how sticking to the mission resulted in a groundbreaking energy storage solution with SimpliPhi Power’s safe, non-toxic battery systems that are being used globally in 40 countries today.
Here are some of the highlights from their discussion…
“…I think the most valuable trait for entrepreneurs is the diligence and persistence that it requires to develop a technology… the R&D, the constant innovation…. it never stops. But it’s the commitment. That’s really what it… comes down to, because believe me, there have been a lot of dark times, and there were a lot of times that we were thinking, well, we should abandon our mission…”
“…[the clean energy business] is so central to the number one existential threat for the entire planet right now. And that is climate change, CO2, and greenhouse gas emissions. No matter what anybody does in this company or in the clean tech sector, they are making some contribution, however large or small, in aggregate. It adds up that is the opportunity working in the energy, specifically, clean energy business.”
“…The most important change to how we generate store and distribute is really transitioning from top down, centralized transmission and distribution, to distributed customer-based community-based generation storage and distribution. And I say that because while large wind farms, solar farms and battery farms are critical, they too depend on the transmission and distribution that is antiquated and failing and it’s critical to our economic wellbeing and everything that depends on energy to get this right.”
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Full Transcript
Bill Nussey:
Well, hello, welcome to everybody out there in the Freeing Energy community, all of our fans, friends, supporters, we are so grateful that you take the time to listen in. Batteries it is today, and the guest we have today sits right in the middle of one of the most exciting battery stories in the country. Her stories is much about street smarts as it is about science. It’s much about mission and determination, about crafting a super cool product at scales and can take on all the challenges we face as we need more batteries. I am super excited to introduce our guest today, Catherine Von Burg, a co-founder president and CEO of SimpliPhi Power. Catherine welcome.
Catherine Von Burg:
Thank you so much. I’m thrilled to be here.
Bill Nussey:
Just a quick introduction to your company. I’ve heard about you guys from the beginning. If anyone’s read my book very carefully, they know you’re mentioned in it as one of the great examples of a cutting edge battery technology. But for those that haven’t heard of SimpliPhi, it’s a technology company that designs and manufacturers, and this is important, non-toxic efficient and enduring energy storage and management systems that they integrate, not just obviously the battery, but they tie in solar, wind, diesel generators, gas generators, all kinds of systems that we still rely on to keep things running all the time. And they do this in conjunction with or independent from the grid, which is also cool. Catherine, what were the shared and overlapping drivers that applied and why did making a better battery and energy storage systems went over say an artificial limb?
Catherine Von Burg:
Good question. Well, the years that I spent in biomedical engineering, for me, ultimately, what really mattered was what was I going to be a part of and create that would make a positive impact in people’s lives. Whether it was a surgical intervention or a drug therapy, thinking about what are the problems in people’s lives around access to medicine or surgical techniques that could improve or prolong lives. That principle of making an impact and really having a mission based focus in all the research and development that I was engaged in from Johns Hopkins, Columbia University, Rockefeller Institute, for years it was really thinking about the R&D, how would we commercialize it? But in the commercialization question, what problems was that going to solve?
And being very conscious for me about that impact. Those principles when you think about energy storage certainly apply. In 2010, thinking about problems around access to energy, access to reliable energy, access to clean energy, where we could reduce CO2 and greenhouse gas emissions, energy storage has an enormous role to play. Think about customer sided distributed energy storage, in 2010 intermittency was seen as one of the biggest barriers to widespread adoption of renewable energy. Why? Because the sun goes down, the wind stops blowing and you don’t have your generation source. Introduce energy storage and the batteries, the storage source can provide the electricity after the sun sets. It eliminates the intermittency that was said to be a barrier for rapid adoption of cleaner generation renewables.
Fast forward today, 2022, the question of intermittency is every bit as relevant for top down centralized distribution of power, utilities. We are facing increasing power outages, the number of power outages, the duration of power outages. It’s not only being caused by failing antiquated infrastructure, that combined with extreme weather because of climate change. But we’re also facing the reality that utilities are willingly turning off the power and they have marketed turning off the power, very cleverly as public safety power shutoffs. And really if you do any type of investigative reading, the utilities are turning off the power really to save themselves from additional lawsuits because of antiquated infrastructure, looking at California as a primary case study that is causing fires.
And that is not an adequate resource in this changing climate with extreme heat, drought and wind. Going back to founding the company in 2010, thinking about eliminating intermittency and leveraging renewables by adding storage to create power 24/7, critical to the energy transition, CO2 reduction and greenhouse gas emissions, and then energy security. And that for us, certainly for me in 2010 included the 1.2 billion people it was estimated lived beyond the limits of the grid, that were marginalized simply because they did not have access to energy. Fast forward today I think the number now is about 900 million. Maybe we’ve made some progress, but not enough in terms of reaching people that live beyond the limits of the grid and then are facing intermittency.
And then of course in climates where you have ample sun and ample wind, being able to leverage that for a much more cost effective energy generation source. Today there’s a lot of debate as we all know on the cost effectiveness of renewables and battery storage. And as a manufacturer we’re constantly being asked about price versus cost and that energy storage needs to come down in price, renewables need to come down in price. But all over the world there are examples where renewables combined with energy storage, especially distributed customer cited, is more cost effective, more reliable than top down transmission and distribution. I’m just providing some examples of what was at play when we founded the company, but certainly what is at play currently.
And the cost versus price debate, I think is skewed by virtue of the fact that we don’t even count externalities, the cost of fuel from extraction, refining, the burning and the incredible environmental and human impact. We don’t consider that in the discussion of cost versus price, and we should.
Bill Nussey:
That was a great overview of the mission and the vision behind what you’re doing personally and what the company SimpliPhi is doing. Thank you for sharing that. But I’m really fascinated by SimpliPhi, and it has a very interesting origin story. You and your partner, your co-founder Stuart Lennox. Just go back in the way back machine, how did you and Stuart meet? How did it come together? What was the spark moment that said we’re going to create a company?
Catherine Von Burg:
I met Stuart Lennox at a social event gathering in this small town, Ojai, California, up in the mountains, about an hour south of Santa Barbara. I had moved there from New York City. I grew up in Europe and the US, European parents, but I traveled all over the world. And when I met Stuart Lennox, he began talking about solutions that he had innovated in his garage as a self respecting entrepreneur in LA. He was in the film and movie industry, in special effects, back in the day before special effects were digital. He had to think about power sources to make a lot of things happen at once in a shoot. The source for power was very often generators, and generators produce a lot of noise, a lot of fumes.
If you’ve ever been on a shoot in a downtown urban area, I’m thinking New York City, with these long, long lines being stretched across, it provides a lot of complication and landed the fuel to have the generators up and running was expensive and really detracted from the set itself. Stuart began to innovate mobile portable battery packs that he could use to displace entirely or even optimize diesel generators. In the movie industry, they say, get the gen set or get the Jenny. And so Stuart began a company called LibertyPak and he called them the Jenny’s. And these Jenny’s were little packs with all the specialized plugs and pins and outlets for 3D cameras and lighting and the 800 Watts strobe lights, for example, exacted a lot of power and also longer duration run times for cameras, et cetera.
And so he began to innovate lithium-ion technology for these packs. Stuart was very interested in film and movie and broadcast news solutions. For me having traveled all over the world in college, I spent about three years in India and saw firsthand what happens to people, whole communities that are marginalized because they do not have access to power. Therefore they don’t have access to power for water pumps, water filtration, basic lighting for schooling, clinics, refrigeration, for medicine, seeing how marginalized these communities were and thinking about what the impact is when people are bereft and without resources and seeing conflict that arises in this model of scarcity, where everybody is having to fight over resources. I looked at Stuart’s mobile, portable battery packs and thought well to hell with a movie industry, Stuart, you can do that. But what I want to do is begin to scale these packs up and address these issues of access around energy.
And if you have access to energy and it’s clean generation, then you have access to all these other resources like lighting and refrigeration and water pump. That was my vision. I began to concoct this vision and proposal for Stuart Lennox, and convinced him to leave his garage in LA and come up to Ojai, California. We found a small network of friends and family, raised about $800,000, our seed money, set up a lab and began to test. We began to test across chemistry. The lithium cobalt oxide, that was the earliest lithium-ion chemistry, NMC, NCA, and also LFP, lithium ferrous phosphate.
Bill Nussey:
You mentioned LFP, that was not the obvious answer to a lot of other companies at the time. I think for anyone listening today, it’s clearly prescient that you picked it because it seems to be the right answer for a lot of people. Why did you pick LFP?
Catherine Von Burg:
Well, going back to our mission, if we’re thinking about energy storage to create energy security 24/7, why would we consider using lithium-ion chemistry that fundamentally was hazardous and because of its thermal profile could put customers at risk?
Bill Nussey:
What does that mean? What happens? What does at risk mean?
Catherine Von Burg:
At risk means, fast forward today, you see in the news constantly battery recalls in residential and commercial systems and utility scale systems that are overheating, catching fire and even exploding. That is the-
Bill Nussey:
That’s risk.
Catherine Von Burg:
… cobalt in the lithium-ion batteries. In addition, cobalt has a very challenging and really dirty supply chain. It is notorious for child labor in what is called artisanal minds, which is ridiculous term because it makes it sound acceptable. But really these mining operations are labor intense and they use children because they can drop into very small holes.
Bill Nussey:
This is almost all out of the DRC, the Democratic Republic of Congo, is that correct?
Catherine Von Burg:
Yes. They have some of the largest deposits of what is considered now a conflict mineral, cobalt.
Bill Nussey:
Conflict mineral.
Catherine Von Burg:
Right.
Bill Nussey:
Okay. Wow.
Catherine Von Burg:
And because of the hazards and the profiles, because we were doing our own puncture tests with nails and crushing and heating up and actually torching them, lighting them on fire. We were able to see very early on the characteristics across different chemistries. So lithium, cobalt, oxide, or NMC or NCA, and the LFP, lithium ferrous phosphate. Lithium ferrous phosphate by far has the safest profile, characteristics when you put it under different stress tests. We decided we would not position ourselves as a company and take a competitive advantage on the market based on price point, because the truth is lithium, cobalt based chemistries are cheaper, and you can also use cheaper form factors, the cells from pouch and prismatic. Those are a lower cost manufacturing process too.
We chose the cell cylindrical that has the greatest structural integrity to house the greatest and safest lithium-ion chemistry, the LFP, and that is through our own testing and innovation in our lab. That was really the beginning of why we selected that chemistry in the form factor, and that’s what we use today.
Bill Nussey:
What’s really interesting to me is that we’re just getting used to these large scale batteries that can power a home or an off grid or a city. These issues that you’re talking about are all relatively new. You guys clearly saw it early on, but I think a lot of the world rushed to what’s cheapest and most expedient. I tip my hat to you. You guys proved it out. There’s a lot of things about your story that are, I think, pretty inspiring and unique. Another one that I’d love to get your take on is, when you guys as a startup you raised $800,000, you created a product and you were pretty quickly paying your own way.
I’m not going to mention any other names, but there’s a couple other battery companies that are sort of like, let’s raise a billion dollars. Let’s do a spec, let’s take 10 years. Some went under, some didn’t, but kind of cool entrepreneur extension of let’s blow up batteries in my backyard. And now I’m actually going to build this thing on cash flow rather than a billion dollars of spec money. Tell us about that. How did you possibly create a company that was cash flow or profitable so early on when you’re making something so complex and scientific?
Catherine Von Burg:
Part of it was because Stuart had these mobile portable packs, the Jenny’s for the film and movie industry. And so he was already pulling in revenue by solving problems around access in that industry. As we began to scale up these solutions for residential and commercial systems, the grand vision as I described, was developing countries, areas that really needed access and to leverage renewables and typically residential and microgrid community based. What ended up happening however is the Department of Defense somehow found out about us in our tiny lab, up in this tiny town of Ojai in California. And-
Bill Nussey:
By the way I’ve been to Ojai many times. Just want you to know my sister-in-law lived there for decades. Wonderful town. Kind of jealous you got to live there for a while. But anyway, sorry, keep going.
Catherine Von Burg:
No, it’s a beautiful town, hardly a place for a startup. Although there have been several that did start in Ojai.
Bill Nussey:
Oh really?
Catherine Von Burg:
Yes. And became very successful. As we all scale and grow, we had to leave the town, but nonetheless. We had the LibertyPaks that we’re selling into the film movie industry through rental houses, movie studios, from Fox to NBC, we had the-
Bill Nussey:
So cool.
Catherine Von Burg:
Tron suits that were lit up. That was our technology. Conan’s moon.
Bill Nussey:
No.
Catherine Von Burg:
Oh yes.
Bill Nussey:
Wait a minute. Go back to the Tron suits. You guys were powering the Tron suits?
Catherine Von Burg:
Yes, because they needed batteries that were not hot to the touch and to light up those suits between the actors skin and the suits themselves. We had a lot of cool, very small, but very cool projects that kept us able to buy wire tools, basic equipment in our lab. But the Department of Defense at the time was having real challenges in Afghanistan and Iraq on forward operating bases with lead acid batteries. And again, the newest generation of lithium-ion, the lithium cobalt oxide batteries. Lead acid batteries were often dead on arrival because they self discharge whether you use them or not, they’re putting them in containers, shipping them overseas, temperature alone causes them to degrade and lose capacity. And then the lithium cobalt chemistry, they were overheating. They were catching fire and they were exploding.
And it created a lot of operational and tactical challenges for the Marine Corps and the army specifically on these forward operating bases. They approached us and we began to work with a systems integrator on installing our batteries and pairing them with generators on these forward operating bases. The idea was to at the very least create a fuel offset because there were more lives lost in protecting fuel convoys to get to these bases than there was an actual direct engagement. It was a real problem. Also landed cost for fuel on a forward operating base could be anywhere from 600 to $800. It was insane.
Bill Nussey:
Wow. When they were using the batteries, were they using solar for example, to charge them locally or was it just offset the generator?
Catherine Von Burg:
Initially it was just to offset the generators. And so we developed high powered batteries, but our view was, let’s develop batteries that could provide an enormous amount of power and a very small footprint, but also could provide long duration power. So if you needed to discharge say a 3.8 kilowatt battery in 15 or 20 minutes for a lot of power, you could do that, and it’s not going to overheat much less catch fire or blow up. But if you need that same battery in a bank of batteries to provide power for the barracks over two, four, six, eight hours discharge, that was fine too. These batteries became workhorses, if you will. And initially were just powered with the generators. We were able to establish an 80% fuel offset for the Marine Corps and the US army in these applications, which meant-
Bill Nussey:
How does that work? Doesn’t it take an X amount of fuel to provide X amount of power, or how does the batteries augment that?
Catherine Von Burg:
Depending on the size of the generator, and you think about cost of fuel now, but a generator can burn through anywhere from two to six gallons of fuel an hour, and a larger generator is more. So if you’re running operations 24/7 with a diesel generator, that’s very, very expensive. Plus the noise, the heat footprint and the fumes creates a bullseye on forward operating bases or on reconnaissance missions. We were able to produce batteries that the generator could charge in two hours or less, shut the generator off, silence, no fumes, no heat footprint, suddenly the bullseye is removed and that incredible amount of money, again, sometimes 600 to $800 a gallon landed was eliminated. That was the beginning of the work we did with the DOD.
It was a nail biter because we were just this small company in our lab. Our batteries were first sent to Camp Lejeune, which is probably the harshest test center available for any technology. We passed through Camp Lejeune, and then we started shipping batteries overseas, engineering in our labs, the integration of our batteries with the generators. That allowed us to begin to start to develop internal competency around interoperability across assets. Hey, let’s add in solar panels, folding solar panels, mobile panels that can be put into cases with the batteries and all the plugs and outlets for their communications, their munitions, and charge their equipment up, allowing men and women to go on reconnaissance, not have any fuel requirements whatsoever and be energy independent.
Speaker 1:
If there’s one common theme we hear from Freeing Energy podcast guests, it’s that the founders and executives of these intrepid clean tech companies all want to individually be a part of something that will be making a positive impact on people’s lives. They have a mission in life. Seems like a pretty basic notion, right? But in practice, it is tough to translate that desire to make a difference into innovative, tested, proven solutions that can scale to solve problems worldwide. Catherine’s story is one of science and mathematics and chemistry of testing again and again, and of scaling production. But at the heart of it all is a tenacious adherence to a mission and the belief that in some small way, the effort will have a positive impact on people’s lives.
Catherine shares important lessons for the clean tech innovators and entrepreneurs that want to make a difference. In his book, Freeing Energy, Bill Nussey shares a quote from Robert F. Kennedy, which speaks to this theme. Kennedy said, “Few will have the greatness to bend history itself, but each of us can work to change a small portion of events, and in the total of all those acts will be written the history of this generation.” This is just one theme we hear from our guests. What other themes have you picked up on? What themes would you like to hear more about in the coming months? Let us hear from you. You can follow us on LinkedIn, Twitter, Facebook, and Instagram, or jump over to freeingenergy.com and subscribe to our newsletter.
Now let’s get back to Bill and Catherine to learn even more about the amazing story behind SimpliPhi Power.
Bill Nussey:
The first time I saw one of your batteries was a day long visit to the Stone Edge, microgrid, and they have some incredibly cool demonstrations, real world working demonstrations, and your products were there. I immediately saw SimpliPhi, and I thought that sounds like Semper Fi, which is the Marines cry. And so I was curious, is that a coincidence, or did you guys name yourself given your early customers were military? How does that work?
Catherine Von Burg:
No, SimpliPhi that’s a whole nother brain child of mine. Phi being the golden mean, bringing balance and proportion.
Bill Nussey:
I love it.
Catherine Von Burg:
The component part, how they come together to bring balance and proportion to people’s lives. That was a very powerful metaphor for me in terms of how we viewed energy storage in people’s lives. But we actually founded under OES, Optimized Energy Storage. And that was from about 2010, going into 2015, and then we rebranded to SimpliPhi Power
Bill Nussey:
Back in the day I used to put batteries in a flashlight. It’s like, no big deal, you just put the battery in, you flip the switch and it works. But I have since learned that managing batteries is an incredibly complicated technical computer software kind of thing. As I understand you guys also, in addition to making entire batteries decided to make a management system as well. Did I get that right?
Catherine Von Burg:
Well, the battery management system that is internal to each battery. Yes. And so the BMS and perhaps what you’re thinking too, is the energy management system, the EMS that manages an entire large bank, as well as other assets that are built into say a microgrid or a home.
Bill Nussey:
And so what does the BMS inside your battery do?
Catherine Von Burg:
Well, the BMS is very important for lithium-ion. It balances all the cells. In any battery of ours, they’re over 300 of these cylindrical cells. And ensuring that they all charge and discharge at the same rate, that they don’t overcharge or over discharge and monitoring other elements like temperature, battery health, what its capacity is, et cetera. All this information is so critical for people, again, who are looking at energy storage to solve certain problems or meet certain project objectives or even financial objectives. Thinking about grid tide, home, or commercial batteries, where people are trying to offset utility rates, time of use, peak shaving. You want as much information, data coming out of your battery to leverage that in the interoperability of say you’re a generator and the grid or you’re solar, or you wind.
Bill Nussey:
When I was looking at your batteries at the Stone Edge setup, I saw there was an ethernet cable. At first I just saw you had a battery and it looked like a very large car battery, like a truck battery, was a big rectangular thing that I didn’t want to try to pick up. But then did I remember this correctly? Did I see an ethernet cable coming out of your battery? Is that right?
Catherine Von Burg:
Yes. Some of our batteries have ethernet cables and have closed loop communications. Those can be paired-
Bill Nussey:
This is cool.
Catherine Von Burg:
Yeah. Well, so it’s Stone Edge-
Bill Nussey:
This is cool. It’s like a brain inside of each battery.
Catherine Von Burg:
Exactly.
Bill Nussey:
For anyone that’s listening that does batteries for living. You’re like, duh, but I just wanted to say that this is really cool. I realized that when I was looking at these batteries that I wasn’t just looking at a large truck battery that has lead acid inside of it or something fancier like lithium ferrous phosphate, but I was looking at something that, it was a whole device. I assume there was electronics in there, and as you’re balancing the cells internally, you’ve got a lot of brains going on in there. I think that’s also part of the magic as an outsider to the battery industry that you just take this really complicated stuff going on inside and you SimpliPhi it.
But if someone wants to stick a computer connected to an ethernet cable into it, you can like you were saying a moment ago, you can have it, well, this is going to be used for backup, or this is going to be used for high discharge. And the battery becomes very intelligent. I love the fact that my first thought was, this looks like a giant truck battery, and now I’m looking at something that’s a miniature computer system that provides power. Maybe I’m just too nerdy, but I think stuff like that’s really cool, and I love that you guys built that product.
Catherine Von Burg:
Well, I think that’s pretty cool too, but I’m in the business. At Stone Edge Farm, they are an interesting microgrid because they have low voltage and high voltage batteries. They have some of our low voltage, the 48 voltages. They have the closed loop communication batteries that you’re mentioning, but they also have our analog batteries that also have a BMS, but don’t necessarily have closed loop communications. If you think about lead acid batteries, for example, they’re just dumb batteries. They don’t have BMS. They don’t have information coming out of them. So analog batteries that, lithium batteries that still have a BMS but provide more data and interoperability functions with inverters and other microgrid systems have a real advantage.
So Stone Edge Farm, they also have a container, a 20 foot container of ours with high voltage batteries. And because of their EMS, the energy management system developed there by Jorge and Mac McQuown, the owner-
Bill Nussey:
He’s been on the podcast.
Catherine Von Burg:
Yes. I saw that.
Bill Nussey:
Jorge has been on the podcast. And so we love Heila, and they’re mentioned throughout my book. It’s a real great text story there too.
Catherine Von Burg:
Yes. Well, Heila, I got to know Jorge for many years because of our engagement with Craig Wooster, who was the first engineer that really started to build the microgrid and Jorge coming on as an intern from MIT and what he’s been able to create and to be a part of that innovation, which is really a living laboratory, is what they’ve created there at Stone Edge Farm.
Bill Nussey:
I got to talk to Mac McQuown, who’s owns the farm a couple of times. For folks that have done really well in their careers and they’re looking to retire, Mac could have done anything. And like so many people in the valley, he decides to grow some wine and build some farms. But what he did beyond that is just so unique. He created from my estimation, the most sophisticated living laboratory for microgrids that the world’s ever seen. I’ve traveled to China, I’ve traveled across Europe to see microgrid laboratories, and I’ve not seen the equal of what he’s done. And it’s perhaps are many, but I didn’t see any. I’ve spoken to him and his mission is so straightforward and to have his resources and to allow to invest, to think that they told me there was a hundred universities that were using the data from the system.
This stuff is really complicated. I joke about putting a couple of D batteries in an old flashlight, but this stuff is really complicated. And the US government, the department of energy does a lot of great stuff. Some private companies do great stuff, but for someone, an individual citizen to take their wealth and to do something like this and to bring folks like you guys in and to birth Heila, they’re heroes to me. I hope to do well enough in life that I can give back and help create some technologies like that. And so the companies like SimpliPhi and others that are earlier in their journeys can have a place to show that this stuff works.
Catherine Von Burg:
Absolutely.
Bill Nussey:
I love it. It’s so cool that you’re a part of it.
Catherine Von Burg:
Mac McQuown and the whole team at Stone Edge Farm, it’s about the technology, but it’s also about, what is it doing? How does it make an impact? And that includes the financial impact. What is the cost per kilowatt hour? What is the cost per kilowatt when you build a microgrid like this? They’re located in Sonoma, California, you think about some of the worst fires in recent California history. You think about what I mentioned earlier, the public safety power shutoffs, there is nothing safe for the public in shutting off the power. That is the marketing campaign that utilities have really brought to their customers to think that this is about safety. What Mac McQuown and Jorge and the team have done there is create a test pad to prove out the economics as well as the technology.
Because if the technology is not solving real world problems like for an organic farm and wine grower and all their commercial operations, it is a commercial operation there, the losses that are incurred every time PG&E shuts off the power, every time power fails because of the antiquated grid, every time it fails because of fires encroaching and wiping out centralized transmission and distribution, Stone Edge Farm has been up and running during all of these catastrophic events since 2019, 18. 2018, going into 19, I believe that they have been operating seamlessly. They’ve created a real value for companies like us to prove out our technology, but also to participate in the evaluation and the analysis and the data so that we can speak to price versus cost and efficiencies and why this is a better solution microgrids customer side, distributed generation and storage assets.
Bill Nussey:
The last big question for you, Catherine. You have this amazing origin story. You developed four or five different things all at once that most companies wouldn’t even attempt a single one. You did it on virtually no money in the beginning. And then you exited, right? You’ve done the whole arc. You’ve sold to Briggs & Stratton. I’ve built and sold companies, and people think it’s really romantic and awesome, and they assume that you’re now flying around in your private jet because you had an exit. The truth is this is hard. It sucks some parts of it, but it’s nonetheless one of the most worthy things that a few people have the privilege of going through.
And so tell us about the last part of the independence. You guys built a company, Briggs & Stratton, obviously an incredibly well respected global company. What was it like to get the company sold and what’s life like on the good side? And I’m sure somebody from Briggs & Stratton will listen. So just tell us the best parts, but I’m just curious what that was like, and from the perspective of another entrepreneur listening that might want to do what you’ve done.
Catherine Von Burg:
Well, what we did was bootstrap. And so I won’t necessarily recommend that. That’s the way that we did it. It’s not easy, but bootstrapping the company instead of working with VCs for me, really required us to be laser focused on the customer and the market we were in, what problems are we solving? One of the reasons we didn’t work with VCs in the early days and they were coming at us through all 12 years of our trajectory, is because the constant question, especially in the early days was, what’s your exit strategy? And for me, I didn’t even understand what that question meant, really. Exit strategy, I’m here for, I just birthed this thing, where am I going? And then there were other issues like the mission part of our company, founding a startup, really executing on a triple or what’s now called integrated bottom line, people, planet, profit.
We would’ve had to abandon the people on planet and stay focused on profit. We were told we had too many products, too many solutions, too many markets. We needed to focus on one. Through the years because of regulatory changes, even utility requirements for interconnection rules, if we had focused on one market and bet on that solely, we would’ve gone under. It’s the diversification of our product line and our market and also the fact that all our batteries are manufactured off of one line, with maybe the last 10 to 20% being specialized depending on the model and the use case, leveraging our manufacturing, creating efficiencies there. VCs for me posed more challenges than answers. I felt that I could build a company, we could build a company that really because we were providing solutions around real problems, we could grow based off our revenue and fund our own R&D and our own growth and scale. And we did.
So to your question, in 2021, after 11 years of being in the industry and thriving through COVID, which was not expected, none of us were thinking we would thrive through a global pandemic and upheaval like that, thinking that, okay, we are about change, making impact, innovation, and maybe it’s time as a continuance of that mission and trajectory to look at larger companies, specifically manufacturing companies that believed in US based manufacturing, not outsourcing for the cheapest, cheapest solution. We again had many companies approaching us, but then we started to also look outward and think about how we could leverage the 11 years of the brand, the reputation for quality and endurance in our solutions, how we could leverage that partnering with a larger company.
And so Briggs & Stratton was one of five that we narrowed down, even larger companies that were already in the renewable energy space. I know it sounds cliche, but very often it comes down to people. Right? The people at Briggs & Stratton, they are looking to chart a new path for themselves. They have a hundred plus years of manufacturing, rapid prototyping available, their global supply chain. There were so many great fits in terms of what the companies were looking for. And then our mission to really create a path forward into the renewable energy space, clean tech, smart tech partnering with Briggs & Stratton. They brought value to the table, we have brought value to the table and really see the synergy there and where we go from here.
Bill Nussey:
We are definitely at a time, but I want to spend the last minute or two, just going through our lightning round questions. We love to ask our guests four questions that get right to the heart of the matter. I think you’ve really addressed these much more than I usually have at this point. So let’s just jump right in. First question is, what excites you most about the clean energy business?
Catherine Von Burg:
It is so central to the number one existential threat for the entire planet right now, and that is climate change, CO2, greenhouse gas emissions, every day, no matter what anybody does in this company or in the clean tech sector, they are making some contribution in however large or small, in aggregate it adds up. That is the opportunity working in the energy, specifically clean energy business.
Bill Nussey:
I love it. I love it. And the second question, if you could wave a magic wand and change just one thing, what would it be?
Catherine Von Burg:
Wow. Everything.
Bill Nussey:
You can’t wish for more wishes.
Catherine Von Burg:
Yeah, no, I’m actually quoting lyric to a song, sorry. What would I change? I guess that data matters, that people would actually look at empirical data more, pay attention to data, even in business there’s so much data available to us. Like what diversity on our teams does to improve our bottom line. What an integrated bottom line does to our companies, data is out there. And even people in business, CEOs are not paying attention to data and empirical evidence. That informs the soundest decision making and strategy. That is what I wish.
Bill Nussey:
I like it. I like it. I like it, because that’s something we should all be doing and we agree with you. We just need to be better at it. The third question, what do you think will be the single most important change in how we generate, store and distribute electricity in the next five years?
Catherine Von Burg:
The most important change to how we generate, store and distribute is really transitioning from top down, centralized transmission and distribution, to distributed customer based, community based generation storage and distribution. I say that because while large wind farms, solar farms and battery farms are critical, they too depend on the transmission and distribution that is antiquated and failing. It’s critical to our economic wellbeing and everything that depends on energy to get this right. The carbon pollution free electricity mandate under the United Nations Paris climate agreement, the numbers are astounding. To achieve the goals it requires unprecedented investment in generation infrastructure, and that’s estimated to be approximately $2 trillion of investment.
And then you look at the transmission system, that’s estimated to be about 314 to 500 some odd billion dollars. Do we have that money available to invest in infrastructure that is creating catastrophic failures, economic losses in the billions? It’s just not sustainable currently, this model of top down centralized transmission and distribution. We are hemorrhaging money. We have climate refugees, this transition and what needs to change is too distributed.
Bill Nussey:
Dear listeners, I just want to point out that we did not pay her to say this. This is not a qualification for her to come on our show. She said that of her own volition, which is why we love what SimpliPhi is doing and the vision that Catherine is casting. Final question and perhaps the most important one, which is, a lot of folks who listen to this podcast in particular are interested in getting into this space. And I’m sure in your position, Catherine, and your colleagues get asked the question, what can I do as an individual citizen or as an entrepreneur or as a person wanting employment, what do you tell people if they want to get in and make a difference? How do they think about it? What could they do?
Catherine Von Burg:
Well, they can join the industry, again, in whatever capacity. There are rappers who are producing music that promote the transition to a cleaner energy economy. There are people who make an impact through their purchasing decisions. Think about price versus cost. Don’t just buy the cheapest product, think about supply chain, environmental impact, every purchasing decision we make and how we live our personal lives in aggregate makes an impact. And then I guess the third prong is vote, vote, vote, vote. We have utilities and governors and state regulators called the PUC who are creating barrier after barrier.
They are stripping homeowners, business owners from the right to install clean generation on their rooftops, solar or wind, and they are creating barriers to installing batteries, so when that utility shuts off your power, you’re prevented or you’re having to pay a solar tax or a battery tax, you’re paying higher rates to the utility just because you’ve exercised your right to put in solar and storage in your home or business or community or a hospital or school. People voting and paying attention to what’s happening on a policy and regulatory basis, that matters too.
Bill Nussey:
Dear listeners, really am not paying her to say this, but she’s clearly a kindred spirit with the Freeing Energy project and our total mission towards local energy. I’ve seen SimpliPhi for years. I’ve heard your name for many years, Catherine, the work that you and your team are doing is inspiring. And your experience as an entrepreneur makes you a hero to all of us that want to build companies that hopefully make a difference using energy technology to better future for everybody. It’s been a real privilege, a ton of fun to have you on the show today. Thank you so much for sharing your time and your ideas, and thank you for all the work you guys are doing.
Catherine Von Burg:
Well, thank you. You just gave me a chance to talk about all the things that are near and dear to my heart and my mind. There’s so much more to say. I just really appreciate discussions like this and the work that you are doing as well.
