#181 Hot Rocks, From EPA to Apple, Paths to Commercialization, The CapEx > OpEx Model, & More w/ Arvin Ganesan (Fourth Power)

🌎 Welcome back to the CleanTechies PodLetter, Founder edition.We tried to devise a better joke, but Hot Rocks was the best cold open we could come up with.Today, we are talking to Arvin Ganesan of Fourth PowerYou may have heard of Fourth Power before but have you heard Arvin’s story of going from the EPA, to Apple, to Fourth Power, and what he thinks are the keys to their success? I don’t think so. There is a great episode with Volts that covers Fourth Power’s technology in depth. If you have not heard it, I’d highly recommend it (if you like science, that is).In today’s conversation, we had a chance to unpack…* How their thermal battery works (high level) * How insanely efficient their tech is * How they maintain the company culture as they grow * Why their model is desirable to utilities * His mentors and the importance of mentorship broadly 📺 Watch on YouTube | 🍎 Apple Podcasts | 🎧 Spotify | 🗣️ Join the Slack Channel🚨Attention! 🚨 We interrupt your regular programming for an important message.ClimateTech founders are taking on a huge challenge. Building a climate startup is highly complex but also SO NECESSARY if we are going to save the climate. Founders not only you need to understand how to build a startup, but you also need to understand how to deal with hardware, have a strong handle on climate policy, know how to fundraise from diverse investors types, etc. etc. etc…It’s a lot.That’s why we make CleanTechies. The #1 Podcast for ClimateTech Entrepreneurs.In addition to our jobs, we devote ~20 hours a week to producing this podcast for you. This way, you can learn from others who have walked the path you’re on now, learn from their mistakes, and gain insights on navigating this complex world.If this mission resonates with you, we ask for your financial support of this project. It takes a lot of effort, and it’s not free. Your willingness to contribute on a monthly or yearly basis helps us keep this going.If you’re already a subscriber and want to contribute financially, click “Upgrade to Paid” at the top right of your screen.If not, follow the steps once you click “Subscribe Now” below to help us out. Thanks for helping us help all the climate entrepreneurs like you. 🙏 🌎The Guest: Arvin Ganesan* After graduating from the University of Massachusetts Amherst, Arvin spent a few years at Calvert Research before pursuing his master's at George Washington University. * He’d then land in the EPA during the Obama administration, where they worked on groundbreaking projects, including efforts to cap carbon emissions. It was during this time he really got to know the landscape of of policy and where he was mentored by Lisa Jackson. * Eventually, he’d end up following Lisa to Apple, where he led global energy procurement policy for them (among other things). * This combination of finance, policy, and corporate sustainability initiatives prepared him well for the role he’d eventually be offered with Fourth Power. * When approached, he was initially skeptical about making such a drastic change, but after seeing what the technology could do and learning that Founder Asegun Henry was a family man, he was ready to make the leap. * Today, he’s the CEO of Fourth Power. The Company: Fourth PowerOne Liner: Making Renewables + Storage Energy cheaper than gas power.Founded by Dr. Asegun Henry through his work at MIT, Fourth Power is now making total dependence on renewable energy a reality, without it raising energy prices. They are piloting their bench-scale technology that allows them to store energy generated by renewables, until needed later…much later. They don’t do this with batteries but rather with Thermal Energy…aka Hot Rocks. Electricity heats a special metal until it’s so hot that the heat transfers (following the laws of thermo-dynamics) to the rocks. When they need the energy they can distribute the enery at a moment’s notice (which BTW, is faster than the current conventional solution of gas peeker plants). The best part of all this is, their model fits perfectly with the way utilities make money. Being regulated, a utility can only make money on the CapEx spend and not the OpEx. For thos unfamiliar, Capital Expenditure is the money used to build the plant, and Operating Expenditure is the cost of operating. Utilities make a fixed amount above their CapEx. So, for them, all the margin is in the build out of hardware / energy generation. A gas plant has decently high CapEx, but it also has a lot of operating expense—making it an undesireable product for the utilities to invest in. Fourth Power’s systems are high CapEx, but have ultra-low OpEx. It’s a perfect fit. In the coming years, with the proliferation of Fourth Power’s technology, we will see massive transformation of the grid to renewables. It’s no wonder funds like Bill Gates’ backed Breakthrough Energy Ventures have invested in their $19m Series A funding round. Do you have suggestions on future guests or topics? Leave a comment!Unable to support financially but still want to help? Share this post w/ 3 ClimateTech entrepreneurs (or aspiring entrepreneurs). Sharing is super helpful to us, and it costs you nothing.📝 Show Notes:Topics* 2:37 Why Cheap and Accessible Energy Storage Matters* 17:30 Fourth Power's Utility-Scale Thermal Battery* 21:58 Fast and Efficient Energy Storage and Discharge* 27:10 Building Fourth Power* 32:04 The Power of People* 37:24 Maintaining Culture with Growth* 42:21 Opportunities in the Utility Market* 47:04 Startup Opportunities in Agriculture Decarbonization* 49:01 The Importance of Mentorship* 52:19 TakeawaysLinks* Arvin Ganesan | Fourth Power* Connect with Somil | Connect with Silas* This podcast is NOT investment advice. Do your homework and due diligence before investing in anything discussed on this podcast.Asks 👋👉 Listeners Survey* We would love to hear how we can improve the show and what you like most.👉 Fundraising for Founders* If founders are looking for funding in the ClimateTech space, reach out & schedule a chat here!👉 Early-Stage Founders Hiring* Silas just started his own recruitment consultancy tailor-made for early-stage ClimateTech startups. He does this by offering heavily discounted headhunting services for companies at Pre-Seed, Seed, and Series A companies. If you need a hand finding the best talent on the market, and you don’t want to sell your kidney to pay for it, let’s chat. 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