manufacture in bulk its patented carbon-based material for making better batteries and ultracapacitors. The material itself looks like a fine, black powder. “It doesn’t sound very sexy, but take a step back and it’s an amazing, amazing material,” says Luebbe. “Messing with the way those molecules are assembled at the elemental level has enormous impact.”
Crucially, in the past year, EnerG2 demonstrated it could make an oil drum’s worth of the material, about 1,500 pounds of it, and tests in the lab showed it had the right stuff. Apparently, that is the critical threshold amount of material that indicates the company’s process engineering—the “secret sauce of dials and levers,” as LeFaivre puts it—is ready for prime time.
So OVP turned up its due diligence and went for the deal, bringing in Firelake Capital because of its expertise in cleantech and energy investments. The $8.5 million Series A round closed at the end of October, with OVP managing director Gerry Langeler joining the board of EnerG2, and LeFaivre joining as a board observer. “Some deals get done fast, but here’s one that took two years,” LeFaivre says.
One more point on the technology front. Surely these venture firms aren’t betting the farm on niche applications of ultracapacitors like forklifts and cranes? It turns out ultracapacitors could be used to get 150,000 miles out of a plug-in hybrid car battery, says Luebbe. They could be used to make more efficient electric rail systems and power tools. Further down the road, they might even be used to make mini electricity generators that charge your phone or mobile device while you’re walking around. What’s more, ultracapacitors could be used for distributed generation and storage of power on the electric grid—a large-scale application in which batteries have major problems.
“We are moving towards an electric economy. That means energy storage is a very, very key part of the puzzle,” LeFaivre says. “A lot of investors are drawn to [energy]. There’s always the challenge of a frothy environment, sort of a bubble. The challenge is to sort through everything.”
I asked Luebbe for his thoughts about the deal’s broader impact on energy ventures—particularly in the Northwest, where there have been pockets of activity in biofuels, geothermal, and solar, but little in the way of broad-based leadership in cleantech venture capital, for instance. “There’s no reason why Seattle shouldn’t be a cleantech hub for innovation,” he says. “With OVP’s commitment, we’re going to see Seattle get much more traction to establish itself.”
