Reliable energy sources is still a problem for a significant portion of the global population. According to the World Bank, 1.1 billion people still do not have access to energy electricity while another 2.9 billion people use solid fuels like wood, charcoal, coal, and even dung for cooking and heating. DUMBO-based startup, BioLite is changing that. Focused on what the company calls “off grid energy” products, the company has already developed a technology that converts cooking fires into electricity that is already being used in over 70 countries.. The company is expanding its technology portfolio and it now includes rechargeable LED lighting and power storage options as well.
BioLite has developed a very unique model dubbed “Parallel Innovation” where core energy technologies are incubated for traditional commercial purposes, in this case outdoor campers, and these technologies are also simultaneously marketed to those in rural areas in need of energy. The profits from the former are used to subsidize the cost for the latter.
Now armed with an additional $5M in financing, Jonathan Cedar, Cofounder and CEO of the company joins us today to discuss the funding, the company’s future plans, and the future of emerging markets energy.
Who were your investors and how much did you raise?
This $5M round in growth capital is a mix of a Series B round led by Acumen, Clif White Road Investments, and RRE Ventures, along with debt and grant funding from Deutsche Bank and USAID.
Tell us about your product or service.
BioLite makes affordable products to cook, charge, and light your life off the grid. Our flagship products are the CampStove and HomeStove, wood-burning stoves that convert waste heat into usable electricity. In February 2015 we launched a new lighting vertical with the BioLite NanoGrid, a rechargeable light + power system that fits in your pocket.
What inspired you to start the company?
Alec and I met at Smart Design in 2006 and realized we both loved to camp. Alec was frustrated that all camping stoves required petroleum fuel and had the idea of a wood-burning stove that could burn as clean as gas. I brought my engineering background to the table and we started to figure it out. Lots of nights and weekends tinkering away on cans and metals. We almost burned down Alec’s loft once, which wasn’t so great, but when that prototype finally worked, it was all worth it.
In 2009, we augmented the business: we took our camping stove prototype to a combustion conference out west and learned that half the planet still cooks over smoky open fires, killing more than 4 million people annually and contributing to climate change. We realized our technology had the opportunity to have an impact on this and we began developing the HomeStove, a forced-draft wood burning cookstove that reduces emissions by up to 90% while generating off grid electricity to charge mobile phones and LED lights.
How is it different?
We believe that the future of energy access is going to happen on a personal scale and we design products to meet that vision. Our technology is designed from first principles and we look for the synergies between potential energy where it exists and the various functions that keep us safe, comfortable and productive like cooking, lighting, and charging for communications.
What market you are targeting and how big is it?
We serve two unique markets: the outdoor recreational industry and emerging markets. The outdoor industry is a passionate and growing audience showing year over year growth and rising consumer interest. However, our long-term scalable vision is to address the most pressing needs of energy-deprived households which make up 3 billion people.
What’s your business model?
We utilize a model we call Parallel Innovation. We incubate core technologies through our product development team, then develop products and market them to both outdoor enthusiasts and rural poor households living in energy poverty. We take the revenue from our outdoor recreation business and re-invest it into the long-term market building efforts to build a scalable and sustainable solution for emerging markets. It’s a departure from the 1-for-1 model; instead BioLite utilizes a market-based approach. We design products that meet the critical needs of rural consumers at a price-point that they can afford, thus boosting local economies, improving public health, and curbing climate change.
What was the funding process like?
As a company that works across developed and developing markets, it was an exciting challenge to bring a diversity of partners to the table who could help us hone our capabilities in each of our core disciplines. Acumen brings deep experience in marketing to rural users in emerging markets, Clif Bar sets the bar for a mission aligned and environmentally friendly product, and RRE and Disruptive Innovation Fund help us to innovate the financial models that keep our unique business growing.
What are the biggest challenges that you faced while raising capital?
BioLite’s story has many facets and addresses two distinct markets with technically complex hardware products. Finding investors who could see the synergies across each of our attributes required us to be very selective and to facilitate a greater-than-usual level of communication between each of our partners to make sure that, as a group, we were all aligned on the path forward for the business.
What factors about your business led your investors to write the check?
Ultimately I think it was a belief in the amazing team we have assembled that lead each of our investors to join. We also had a strong track record of lean cash management and professional execution in both product operations and marketing which suggested we could deliver on our promises.
What are the milestones you plan to achieve in the next six months?
We’ve got big goals for 2016. We’ve seen ourselves as an energy company since our start, but I think customers may have seen us a cooking company. In 2015 we launched our first lighting and power-storage products and announced that our core energy verticals are comprised of Cooking, Charging and Lighting. In 2016 we will be nearly doubling our current product line in ways that can make BioLite the center of your off-grid energy systems and truly fulfill the promise of energy everywhere.
We are also committed to increasing our presence as a thought leader in the categories in which our mission is strongly informed: climate, energy, and the future of what businesses can look like. Keep an eye out for some big announcements from us later this year.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
A focus on lean operations is important for bootstrapping and well capitalized companies alike. We’re in a period where giant venture transactions have become the norm and I think this is a dangerous mindset for young companies. Scrappiness is an asset at any size.
Where do you see the company going now over the near term?
Gearing up for a really big 2016. Plus, we just built an off-grid research facility three hours north of NYC, so in the very near term, we’ll be putting that to the test with all of our latest prototypes.
Where is your favorite place to grab a drink in NYC on a nice summer night?
A box of wings from Wangs plus a couple pitchers of beer at Mission Dolores in their courtyard is a pretty nice combo. Otherwise, you can find me at Sunny’s in red hook.
