By Don Dodson
CHAMPAIGN – One of the founders of SolarBridge Technologies says he learned some valuable lessons in the seven years since the company was founded.
One of them, ironically, was that for certain entrepreneurs, the lowest risk is to “bet all of your chips” on one product.
Another lesson learned by SolarBridge co-founder Patrick Chapman: Move quickly.
“In an emerging opportunity, the winners and losers may be decided before 80 percent of the companies are even founded,” Chapman told employees of start-up firms at EnterpriseWorks recently.
SolarBridge makes DC-AC power converters that can be used to improve the reliability and performance of solar modules. The Austin, Texas-based company, which has a research-and-development facility in the University of Illinois Research Park, sells its “microinverters” directly to solar module companies. In October, the company announced partnerships with SunPower, Kyocera and Solarfun.
“Several more, all in the top 10, are working with us,” Chapman said.
Since SolarBridge has only a small number of customers, it has little need for an “empire” of sales, customer support and distribution personnel, he said. It has about 40 employees, with about a quarter of those based in Champaign.
The company was founded in late 2003 as SmartSpark Energy Systems. Its founders included two professors – Philip Krein and Chapman – and a research engineer, Jonathan Kimball. The first employee, Brian Kuhn, was hired in 2004.
Initially, SmartSpark focused on battery management circuits and “dabbled in numerous ideas,” Chapman said.
The company got most of its revenues from consulting, contracts and research grants. But at that point, venture capital funds weren’t interested in investing in SmartSpark. The company relied on friends and family for capital. “By 2006-2007, we realized that we had to make choices,” Chapman said. “In early 2007, we decided to shift our focus to the growing solar power field.” SmartSpark had been working with microinverters for two or three years and felt they were “a game-changing technology” that had been overlooked by the solar industry.
The company’s idea was received well by investors, and in October 2007, Battery Ventures provided its first $3 million investment, and by 2009 had provided a total of $9 million. Meanwhile, SmartSpark adopted the SolarBridge Technologies name.
Earlier this year, SolarBridge received another $6 million in venture funding from Battery Ventures, Rho Ventures and the Texas Emerging Technology Fund. The company launched its first product in October. Chapman, 36, worked as a part-time consultant for SolarBridge until 2009, when he took an unpaid leave of absence from the UI to help the company. This year, he was offered a permanent position at SolarBridge. “I discovered there was way too much going on, to help from the sidelines,” said Chapman, the company’s chief technology officer. He now lives in Austin and divides his time between Austin and Champaign. From his years in the business, Chapman concluded it’s best to concentrate on one product. “Diffuse efforts with limited capital are doomed,” he said. “In an attractive market, competitors will emerge that will bet the farm.”
Chapman advised entrepreneurs in start-up technologies “to raise three times what you think you will need.” He also recommended they concentrate on their technology and not devote their own time to “fund-raising, bookkeeping, ordering stamps.”
By Don Dodson