Stanford Graduate School of Business
Industry: Transportation, Climate Technology
Founding Student Name(s): Ted McKlveen, Bav Roy
Brief Description of Solution: Heavy-duty transportation, including trucking, shipping, and aviation, is responsible for 10% of all global greenhouse gas emissions. Unlike light-duty transport, which can be decarbonized with battery EVs, heavy-duty applications require a technological breakthrough: enough energy must be stored on-board to meet high power requirements without taking up precious cargo space or weight. Due to its high energy density, hydrogen is a promising fuel of the future for these sectors. However, there is one challenge limiting the broader applicability of hydrogen: the method of storing hydrogen on-board the vehicles.
Verne is developing high-density, lightweight, and low-cost hydrogen storage systems for heavy-duty transportation. Verne stores hydrogen at 2x the density of current solutions, doubling vehicle range, increasing payload capacity, and reducing upfront cost by 50%. By improving the economics to vehicle owners and operators, Verne is accelerating the transition to zero-emission hydrogen fuel.
Funding Dollars: $1M
What led you to launch this venture? Both founders have long been passionate about addressing climate change. Before business school, Ted worked on renewable energy as a chemistry major in undergrad and later at a renewable energy startup, and Bav received a bachelor’s degree in renewable energy engineering and worked as an engineer on solar power systems. Ted and Bav both entered business school hoping to address the largest challenges in combating climate change, specifically in the most “difficult-to-decarbonize” sectors of heavy-duty transportation and industrial processes. At an energy conference hosted by Stanford, Ted and Bav learned that hydrogen could decrease the emissions in these challenging sectors. After further research into hydrogen technology and markets, they started Verne with the goal of decreasing emissions in difficult-to-decarbonize sectors.
What has been your biggest accomplishment so far with venture? We have grown the team to include the global experts on high-density hydrogen storage. Our team now includes 6 employees, as well as the original inventor of cryo-compressed hydrogen storage (Verne’s technology platform) as our technical advisor. These hydrogen storage engineers bring decades of experience and fuel Verne’s continued innovation and IP development. We’re incredibly proud to have assembled this team.
How has your MBA program helped you further this startup venture? Our business entails all aspects of the MBA curriculum on a daily basis: recruiting, operations, fundraising, finance, and sales. Understanding the fundamentals and best practices in each field enables us to confidently run the business, while spending most of our time focused on strategic and technical topics.
More specifically, the MBA coursework directed at entrepreneurship has been incredibly relevant as we iterate on our business model and raise funds. We have pivoted numerous times as we’ve learned more about the market and technology, adapting our business model and target market. Coursework that emphasized the business model canvas and Steve Blank’s emphasis on value proposition have guided these iterations in strategy. Coursework on venture capital financing and corporate finance have similarly given us confidence and saved precious time as we raised funds.
What founder or entrepreneur inspired you to start your own entrepreneurial journey? How did he or she prove motivational to you? Tim Latimer, Founder and CEO of Fervo. Tim also attended the Stanford GSB and founded a Climate Technology company (focused on geothermal energy production). Tim’s focus on industrial hardware was very impactful, as he strayed from the more common path of software innovation and took on numerous challenges in hardware: a technical challenge with high capital requirements and long development time scale. In addition, Tim started Fervo as an MBA student, which was encouraging to us as we similarly founded a technical hardware company as MBAs. Tim has continued to serve as a role model, as he grows Fervo and shows an example of how to scale a Climate Technology hardware business.
Which MBA class has been most valuable in building your startup and what was the biggest lesson you gained from it? Stanford Climate Ventures was the most valuable course. This course was an experiential entrepreneurship course, during which we contacted dozens of potential users and industry participants and developed an initial business model. From this course we learned the importance of listening to the customer to understand the true market need, and refining our understanding of value proposition from the customer’s perspective. We also learned the value of continually questioning our assumptions and plans, and ultimately pivoted both our technology and beachhead market during the 10 week course.
What professor made a significant contribution to your plans and why? Rob Siegel made numerous contributions to our plans. Most importantly, Rob encouraged us (and all his students) to go for it: to take the risk and give entrepreneurship a try. More specifically, Rob offered us guidance and feedback as we were raising our first private capital. His guidance helped us quickly and confidently close our fundraising round, financing the company and allowing us to refocus on building our product and team. Rob’s encouragement, leadership by example, and directed advice have provided the boost we needed to get Verne off the ground.
What is your long-term goal with your startup? It is our goal to eliminate carbon emissions from all heavy-duty transportation: 10% of global CO2 emissions by 2050. By providing high-density hydrogen and high-density hydrogen storage to these industries, we will accelerate the transition from fossil fuels to zero-emission hydrogen power.
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