DOE OSTI2019
Commercializing energy technologies through traditional market pathways is challenging for early-stage energy innovators. Development cycles in energy are long and expensive, and adoption is difficult, making energy technologies of limited interest to venture capital relative to industries with faster growth and shorter product life cycles such as life sciences and software. As such, partnerships with established corporations are one of the most promising, and in some cases only, go-to-market pathways for energy technologies. Startups often seek to work with, large well-known Fortune 500 (and similar) companies. However, the size and risk aversion of those firms often makes partnering challenging. It can take well over 12 months for a large corporation to agree to commercial terms and get internal board / management approval to move forward with a binding agreement with a startup for even a simple starting partnership. This timeline is prohibitive for most early-stage companies who are both time and money constrained, and often working in highly competitive commodity sectors. Mid-cap corporations ($\$ $100M to $\$ $10B) are a promising but untapped resource for partnering with technology developers because they are often nimbler, tend to be fiercely competitive, and are looking for new revenue or cost-saving opportunities. These factors make them both more receptive to disruptive technologies, and more capable of integrating them. However, while Fortune 500 companies often have venturing groups that facilitate the initial connection process, most midcap incumbents do not have the resources to create standalone corporate venture groups. As a result, although they could help each other significantly (startup technologies make midcaps more competitive; midcaps offer a faster commercialization pathway to startups), midcap companies and startups rarely work together. In 2017, ADL Ventures (ADL) received Award #DE-EE0008111 from DOE EERE’s Innovative Pathways program to unlock the domain expertise and material resources of midcap companies. The goal of the award was to support energy technology commercialization via an innovation platform for startups to interface with midcap corporations. During the grant period, we have developed a novel open innovation platform that allows financially conservative incumbents to efficiently engage with energy innovators and startups, thereby unlocking the incumbents’ domain expertise, strategic capital, R&D facilities, supply chain, and pathways to market. We have executed full-scale open innovation challenges for three clients, exceeding the initial proposed goal of two. We also built a diversified opportunity pipeline which resulted in four projects contracted for 2020, meeting the goals of the proposal, with others pending.
29 ENERGY PLANNING, POLICY, AND ECONOMY↗