Posted: 12:23 pm Wed, September 7, 2011
By ?JEREMY STRATTON
Tags: Adam Hegland, Atmosphere Recovery, Electric Yacht, Energy Max Panel, Fredrikson & Byron, Lighting House, Ronald Rich, Scott McMillan, SheerWind, Sudhir Singh, Supreme Energy Products
Adam Hegland (left) and Tadd Johnson, pictured at a home under construction in Hudson, Wis., are the co-founders of Lakeville-based Supreme Energy Products, which recently won the $25,000 prize in the Minnesota Cup?s clean technology and renewable energy division. The company is also one of 20 regional semifinalists in the Cleantech Open, another competition. (Staff photo: Bill Klotz)
Although the Minnesota Cup and Cleantech Open may be referred to as ?startup? competitions, five Minnesota companies making strong showings in the contests? renewable energy, green building and clean-tech divisions are beyond the birthing stage.
The three 2011 Minnesota Cup semifinalists already have commercial sales, and two other Minnesota semifinalists in the Cleantech Open?s North Central Region show good odds as well. One is a 17-year-old company seeking capital to match demand for its product; the other is a well-backed startup heading out of the development stage toward its first $3 million in equity.
None of the five companies says its success hinges on winning. While prizes reach into the tens of thousands of dollars, founders cite other benefits ? mentorship, business advice, access to investors ? as the true rewards of the competitions.
Here?s a look at the winners and semifinalists in the Minnesota Cup, clean technology and renewable energy division.
Winner: Supreme Energy Products
Homebuilders Tadd Johnson and Adam Hegland hoped their Energy Max Panel ??insulation made out of polystyrene panels ? would give them an advantage over competitors that use the decades-old industry standard, fiberglass insulation.
The ?recyclable and reclaimable? panels offer twice the effective R-value (insulation rating) as fiberglass, Johnson claims, reducing heating and cooling costs up to 70 percent.
Industry experts have told the builders to think bigger ? and that their product could be a ?game-changer? in residential and commercial building, Johnson says.
On Aug. 30, their Lakeville-based company, Supreme Energy Products, won the $25,000 prize in the Minnesota Cup?s clean technology and renewable energy division. The company will compete for the Minnesota Cup grand prize to be awarded Thursday evening. (Supreme Energy Products is also one of 20 semifinalists in the Cleantech Open?s North Central Region.)
With four residential jobs completed, Johnson says both competitions will teach the licensed contractors how to grow a business.
?Me and my partner, we both pound nails for a living,? he says.
Runner-up: Electric Yacht
With sales outlets in 15 states and Canada, divisional runner-up Electric Yacht has sold nearly 125 electric motor systems for sailboats since 2008, says President and Chief Executive Officer Scott McMillan.
The electric systems can typically replace a diesel or gas engine of twice the horsepower, according to the company?s website. While most customers are on the coasts, the Golden Valley-based company partners with a metal fabricator in Melrose, Minn., to manufacture the products.
McMillan says visibility in the investor market is a key benefit of the Minnesota Cup, especially as Electric Yacht rolls out its new hybrid design.
?Another round of financing would definitely help us move faster, both in terms of [research and development] and manufacturing,? he says.
Finalist: Lighting House
Plymouth-based Lighting House manufactures and installs LED-based lighting to replace conventional lighting in commercial, industrial, architectural, outdoor and other applications. Energy savings run 60 percent to 90 percent, says founder and Chief Executive Officer Sudhir Singh.
An outdoor demonstration project in 2010 in Hibbing has led to other projects in northeast Minnesota and the Twin Cities, he says, including solar-powered outdoor installations and larger projects in the pipeline for the fledgling company.
?Two years ago, we did not know how to install lighting,? says Singh, adding that the Minnesota Cup has ?really opened our eyes? to how to grow Lighting House as a company.
?We need to build that capability,? he says, ?because we know this is coming, in a big way.?
Here?s a look at the two Minnesota renewable energy companies that are semifinalists in the Cleantech Open, North Central Region.
Atmosphere Recovery
After nearly two decades of searching for a market for its process to capture and measure excess gases in industrial operations, Eden Prairie-based Atmosphere Recovery finally has a better problem: the need for capital to keep up with demand, says Ronald Rich, the company?s president.
Launched in 1994, Atmosphere Recovery?s technology reduced emissions to 4 percent and cut natural gas consumption 25 percent in auto industry heat-treating processes, Rich said. Its laser gas analyzer added even more benefit, but niche markets were resistant to change, he says.
In 2005, the company expanded its focus, capitalizing on safety, emissions, energy savings and compliance applications in large industry, landfills, energy conservation and renewable energy, bioprocesses and more. Growth has doubled in the past two years.
The Cleantech Open offers the seven-person business the knowledge ?to raise funds properly, to grow staff and do the things we would need to do to become big players,? Rich says.
SheerWind
Chaska-based SheerWind?s wind-energy system INVLEOX promises 200 percent more power than conventional wind systems. Funnels atop shorter towers collect and concentrate the density of wind power ? inventor and founder Daryoush Allaei compares the technology with that of a hydro dam.
The concentrated process uses shorter towers, narrower pipes and smaller blades, allowing lower maintenance costs and a smaller footprint, Allaei notes.
While the endeavor is new, Allaei has a decades-long history in research and development and has helped found six companies. His larger development company, QRDC, was a Minnesota Cup semifinalist in 2010.
The company?s board and operations team includes several high-level executives from Xcel and other energy companies. Allaei expects to raise $3 million in Series A equity by November, and he speaks of a second, $40 million round. The Cleantech Open offers exposure to investors who can make that happen, he says.
A ?bigger field?
Companies like Supreme Energy Products and Electric Yacht are not what one would think of as traditional clean-tech or renewable energy companies, says Todd Taylor, a judge in the Minnesota Cup clean technology and renewable energy division.
?It?s showing that the field of clean technology and renewables is really bigger than what we?ve traditionally conceived of,? says Taylor, an attorney with competition sponsor Fredrikson & Byron. ?I?m really looking forward to seeing more companies that are sort of outliers in the traditional view of renewables getting involved.?
Source: http://finance-commerce.com/2011/09/contests-spotlight-renewable-and-clean-tech-companies/
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