Relume Technologies Foresees Growth Driven by Advances in LED Displays, Smart Grid

12/7/10

Relume Technologies might become one of the great growth stories in the state of Michigan’s tech sector next year. The Oxford, MI-based maker of light-emitting diode (LED) lighting products and networked lighting control systems is aiming for significant increases in revenue and employment over the next year, president and chief technology officer Peter Hochstein says.

The company raised its first institutional capital last year from Beringea, the Farmington Hills, MI-based venture firm, Hochstein says. Ever since, the company has been investing in modernizing its manufacturing operations in Oxford and improving its sales and distribution. The investment appears to be paying off.

Relume, which is expecting sales of around $8 million this year, has gained orders for next year that could help the firm double its revenue in 2011, Hochstein says. Also, the firm might double its work force of about 50 people over the next year because of the expected increase in business. In the first quarter of 2011, he says, the company expects to raise more money from Beringea as one of multiple investments that are expected to total about $7 million.

The LED market consists of major players like General Electric, Osram Sylvania, and Philips Lighting, but when it comes to the design and assembly of LED lighting products, “no one does anything close to what we do,” Hochstein says.

Relume has differentiated methods for fabricating its lighting assemblies to make them last longer and perform better than others, Hochstein says. While the firm doesn’t produce LED semiconductors, it makes circuit boards on which it attaches the LEDs. It also products other related LED products. Its assembly designs are intended to transfer heat away from the LED to prevent premature degradation of the devices. The company is focused on the market for outdoor LED products, which include street lamps, large commercial signs, billboards, and garage lighting.

In general, LEDs have shot up in popularity because they require less electricity and last longer than typical incandescent and fluorescent bulbs. For instance, Relume has retrofitted globe lamps in downtown Ann Arbor, MI, with LED lighting, and each lamp is expected to save the city $1,111 in electricity and maintenance costs over a 10-year period, according to the company. Hochstein says that his firm has seen similar savings for projects elsewhere such as in Arlington, VA.

“Saving a cash-strapped city or town 50 or 60 percent on its energy bill is a big deal today,” Hochstein says.

Yet the firm’s greatest invention might not be directly related to LED technology. The company has developed a networked system for centrally controlling and monitoring street lamps. Its system taps cities’ existing communication infrastructures, using its radio repeaters and public safety radio frequencies. Controlled from a computer, the system enables cities to turn off or dim specific lights or get alerted to those lights that require maintenance, Hochstein says. He adds that Ann Arbor and Oxford have already adopted the firm’s system, which it calls the Sentinel System. The company is also in talks with utilities that are interested in the system for smart grid applications.

Hochstein, who founded Relume in 1994, has been tackling engineering problems associated with LEDs for a long time. During his days as an R&D consultant for the automotive industry, he says, he worked on a project for Chrysler, designing LED instrument cluster lighting. In the early 1990s, he served on the national committee charged with establishing standards for LED lighting in traffic signals, and he became aware of the challenges of managing the heat in lighting devices such as LEDs.

Despite the presence of those large players and the rising tide of overseas competitors, Relume distinguishes itself from the rest with its patented products—which are all assembled under one roof in Michigan. If the company does grow as rapidly as Hochstein expects, it’s unlikely that the founder and president is going to lose focus on some of the core values that have brought the business to where it is today.

“Our view,” Hochstein says, “is be upfront and honest with the customer, prove you can do what you say you can do, and let the chips fall where they may.”

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