Waltham, MA-headquartered lithium-ion battery manufacturer A123 Systems, which has operations in Michigan, announced today that it is kicking off a pilot project with Boston-based NSTAR to study the benefits of employing the A123′s grid battery technology in a suburban electric grid. The system, NSTAR’s first battery energy storage project, is expected to be up and running in 2012 at a substation in Medway, MA.

Andy Chu, A123′s vice president of marketing and communications, says his company’s grid battery system is designed to provide area regulation services, which address the momentary differences between electric power supply and demand. Fossil fuel-fired generators are the industry standard, but Chu says A123′s batteries can provide the same storage capabilities much more efficiently.

Though A123 Systems is well known for supplying products to auto makers for their electric vehicle lines, Chu says the project with NSTAR is far from the company’s first grid-storage project—in fact, grid energy storage is one of A123′s main vertical markets, and he says he expects that market to provide 40 percent of the company’s income in the future. A123 has manufacturing plants in Livonia and Romulus, in addition to an Ann Arbor research and development site.

Comments (1) | Reprints | Share:          

Last week, Forbes magazine announced that Auburn Hills, MI-based ALTe Powertrain Technologies, developer of the first range-extended plug-in hybrid electric vehicle powertrain for light commercial fleet applications,  made its list of America’s most promising companies. ALTe is one of only three companies listed in the Capitol Goods industry category, the only hybrid technology company, and the only company from Michigan.

“We’re ecstatic, but we’re also humbled,” says John Thomas, CEO of ALTe. “It’s rare that a pre-revenue startup gets attention of this magnitude from such a prestigious publication.”

To determine which companies made the list, Forbes enlisted CB Insights, a New York City-based data firm that tracks investment in high-growth private companies, and its Mosaic software, which helps lenders and investors allocate capital more efficiently. Mosaic created an algorithm by pulling data from 30,000 sources, including court filings, press releases, news articles, and social media, and used the algorithm to create a score that measures a company’s potential. Forbes then took the Mosaic scores and combined them with “old-fashioned reporting” to create the list of most promising companies. [CB Insights also provides the data behind Xconomy's companies database.]

ALTe’s series of significant announcements in 2011 no doubt contributed to their placement on the Forbes list. These announcements included a long-term supply agreement with battery maker A123 and electric motor supplier Remy, a preferred installer partnership with vehicle remarketer Manheim, a collaborative effort with Pacific Gas & Electric Company to test their technology on PG&E’s fleet of trucks, and a joint venture with Inmatech to produce and sell hybrid electric storage devices.

Thomas says he’s not worried at all about A123′s recent announcement of layoffs because he’s looking forward to getting the focus of their resources. Thomas’ optimism extends to the electric vehicle market as a whole, regardless of what appears to be a slower-than-expected response from consumers despite relatively high customer satisfaction.

“We’re confident, because we’re being told by our customers that we have the right plug-in technology,” Thomas says. “The lack of battery-charging infrastructure and concerns for range—all those things add up to a need for range-extended powertrains. We offer comfort to consumers.”

I spoke to Thomas as he was packing to leave for China, his second time visiting the country in less than four weeks.

“We’re absolutely engaged in business opportunities for both domestic Chinese consumption and export,” Thomas says. “China has embraced our technology even more so than the United States.”

Comments | Reprints | Share:          

Waltham, MA-based A123 Systems (NASDAQ: AONE), the lithium-ion battery maker, has laid off about 125 employees at its manufacturing facilities in Livonia and Romulus, MI. The news originally broke the week of Thanksgiving and was reported by media outlets including the Observer & Eccentric and Crain’s Detroit Business.

The layoffs are apparently the result of lower demand from Fisker Automotive after its plug-in hybrid sports car ran into production delays. A123 invested in Irvine, CA-based Fisker early last year. Media reports quote Jason Forcier, the vice president and general manager of A123′s automotive group, and PR manager Dan Borgasano as saying the layoffs are temporary and the workers should be hired back within six months.

Forcier spoke with me last year around the opening of the Livonia plant. At the time, he noted that “the battery industry is really a rejuvenation for the whole area. This is extremely important for Michigan from an economic standpoint.”

A123 still employs about 600 people at its two Michigan plants and its research and development center in Ann Arbor, according to the Crain’s report.

Comments | Reprints | Share:          

Bedford, MA-based VideoIQ, a maker of video surveillance technology, announced today that it has pinned down $7.5 million in Series C funding, from Atlas Venture, Cisco, Matrix Partners and Tenaya Capital. The company reported $6 million in funding earlier this year in an SEC filing. It said today that the new funding will go to fueling growth and product development.

VideoIQ also announced it has hired Ed Bednarcik as its new president and CEO. He was previously CEO of Wright Line, a company focused on 911 public safety and data center technology. Before that, Bednarcik was an early employee of A123 Systems (NASDAQ: AONE).

VideoIQ’s technology is designed to store video surveillance footage for months of continuous recording, and offers HD viewing and analytics capabilities to capture more relevant information for its customers.

Comments | Reprints | Share:          

Auburn Hills, MI-based ALTe last week announced a long-term supply agreement with Waltham, MA-based A123 Systems for complete lithium ion battery packs to be integrated into ALTe‘s range-extended hybrid electric powertrain systems. The battery packs are designed to deliver higher power, longer life, and increased safety. This announcement comes just weeks after ALTe’s agreement with Pacific Gas & Electric for the California utility to test drive a vehicle retrofitted with an ALTE powertrain.

“We believe that ALTe’s innovative powertrain systems will enable organizations to cost-effectively hybridize their fleets of light trucks to realize the significant economic, environmental and operational benefits of electrification,” said Jason Forcier, vice president of A123‘s Automotive Solutions Group, in a statement.

Comments | Reprints | Share:          

It looks like A123 Systems is seeing some payoffs from the lithium-ion battery manufacturing facility it opened in Livonia, MI, late last year. Waltham, MA-headquarted A123 (NASDAQ: AONE) has nabbed a production contract from General Motors to provide the battery packs for an upcoming line of electric vehicles from the automaker, GM announced. The battery packs will be produced at the Livonia site. General Motors, which was previously testing the A123 technology in a development agreement with the company, did not disclose the financial terms of the production contract or which vehicles the A123 battery packs will power.

Comments | Reprints | Share:          

Busy day for a couple of well-known cleantech companies around Boston. One public company has signed a big deal in China, while the other, an ambitious upstart, is carefully protecting its intellectual property as it heads toward large-scale commercialization.

—A123 Systems (NASDAQ: AONE), the Waltham, MA-based maker of lithium ion batteries, said today it has won a contract with China’s Dongfang Electric, a large manufacturer of wind turbines and power equipment. A123 will provide an energy storage system for Dongfang’s manufacturing facility in Hangzhou by the end of this year. Financial terms weren’t given. If all goes well, this will be A123’s first storage system installed in China.

A report in CNET today has more context on the deal: A123’s battery bank will be attached to a 1.5-megawatt wind turbine and diesel generator to test how well the batteries can smooth out the dips in wind energy production. A123 has car battery manufacturing facilities in China, but no grid storage systems there yet, the report says.

—Joule Unlimited, the Cambridge, MA-based biofuels startup, said today it has been awarded a pair of U.S. patents that cover its method for producing ethanol at high volumes and high efficiencies. The method involves genetically engineering “photosynthetic bacteria”—microorganisms that convert sunlight and carbon dioxide into ethanol without fermenting sugars from cellulose or other types of biomass. The patents (#7,981,647 and #7,968,321), which were granted in the past month, cover various enzymatic mechanisms that Joule has engineered into cells to maximize their ethanol productivity.

Joule has received plenty of media attention since it started in 2007. The company is also applying its method to produce energy in the form of diesel fuel, which could power trucks and planes. Joule has previously been awarded patents in the area of diesel production. The overarching idea is to replace fossil fuels, but most biofuels makers have found “they can’t compete on a cost basis,” said Joule senior vice president Troy Campione, on a panel at our XSITE conference last month. Joule, of course, believes it is different.

The company has a pilot plant in Texas that has been producing ethanol and is slated to start producing diesel later this year. Joule says it has also signed a lease for land in New Mexico on which it is building a demonstration-scale plant that will begin operations next year.

While the new patents should help distance Joule from some of its competitors, they don’t necessarily get the company to commercialization any faster. George Church, the Harvard geneticist (and chairman of Joule’s technical advisory board), was quoted in the New York Times in March saying, “It’s not a totally obvious organism and they’ve changed it pretty radically, so it’s not clear they can protect everything by patents.”

Comments (1) | Reprints | Share:          

During a panel discussion with three cleantech investors at the Energy Infotech Forum in New York City yesterday, an audience member posed a provocative question: “What won’t you invest in?” he asked. Scott DePasquale, a partner at Braemar Energy Ventures, responded “consumer space travel.”

DePasquale was only half kidding. Ever since Braemar was founded in New York in 2003, it has invested in virtually every corner of the energy sector. “We don’t fashion ourselves as a cleantech fund,” DePasquale said during a sit-down interview at the conference. “We’re an energy venture capital firm. We invest in cleantech and renewables, but we’re also investing in any technologies that can help extract oil and gas more efficiently and in a cleaner way.” DePasquale works in Braemar’s Boston office, which opened in 2007.

Braemar, which is in the process of raising money for its third fund, has a portfolio of more than 25 investments. They run the gamut from Cerion Energy, which makes a fuel-based additive that reduces emissions, to Convey Computer, which has developed a technology to make high-performance computers run faster with less energy. Braemar also has investments in smart grid, energy storage, lighting, clean coal, solar, and biofuel technology companies.

The firm’s co-founders bring a wealth of experience and perspective to energy investing, DePasquale says. Neil Suslak has experience as an investment banker in the energy, communications, and transportations sectors. George Reichenbach ran two divisions of the industrial-products maker Norton Company. And William Lese worked for NPS Industries, which made equipment for the power industry, and Vivendi affiliate Sithe Energies, an independent power producer. “What’s unique about us is our founders have a really good sense of what it means to scale technology solutions around the utility customer,” says DePasquale, who was a vice president at GE Energy Financial Services before joining Braemar in 2009.

Braemar’s first fund made just north of $50 million in investments. An early bet on EnerNOC (NASDAQ: ENOC)—a cleantech firm that pulled off a $98 million initial public offering in 2007—helped Braemar launch a second fund with a total of $250 million to invest. And according to a May regulatory filing, Braemar is now in the process of raising $300 million for the third fund.

DePasquale makes a strong case that there’s rarely been a better time for energy entrepreneurs with good ideas to raise capital. Quoting figures from the National Venture Capital Association, he points out that cleantech companies raised … Next Page »

Comments (3) | Reprints | Share:          

Sakti3 is one of Michigan’s most high-profile startups, whose solid state, lithium ion batteries have won funding from General Motors and Khosla Ventures and plaudits by MIT’s Technology Review.

Such technology could revolutionize electric cars by packing more energy into a battery that occupies much less space under the hood than existing batteries. With less battery weight to hold it down, an electric car could travel longer distances without having to recharge.

However, I recently came across two other technologies that could give Sakti3 a run for its money. They focus on the same problems-reducing the battery’s bulk while stuffing the car with more energy-but from completely different approaches.

Be careful. That’s not just a hood you’re sitting on: Volvo is funding a $5 million research project at the Imperial College in London to create composite materials that can store and distribute energy.

The strong, lightweight materials, made of carbon fibers and polymer resins, can essentially convert parts of the car, like the hood, trunk, or wheel wall, into extra fuel tanks. That means the car doesn’t need large (or as many) electric batteries to power the engine, allowing the vehicle to travel farther between recharges. Researchers estimate they can reduce the car’s weight by 15 percent.

And unlike conventional batteries, the composite materials don’t rely on chemical reactions to work their magic. Since each chemical reaction that enables a charge degrades the battery, Volvo’s batteries will theoretically last longer.

Researchers are also trying to apply the technology to cell phones and computers. For instance, a cell phone made of the composite materials could be as thin as a credit card because it doesn’t need a traditional battery.

“Cambridge Crude:” An MIT team in Cambridge, MA, led by A123 Systems founder Yet-Ming Chiang, is working on a new class of “semi-solid state” battery technology. The research combines the basic structure of aqueous-flow state batteries with the chemistry of lithium-ion batteries. (A123 Systems recently opened the largest lithium-ion battery manufacturing plant on the North American continent in Livonia, MI.)

The system converts a battery’s active solid state components (the positive and negative electrodes, called cathodes and anodes) into tiny particles suspended in a black goo-like liquid. The thick substance, which researchers affectionately dub Cambridge Crude, can hold more power than traditional flow batteries and is cheaper to manufacture than lithium batteries, the MIT team claims.

So when an electric car needs to refuel, drivers can either recharge the battery the normal way (plugging into an outlet) or pump in freshly charged Cambridge Crude. The result is a lighter, more energy-efficient electric car that can travel longer distances before it needs to recharge.

MIT has already licensed the technology to a startup called 24M Technologies, which spun out of A123 last summer. The company has raised $16 million in venture capital and federal research funding, including grants from the U.S. Defense Advanced Research Projects Agency (DARPA) and Advanced Research Projects Agency – Energy (ARPA-E).

Comments (1) | Reprints | Share:          

Boston-based cleantech startup Digital Lumens has taken in $10 million in a Series B funding from its existing investors Black Coral Capital, Flybridge Capital Partners, and Stata Venture Partners, and has nabbed a line of credit from Silicon Valley Bank. The deal brings Digital Lumens’ funding pot to about $25 million.

Digital Lumens has married software and networking technology with light-emitting diodes (LEDs) to enable the more efficient lighting of commercial facilities like warehouses. Multiple fixtures in a lighting system can communicate wirelessly to automatically shut off in areas that don’t need as much illumination. The company has said that the technology can slice commercial lighting costs from $1 per square foot to one dime per square foot.

The new money will go to amping up sales efforts—both in the U.S. and abroad—and further developing the product. “We’re growing pretty aggressively in response to really great adoption in the marketplace,” CEO Tom Pincince told me in a phone call on Monday.

Digital Lumens, which just moved into new office space in Boston, has added six or seven employees just this year, bringing its total headcount to about 30, Pincince says. “People want to be part of a company that’s experiencing real customer traction,” he says. “It’s the demand to be a part of the cleantech revolution.”

Speaking of that cleantech revolution, which Pincince also referred to as the “next story in New England,” Digital Lumens has also recently attracted some executives from other Boston-area energy and lighting companies. In February, Fritz Morgan joined the company as chief product officer. He was previously CTO of Burlington, MA-based LED maker Philips Color Kinetics, and most recently worked as senior vice president of engineering Joule Unlimited, a Cambridge, MA-based renewable energy firm. Last November, Digital Lumens announced that Mike Rubino, former chief financial officer of Waltham, MA-based battery maker A123 Systems (NASDAQ: AONE) would be joining Digital Lumens as CFO. [[An earlier version of this post mistakenly said Fritz Morgan was CEO of Philips Color Kinetics. We regret the error.]]

Digital Lumens started out focusing on warehousing customers, but has also begun to look to lighting up manufacturing sites and retail stores. It’s targeting all aspects of the supply chain: customers “who make things, who store things, and who sell things,” Pincince says.

As far as product development goes, Digital Lumens has plans for the software and networking components that control the LED light strips and fixtures in its products. Pincince ultimately sees that technology as playing a part in smart buildings, by helping building managers understand their energy footprint and better respond to overall energy demands. Later on down the line, Pincince says he hopes the Digital Lumens technology could collaborate with other third-party applications to “become a foundation for intelligent buildings.”

Comments (1) | Reprints | Share:          

Foreign competition is rising, and U.S. consumers haven’t departed from their penny-pinching mentality of The Great Recession, and behind this double whammy the cleantech industry is feeling the squeeze. That’s one of the big impressions I came away with after polling a crop of cleantech experts from Xconomy’s network of advisors and op-ed contributors for their predictions for 2011. But take heart; there’s plenty of room for optimism, especially in the fields of energy efficiency and monitoring, where the U.S. may be leading the way to a greener future that’s much more achievable—at least in the short term—than through any form of alternative energy.

One sub-theme was pretty overwhelming among the responses I received: the actual materials manufacturing side of cleantech (i.e. the production of components for generating solar and wind energy, efficient batteries, and LED chips) is struggling, but energy-focused software and services are rising to the occasion. A number of Xconomists and contributors have pointed out that the U.S. cleantech manufacturing base is weakening due to competition from countries like China, which offer cheaper production and strong government incentives (or mandates) for adopting the new technology.

“It’s a rapidly commoditizing good,” Ray Demeo, VP of worldwide sales at Marlborough, MA-based Coolcentric, says of solar equipment. “The price that China can produce the product at is lower than U.S. manufacturers.”

Additionally, consumers and investors are nervous about spending upfront on things like efficient appliances, electric vehicles, or solar power, to get cleaner sources of energy into their homes (or cars), and would rather find ways to save. Makes enough sense. That’s actually the silver lining for the cleantech space, though, several experts say.

“The fundamental business proposition is we will go in and evaluate some aspect of your energy utilization and we will cut your cost—-I won’t be surprised to see those kinds of business models continue to thrive,” says Tom Ranken, president and CEO of the Washington Clean Technology Alliance. “Ten to 15 years from now, people might be slapping themselves upside the head saying, ‘how did I miss that?’”

Here’s a roundup of some specific predictions we gathered from our network of cities:

—Stephen Mayfield, director of the San Diego Center for Algae Biotechnology and a professor in UC San Diego’s Department of Molecular Biology, said we can expect to see a slew of biofuels advances this year:

• The first synthetic algal genome.
• The first significant scale-up of

… Next Page »

Comments (1) | Reprints | Share:          

When Xconomy Detroit launched in April 2010, I wrote that this city is a verb, in a constant state of action, of “becoming,” of striving for something greater. Having lived in Michigan for much of my life, I can say that this was true even in good times, and certainly even more so in bad.

I think we launched Xconomy Detroit at just the right time, because this year has been one filled with stirrings toward another period of great change. It might still be fashionable to bash Michigan if you do not live here, but those who stayed can really feel something new beginning. It is not only Midwestern stoicism at work, but something more concrete.

I’ve written about Michigan for Xconomy and other publications for decades now and can feel that 2010 marked the beginning of something brand new. Here are what I believe are the Top 10 reasons for optimism this year.

Batteries

Jennifer Granholm, Michigan’s outgoing governor, deserves a great deal of credit for working toward her vision of the state as a center for battery innovation and manufacturing. Batteries will not replace the jobs lost in the automotive industry as a whole, but she recognized early on that Michigan has the engineering know-how and manufacturing infrastructure to attract and retain companies developing and making the lithium-ion batteries that will be crucial to Auto Industry 2.0.

In 2010, her proselytizing — and creation of tax incentives — seemed to pay off, with A123 Systems, Compact Power, Johnson Controls, Dow Chemical, and TSC Michigan all either opening or announcing new lithium-ion battery plants in Michigan. Also, ALTe, developer of electric propulsion systems, opened a new plant in Auburn Hills, MI, and longer-range battery developer Sakti3, based in Ann Arbor, waiting in the wings while attracting venture capital funds

Michigan has competition from surrounding states in battery manufacturing, but Granholm’s efforts made sure that the Great Lakes State will remain an important player. Now, of course, consumers will have to actually start buying those electric cars.

Venture Capital

Michigan entered 2010 with some pretty dismal VC numbers, in terms of numbers of firms and dollars invested, even during a dismal time for venture capital in general. The only good thing that was … Next Page »

Comments (2) | Reprints | Share:          

Startup deal-making in Massachusetts rebounded slightly last month. Thirty companies brought in $143.6 million in equity-based financing deals, which was almost a 10 percent increase from July’s total of $131.4 million, according to data provided by private company intelligence platform CB Insights.

It’s not anything like the surge we saw in June, when Bay State tech and life sciences companies raked in $307 million in funding, but it’s still an improvement. Could it be the area is slowly readying itself for a busy new innovation season?

Watertown, MA-based gene-silencing drug developer Dicerna Pharmaceuticals took the top spot last month with a $25 million Series B round. That deal, plus another 11 financings, made healthcare the leading sector for August, with a total of $77.1 million raised.

The energy industry showed up with the third-biggest deal in August, a $10 million Series A round for Cambridge’s 24M Technologies, a new spinoff from Watertown, MA-based lithium-ion battery maker A123 Systems (NASDAQ: AONE). The startup, which is working on energy storage systems that use a mix of lithium-ion and flow battery technologies, hasn’t given too many details yet about its products or business plan, but the first institutional round seems to be part of a strong push to establish 24M as its own entity in the public’s eye.

The Internet sector stayed strong in second place, with $33.4 million raised. And mobile and software companies regained some footing as far as fundraising goes. Companies in both spaces have been struggling to bring in much money this year; last month, the software industry pulled in a grand total of $100,000, and mobile companies got no money at all. Both rebounded in August to raise just over $11 million.

It’s also worth noting that while the total dollar amount brought in by startups was still relatively low in August, the number of deals wasn’t. So, in reality, it’s the individual deal sizes that shrank during the later part of summer, not the number of companies getting funding. For example, Bay State equity deal-making boomed to $307 million in June, the total came from 31 transactions. Last month, however, nearly the same number of deals (30) amounted to less than half the total amount of cash ($143.6 million). And July’s dwarfed total also came from a relatively high number of transactions, 26. Also, last August startups raised more money ($179.2 million) from fewer deals (21).

Massachusetts also saw a higher number of startup financings last month than it did earlier in the spring, when monthly startup investing totals hovered in the neighborhood of $200 million. So it seems startups made do with less financing in the past two months than they had earlier in the year. We’ll have to wait to see how this trend plays out in the fall. Meanwhile, check below for the full list of deals.

Bay State startups brought in another $13.6 million through debt- and rights-based financings. Read below for the breakdown.

Comments (1) | Reprints | Share:          

One of New England’s most prominent cleantech companies is making strides today in a very active field. Westborough, MA-based Boston-Power, a maker of advanced lithium-ion batteries and energy storage technologies, says it has raised $60 million in Series E growth equity funding, co-led by existing investors Foundation Asset Management and Oak Investment Partners. Previous investors Venrock and Gabriel Venture Partners also participated in the new round, which brings Boston-Power’s total funding to $185 million since it was founded in 2005.

The company says the money will be used to expand into international markets, ramp up production of its battery technologies, and strengthen its sales, marketing, operations, and engineering team, especially in the Boston area. Boston-Power now has about 100 employees in Massachusetts and some 500 workers and consultants worldwide. So it caught my ear when I heard the company is now planning to double in size over the next two to three years.

“This is a pretty happy day for us,” said Christina Lampe-Onnerud, Boston-Power’s CEO and founder. “It’s been a very interesting journey.”

Indeed, the road to building a better battery is a long and winding one. But battery design—and energy storage in general—is becoming increasingly important in markets ranging from consumer electronics to transportation to power grid management. Boston-Power’s main innovation is in the chemistry and engineering of lithium-ion batteries that are safer, more reliable, longer-lasting, and more eco-friendly than the status quo. Other companies working in the lithium-ion battery sector include A123 Systems (NASDAQ: AONE) in the Boston area, ActaCell in Texas, Sakti3 in Michigan, Mobius Power in California, and Korea’s LG Chem and Techno Semichem (which both have U.S. operations in the Detroit area).

Boston-Power’s strategy has been to break into established markets with a new technology—and that takes time and money. First, the company established itself in consumer electronics, forming partnerships with companies like Hewlett-Packard to provide batteries for notebook computers. Next, it moved into transportation with electric and hybrid vehicles, inking deals with automakers like … Next Page »

Comments (2) | Reprints | Share:          

TSC Michigan, a subsidiary of South Korea’s Techno Semichem, which develops components for lithium-ion batteries for electric vehicles, cut the ribbon Wednesday for new U.S. headquarters in Northville Township near Detroit.

The plant is expected to create 279 new direct jobs over five years and 1,394 indirect ones. It was another case of tax breaks sealing the deal, as part of Michigan Gov. Jennifer Granholm’s push to re-create the state as a center for automotive battery manufacturing. The Michigan Economic Development Corporation had awarded TSC Michigan $3.2 million in tax credits over seven years. The township of Northville also offered property tax breaks.

The company plans to invest $31.1 million in the new headquarters, which will be built in a now-vacant building. Development of a new way of producing advanced electrolyte materials—key ingredients to lithium-ion batteries—will be moved from South Korea to the new Michigan site.

TSC joins a number of other lithium-ion battery and components developers in Michigan as the state tries to bill itself as the center of advanced automobile battery manufacturing. Here are a few notable moves I’ve spotted lately.

• Last year, Michigan awarded A123 Systems, based in Watertown, MA., $100 million in refundable tax credits to support a new manufacturing facility in Livonia, MI.
• Compact Power, a Troy, MI-based subsidiary of South Korean manufacturer LG Chem, will spend $303 million to build a new lithium-ion battery plant in the west Michigan city of Holland. The companies said the plant will break ground this summer and by 2013 will employ more than 400 people.
• Milwaukee-based Johnson Controls is opening a plant in Holland, MI, to manufacture lithium-ion batteries.
• Dow Chemical is working on a lithium-ion battery plant through a joint venture with TK Advanced Battery in Midland, MI.

Comments (1) | Reprints | Share:          

[Updated and corrected, 5/4/10, 1:15 pm ET] Jason Forcier was raised in Flint, MI, a city whose economic woes have been tied to the decline of the U.S. auto industry. Now he’s grown up and heading efforts at a growing company called A123 Systems to make advanced batteries for a new generation of energy-efficient cars and trucks. The vehicles hold promise for revving up the future of the auto sector in his home state and around the country.

That might sound like the first page of a Hollywood movie script, but Forcier and A123 Systems’ ambitious plans in the auto industry are real. Last summer, Watertown, MA-based A123 (NASDAQ:AONE) hired Forcier to be its man in Michigan, where the company plans to expand production of lithium-ion batteries for automobiles at plants in Livonia and Romulus. Batteries like the ones A123 produces power electric and hybrid-electric vehicles, and the company aims to grow its sales to automakers as the popularity of such autos grows.

Despite deals it has already secured with Chrysler, BMW, and other major industry players, A123 still has much work to do to succeed in the competitive auto battery sector. Forcier says that the company’s engineering group is working on boosting the energy capacity of its batteries to make them more attractive to automakers from both cost and performance standpoints. The company, which does most of its existing manufacturing in China and Korea, is also counting on its increasing production capacity in Michigan to ensure steady battery supplies to its auto customers.

Like many others from Flint, Forcier, 38, has deep roots in the auto industry. His father, his grandfather, and most of his uncles were all employees of General Motors, he says. While studying engineering at Kettering University in Flint, he was in a co-op program that put him to work as an intern in multiple departments at GM. So he’s been closer than most Americans to the endangered U.S. auto industry and its devastating impact on the economy in Michigan. [Editor's note: A previous version of this story mistakenly said that Forcier once worked for GM as an industrial engineer. His father was actually an industrial engineer at GM. We regret the error.]

“The economy here in Michigan has been in a bad state of affairs due to the decline in the auto industry,” Forcier, vice president of A123′s automotive group, says. “But there’s a lot of integrity around here and support for what we’re doing.”

Jason Forcier, VP of Automotive Solutions Group, A123 Systems

At A123, Forcier is in a unique position to help lead the expansion of a growing company in a growing industry in his state. The company, a 9-year-old spinout of MIT, was employing between 150 and 200 people in Michigan as of March. While such a work force figure is modest, the company planned to begin recruiting people last month for jobs at its manufacturing operation in Livonia, which is slated to begin production in June. (He says the A123 website gets thousands of resumes per month for jobs in the Wolverine State and Massachusetts.) Forcier didn’t provide exact figures on how many jobs the company is adding in Michigan, but he placed the number in the hundreds for this year.

Michigan has a lot riding on the success of A123. Last spring the state awarded the company $100 million in refundable tax credits to support its expansion in the state. Later in 2009, the company won a $249.1 million grant from the U.S. Department of Energy, which provides a 50-cent match on every dollar the firm invests in expanding its manufacturing operations in Michigan, Forcier says. Still, it could take a while before next-generation battery companies like A123 provide the kind of economic boost the state needs to … Next Page »

Comments (1) | Reprints | Share:          

Think it’s possible to shoot down a swarm of buzzing mosquitoes in mid-air? Or maybe you want to power up a remote flying vehicle? Tom Nugent is your man. The Seattle-area entrepreneur just might be the most versatile guy with a laser you’ve ever met.

Yes, a laser. Until recently, Nugent worked in the laboratory of Bellevue, WA-based Intellectual Ventures, the invention company led by Nathan Myhrvold, where one of his projects was the so-called “photonic fence.” This effort has gotten lots of media attention, most recently for an impressive demo at the TED conference in February. That’s where Myhrvold showed a video of a laser burning the wings off a flying mosquito in super slow-motion. The idea is this technology, implemented on a larger scale, could help prevent the spread of malaria or protect crops against flying pests.

But Nugent’s focus now is on something that might be more practical: power beaming. That means using lasers to deliver energy to remote sensors, vehicles, or base stations. It’s a two-way trick: the receiver has to have a solar cell to convert the laser’s energy into electricity. But as long as the solar cell is viable, the technology could be useful in any situation where installing a wire is impractical, where batteries run down, or where it’s too expensive to truck in fuel.

That’s really just the beginning, to Nugent’s mind. One of his ultimate goals is to be able to beam large amounts of solar power to Earth from space, presumably to help solve global-scale energy problems. For now, though, he’ll settle for beaming power to unmanned aerial vehicles (UAVs) and other remote devices, including very early technology that could help scientists develop something called a space elevator. These ideas, in sum, have turned into a small company called LaserMotive, based in Kent, WA.

Before dismissing these projects as far-fetched, a little background is required. The idea of power beaming has been around for decades. But advances in cheaper and more energy-efficient diode lasers have made it possible to pursue the idea commercially in the past few years. Even the rise of laser hair removal products (which you might see on late night TV) have helped things move forward. So in 2007, Nugent and fellow physicist (and Intellectual Ventures veteran) Jordin Kare, an expert on laser rocket propulsion and optics who worked on the “Star Wars” nuclear-missile defense system in the 1980s—decided to make a business out of power beaming, and co-founded LaserMotive.

“We think we can produce revenue while we get experience,” says Nugent, LaserMotive’s president.

Their first project: tackling the power beaming aspect of NASA’s “Space Elevator Games.” If you don’t know what a space elevator is, that’s OK—it doesn’t exist yet. The über-futuristic idea is to have a cable anchored to the ground, extending thousands of miles into space, that could be used to launch payloads into orbit. The space end would be unattached, and the Earth’s rotation would keep it taut so a robot “elevator” could move up and down the cable, carrying equipment. Sure, this would take billions of dollars and a few decades to get working, but it could ultimately make space operations much cheaper than using rockets. That’s the idea, at least.

If a space elevator is ever going to work, it will need power at multiple steps along the way. So, at “Level 1” of the NASA Power Beaming Challenge, held last November in Mojave, CA, Nugent and Kare’s team used a ground-based infrared laser to beam energy to specially designed solar cells aboard an 11-pound robot (see photo, left) driven by an electric motor. (All power must come from the ground.) The robot climbed a 900-meter length of metal cable suspended from a helicopter. Nugent and Kare’s was the only team to make it to the top with an average climbing speed of more than 2 meters per second—their robot went nearly 4 meters per second (9 mph)—beating out two other teams, who failed to reach the top. The prize was $900,000 (before taxes, Nugent laments—yes, it’s that time of year).

The upcoming “Level 2” competition will be held later this year, … Next Page »

Comments (16) | Reprints | Share:          

Maria Thompson, an Ann Arbor, MI, entrepreneur who helped develop the technology used in Watertown, MA-based A123Systems‘ lithium-ion automotive batteries, has retired. Thompson founded T/J Technologies in Ann Arbor in 1991. She guided the company’s development of nanophosphate technology that eventually attracted A123Systems, which bought T/J Technologies in 2006. After the acquisition, Thompson continued as president of A123′s research and government solutions group in Ann Arbor. Thompson says she’s going to devote more time to private pursuits, but would not rule out involvement in another company down the road.

Comments | Reprints | Share:          

It’s a far cry from a hot market for initial public offerings these days, but there are reasons to believe that the long-awaited “IPO Window” is slowly opening for venture-backed companies in the Boston area.

Sensata Technologies, an Attleboro, MA-based maker of sensors and switches, jumped through the IPO window yesterday, pricing its initial public shares at $18 apiece. By offering 31.6 million new shares, Sensata (NYSE: ST) raked in a fresh $568.8 million. This price was, however, on the low end of the company’s hoped-for range of $18 to $20 a share. (Sensata, whose business dates back to 1916, is a former unit of Texas Instruments that Bain Capital took over in a leveraged buyout in 2006. So this isn’t a traditional venture-backed company IPO by any means.)

Next in line appears to be Cambridge, MA-based cancer drug developer Aveo Pharmaceuticals. Aveo plans to raise about $100 million, in an IPO that’s scheduled to price today, according Renaissance Capital. And though the company fell short of its estimated price range of $14 to $16 per share for its public debut, Cambridge-based Ironwood Pharmaceuticals (NASDAQ:IRWD) managed to pull off an IPO last month for $11.25 per share that netted the firm $203 million. Fortunately for investors, Ironwood stock has traded up ever since, closing yesterday at $12.65.

The IPO drought for venture-backed startups in recent years has been a major bummer for both maturing startups and their investors. When public markets aren’t receptive to IPOs, it blocks one avenue that venture firms use to get liquid cash returns after years of locking it away in a startup. For private companies, the lack of a healthy IPO market forces some to look elsewhere for funding to keep their operations afloat. It can also make it harder to entice employees when there isn’t a realistic chance that all their sweat equity will someday turn into financial equity.

One recipe for venture-backed companies to break into the public markets appears to be having a product on or close to the market, which significantly reduces the risk for public investors. For example, A123 Systems (NASDAQ:AONE) made a successful public debut in September, which raised more than $400 million, in part because the Watertown, MA-based company was already generating revenue from sales of its advanced lithium-ion batteries. Ironwood’s IPO followed the firm’s successful completion of two pivotal trials for its lead treatment for constipation.

We’ve compiled a list of New England-based life sciences and technology companies that are in registration to go public. (While we’ve cross-referenced our list with the Renaissance Capital website, please let us know if we’ve missed any.)

Here’s the list of active Boston-area IPOs:

—Aveo Pharmaceuticals, a Cambridge, MA-based developer of cancer treatments, could launch its IPO sometime this week. A big question is whether the firm’s IPO price range of … Next Page »

Comments | Reprints | Share:          

A123 Systems (NASDAQ:AONE) reports today that it will supply its advanced lithium-ion battery systems for Warrenville, IL-based Navistar, which plans to use the batteries in electric trucks it is developing in a joint venture with Tokyo-based Modec. Watertown, MA-based A123 says that it expects to manufacture the batteries for the Navistar (NYSE:NAV) vehicles at its plant in Livonia, MI, which is due to open this month and begin production in the second half of this year.

Comments | Reprints | Share: