#32) Battery Tech from a Fully Charged Team
Introducing ZNL Energy from Norway
I am quite sure you take the importance of battery technology for granted, as I myself did until a few months ago.
Consider phones and cars. What would you do, Dear Reader, if either of them were removed from your life much less both of them?
Mobile phones primarily use Lithium-ion (Li-ion) batteries. Without these batteries, we would travel back in time to the 80s and have huge clunky devices (phones and laptops), unbearably heavy and unbearably expensive.
Indeed, The 2019 Nobel Prize in Chemistry was awarded to John B. Goodenough, M. Stanley Whittingham, and Akira Yoshino for the development of lithium-ion batteries. Hopefully that tells you all you need to confirm the magnitude of the scientific breakthrough.
A battery contains four main components: a cathode (positive), an anode (negative), electrolyte and a separator. Put very simply —> during discharge, ions move from the anode to the cathode, releasing electrons that flow through an external circuit, creating electrical current.
Enter a company I am working closely with, ZNL Energy, and the often overlooked importance of the battery separator in this mix. The battery separator is a thin, porous polymer film that prevents physical contact between electrodes, avoiding short circuits.
Battery separators are a critical safety and performance component across battery technologies, including lead, flow, and lithium-ion. Though often overlooked, the separator plays a central role in enabling chemical reactions to occur safely and efficiently across battery chemistries.1
I do not think now is the time or the place for a deeper battery chemistry lesson (and my brain hurts from research). Rather, I think it more important to highlight the importance - the vitalness - of evolving battery technology, for, as the CEO of ZNL Energy, Benjamin Ferstad, states it, “there are now industrial use cases around the world that wouldn’t exist if you didn’t have the access to batteries to help support them.”
What are the problems with battery tech and production today? Poor fire safety, low lifetime expectancy, low energy density, to name just three.
The global supply chain is another worrying issue - rare materials being unearthed in “complicated parts of the world” and “vulnerable to geopolitical rivalries” as Nicolas Niarchos writes in his recent masterful and exhaustively researched book, The Elements of Power. Batteries are not just about power with a small p, but are now on par with Big Oil as a Global Power chess piece, top of mind in the US, ordering under Joe Biden a strategic review of critical mineral supply chains to mitigate foreign control (vis a vis China which dominates). It’s a battery revolution in other words from the Congo to Washington to Beijing.
Thus, the battery cell market overall is massive, projected by McKinsey in a 2024 report to grow 19% annually until 2030, “reaching more than $250 billion.”
Yet only 4% of global battery separator production is found in Europe and North America.
North American and European battery producers have embarked on a paramount push to reduce supply chain risk and the separator represents the biggest “white space” in battery cell components (McKinsey).
Norway based ZNL’s patented new battery separator technology is a drop-in replacement for existing separators in “roll format” (a continuous production method key for large scale).
According to ZNL management, quantified, this is an $8B current serviceable market growing to $18.2B by 2030.
According to Benjamin, “what we’re trying to do is help the cell manufacturers become better and safer and last longer without having to compromise on the factors that will make them better.”
ZNL’s key advantages over conventional separators:
Doubles useful battery life in some chemistries
Enables higher energy density in extreme chemistries
Greatly reduces fire risk hazards, i.e. shrink-resistant during thermal events
Prevents harmful ion transport (transition metals, impurities)
Temperature stability up to 250°C
Or as Benjamin states it more compellingly, “we make batteries safer while increasing energy density and maintaining long life cycles.” One of his gifts is explaining ZNL to a dumb layman, which is a game changing skill as all investors are “dumb” before they invest, and most entrepreneurs struggle with translating deeptech into an equity product. And thus most entrepreneurs fail to raise growth rounds.
Their commercial traction shows clear lean in engagement from industrial partners and OEMs in the form of multiple production trials, including High Performance Battery, Siemens for digital twinning and Danish firm Eltronic for engineering, procurement and construction work (EPC). Due to NDAs, we cannot divulge too much more, but safe to say, the findings show ZNL significantly outperforms the incumbents across key metrics.
Cofounder and angel investor Jan Børge Sagmo reckons in the pipeline over 1300 gigawatt hours in potential (enough to power approximately 975 million homes for one hour in Europe.). If you want to roughly calculate revenue potential, think circa $8M per gigawatt hour. Even 5% pipeline conversion implies strong revenue.
When Jan started commercialising the technology, he made a test agreement. Sounds obvious, right? But so many entrepreneurs just agree to a test with no control of the process or results. In Jan’s words, “We own the narrative of testing from the start. It’s the only way to grow together the large incumbents.” The test agreements requires the teams to sit together, establish the test parameters clearly upfront and partners are obligated to provide the test results (3rd party validation, in other words).
Team, Team and Team. Jan started a company called Bergen Carbon Solutions that he took from a bachelor thesis to an IPO in 2021.
Jan and Benjamin met as students in 2009 when they were taking a taxi driver qualification course together. As Benjamin likes to tell it, “I needed money for food and beer and Jan needed money for diapers.”
Benjamin is educated as a mechanical engineer, holds a master’s in industrial economics and a trade certificate as a car electrician. Hands on guy.
Prior to joining ZNL in 2022, Benjamin was Operations Director for a large publicly traded oil services concern, NOV, responsible for oil drilling in Europe and Russia. It became a turnaround story; he grew it from $10M per year in revenue (and losing money) to $60M in revenue per year, doubling the team and churning profits.
My business is to consult, advise and invest in entrepreneurs and emerging fund managers as they try to grow. Grow revenue. Grow team. Grow investment. With entrepreneurs, my focus is on first product to $10M in revenue; with emerging fund managers, my focus is Funds I, II and III with assets under management less than $2B. In my seat, I hear 20 new stories per month (sometimes in two days if I’m at a conference) and over time you develop pattern recognition.
And as you become better as a coach, you have the privilege of working with the best players.
Benjamin is one of the most all around supremely competent individuals I have come across in a long long time. Solid, steady, consistent, level headed, smart, thorough, soaks in knowledge and spits it back out in pristine summary form, and, what’s more, I haven’t heard him lose his sense of humour once. I am already saying to myself, whatever he’s doing after ZNL, I will back him. This is a man who should have his hand on the tiller. This is the man who should be speaking to investors.
Jan is intense, prefers to stay out of the limelight, seasoned (and bloodied) from his Bergen Carbon Solutions journey and now back at it with lots of lessons learned. He’s an entrepreneur through and through, he does not know how to live any other way (I recognise the type), and he spotted something in the ZNL IP before most others and is now determined to apply not just his scientist chops but his commercial chops while also wisely jettisoning the notion that the CEO is the best or most glamorous job to have in a company. Instead he designed the job he wanted - strategy, customer engagement - which happens to be of enormous value to those who have invested in ZNL.
God how I wish more entrepreneurs would do the same.
https://batterycouncil.org/battery-facts-and-applications/about-battery-separators/