#Cleantechers, Scaling Clean listeners know that we seek out clean economy CEOs for their lessons on building teams and running companies. All our guests to date have developed their leadership abilities by ascending a career ladder, and they’ve done that across several companies.
Today’s guest has instead learned his leadership lessons on the job, so to speak. Jesse Grossman founded Soltage LLC 17 years ago, and he’s led since then as Chairman and CEO. Soltage is a New Jersey-based utility-scale solar IPP company that was founded on the belief that capital cost shouldn’t stop the spread of solar.
I met Jesse several years ago through the sponsor of this episode, Cleantech Leaders Roundtable, and it’s great to reconnect with him today.
Find out more about Tigercomm’s work at the center of the cleantech industry at www.tigercomm.us.
You can listen to our episodes on Anchor, Spotify, Apple Podcasts and iHeart Radio.
Episode 17: Pioneering Clean Energy from Rainforests to Solar Frontiers with Jesse Grossman
Overview
- Jesse Grossman - From Rainforest Ecologist to Cleantech CEO
- Early Career in Conservation and Sustainability
- Challenges and Growth of a Cleantech Company
- Evolution of Leadership and Company Stages
- CEO's Role and Effective Leadership
- Climate Optimism and Adaptation
Jesse Grossman - From Rainforest Ecologist to Cleantech CEO
Mike Casey:
Hey, Cleantechers! Scaling Clean listeners know we seek out clean economy CEOs for their lessons on building teams and running companies. All our guests to date have developed their leadership abilities by ascending a career ladder, and they've often done that across several companies. My guest today has instead learned his leadership lessons on the job, so to speak. Jesse Grossman founded Soltage 17 years ago, and he has led the company ever since as Chairman and CEO. Soltage is a New Jersey-based utility-scale, solar IPP company that was founded on the belief that capital costs should not stop the spread of solar. And I actually met Jesse several years ago through the sponsor of this episode, Cleantech Leaders Roundtable. And it's great to connect with him today. Jesse, welcome to the show.
Jesse Grossman:
Thanks, Mike. Great to be here.
Mike Casey:
Okay. Let's start with your background. You have, I think it's safe to say, a unique background for cleantech CEOs. Tell me and our listeners about yours.
Early Career in Conservation and Sustainability
Jesse Grossman:
My past life really has informed what I'm doing currently and why I'm doing it currently. I was a tropical rainforest ecologist for many years. I studied science. I realized I liked being outside and, setting up good scientific questions that would lead to ideally good science projects that would influence conservation and sustainability outcomes. So I spent a lot of time in the US, getting good training, and then overseas in East Africa for many years, and Southeast Asia for many years, running large landscape-level ecological surveys, largely looking for justification of why raw rainforests should be kept in place based on the megafauna that was inside of it, or rare and endangered species.
And I have to say it was a really nice time of life and a very useful bit of work that I appreciated doing at the time. However, after a couple of years of doing this, I started to see some patterns emerge, and those patterns were very negative. All of the sustainability and conservation features of the world that I was keen to work on and work in for the long term. I would be doing a project in Africa in a relatively untouched virgin rainforest, hosting a number of large animals. Then two years later would understand that a business interest wanted to harvest the timber from that. And unsustainably that forest was cut down and and clear cut.
I was working in Southeast Asia on some coral reefs and looking to justify a marine park getting set up. And that was entirely derailed because there were some offshore natural gas deposits that were found that were then given into a concession to be mined. So I saw this happening and I said to myself, ‘I'm a fairly pragmatic person. I'm gonna be very frustrated if I'm from an NGO perspective, from a non-profit perspective, or a government aid organization perspective, lagging my fingers at governments and big business interests saying, ‘Do not do that. That is wrong based on the science. I said to myself, ‘That's not gonna be a winning game, and I will be somewhat depressed if I keep doing that my entire life. So I need to see what is the difference maker in these equations. And it was the businesses that were coming in. And I needed to figure out how to capture the ability, strength, power, determinism of a business and harness it for the sustainability objectives that I hold so true to my heart.
And so that was really the transition where I said, ‘Apply to some good grad schools to the analytical side of how to run teams’. I had sort of raised money to some extent I had picked up in my past career, but I needed to speak the business language. I went to a great set of grad programs at Yale. And there are others, in Duke and Michigan that have similar programs focused on the crosslink of sustainability and business. And I started Soltage here. So that was the decision to found Soltage. Why did that make sense at the time? It's clear that solar and renewable energy technology made sense. But at the time, back in 2005, the opportunity was not ready to be picked up by the broader market in a manner that would push it forward at scaler speed.
And that was due to a couple of things. Capital was really mispricing the assets, and solar energy technology regulatory risk was seen as a much larger risk than it ended up at the end, simply because, the regulatory markets hadn't been working for a long period of time. There were questions about contracting risk, and how customers were going to pay for that. And then it was very clear that as a capital-intensive asset, the owners themselves were not well set up to be the operators. Where you are in the business of running a big factory making widgets, if someone says, ‘Well, why don't you put a big solar asset on your roof or adjacent into your land, you've gotta kinda capital for that. You've got to come up with the operational protocols for that’. That didn't make any sense for that owner.
And they probably weren't gonna do renewable energy at scale. So really it was clear that a business platform needed to be created, that would take on all of those roles and simply deliver to the client the commodity needed, which is the kilowatt hours. There was a good history of IPPs in the US and it seemed the time was right to create an IPP for solar energy provision.
Challenges and Growth of a Cleantech Company
Mike Casey:
Starting a company is a pretty gutsy thing to do, particularly when the technology you're gonna base your company on is at such an early stage as solar was 20 years ago. You articulated what catalyzed your decision to found Soltage, but were lessons that you learned in the rainforest, were they applicable to running a company? And if so, what were they and how did they apply?
Jesse Grossman:
Yeah, that's a good question. The answer is yes. One of the great joys about life is that you're always learning. And I think many of us are always kind of creating threads based on past experiences and bringing those to their different current challenges, current problems, current opportunities. Working in the rainforest, you're often far from resources, bringing together teams. And so you need to set direction. You need to focus your team. You need to clearly communicate the goals of what you need to do and pull everybody together to achieve the same outcomes oftentimes, where you've got really disparate disciplines working together: somebody cutting the trail, you've got somebody back at camp doing logistics and cooking. You've got various people taking different pieces of scientific data. If you think about it, it's not that different from a company with many different sorts of departments that need to work seamlessly together. Then from a logistics perspective, you need to have raised the capital and gotten the buy-in from whatever funding source you have, which could be equivalent to a board. So I would say yes, Mike, absolutely.
Mike Casey:
Jesse, look back at your career. Who were the most important mentors and what did you learn from them?
Jesse Grossman:
Yeah, well, Mike, I was really fortunate to start the business with my co-founders at Yale and the bad school as you can imagine, the professors there are great thinkers and are really looking to equip the next generation of doers with their skills and knowledge. First one, I would call out was a professor there, the name was Ben Ellis, a former lecturer and also the former CEO of Northeastern Utilities. And from this gentleman, I learned really how a utility company’s CEO thinks about providing services, reliability to a distributed network of power purchasers. The second was also a professor up there, her name was Marion Chertow. She was a real early innovator in ecological and economic systems thinking and also had practical experiences setting up waste energy companies. So from her, I was able to get many themes of entrepreneurship, early capital raising, and just the nuts and bolts of setting up a business that has many moving parts and complexity in terms of energy provision services.
Finally, I would call out David Cromwell who was the professor at Business School, it was his class where Soltage was actually founded. He was a Wall Street scion for 30 years of a career prior to being a professor, running private equity and venture capital. So he had analyzed tens of thousands of businesses and his team had invested in thousands of businesses many billions of dollars. And to have him and his co-teacher Maureen looking over me and my team's shoulders as we were doing initial customer sourcing, business plan analysis, financial modeling, and total addressable market scope, those sorts of things came second nature to him. And the observations and thoughts were invaluable.
Mike Casey:
Wow. What a slingshot. I think a lot of people listening to this will be retroactively jealous of you. All right, you and I met through Cleantech Leaders Roundtable. I know that you're up there in the New York City area. So presumably you've had the opportunity to compare notes with other CEOs, people who've been more traditionally tracked to a CEO job where they're coming up in finance and they're getting ascending jobs and they're working across companies. When you compare notes with those people, with what your experience has been like, where you've been the CEO from the start of one company for almost two decades, what have you observed your experience differing from their experiences?
Jesse Grossman:
Yeah, that's a great question. And we do try to get together in terms of other C-level folks running businesses either in the same industry or separate industries and compare notes frequently because that's one of the important things about staying fresh, staying agile, staying innovative in this space. So, I have to say, talking with other CEOs, what very quickly emerges is that everyone has had very different experiences and past getting to where they are, and there are very few molds or modalities that lead one to the title of CEO or whatever that means, sort of starting your own company. That said, there are a number of points that are consistent. Most other successful CEOs that I talk with, they're serious subject matter experts. They have a passion for learning, they have broad interests and experiences. That all translates into an ability to be a good CEO. From my perspective, yes, there was a significant level of difficulty and challenge in growing into this role, but it has not been the same role for the last 17 years as you can imagine.
Mike Casey:
Interesting point.
Jesse Grossman:
Yeah. As you can imagine being a CEO of a venture capital-backed company is very different from being a CEO of a private equity bank company, which is very different from being a CEO of an institutionally funded company. And there are different stages, there are different roles that have evolved, and different challenges and growth points that have had to be overcome as we've moved through the business lifecycle over the last 17 years.
Mike Casey:
Okay, I know that's a very deep well we could climb down into, but I gotta tell you, I can't jump over that delicious distinction you just pulled out. How would you summarize for our listeners, what is the difference between being a CEO of a venture-backed company versus a PE company to one that’s now stood up on its own and is maturing? How would you just table those differences?
Evolution of Leadership and Company Stages
Jesse Grossman:
Yeah, Mike, I'll start by saying that one of my mentors who we didn't talk, said that if you are fortunate enough to have a job for over 10 years, you're able to really do a lot in that position. So being 17 years in this position, feel very fortunate with what we've been able to grow and how personally I've been able to grow and learn and transition, as this company has transitioned through these stages. And it certainly hasn't been alone, it's been with an excellent evolving set of colleagues and investors that have been along on this ride with us. Now looking back over 17 years and the different stages that we've gone through, venture capital-based, private equity-based, now institutionally funded.
It has been, I would say a challenge of navigating an industry that continues to mature where from the early stages to the late stages opportunities are unclear, opaque, small, hard to capture, and risks, being numerous to being understood, mitigated as this industry has gotten more and more mature. I think the traditional rubric of investments makes sense here - venture capital - you are working in a market where revenues are not particularly clear, business plan is still coming together. Customers are not known and are difficult to find. And that was an interesting stage of the market. And certainly an interesting stage for Soltage when we were navigating through the few solar markets that were available in the US and the changing regulatory landscape, convincing investors that this was a good place to put increasingly mature capital.
And then executing on that with customers and creating an initial base of revenue for the company. Moving into the private equity phase where you're a bigger company, you're funded, you've got revenues coming in, but there are still significant risks ahead, perhaps not so much in the broader market scheme, but in terms of how the business can scale. That brings its own set of risks in terms of which markets are being selected, how much capital is being allocated to each one of those markets, gets more into organizational construct in terms of how you're setting up your company with the various divisions and roles, responsibilities, delegated authority there. There you're getting to a stage where as a leader you are not able to run the entire company or do all of the work.
And so you really need to make sure you've got excellent colleagues, ideally folks smarter than you and trained in different areas than you're trained trend, onboard to navigate and continue to grow through that and then getting to a mature stage of a company where you've been either sort of poured into a market or you've been working in a market long enough where the total addressable market is somewhat scoped out, where that market is going, is also scoped out. The opportunities are more established. At that point, it's about whether you can efficiently run a larger company and have the right people, have the right culture created, have the right institutional investment dollars, and go into opportunities on a consistent basis. And all of those have had their challenges and real opportunities. I think that drives home a number of things that I try to keep fresh about myself and sort of personal goals that I have to always be learning, always be in a space where there's growth and always be working with real high-caliber people in the company, as customers and as investors. And that has continued every single day that I wake up. And I feel very grateful for that.
CEO's Role and Effective Leadership
Mike Casey:
Good. Okay. You quit your job tomorrow. You go back to Yale and you are a guest lecturer at the business school. Your first lecture is sharing with your students what the role of the effective CEO is. What's the guts of that lecture?
Jesse Grossman:
Yeah, Mike, thanks for going there. I do love teaching. I've got some friends and colleagues who are professors at Columbia, Yale, and they regularly pull me back to give guest lectures with classes that I wish were taught when I was at school. So I hope to do that at some point someday in terms of how I would talk about being an effective CEO to our students. It's really from a player-coach mentality, where you need to be able to do both. You need to be able to do the work, understand what needs to be done in the company, but then not do the work and step back and guide the team, understand what good looks like, where the team needs to get to put the right people in place, and then manage the company, manage the teams, manage the individuals to collective success.
Big points are communication internally and externally. That's not only being a mouthpiece but having two ears and listening to the great people who are working with you and who are present in the space. It's being able to convey ideas and storytelling a bit, and then it's about establishing consensus and buy-in. That needs to happen on a daily basis with your team, with your partners, with your board, with your investors, and with your customers. It's constantly about creating win-win situations, which, thank goodness, in a growth space like renewable energy, this is not a zero-sum game. So it makes it easier to establish consensus and buy-in even with folks that otherwise might be competitors.
Mike Casey:
Looking back, salted to success to date, has it been more reliant on what you and your company chose not to do or on what it chose to do?
Jesse Grossman:
That's a good question. And you know we're 17 years in, we've deployed over a billion dollars and we're operating across 25 states. And we would not have gotten here particularly in our startup and venture capital mode if we didn't focus on what we do and make that a very small sliver of the universe of potential and say no to everything else. So that's really discipline and discipline in terms of what is in scope for this business, what do we need to be focusing on above all else to make this quarter successful, this year successful? And then leaving all else aside as a business leader and for folks in the company there will always be things pulling in a thousand different directions. And so really having a crisp idea of what the business is supposed to do, where the business builds value and what leads to success, that sort of discipline and mentality that needs to inform each and every time allocation decision. And that's particularly relevant in the renewable energy business where we're in a growth field, but time is our one non-renewable resource. And so we need to very carefully schedule what we do against those activities that are gonna build clear value.
Climate Optimism and Adaptation
Mike Casey:
Is Jesse Grossman a climate optimist or a climate pessimist and why?
Jesse Grossman:
Oh, Mike, that's a tough question. So I'm a species optimist. From a climate perspective, we are at a carbon level from a parts per millions perspective where I believe we are past the tipping point for the massive climate changes that we are starting to see. Those include sea level rise, large climatic events, temperature events, it's not a debate anymore if this is happening. And we've seen the writing on the wall to the extent that we wanted to read that writing since at least the 1970s. So I think that we are having massive climate changes and that's not gonna change. That said, however, humans like most animals are amazing at adapting. And I believe our species can adapt and innovate ourselves out of trouble faster than the climate events will update. I have two children with my wife that I am so happy and proud to have brought into the world, and I think that is the ultimate pessimism to the optimism that I feel here.
Mike Casey:
Fair enough. That is a great place to end. Jesse Grossman, I have loved reconnecting with you through this interview, you are as wise as I remember you being and more experienced than when we last talked. And I think our listeners are gonna benefit from both. So please accept my thanks for getting on with us, having this conversation, looking back at what you've been doing with this company because it's remarkable and I think it's something that we can learn a lot from having gone from the rainforest to sitting in a corner office 17 years later is pretty cool. So I appreciate what you're doing and I want to just express our thanks for you getting on and sharing the view from the rearview mirror you've got.
Jesse Grossman:
Yeah. Well, Mike, I'm more excited about the next couple of decades in the US in the renewable energy space, and I very much thank you for having me on your show. A real pleasure to connect with you and your listeners today.
