Where the Solar Industry Is Going | Xavier Helgesen

Like it starts at solar lanterns, and a lot of people thought that was what the market was, but that's not where it's going So where it's going is everybody produces their own power, and your power's an asset, rather than expense

If I could be that CEO that my company plummets off the cliff, and everybody's like, "That was amazing, I would still work with you" Like even a second, then you know you've actually done your job I don't know if you all know this or not, Xavier is a serial entrepreneur Off Grid is absolutely not his first company So maybe we could just start there

How many companies have you founded or co-founded? I guess I'd call it four Four? Four with some sub-companies, so maybe up to six or seven Six or seven? Yeah And how do those go when you look back on your story as an entrepreneur throughout these different cycles, can you tell us a little bit about the companies Well, I'll tell you the first company I started, maybe you'll know me a little better

I leased a mini golf course when I was 14 [Laughter] So I was pissed that I was not of legal working age I wanted to earn some money, and so I talked my tennis coach intof – he was the parks and rec director in my small town He had this mini golf course that would just lose them money every year, because they'd pay some kid to sit there and collect fares, and no one would ever go, because nobody put any love or effort into it And so he's a smart guy – I always thank him for this – and he said, "Look, I'm not gonna" – because I originally talked to him, and said "Hey, can I work there?" And he said, "You know what, no, but you seem like a creative guy, so you run the place, and you give me 10 percent of whatever you make

" No way You're 14? Yeah, I'm 14 "Whatever else, you can keep it" Yeah, how'd you do? I tripled revenue I did alright

[Laughter] You tripled revenue from zero? Yeah, I mean, I think I made about 4 dollars an hour, but the lesson was there The lesson was there The smartest marketing thing we ever did is we gave out these coupons that said, "Free mini golf course," or "Free round of mini golf if you buy this," you had to peel off the sticker, and it was – or actually, no It was, "Buy a mini golf round for a dollar, and get blank for free" And it would either be another round of mini golf, or it would be a can of soda that would cost us like 20 cents or 30 cents

So anyway, you'd give these out to all these kids, and then they'd just go running to their parents And the other thing – and their parents were like, "Okay, here's a dollar Go do this" And whatever we'd give them would be really low, marginal cost, you know, mini golf course The other thing I did was sell family passes for about 20 bucks

The reason I did that was so the mini golf course would always look busy, rather than not busy Because these families would send their kids down every day, like, "Go play mini golf so you don't bother us" So you got the itch from mini golf I got the itch, yeah So I got into web design in '95, and was doing local websites, and I got to college, and founded this company that was like if you dig out the pre-history before there was Facebook, and you find college websites that were actually kind of popular, I had this interesting website that was super, super popular at Notre Dame, and Yale, and U Penn, a few other places way back in 2000

Our number one thing was user generated polls So you would post a poll like, "Who's the hottest girl on campus? Blank, blank, blank, blank, blank" You know? And inevitably, someone posts a really terrible poll like, "Who's the creepiest guy on campus? Blank, blank, blank, blank, blank" And those guys would all call us hours later like, "Take this down" We had like five disciplinary hearings on campus, it was all from this website

[Laughter] So you have that, it's almost a Facebook startup, and then? And then, so I was gonna head out to Silicon Valley, but I stayed in school, which is a proven recipe to fail in Silicon Valley So sure enough, I stayed in school, and then 2001, the com crash happened before I could graduate from college So I ended up kind of bumming around for a year, and I started this business with two friends of mine running college book drives, and it was the most bizarre business But the idea that all the college textbooks that the bookstore wouldn't buy back from you, we had this theory that people would just donate them, and that you could sell them online on behalf of the charity, and raise money for the charity by doing so, and that would actually create an economic motivation to run these book drives

And turns out, it just worked like a charm Amazon and halfcom had just opened up, so the sales and marketing was – I mean, I'm stunted for life, I don't know how to do sales and marketing because of Amazon They're so good at it, so you just list the book, and then it would sell It was easy

So you'd focus your entire energy on acquiring books And so we went from one book drive to about a thousand, and something like 0 to 10 million revenue, or something with bootstrap, completely bootstrapped Just collecting books, selling books, repeat The only problem was we only got that revenue about 2 months out of the year, so the other 10 months of the year, we're always desperate to pay the rent, and pay everybody back we borrowed money from, you know, and try to get a little better, and do it the next time So long story short, our breakthrough there, it took us like 3-4 years in that business to ask ourselves, "Who else would have books?" And then about 5 seconds later, we were like, "Oh, libraries have books

Okay, let's talk to them" [Laughter] So, brilliant entrepreneur skills, you guys will never be able to master this So we went to the American Library Association and got a table, and made this one page flyer, and we're like, "We will sell your books on the internet" And sure enough, we had like 300 libraries They were all like, "Oh my god, we have all these books, we run these book sales, they waste our time, they don't make us any money

So you're telling me you'll just take all of our books, and you won't charge us to do that" I'm like, "Yeah, we won't charge you We will absolutely take all your books for no money up front That is our valley proposition to you" [Laughter] And so what our deal was – and this was a smart thing, and actually locked us in forever with these guys

I mean, still, forever We do it for New York Public Library, Brooklyn Public Library, you name it, huge systems We said, "We won't charge you a dime up front If we sell a book, we'll basically deduct the marginal cost of doing that – the shipping, and so on And then we'll pay you revenue share, and we will also pay a literacy program revenue share

" So at that point, we really codified that our mission was literacy, and we wanted to raise a bunch of money for literacy So every book we sold, some was gonna go to literacy So we have a little program in Brooklyn called Brooklyn Reads It probably gets 100 grand each year ballpark, because Brooklyn Public Library sends their books to us, and we sell them online, and Brooklyn Public Library probably gets 500 thousand a year, something like that And so as a result, it's really, really hard when some vendor comes to them and says, "Okay, I'll sell your books on the internet for 5% more than these guys give you," or whatever

They'll say, "No way! Are you kidding? Brooklyn Reads depends on these guys, and how can we trust this new group when a better one's been doing this for years, and years, and years" So Better World Books has grown revenue, actually, every year since it was founded 2002 So maybe 70 million in revenue, or something like that Not gonna take over the world, very tiny niche which we sell a lot of used books on the internet

Still a time of change People still buy paper books I love my paper books Tried the Kindle for a while, didn't work for me But anyway, learned a lot

I actually spun a software company out of that that was some technology we built, because we were really smart about automated online pricing in the early days of that And so there was a lot of value to be created by taking the same book and selling it on every possible website you could sell books on And that's actually still true today And then you stepped out of that company Yeah, I stepped out

So I was in full time for about 7 years, and I just got to a point where I felt like Better World was really good at one thing, and it was gonna kind of keep doing that thing, and every time you tried to come up with a crazy idea, you generally just lost the company money, and distracted everyone from the thing they were good at and needed to do more of And so I kind of focused on that, and said, "Okay, personally, I just want to work on something else" It was also challenging business, because we do have a direct consumer website, and I run into customers every now and again We do sell millions of dollars direct to consumers, but it's really hard to compete with Amazon for selling books on the internet They're pretty good at it

So we carved our little niche, but it was never gonna be a business where you could just go straight to consumer And then on the impact side, we were donating We became the biggest book donor to Africa, the biggest children's book donor in the US, still are, and huge funder So we funded 20 million dollars through literacy programs all over the place But it was never direct impact

Other than kind of giving away the books, which is cool But other than that, it was never like, "Oh, we actually systematically it Systematically improved literacy" So I think all of these startups, if anybody in the US was watching this interview, they could probably relate to them But then you took a leap, and you ended up in Tanzania for the company you're working on now, and how did that happen? What drew you into that market, and tell us a little bit about Off Grid

Man, that was just a ridiculous idea I can't believe it worked out I mean, it hasn't worked out yet You know, its fate's still to be written, but at least we're serving some customers So how'd that work? So I was lucky enough to get the Skoll scholarship to Oxford

It's a wonderful, wonderful program Basically, you get an Oxford MBA paid for for free, and it's a year long program, and so you go there, and spend some time, think about big problems in the world So I went there, and I just got obsessed with this thing about off-grid energy So I had experienced it first hand, because I had been traveling in Africa I was very interested in Africa and it's growth

I was very interested in solar, and I felt like solar was this incredible, revolutionary technology that would find all these interesting applications, but they wouldn't be immediately obvious And then the places where they're probably the most useful would not be in the first places they'd be adopted So in the US, our electric grid works So if you adopt solar, it's either for green reasons, or because it's cheaper than the grid And that's relatively hard to do

But if you just need electricity, this technology you can just put on your roof, and here's come electricity That's completely revolutionary But making that relevant for the average person, it's not just as though it's as simple as that So that was what really fascinated me about the market And it was very, very early on in that when I got interested in it, and really our friends at d

light were one of the pioneers Just nuts what they had to do with the technology at the time They did not have these fancy, cheap LEDs, and these lithium batteries You know, it was really expensive stuff, and they were gutsy, and they got in early and just started making it work That's not an easy journey

So then I looked at them, and I looked at some of the other guys, and I was like, "Okay, well, where is this going?" Where it's going is people doing real big power It starts at solar lanterns, and a lot of people thought that was what the market was, but actually the nascent seed It was like the internet in '95 when we had no useful website, and everyone was on a dial-up modum But that's not where it's going So where it's going is everybody produces their own power, and your power is an asset, rather than an expense

And solar gives us this ability to have power be scaleable So if I need a little bit of power, and I can afford a little bit, I can pay for that, and I can kind of build on it Whereas the grid is binary You either have it or you don't, which is why there's 12 billion or so people who don't have the grid at all, and then at least that many who have a grid that's so unreliable that it's almost unfunctional

And so can you walk us through – I think a lot of people, you look at solar, and you look at its ability to replace fuels like kerosene, and you say, "We're selling this at a price that's cheaper than kerosene at a daily rate, and then you can lease to own, potentially" The model seems to make sense, but how hard has it been to actually execute on the idea, and what's been hardest? Fucking difficult [Laughing] Let me just tell you So turns out, I didn't just get to build one start up in this company I had to build a hardware startup, but that's just the entry point

Then I had to build an African sales and distribution startup to sell my hardware startup's products But then I had to build a consumer finance startup, because none of the startups – so this fintech startup needed to finance the products my hardware startup was selling to the African consumer through my sales and marketing startup And then I needed to build a software startup to manage all of this, because it's almost impossible to integrate with every mobile payment system in Africa, and keep track of sales people, and service people running all over the place, and 100 thousand plus customers Keep track of all that without some really good software So building all these startups at once is expensive, it's difficult, you know, operating across time zones, across geographies

It's tough, because I don't have personal context I didn't grow up off the grid, so I have to learn the language, learn the context, learn the environment That's why I moved to Tanzania when we started the company So I felt it was important enough to just pick up and give myself a massive pay cut, and take some seed funding, and go just try to figure it out So we landed there with, yes, a business plan, but that almost got thrown out on day one

No technology, no nothing Our first hundred customers were literally we bought off the shelf solar equipment, we set up a little kiosk in one part of town, and we had our pre-paid hardware was a large Maasai guy So this guy would walk around every month and collect money from you, and he'd take your solar system back if you didn't pay Simple, but effective proof that it could work [Laughter] That pre-paid hardware would be effective

We'll kind of move out of the company context, but what do you wish you had known at the start of starting Off Grid that you know today? You know, what Bruce just said spoke to me This is what Jeff did so right, not that he's a brilliant marketer, but he's focused so heavily on the culture, and the processes of operating in the company so that it's just an awesome place to work And so I haven't always gotten that mixture right So building up HR debt, and building up these other things as you're just barreling ahead at the target That's all my obsession has been lately is what do the best managers in the world do, and how to they do it, and how to they keep people in line, how do they write performance reviews, how do they build these structures? Because people love working for great managers

There's the story about Bill Campbell, who's one of Silicon Valley's great coaches He had a hardware startup that was a massive failure Raised a ton of money, just plummeted into the abyss, and everyone who worked with him said, "That was one of the best experiences of my professional career" [Laugher] That's amazing You know? And, I mean, that's who I want to be

If I could be that CEO that my company plummets of the cliff, and everybody's like, "That was amazing, I would still work with you in a second" Then you know you've actually done your job Yeah, so what are you implementing to lean towards that? So what am I implementing? I think it's a CEO's job to train, so every time I get a good idea, I'm not just like, "Hey guys, here's a good idea" I'm like, "Okay, I'm just gonna beat this into everybody's head," upper level, lower level, like, "Here's how we run a good meeting" So I'm gonna set the example of here's how we run a good meeting, then I'm gonna crash some meetings, make sure that they're actually being run to that standard

I look for – I think OKRs are a really good tool, and we get very militant about those in our company, and I think a lot of this is actually process enforcement I had a really, really good HR person who started a couple weeks ago I'm realizing more and more that that's one of your most important tires, and when people do it way to late, it's really a CEO's, one of your most important partners Someone you can have honest conversations with about where you come up short as a team, where some people aren't scaling, where some people are Last question, then we'll get to dinner

Curious on the personal side So you've been in the hardship and the muck of starting new companies since you were 13 How do you balance that with family? How do you think about that? That's been a real challenge honestly So I have two kids, 6 and 3 I have a wife I adore who's also a venture funded entrepreneur, which is a completely ridiculous choice

Don't do that And so I think the only practices I – what I can say is you have to choose in life So there are some things I'd really, really like to do that like, hang out with friends, or watch sports, that I just don't do Ever I mean, I shouldn't say never ever hang out with friends, but pretty rare

And that sucks, I would like to do that at some point in my life You know, spend a bunch more time with my buddies, but I just don't do that I don't go to Notre Dame football games, even though I went to school there, and all my buddies go And so I thin the more you're really realistic about what you say no to, and the more you're realistic about intentionality of your time, so that I'm not just, "Oh, we're kind of, sort of hanging out as a family," but know we're having family dinner, and we have it from 6:00 to 7:30, and I'm dad who cooks So I cook the dinner, and I think just doing that practice, and my kids seeing me as that role maybe makes up for some of it, not all of it

I really respect people who take off from this crazy life, and spend a bunch of time with their kids, too, because that's important stuff, and I don't think I get as much time as I would like Xavier, thank you for being honest Thank you for being the first entrepreneur who's done this

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