Nanalyze

The World’s Most Energy Dense Lithium Batteries

In the past, we’ve seen a lot of interest from readers in battery technologies, mainly lithium batteries of the type used in electric cars or drones along with large scale energy storage solutions for use by utility companies. It’s mainly advances in lithium batteries that people are most interested in because they promise to increase the range of electric cars, drones, and allow you to spend more time on your smartphone creating free content for Mr. Zuckerberg between recharges. In March of this year, we looked at 13 Lithium Battery Technology Startups that hope to address this pain point by making improvements in the following areas:

  • Cycles need to be improved – Lithium batteries typically have a charge/discharge life cycle of 300 to 500 before they “die”.
  • Density needs to be increased – The more energy you can store in a battery, the smaller and lighter you can make the appliance that carries the battery.

It’s the second bullet point we’d like to see worked on because that means we get more distance out of electric cars, drones, and cell phone use. When discussing the topic, you’ll find various camps of thought, like those who believe that the advanced technology is actually being suppressed so that it can be released incrementally over time as “product improvements”. The reality is that if you are a startup that can create a denser lithium battery, people are going to pay you money for that technology once it is proven to be viable. That’s why when we saw a startup called Romeo Power take in $30 million in funding last week, we decided to take a closer look.

Founded in 2015, Romeo Power took in a $30 million seed funding round just 5 days ago. Yes, that’s a large sum of money for a “seed round” which is usually indicative of some pretty excited investors. In this case, those investors are the people who are closely associated with the founder, a man by the name of Michael Patterson who is a serial entrepreneur with multiple proven successes. He is one interesting fellow.

You have to appreciate a guy who owns up to his mistakes. Mr. Patterson’s career started at Quantum Capital where he worked as a bond trader after dropping out of Ohio State University while majoring in physics. His LinkedIn profile says that Quantum Capital was “closed by NASD”, which is a really nice way of saying that he was disciplined for “over-charging customers in municipal securities transaction” and barred from trading again. Then, he decided to take a short break before doing the following:

  • 2000 – Founded FedCel which provided mobile communications management software and services. Sold in 2005 to ProfitLine for undisclosed sum.
  • 2002 – Founded SMobile Systems, one of the first mobile anti-virus programs. Gets acquired by Juniper in 2010.
  • 2010 – Founded InAuth, a leading digital device intelligent company backed by Bain Capital with $31 million in funding. Acquired by Amex in Dec 2016 for undisclosed sum.
  • 2015 – Founded Romeo Power

It’s at this point we begin to understand why a great number of people around him would want to place their bets on his next venture. He has a proven track record of success. You often hear people whine about not being able to raise money, usually placing the blame on how “broken venture capital is”. Then, when you have the gall to suggest that maybe it’s because their business idea sucks (and they have no track record of executing which might lend some hope to their mediocre idea), they tear your head off for daring to question their unbridled genius. Talented entrepreneurs are people like this man who executes like a maniac and has proven his value multiple times over. He’s probably been turning away funding, given the fact that he didn’t have to go outside his inner circle to raise a massive seed round. Of course, you’re only as good as your last startup these days so the verdict is still out.

Mr. Patterson isn’t the only one that’s making things happen at Romeo Power. He managed to convince the Chief Battery architect at Faraday Future to become his CTO while his other 190 employees hail from places like SpaceX, Samsung, and Tesla. They’ve already started shipping and have booked $65 million in orders already for 2018 which come from the production line seen below which will be fully automated by the end of this year:

The sort of batteries getting cranked out in this 113,000 square-foot facility are nothing short of a technological marvel if we can believe the marketing hype. We’ll let them tell you:

The platform we’ve developed brings huge advances to battery pack technology available today from others. We offer the highest energy density by 25%, fastest charge times (decreasing standard battery charge times by 15 percent to 30 percent), superior safety with inherent thermal runaway mitigation and protections against cross cell propagation, and we’ve shortened the time to prototype from months to days through our automated modular design capabilities.

According to Romeo Power, they’ve already began selling to U.S. and European automakers, manufacturers of motorcycles and forklifts, industrial players such as Power Designers, robotics companies including Robotic Assistance Devices, and others. One of their key product offerings is the forklift battery seen below:

The lithium-ion Thunder Pack lasts three times longer than leading lead acid batteries, is non-toxic and maintenance-free, and eliminates all the time-consuming maintenance and charging processes that lead-acid batteries require. According to an article by Modern Materials Handling, 62% of all forklift sales are now electric, up from 60% in 2015. In that same article we were surprised to see that the biggest manufacturer of forklifts in the world today is actually Toyota with $8.5 billion in sales of forklifts for 2016:

While forklifts account for around 3% of Toyota’s sales, you can bet that’s exactly the type of company that would be interested in acquiring Romeo Power’s battery technology for use in other areas like electric vehicles and robotics.

Forbes interviewed Mr. Patterson and one interesting thing he said was that Romeo Power uses “off the shelf” lithium-ion battery cells from companies like Sony and Samsung. The value-add lies in the way they package these battery cells and the software and firmware that they use to manage them with. Maybe they can optimize those software algorithms with some good old machine learning and get even better performance. Of course, that could be the reason for their stellar battery performance in the first place.

Elon Musk wouldn’t be building his gigafactories if he wasn’t certain that lithium-ion battery technology is the way forward. Consequently, when we think about a new battery technology that will create maximum economic impact, it needs to be something that can be easily introduced into an existing battery production process like those at the gigafactories. Can Romeo’s Power be introduced into standard lithium battery production? There are certainly a lot of people asking that question, people who just might make Romeo Power the 4th successful exit of Mr. Patterson’s impressive career so far.

Do you trade stocks? If you pay more than $4.95 a trade, you're paying too much. Ally Invest is one of the lowest-fee brokers around so you spend less money on transaction fees and more on stocks. With more than 30 trades a quarter it drops even lower to $3.95 a tradeOpen an account and begin trading today.

Subscribe to the Nanalyze Weekly Digest

Subscribe to our Nanalyze Weekly Digest to receive a summary of all articles every week.

We’ll never use your email for anything other than sending you great articles about investing in disruptive technologies.

  • This field is for validation purposes and should be left unchanged.

159 Shares
Tweet4
Share150
Share4
Reddit
+1
Buffer1