In recent years, episodes of extreme weather crises and power outages have prompted doomsday planners to plan for off-grid survival scenarios. The mindset has been a boon for EcoFlow, a Shenzhen-based power generation and storage unicorn, which racked up $220 million in revenue last year as consumers in the US demanded its solar-powered portable power stations. .
After a notable phase of growth (revenue multiplied by 50 between 2019 and 2021), the startup, which was founded by a group of veterans of the drone giant DJI in 2017, discovered a new niche to explore: glamping. In a call with TechCrunch, its co-founder and CEO, Lei “Bruce” Wang, envisioned a future of being out in nature while enjoying a cool breeze sent from EcoFlow’s outdoor air conditioner, which is launching in the US. .in the coming months.
Glamping enthusiasts can already plug a variety of appliances, such as ovens and electric stoves, into portable battery stations, but air conditioners are tricky because most of them use AC power, which is not compatible with battery charging. and has lower efficiency, explained the founder. . The outdoor air conditioning unit that EcoFlow is revealing uses direct current and can therefore be charged by batteries.
Nature-loving campers may scoff at the idea of outdoor air conditioning. I, too, was taken aback by the proposal, but Wang aptly reminded me that if weary urbanites make the effort to drive into nature, many of them would prefer to do so comfortably and forgivingly.
“Wherever people go, whether inside or outside the home, they can achieve much more with electricity,” explained Wang, the rationale for expanding beyond battery manufacturing and into electronics. “Now we cover the whole cycle [of use cases]from power generation, energy storage to energy consumption.”
a green dream
Wang grew up in the vicinity of the Mu Us desert in northwest China, where he saw how the government’s ecological restoration effort helped combat severe desertification in the area. The childhood experience planted in his mind the goal of pursuing a career in renewable energy, leading him to complete a Ph.D. in energy storage technologies at the University of Hong Kong and later helped establish DJI’s battery R&D department.
Having seen that the trend in the energy industry was changing, Wang decided to start his own company in 2017. “Replacing fossil fuel with renewable energy is the fundamental way to increase energy consumption per capita while achieving sustainable growth.” said the founder.
At the same time, lower raw material costs made it easier to get a battery up and running. “Between 2010 and 2020, the prices of lithium batteries and solar panels have dropped 10 times. Such conditions would drive anyone doing technological research to become a tidal player, to take risks,” Wang recalled.
Recent lithium price spikes and supply chain disruptions have not worried Wang. EcoFlow works with strategic partners to ensure a steady flow of supply, the founder said, and believed lithium costs will eventually decline in the long run. .
The startup has come a long way since its formative days as a Kickstarter project. It has raised more than $100 million in funding from notable investors, including Sequoia Capital China and GL Ventures, the early-stage arm of private equity powerhouse Hillhouse Capital. With the expansion of the category, as well as its plans to enter new markets such as China, EcoFlow expects to generate $630 million in revenue this year, which would make its growth between 2019 and 2022 almost 150 times greater.
Such growth is fueling EcoFlow’s path to an initial public offering. Last year, EcoFlow reached a $1 billion valuation and announced plans to go public on the Shenzhen Stock Exchange. The company has entered a preliminary “mentoring” period with the city’s stock exchange regulators and aims to list its shares in the next two to three years.
Wang said the Shenzhen-based bourse, which was designed to encourage technological innovations, will attract investors who “understand the new energy industry”, though he did not rule out the possibility of an overseas listing in the future. Trading at a profit, EcoFlow declined to disclose whether it will raise another round of financing before its IPO.
Powering global customers
Unlike many hardware manufacturers that venture out of China only after testing their products at home, EcoFlow focused on foreign markets from the start. He first went to Japan, a country prone to natural disasters and whose consumers are known to be tech-savvy. Today, Japan and the US are EcoFlow’s two largest revenue generators among the more than 100 markets it ships to.
EcoFlow recently began selling its battery products in China, where a growing middle class has shown a growing fascination with luxury camping. The company is also exploring opportunities in emerging markets in Asia, Africa and Latin America, where it wants to supply households affected by electricity shortages with “affordable” products, Wang said.
When asked how EcoFlow managed to establish a foothold in foreign markets, Wang, who looks to Tesla and Apple for inspiration, offered the obvious if difficult playbook: understand your customers. “We say internally that ‘customers are never wrong. If something goes wrong, it must be us.”
To put the adage into practice, EcoFlow operates a fairly international office in Shenzhen, a full team on the ground in Japan, a small but growing force in the US, and will soon be hiring in Europe. Globally, EcoFlow has more than 1,000 employees working in an extended value chain, from R&D, which represents 40% of its staff, to after-sales service.
While many Chinese consumer tech startups are finding it increasingly difficult to operate abroad as geopolitical tensions threaten to bring them into the crosshairs of foreign authorities, as giants like TikTok and Huawei illustrate, Wang doesn’t see the same obstacle.
“At the end of the day, users will pay for a good product, which is why I like being in the business-to-consumer space,” the founder said confidently. “In addition, our products are helping to promote environmental sustainability, which is a universal goal that can strike a chord with consumers around the world.”