Saturday, June 7, 2008

SDM lessons help alum launch startup in solar-powered refrigeration - SDM Pulse, Summer 2008

Sorin Grama, SDM ’07
By Lois Slavin, MIT SDM communications director

Editor’s note: In spring 2007, SDM student Sorin Grama was part of a prize-winning team in MIT's $100K Entrepreneurship Competition. His team, Promethean Power, proposed developing solar turbines made of car parts and plumbing supplies. The innovative microgenerator was to combine solar thermal concentration with a simple thermodynamic cycle to generate heating, cooling, and electricity for various applications in underdeveloped countries.

Since graduating in June 2007, Grama has devoted most of his time to building a company inspired by this project—Promethean Power Systems. The business is developing an energy-efficient, grid-independent solar-powered refrigeration system for small and midsized enterprises in the developing world. The company’s product converts solar energy into cooling using technology that requires no moving parts or ozone-depleting refrigerant gases.

Q. Tell us about the evolution of the product over the past year. What's different now?

A. Much has changed in the last 12 months. Your readers may be scratching their heads trying to understand
how our technology has evolved from a microgenerator made of car parts to a refrigeration system that requires no moving parts. Instead of using solar thermal concentrators to generate heat and then electricity we’re now using photovoltaic (PV) panels and thermoelectric modules to provide cooling only.

Several factors led to this decision. Last August we conducted a market study in India. We visited more than 40 different villages and talked to farmers, business owners, and village leaders. From this study we concluded that a cold-storage solution for fruits and vegetables is what’s most needed, so we’re now focusing only on providing a refrigeration solution.

The decision to drop the car parts idea was a little more difficult and convoluted. When we started this project we had a team of five and we incorporated as a nonprofit. After winning the MIT prize, two of us wanted to pursue a for-profit venture because we could get more funding and make a bigger impact, but the other three members wanted to keep it as a nonprofit while continuing their studies at MIT. Moreover, because they wanted to retain the technology licensing rights, we had to negotiate an agreement between the nonprofit and the for-profit entities. We couldn’t reach a simple agreement, so the team split up and we—myself and my current business partner—decided to pursue the for-profit opportunity with a different technology.

Q. What stage is the company in now? Prototype? Testing?

A. After the split, we took some time to reevaluate things. We were back to square one. We had a fabulous market opportunity, but no technology and no team to implement it. We were just two guys with an idea. Still, we didn’t want to give up on the idea, so we began to slowly build the business by looking at alternate technologies.

This is how we ended up with the PV panels and thermoelectric cooling solution. We received a small amount of funding from an angel investor and we’re now building a proof-of-concept prototype. We plan to test the unit this summer in Boston.

Q. What are the challenges?

A. Funding is always a challenge. It’s a catch-22: nobody will give you money unless you have a prototype, but you need the money to build the prototype (this is why, I think, so many startups come out of research labs or universities—because they’ve already built the prototype as part of someone’s research work).

Funding is always a challenge for us because we’re targeting developing world markets, which many investors perceive as both risky and unable to sustain a profitable business. Of course, we disagree. We just have to look for the right investors who understand this market.

Q. What surprises have you had and what lessons have you learned in the past 12 months?

A. Well, the team split was a bit of a surprise and a disappointment, but I understand why it happened. We’re moving on. The licensing issue was the last issue I thought would hold us back and, in the end, it was the single most important concern. I should have paid more attention to it early on.

A startup must constantly adjust to changing conditions. It must evolve, but not too quickly—otherwise it can lose focus and alienate people. I’ve heard that, at most, a startup has one or two opportunities to completely
change its technology strategy. Anything more than that will make investors and employees nervous. Well, we
took that opportunity and now I feel much better about our chances to succeed.

Throughout this roller-coaster ride, we’ve kept a laser focus on the customer, and we’re still very passionate about doing something for developing world markets. Our new technology strategy is just another form that fits the same function—something I learned from Professor Ed Crawley’s system architecture course.

Speaking of SDM classes, I’ve relied heavily on the lessons learned in our product design and development
class, such as conducting customer interviews, ranking user needs, and generating target specs. All of these lessons came in very handy when we started designing a new solution for the market need.

Q. What's next?

A. Pushing for ward with our prototype, signing up new team members and strategic partners and, of course, looking for funding.

Q. How can Pulse readers learn more?

A. Our website ( has minimal information right now, but we’re working on a new one, and we’ll have more updates in a couple of months. If anyone is interested in learning more about our work or even helping us change the rules of the game, contact me at Full details of the market analysis, business case, and economics of the system are available in Promethean's business plan.

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