November 23, 2023

Discovering the Next Energy Transition Solution

Neal Dikeman speaks with Chris Howard on Forging the Future Podcast

Neal Dikeman: That’s the one lesson Houston startups need to learn. Throw your idea in the trash. Don’t worry about it. Just find a idea.

Chris Howard: Are you finding deal flow here in Houston and Texas that you’re not finding in California?

Neal Dikeman: We’re certainly seeing a pickup in Texas deal flow because VCs are parasites, right?

You need other founders. You need people to work with. You need me. I’m really trying to decide, right? Do I want to be in business with you? You’re trying to decide the same with me and we’re trying to pick an idea and it really doesn’t matter which combo comes together. It matters that it comes together. In Texas entrepreneurs tend to have their startup idea.

Chris Howard: Welcome to forging the future and whether you’re an investor or startup founder. Everyone has their eyes on the energy transition, global investment in the energy transition hit a record 1.11 trillion in 2022, and it is only rising. So today I’m sitting down with one of the investing partners leading the charge, Neal Dikeman, partner at Energy Transition Ventures.

So Neal, welcome to the show.

Neal Dikeman: Thanks for finally bothering to have me. I’ve been trying to get on the show for a year. I’ve been blown off. So I appreciate finally getting the opportunity.

Chris Howard: We just have such a long list of people wanting to get on here. I was waiting to have you on as one of our special guests.

We’ve had so many good conversations during our VC breakfasts over the last year.

Neal Dikeman: You mean the ones that you and I are the only ones that show up to?

Chris Howard: Yeah. It’s such a big community here, yeah, so it’s good to finally sit down and cover some of those topics and talk about what’s going on.

You had an article that just came out today, which I read on energy.

Neal Dikeman: And yeah, we’ve got it like in the ION now here in Houston, we actually got like a little investor row, so we can pretend we’re all big and important but it is actually pretty cool to finally have people that are actually writing checks and doing things within physical touching distance that I can go grab folks for coffee. That didn’t happen for four or five years ago. So things are better than they were back in the day. We’re seeing some good stuff in Houston.

Chris Howard: I wonder what kind of acronym they’re going to call it. It’s not Sandhill road. It’s going to be a Sandhill row, energy row, I don’t know.

Neal Dikeman: I’ll look at, leave that to the podcasters to name.

Chris Howard: We’ll see what happens. So you you’re from Texas? Yeah. At least you got your degree in economics here in Texas.

Neal Dikeman: I am.

Chris Howard: You did grow up here.

Neal Dikeman: I am from up here, I grew up in Memorial.

My family has been in Texas since 1837.

Chris Howard: Oh, really? And why?

Neal Dikeman: Oh, that’s a good question. Dikeman is like Dutch, makes, makes sense, they moved to New York in the 16 hundreds and one of ’em in the 1830s moved to Florida. Didn’t last very long there. There was nothing in Florida in the 1830s. Can’t even imagine why you stopped. And then he came over and landed in Montgomery County sometime right after the Texas Revolution.

Chris Howard: Were they looking for oil at the time or what were they looking for?

Neal Dikeman: I Think people came to Texas for land back then.

Chris Howard: Okay. So you got an analyst job and then you were working for a fund almost right away or not?

Neal Dikeman: No, I started off at Bankers Trust in the oil and gas group, working for some really rockstar people. I didn’t know they were rockstars at the time, but they were. And then Deutsche bought Bankers Trust, and I wasn’t sure I wanted to do all energy. And Deutsche was basically going to destroy Bankers Trust, and my bosses were all very clearly leaving. So I’m thinking, I need to go to business school, which I don’t want to do, or I need to go somewhere and get out before the ship sinks. So I managed to find myself a fund in the Bay Area doing manufacturing turnarounds. Yeah, former Alex Brown partner was running it and they recruited from the BT Alex Brown network. I get out there. It’s the dot com boom, and I’m working in a company doing manufacturing turnarounds. I was the corporate secretary for Ocean Pacific, OP, the surfwear brand. Do you remember that one?

Chris Howard: I Do remember that, even though I wasn’t a surfer.

Neal Dikeman: I was not a surfer either, and by the 90s when I was there, we were not the cool brand anymore, but we’d hired this really awesome executive and he was rebuilding the franchise and we were the turnaround shop behind it. Then we had a potato chip manufacturing company, a tube bender. It’s cool.

Chris Howard: And this is all in SFO?

Neal Dikeman: Scattered around the west, but yeah, the office was in Burlingame, right there in Silicon Valley and it’s the dot com boom, and I’m literally going over to Hayward to a plant vending metal. This is not a bright career move.

So I jumped, and I figured I gotta leave or get into tech. So I jumped into, yeah, a little fund behind and a few others, and learned Learned Venture the hard way.

Chris Howard: So you actually did get into Venture.

Neal Dikeman: I did. I did not spend very long at that first fund.

Chris Howard: Okay. All right.

Neal Dikeman: But I arrived in Venture Capital the day Nasdaq fell the first time.

Chris Howard: Perfect timing.

Neal Dikeman: My timing was just impeccable.

Chris Howard: Was it still an interesting time to be in?

Neal Dikeman: Absolutely. Absolutely. Year later, software’s dead. I just completely dead and people trying to figure out what to do next. I had left that firm. My boss there and I spun out and we pulled the team and set up a firm called Jane capital. And we’re like, what are we going to do? All I knew was energy and I didn’t know very much cause I was just beyond analyst. My other partners were from the environmental sector and we wanted to do tech because it’s the Bay area, you can only do tech. And in 2001 energy environmental tech, that meant clean tech, right when the term was being coined.

Chris Howard: And that’s when you decided to do your own startup.

Neal Dikeman: We just fell into it. We started the firm with two deals. Yeah. Macquarie bank. We were the advisor of their tech fund, which was mainly IT and it was in harvest mode and some really cool companies, migrating companies from Australia, New Zealand over to the US, they’d seed them down there, flip them up, and then, so we were the advisor to them for about five years or so there, and then we’d gotten ahold of this tiny little company doing green EMF shielding. And RFID tags with a vacuum metalization process for plastics. And we ended up floating that in the UK and one of the first U. S. to aim deals. I don’t know if you remember the aim trend. It was a, the hot, capital raising. It was the SPAC trend of 15 years ago.

Chris Howard: Okay.

Neal Dikeman: And so we hit one of the very first U. S. to cleantech aim deals and that made us think we were smart. So we went on and figured out, let’s go get a few more of these startups and do them for ourselves. And so we, my partners had launched a bunch of companies before. I was young and I thought we could do anything. So we took some licenses, some product, we bought some things and just started launching companies.

Chris Howard: Popped the red pill and went off on your own, right?

Neal Dikeman: You really did pop the red pill, yeah.

Chris Howard: Sounds like you did pretty well. You IPO’d at a 300 million market cap in less than three years.

Neal Dikeman: So one of ours was, we actually, I was actually trying to sell, get an M& A deal to sell a company, an R& D platform in superconductors back when superconductors were not cool.


Chris Howard: There was a time when they weren’t cool.

Neal Dikeman: There was for a period there. And we ended up founding a company, did a joint venture with the people that own that thing and founded a company to go launch this new business in super conductors around grid stability devices. And which I still think is a hot thing.

We’re still invested in that today. The, this whole renewable energy transition thing and all the demand response and EVs and all of it puts pressure on the grid. And if we keep doing the grid the same way for the next hundred years that we’ve done it, the last hundred, it’s not going to work. We’re going to have to spend too much money.

It’s painful. So we were interested in that 15, 20 years ago and frankly, the time was a bit early, but we did manage to get that company, a company called Zenergy, spun up and eventually IPO’d there.

Chris Howard: And so there was a total of seven venture backed spin outs that you did?

Neal Dikeman: We did. The number of real numbers is probably a bit closer to 10.

There were a couple that didn’t really go, yeah. But we had three IPOs out of that portfolio. The first one we did not found. We were an early little seed investor. And and then a couple exits of acquisitions. It, did okay. And so it depended, as usual power rule, the top two deliver all your money.

Chris Howard: Was it really more like a It sounds almost like a studio or incubator in a way because you were a fund and you were picking specific companies and then trying to help these grow.

Neal Dikeman: So we never ended up raising a fund at that. We ended up having a couple of big corporate partners that we’d use their balance sheet to do some deals on.

And then most of the seed ones was partner’s money. We had a couple of partners and we’d put our cash in and so we would do the seed deal and then we’d go raise the rest of it.

Chris Howard: Interesting. Like a fundless. Fundless fund almost. So what about this 270 day process for evaluating startups? You’ve evaluated quite a few of them.

Neal Dikeman: Not evaluate them. That’s how fast the startups is supposed to move. We’ll evaluate them in 72 hours.

Chris Howard: Okay.

Neal Dikeman: Look, I used to, I lived in Valley and I’d come, my family’s here. I’d come back to Houston a lot. And then eventually in 2010, I moved here and I’d go back there a lot. You need to go back every three months or flip back and forth and you notice, okay, I.

Get to meet friends, people in business, and, you would see people every kind of nine months, right? Because you can’t see everybody on every trip, huh, they’re not in the valley. They’re not talking about the same thing that they were the last time I saw them. They’ve literally got a whole different company, a whole different product and their deal.

What they were talking about last time is either succeeded and they’re telling the next version of that story or it’s failed and they’ve gone on to the next one. And in Texas, I’d come in these little Houston startups and they’re still talking about the same story. Oil and gas is a long play business, but in the valley it was a light speed thing.

And so it dawned on me, okay, you give a startup two years of cash when you invest in them, right? That’s the target golden rule. That’s one year, so once you get down in that one year time frame, nine months, you need to get raised some more money because you don’t want to ever get down to three or six months without any cash.

So you usually start raising somewhere in that year mark for the next round, which means you have to have finished something enough to get the next round off, whatever your milestone was sometime around that time. So basically, if you get to day 270 and nothing good has happened, you’re still talking about the same stuff you were when you started, you’re probably stale.

You’re probably beginning to run in some trouble. So it dawned on me that a lot of these venture backed family startups, they’ve taken this two year cycle and they’re basically backing into the sprints they need to do. And so if you talk to a company, and in 270 days, they’ve done a lot more than you think they should have. This is good. And if they’re struggling and they really haven’t changed their song, they’re probably not on the velocity that you need. And I used to teach entrepreneurs this. Look, don’t sprint to 30 or 90 days. You can’t get much done that fast. If we’re talking a year time frame, you’re probably running a little slow.

Just target 270 and run your kind of milestone model to nine months. It magically works out.

Chris Howard: So if they don’t achieve that milestone in 270 days, do you then decide that it’s not worth any additional like capital or interest or whatever?

Neal Dikeman: No, because most startups, they take twice as long as they think they will.

There was a, I had an investor in one of my companies years ago named Jerry Langler. He was an OVP. He was a, Yeah, Ben, the president, founder, mentor, graphics, super smart dude. And he used to manage startups to the red shift. You know about red shifts and like astronomy stuff, right? So in Excel, you give them this, give them your financial model, right? And they would chart all of, for the forecast you said you were going to get when they put their money in and they chart for every startup they’d done in two decades, what you actually did. And they would plot this on a little graph. Yeah. And the way Excel worked in just the standard colors, that second dot was red.

And so they would basically chart everyone to the redshift. So Jerry would say what do you think you’re going to do? Business, milestone, dollar wise, whatever. But they were not managing you to what you said. They were managing you to the rational expectations of what they knew a startup like you was probably going to do.

So you may guide them. Yeah. You got to get stuff done at nine months, but dude, I know what you’re telling me you need to do is going to take a year and a half type thing.

Chris Howard: I think it’s interesting that VCs want to be entrepreneurs and entrepreneurs want to be VCs. It’s always greener on the other side.

You’ve been on both sides, which one do you prefer?

Neal Dikeman: I really like launching things. And as a VC, I really like the coaching, the mentoring, and I like the launch stage. I’m not necessarily a great operator. Operator meaning, look, we’re in the grind phase. Yeah, we’ve got the organization set up. We need to just pound it out, do the same thing every week, manage out.

For a period. Yeah, I’m much better in the sprints. I’m in software development terms. Waterfall makes my head hurt I need to be in an agile shop. Everything we do is agile style methodologies I just applied to business launches and investing so I liked I really enjoyed being in startups It’s fun. What I found is when I was running companies, yeah It burned me out.

I could do it, but the anxiety and the stress of just trying to get everything done. Yeah. It was much more comfortable on this side of the fence. I can scale myself better on this side of the fence, but it was a lot of fun. There’s nothing quite as exciting as going out to talk to a customer and selling product.

Chris Howard: It is true that, entrepreneur life isn’t for everyone. There’s a lot of fun in entrepreneurship. If you subscribe to the Elon Musk model, glass and staring into the abyss. I spoke at the U of H Wolfe Center last … yesterday afternoon actually. And one of the questions they had was how do you avoid like the work life burnout and everything? And Elon’s not too far off.

Neal Dikeman: How did you answer it?

Chris Howard: Two things. One, you definitely have to carve out some time. For what’s important and family, of course, is up there for me making sure you’re there for your kids that, dinnertime, bath time.

Neal Dikeman: By the way, I’m going to end up having to cut this five minutes short to go literally to a fall festival for my eight year old.

Chris Howard: Exactly.

Neal Dikeman: Yeah that’s the thing.

Chris Howard: That’s what I mean. So it’s like you’re there for dinner and rough housing and bedtime and reading the book and putting in the bed. And if you need to go back to work, then that’s when you do it.

Neal Dikeman: So can you work late at night?

Chris Howard: Yes, actually, and I missed an opportunity to remind them that, Hey, I was at Venture Dallas.

The whole day before, and then I went to dinner with my team and then I was catching a light flight out of Dallas that got delayed from 9:30 at night until one, two in the morning, three in the morning, six in the morning, and then I flew into Houston at, I got, I arrived at seven.

I had an all hands meeting like at eight or nine o’clock in the morning. I got home 45 minutes before the meeting did an all hands, then went to the U of H did my speech after an all nighter. And that’s, and I’m 60 and it doesn’t change, right?

Neal Dikeman: Man you’re tougher than I am. I don’t think I can do the late night work and the all-nighters like I could before.

But to be fair, I’m a lot more productive. I could outwork myself early. Neal could outwork today neal by a lot. Today, I’m a lot more productive with my time. I know what to spend my time on. I know what to get my entrepreneurs to spend their time on. Keep them out of the crevices and problems that they’re going to, the minefields that they’re going to find.

I definitely cannot outwork me from when I was 32.

Chris Howard: I’ve always been a night owl and I’ve always been a hard worker. I think that, If you’re going to take the life of an entrepreneur, you have to understand that there are those times when you need to make that kind of commitment, solve those kinds of problems.

You have different issues that you’re going to either face or go into your bedroom, turn off the light and curl up into a ball and cry, cry yourself to sleep kind of moments, or, tackle it head on and say what’s the opportunity here? How do I solve this problem? What I call the opportunity and adversity.

You’ve lost 85 percent of your business because the customer just canceled. Now, what are you going to do? So you got to go solve that problem.

Neal Dikeman: One of the company as I had years ago, I wrote, written some engineering rules because I never run engineering before and I wasn’t very good at it. Yeah. But started to make these engineering rules.

And one of them was that we got to stay, find and stay on the critical path. All companies have a reason for being, you got to know yours and you got to find the critical path. And sometimes the critical path isn’t doing work. It’s figuring out what to do. Think about Okay. Product launch, MVP, customer discovery.

If the team jumps in and builds stuff. It’s going to be wasted, right? So sometimes, you actually don’t need to work harder, you need to, or smarter, you need to simply figure out what you’re going to do. My dad is a veterinarian, and been in the farm and ranching business his whole life as well, he used to tell me about some farmer book from years ago, where the farmer was telling all these young farmers, you need to take the time to work on the business and not just in the business, and that’s still a pretty powerful statement. And I think that’s true of both an entrepreneur as well as a venture capitalist.

Chris Howard: It’s great.

Neal Dikeman: We don’t make all of our money by showing up tomorrow and working really hard. You probably aren’t going to make money if you don’t work very hard, but you also got to get it done right.

And yeah, I, sometimes that’s, I think that’s how we can manage the burnout, right? It’s a most entrepreneurs. I think are more sprinters than marathoners, most really good ones. And so you’ll see a lot of folks they take off between companies. They just, or they’ve sold their company and they’re coasting inside the big company until they, their golden handcuffs are gone or their vesting’s done or they can go back out and do it again.

And. I think that’s okay. I think that we get our breaks in different ways. And sometimes you get your break by saying, look, I’m literally, I’m still going to make payroll tomorrow. If I knock it off, it’s three o’clock. I’m going to go over to my kid’s game or whatever and recharge you.

Chris Howard: That’s an important point.

Yeah, that is exactly how you do it. You need to have the time for family, you need to carve out, be there for their games, you need to, exercise, reduce your stress, all of those things that, in order to take care of yourself because frankly, entrepreneurship usually is a marathon, not a sprint.

And if you try to sprint through it, then you are going to burn out. And so if you recognize that you need to pace yourself or doing like product development, like you said, we call that, you don’t want to, you want to build version 3.0, you want to build version 1.0 or whatever it is that needs to be done so you can figure out whether the customer actually wants that or not.

Because just the busy work of building a product, you get, it’s like doing the dishes or something. Oh, I can do that. You really need to be working on something else. Are you finding deal flow here in Houston and Texas that you’re not finding in California? Where are most of your investments being made right now?

Neal Dikeman: We’re certainly seeing a pickup in Texas deal flow. I think the, one of the good things, the, cause VCs are parasites, right? We just follow entrepreneurs and teams. Team building is hard. For an investor, once you got some money, it’s really hard for a founder who doesn’t have any money. One of the challenges Texas has seen for all over the years is you have a lot of great management talent, but you don’t necessarily have a lot of experienced startup executive or startup talent.

And getting two or three or four of those experienced folks experience doesn’t mean I can go run a company. It may mean I was on the team of a startup that raised some money and went through a process, went bust or exited, right? So they have some pattern recognition there. So finding teams and putting them together here is quite challenging unless poach people that have never been in a startup before.

Cause where does startup talent come from? It comes from a straight out of school. We’ve backed all first time founders in our fund so far. I’ve got one term sheet I write out now, and it’s another first time founder. Yeah, all of them are first time CEOs. And so where do they come from? A lot of them came straight out of a PhD program. It’s their invention. They were in business school. They wanted to do a startup. They didn’t care which one. This just happens to be the one they’re doing. Other place startup talent comes from is another startup. That’s a bit of a problem because if you don’t have some big startups that have spun off, minted more founders, Where are you going to get those startups?

And the other place it comes from is a venture fund. And there aren’t a lot of startups that come from not one of those three places, right? So that holds hubs back, until you have that one startup that punches it out. But it only takes one.

Chris Howard: What I’m surprised to not hear on your list would be entrepreneurs coming from Large enterprise and don’t an entrepreneur at all of these energy companies here in Houston Whether that’s BP or Chevron or etc

Neal Dikeman: Have you ever tried to get somebody paid by BP or Chevron or etc to quit the really fat?

Cushy easy to do job that annoys them because of the bureaucracy, but it’s still well paid great benefits Got a career track and you want them to throw that in the trash, quit their job and go do a startup.

Chris Howard: And take the red pill.

Neal Dikeman: Yeah, take the red pill. They want to.

Chris Howard: They want to, but this is why I would imagine in Houston’s boom and bust oil and energy market, that those guys weren’t getting let go with a, nine month, 12 month severance package and say, look, honey, I’m I finally want to do my startup and I’ve got a nine to 12 month runway and I’m not quitting my 300, 000 job to go do a startup.

So why isn’t that happening?

Neal Dikeman: Let’s say, so let’s say you’re working for BP, right? And you get fired, re-org, whatever, laid off, you’re gone, right? So you’re ready to do it. Great. You by yourself are useless. You need other founders. You need people to work with. You need me. I’ve still got a job.

So now you’re stuck trying to convince me to quit my job to join you. So we both have to basically get, canned at the same time, or be really ticked off, or have wives that are working so that we can get health insurance while we jump together, and it’ll put up with us doing that. And so it’s not a matter of each of us being at the right point in our career, the time, et cetera.

It’s a matter of two or three of us at once.

Chris Howard: But why does that happen in California? And it doesn’t happen here because you are surrounded by company guys that are working at Google, Facebook, Meta, et cetera. Who do get paid very well.

Neal Dikeman: Yes.

Chris Howard: And then they do. The whole star culture was four guys that quit nice, high paying jobs at a Fairchild and went and started Intel. Yeah. That’s exactly what happened. So why is that happening here?

Neal Dikeman: It’s cultural. The Valley is a special place. It’s a unique place. And so there’s no real reason to try and copy it. You just can’t. But there’s definitely a culture in the Valley that says that doing your own startup is cool. And here, I’m not sure doing a startup is cool.

People think they want it to be cool, but is it really? You talk to people about why are they not quitting? And because it’s really, it’s not that cool. The other thing I think that’s really fun about the Valley and different than here; a Texas startup tends to be like, okay, you’ll come to me and you’ll say, Neal, I have this idea and I’m going to make the coolest little reactor, green hydrogen, pick your favorite oil field service, software widget, whatever your thing is. But this is your idea and you’re in love with your idea. And you try and convince me that your idea is great and join you with it. Your idea is really not that good. Yeah, you don’t know that because you haven’t been in a startup. But it’s not. In the Valley, each of us, we show up, there’s three or four others, we got there’s a little group of us. We’re all working for somebody else. Maybe one of us has been, lost their job or exited the company, whatever. But the others, we got our jobs. And we’re each telling each other, I’m like, Hey, Chris, I’ve got a couple, I’m going to go do a startup. I’ve got a couple of ideas.

I tell you mine. You’re like, those aren’t very good. And you tell me yours. And I’m like, no. And, Joe, our new friend tells me his and Grace tells me hers. And what we’re really doing is we’ve already decided we want to do a startup. We don’t really care which startup, whose idea?

We also aren’t suicidal enough to do it alone. So we’re really just the cultural yeah, morass this this chaos of primal soup is us trying to figure out Which startup we’re going to do, and who we want to do it with. So we’re really, I’m really trying to decide, do I want to be in business with you? You’re trying to decide the same with me, and we’re trying to pick an idea. And it really doesn’t matter which combo comes together, it matters that it comes together. In Texas, entrepreneurs tend to have their startup idea. If yours is great and you can pull a team, fantastic. But the Valley, yeah, startup launch culture is a much healthier culture because we don’t care which one.

I used to tell people if I have any silly little idea and three resumes, I got a fundable company. Doesn’t even matter what the idea is. It’s the resumes plus an idea. If I get an idea, three resumes, and a customer, I’ve got a very fundable company. That doesn’t matter which idea.

Chris Howard: In the valley or would that apply even here?

Neal Dikeman: It’s very hard to sell that song here, and it’s very hard to sell it to several people because people want to do theirs. So I think the one big lesson Texas needs to learn and how to do a startup is, hey, just don’t care which one and don’t care who you do it with, just care that there’s really awesome people to do it with, don’t ever do it alone, and search until you find that idea.

So you’re in the venture studio business, right? And I don’t know, the Y Combinator deal. Y Combinator, I swear to god those companies pivot seven times before they finish the program. They’re not actually Impacting outcomes or they’re literally just creating a pool for entrepreneurs to get together to do problem discovery, they’re not even working on the same problem by that time they finished the program that they were talking about when they started.

Chris Howard: It’s true. There’s a stat, I think one of the first cohorts and one of the accelerators, I can’t remember exactly which one, but it was like the most value of any cohort because out of the five or ten companies, three of them were unicorns and all three of them were doing something else than what they went into that cohort for.

Neal Dikeman: It’s not like they have, they changed the solution to the problem. They literally picked a different problem.

Chris Howard: Exactly. The whole different thing.

Neal Dikeman: So I think this is on one hand, this sounds really stupid, right? Cause okay, that company was completely useless. They didn’t even know what they were doing. How could you seed fund them?

No, you were backing people and they, that were going to go do a startup. So what Y Combinator appeared to figure out very early, cause this wasn’t a thing back when I was doing startups, there was no accelerator thing. It wasn’t a deal. There was no prize competitions. There was … we had to do it the hard way.

Yeah. YC and a few others, 500 startups, people, a lot of folks that got into this business in the 2005 to 10 timeframe and punched through in this in post financial crisis, what they’d figured out is, ah, the startup model is just do one. And let’s just get people together and let them give them a space to figure out what they want to do and don’t even worry about which one they do and pretend it’s okay that they literally changed everything.

And it’s fine. They just name the company and cut up the shares and go. We’ll figure the rest out later.

Chris Howard: As a vehicle, right?

Neal Dikeman: Yeah. This is pretty cool. That’s the one lesson Houston startups need to learn. Throw your idea in the trash. Don’t worry about it. Just find a idea. Chris. You’re in Houston, right?

You’re doing this startup venture thing for a living. You got a whole bunch of like software developers running around the world. You’ve been doing this for a while. Okay, we have a problem. We cannot find good software startups in energy to do. It’s a challenge. It’s like they all look like not good enough SaaS companies.

The question back to you is, why are we not seeing more big, awesome SaaS companies and energy with rockstar teams, huge problems, lots of great growth rates? What’s missing to bring the software business model hard and heavy to energy transition and all of it. What do we need to do here?

It’s hard. It’s big on our funding list. My partner funded O-Power way back in the day, which is still one of the top SAS and software companies ever to exit in cleantech and energy. And we’re struggling to find them. We need some help here. We need some software deals in energy to go.

Chris Howard: I would say it’s more from my side about the ideas or what is the solution that’s needed because from my side, building it is something I can do, right?

I got that 100%. You bring me something, I’m going to build it for you, whether that’s hardware or software, right? I don’t know enough about the energy sector to know what the problems and pain points are that need to be solved for these other energy companies that we need to build and and deliver.

Neal Dikeman: How do we bridge that gap? What do you all need to get into energy in a big way?

Chris Howard: I think we need to partner a little bit more closely with the BPs and Chevrons. Maybe I need to be on that energy road to start hearing about what problems they have that need to be solved and startups that need to solve those problems because or those people that have great ideas and don’t want to quit that 300, 000 job. But what is the idea? And let’s get the founder in place to do it. And I’ve got a team of 300 engineers that can actually build the MVP. And if they say look, if you build this, we will use it. We just need someone to do it or solve the problem. But I need a list of what those problems are. Because otherwise I’m just shooting in the dark. I think that people are too siloed in, in these different areas where they’re like, it’s all contained within this venture studio or this venture arm fund, or this company and getting outside of that is: hey, Chevron, what are your problems? And what are you looking for? Let’s build those companies and then, acquire them. They want to do that.

Neal Dikeman: I got some for you.

Chris Howard: Okay.

Neal Dikeman: All right. We think there needs to be a company built to do controls for hydrogen, like big hydrogen plants and stuff. It’s a controls meets software—it’s a layered problem … it’s nothing out there we’ve seen to do that.

Chris Howard: All right. Then I would say, let’s bring in a solution architect and a domain expert, get them in a room and figure out like, what is a solution to that? And what can we build as an MVP or a POC and put it in front of whoever would possibly use that and see if they would buy it.

Just like you said, you got the idea, the team and the client. All right. Who’s going to buy it?

Neal, thanks for being on the show. Super interesting. We could talk for another hour or two. We should, I should have you back.

Neal Dikeman: I would, but I literally got to go take my, actual people break and go hang out with my daughter and her fall festival.

Chris Howard: That’s a very important thing to do. I’ve got some Benjamin socks here, 100 socks that you can wear. I think you’ll find those useful.

Neal Dikeman: I love it. I love it. I’ve got my Bucky socks on today as a Texas entrepreneur. I’m actually wearing socks from my PR firm. My PR firm apparently thinks just like you do.

They’re all about socks and marketing. And I love it, man.

Chris Howard: Socks are the key. Have a great weekend and spend that family time because Monday we’re back at it, right?

Neal Dikeman: Thanks for having me on finally. This has been terrific. I’ve been looking forward to being on your show.

Chris Howard: Absolutely.

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About the Author
neal dikeman

Neal Dikeman


Author Neal M. Dikeman is the Chairman of online network and cleantech think tank, and a partner at early stage venture capital fund, Energy Transition Ventures. He has cofounded half a dozen cleantech and energy startups, previously worked in venture capital at Jane Capital Partners and Royal Dutch Shell. He has been one of the most prolific writers on the subject of cleantech, as chief blogger for, named a 50 Best Business Blog by the London Times. He authored What is Cleantech?, the first brief history of the term cleantech,, 2008, What is the Energy Transition?, 2020, author of a book chapter on cap and trade in The Green Movement, Greenhaven Press, alongside George Will and John Kerry, and a former cleantech columnist for CNET/, Christian Science Monitor, and Sustainable Industries Magazine.