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Summary:

While the green-leaning venture capitalists at Kleiner Perkins look like they own about 20 percent of buzzy energy storage firm EEStor, Vinod Khosla — an affiliated partner at Kleiner and head of his own firm, Khosla Venture — appears to have a different perception of the […]

vinodkhoslapicWhile the green-leaning venture capitalists at Kleiner Perkins look like they own about 20 percent of buzzy energy storage firm EEStor, Vinod Khosla — an affiliated partner at Kleiner and head of his own firm, Khosla Venture — appears to have a different perception of the high-profile startup. He is “somewhat skeptical of this particular company [EEStor],” and while he believes that the science in EEStor’s patents are possible, these types of “radical approaches…are in the domain of a hope and a prayer,” he wrote in an article for Grist this weekend.

Given Kleiner hasn’t exactly been embracing a public link to EEStor as of late, and the startup has yet to produce a commercial product, missing its projected deadlines, it’s interesting to hear Khosla’s impression of the company. His skepticism of it is by no means uncommon — EEStor is one of the most controversial companies we’ve written about, eliciting many positive and negative comments about its supposedly revolutionary claims.

Khosla didn’t go into much detail about his skepticism of EEStor, or why he doubts the company. But I would be very interested to know what exactly pushed him over the edge — Khosla generally is willing to take a lot of risk in his investments, clearly sees the market opportunity for electric vehicles and power grid energy storage, and is looking for “a black swan,” or a truly disruptive technology, for auto technology.

The primary intention of Khosla’s article was actually meant to elaborate on his comments from a couple of weeks ago at the Always On conference, where he said that lithium-ion batteries are over-hyped. Khosla’s Grist article reiterates what Josie reported from the conference, which is that Khosla Ventures is backing lithium-ion battery technology because the “lithium-ion markets are here today” and “are good markets.”

If EEStor’s technology is viable and economical enough to be mass produced, it could revolutionize energy storage. Its claims are much more aggressive than the competition’s — as many have pointed out, perhaps too aggressive. We’ll wait to see if EEStor meets its upcoming deadline of an early 2010 commercial launch of the Zenn Motor car using EEStor’s technology. If the company yet again fails to start selling its tech by 2010, well, then we can probably consider Khosla’s skepticism smart.

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  1. Khosla believes “we all know long term we will be on fusion power”. Now there’s “hope and prayer”

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  2. PS: How can anyone who doesn’t work for GM quote a price “far higher” than $1000/KWhr for the Volt battery?

    The 53 kWh Li-ion battery pack in the Tesla Roadster costs $20,000. That figure matches the open market price for 18650 Li-ion cells of approx $3.00 (x6800 in the Roadster pack)

    That’s $377 kWh already! About 1/3rd the price quoted by Khosla.

    Chinese sourced LiFeP04 Batteries sell ‘retail’ for $500 kWh. To say these prices won’t reduce simply with volume is a false statement.

    Me thinks he’s pushing his own barrow!

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    1. He says that it is 1000/kwh, because you can not take the batteries below 50%. In addition, my understanding is that Chinese sourced batteries sell for MORE than 500 WHOLESALE. He is right.

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  3. $500, i have $377, do i hear….? and perhaps we will get a chance to buy at a lower price, we few, we small we alternate hopefulls. Perhaps not. Seems to me the “market” wants to stay full of high cost players and capital addicted to the same old magic bullet “jackpot” business model. Fast money drive out slow money, still.

    “Replace the 3 ton SUV with a 3 ton free energy device, make it cheap and make us rich, amen.” And I’m not sure on fusion, having just read a book on the history of this tech, though there is an announcement this very last weekend from a Canadian company………or maybe just another “trolling for capital” pre-release, who can say?

    There is no disruptive technology in the pike for the car because the platform is not disruptive. There may be “great advances” as in battery tech. But I don’t put that in the same realm as what I consider “disruptive ” tech. Not a non-forseen consequence, not a “black swan.” Just a bump in the road for the oil consortiums.

    Returning to battery and price matters. First: I believe the above quotes refer to two different Li technologies. The low to the standard one, the higher to the FeP type. Second: Did any one notice the post from China that they will limit where the Li cars can operate? They want to ban them from high population congestable highways because of concerns with thermal run away. They don’t want Li bombs block streets, killing innocent folk. Well, they best should know the quality of their products. What a sad thought that this tech might not be available where it can do the most remediation for the environment.

    Coming soon: Li wars, Bolivia and more of what we are already too painfully aware of…..

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    1. LiFePO4 is actually completely safe, unlike the batteries in the Tesla (which has technology to make the battery pack safe, a major part of their IP).

      LiFePO4 can’t catch on fire from over/under voltage or current, as well as being immune to exposure to the moisture in the air (unlike std Lithium batteries).

      It’s always good to pay attention to the details.

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      1. Thank you to AnonAmerica. I’m sure I saw something on this topic, but did not “file it away” in the “cpu” or thought it was specific to a certain brand/design of LiFePO4 battery. This will change my evaluations in the future, as well as my direction in seeking suppliers.

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  4. Well, what the point for Kleiner Perkins to do any claim about EESTOR? Any public comment from venture capitalists has self-served agenda and it may have totally opposite reasons so, such comments may mean he protects his investments in alternative to EESTOR solutions or downplay EESTOR to get better deal to buy some equities related to EESTOR.

    –sb

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  5. I got news for Khosla: every new venture is a gamble.
    He hasn’t the knowledge to evaluate the risks in the case of EEStor, so he’s standing back. That’s just stupid. You don’t have to bet the farm to strike it big if EEStor works. I don’t think I’ll be consulting Khosla for any future investment advice. He doesn’t seem to understand
    the stats of gambling very well. He also has one really bad tan.

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  6. [...]  0 Here’s one reason why greentech venture capitalist Vinod Khosla might have been a bit skeptical of stealth energy storage company EEStor last year — looks like he’s invested in a company that could be a competitor called Recapping [...]

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