Technology-to-Market Overview

Carlton Reeves, Ph.D.Technology to Market AdvisorAdvanced Research Projects Agency – EnergyU.S. Department of EnergyWashington, DC

NEXTCAR T2M Briefing – April 7, 2017

Outline

02 T2M Methodology

04 Transportation Disruption

03Focal Areas

01T2M Overview

05Conclusions

ARPA-E Mission: American Competitiveness

3

Catalyze the development & deployment of transformational, high-impact energy technologies

Ensure America’s Economic Security, Energy Security, & Technological Lead in Advanced Energy Technologies

Technology Transfer and Outreach

5

‣ From the America COMPETES Reauthorization Act of 2010:

“IN GENERAL- The goals of ARPA-E shall be--(A) to enhance the economic and energy security of the United States through the development of energy technologies that result in--

(i) reductions of imports of energy from foreign sources;(ii) reductions of energy-related emissions, including greenhouse gases; and(iii) improvement in the energy efficiency of all economic sectors; and

(B) to ensure that the United States maintains a technological lead in developing and deploying advanced energy technologies.”

“ALLOCATION.—Of the amounts appropriated for a fiscal year under paragraph (2)—(A) not more than 50 percent of the amount shall be used to carry out subsection (e)(3)(D);(B) at least 5 percent of the amount shall be used for technology transfer and outreach activities; and(C) no funds may be used for construction of new buildings or facilities during the 5-year period beginning on the date of enactment of this Act.”

Inve

stm

ent

TimeConcept

$1M

ARPA-E now

ARPA-E Future?

Private Sector

6

$10M

$100M

Energy Technology “Mountains of Opportunity”

Commercialization

TechnologyDe-Risk

CommercializationDe-Risk

Manufacturing/MarketDe-Risk

Demonstration

Prototype

Research

ARPA-E’s HistoryIn 2007, The National Academies recommended Congress establish an Advanced Research Projects Agency within the U.S. Department of Energy*

7

…“The new agency proposed herein [ARPA-E] is patterned after that model [of DARPA] and would sponsor creative, out-of-the-box, transformational, generic energy research in those areas where industry by itself cannot or will not undertake such sponsorship, where risks and potential payoffs are high, and where success could provide dramatic benefits for the nation.”…

2007Rising Above the Gathering Storm Published

America COMPETES Act Signed

2009American Recovery & Reinvestment Act Signed

2011 2012 2013 20142010

1

37

712

1620

23

ProgramsTo Date

Awards Announced

2015

32

America COMPETES Reauthorization Signed

$400 Million(Recovery Act)

$180 Million(FY2011)

$275 Million(FY2012)

$251 Million(FY2013)

$280 Million(FY2014)

$280 Million(FY2015)

580+

2017

36

$291 Million(FY2016)

1st T2M Hires

1st Deputy Director for Commercialization

1st Programs with T2M from Inception

Measuring ARPA-E’s Success

MOVING TECHNOLOGY TOWARD MARKET‣ Private-Sector Funding‣ Partnerships with Other Government Agencies‣ Licensing/Acquisition by an Established Firm‣ Licensing/Acquisition Resulting in a Spinoff‣ Growth of Existing Company (e.g., Organic Growth)

BREAKTHROUGH ACHIEVEMENTS‣ Patents‣ Publications

OPERATIONAL EXCELLENCE‣ Expedited program development and project selection‣ Aggressive performance metrics

8

Commercialization MetricsSince 2009 ARPA-E has supported more than 580 projects

with approximately $1.5 billion of R&D funding

9

0

10

20

30

40

50

60

70

80

End 2012 End 2013 End 2014 End 2015 End 2016

Cum

ulat

ive

Num

ber

Commercialization Metrics

Private SectorFunding

New CompaniesFormed

Further Gov'tFunding

Cumulative number of projects that have:

T2M Key Performance Indicators

New Companies Formed (Public, Private, or Acquired)

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Projects have received $1.5 Billion from ARPA-E

Projects Received Follow-on Funding from Other Government Agencies

Projects Received Over $1.80 Billion in Private Sector Funding

https://arpa-e.energy.gov/?q=news-item/arpa-e-projects-receive-more-18-billion-private-follow-funding-transformational-energy

Establish a Business

Misinformation of Commercialization

StrategicPartnersPatent

Good ScienceIdea

Secure Funding Deploy New

ProductsGain Fame & Fortune

Grow Business

Commercialization Can Be Long & Hard

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Technology Market DisruptedIntermediate MarketsFirst market

Li-Io

n B

atte

ries

Long Lived, Energy Dense Cells

Long Lived, Energy Dense, Rechargeable, Cost-Effective

Long Lived, Energy Dense, Rechargeable

Pho

tovo

ltaic

s

Decreasing Cost

Alg

ae F

uels

Commodity Fuels?

Nutrition Supplements & Pharmaceuticals

Techno-economic Analysis

Intellectual Property

Plan

Value Chain

Analysis

Customer Discovery

T2M Plan

Follow on Funding

Product Hypothesis

Scaling Up

Market Analysis

Evidence-based T2M Methodology

Initial TechnologyDevelopment & Identify

Product-Market Fit

Program Development by Year

ff

Y1 Y2 Y3

Hardware-in-the-Loop Testing & Market

Analysis with Cost Modeling

Hardware-in-the-Loop Validation, Refine Go-to-

Market Strategy, & Follow-on Funding Plan

Focal Areas

Focal Areas

Support Program Directors to generate highly

innovative, commercially-relevant programs

Scope: Market CharacteristicsDistributed Energy Resources

C

B

A

Com

plex

ity o

f Sys

tem

Ease of Integration

Males Will Use DERs6 of 10

Females Will Use DERs9 of 10

Trusting Local Manufacturers

Accessibility

Resources Needed

InstallTime

Reliability

Factors Influencing DER Utilization

Example

17%Brazil

9%Asia

93% United States 46%

Europe

Scope: Market Characteristics% of Forecasted DER Users Worldwide

Example

Focal Areas

Manage project teams’ T2M efforts through T2M plans

and jointly developed milestones

Support Program Directors to generate highly

innovative, commercially-relevant programs

Manage: T2M Milestone Negotiations

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8 Layers to Unpack

T2M Negotiations

Product Definition Intellectual

Property Plan Cost-Performance

Model

Customer Discovery &

Market Analysis

Competitive Analysis & Regulatory

Analysis

Manage: Approach to Tech-to-Market

Technology-to-Market Plan

Focal Areas

Manage project teams’ T2M efforts through T2M plans

and jointly developed milestones

Support project teams with skills & knowledge to align

technology with market needs

Support Program Directors to generate highly

innovative, commercially-relevant programs

Advise: Product-Market Hypothesis

Value Proposition

Customers

Relationships

ChannelsResources

Partners

Activities

Cost Revenue

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Business Model Canvas

“Business Model Generation” by Alexander Osterwalder

Advise: Minimum Viable Product

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Control

Data Analytics Communication

Hardware

I’ll usefeature B.I’ll pay for

feature A.I want

features A & C.

Customer Data

Market Data

CA

B

Technology

What is the business model of the future?How does your technology fit in?

Advise: Techno-Economic Analysis

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Focal Areas

Manage project teams’ T2M efforts through T2M plans

and jointly developed milestones

Support project teams with skills & knowledge to align

technology with market needs

Support Program Directors to generate highly

innovative, commercially-relevant programs

Engage third-party financiers to support continuity of

technology development towards the market

Technical, Financial Risk

Fina

ncia

l Ret

urn

Private Investment Threshold

Private Sector Invests

Government Invests

Hig

h Im

pact

Te

chno

logy

Hig

h Im

pact

Te

chno

logy

ARPA-E

Finance: Investment Threshold

Finance: Follow On Funding

GovernmentDOE,DOD, State & Regional Agencies

Private CapitalVenture Capital, Family Offices, High Net Worth People, Impact Investors

Corporate StrategiesAcquisition, Licensing, Joint Venture

Accelerators/IncubatorsStartup, Team Formation, Quick Growth

Strategize & Think Through Sources of Funding

CAVS Disrupting Transportation

GPS provides accuratelocation. Computer analyzes data and

cross-checks systems before maneuvering.

LIDAR uses spinning lasers to construct a virtual 3D map

of the surrounding environment.

Radio signals between vehicles—and from stop lights and otherinfrastructure —further augment safety and efficiency.

Platoons ofautomated trucks

and cars will reduce congestion and

save on fuel.

Short-distance radar measures proximity of nearby surroundings.

Long-distance radar monitors the location

of vehicles well ahead of the car.

Ultrasound aids with parking maneuvers and objectdetection.

COORDINATING TECHNOLOGIESFor a fully automated vehicle to navigatethrough a complex and dynamic system ofroadways, it must rely on a wide range of sensing, orienting and processing systems.

Cameras create a 360-degree image for analysis, revealing stop lights, pedestrians, crosswalks and other features. Forward-mounted stereo cameras see the road ahead in 3D. Infrared lights and cameras penetrate reflective surfaces.

Wheel sensors track distance and velocity.

Disrupting Transportation

Business ModelsOwnership vs. Control

Mobility AccessibilityUnderserved Populations & Older Americans

Commuter Expectations Shaped by Technology

Connected & Automated

Vehicles

Shifting Demographics

(Millennials)

Urbanization: Shifts to

Megaregions

Key Learnings

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01Innovative Technology that Disrupts Incumbents and Outperforms Competition

02Clear & Quantifiable Value

Proposition with Appropriate Product-Market Fit

03Defined Customer

Segments Enabling Market Penetration for

Accelerated Growth

ARPA-E External Forces

Research Team

Desired Impact

• Hire Experience• Active Management

• Technologies• Markets

• Concurrent Technology• Commercialization

• Market Penetration

Next Steps

Perform Customer Discovery & Market Analysis

01

Develop & Test Technology, Align T2M Plan with Partners

02

Validate Solutions in HIL & Large Scale Simulation

03

Execute Technology to Market Plan & Deployment Strategies

04

Engage Industry & Customers

Address Technology

Needs

Demonstrate Capabilities

Commercialize Technology

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www.arpa-e.energy.gov

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Thank You

Carlton Reeves, Ph.D.Technology-to-Market AdvisorCarlton.Reeves@hq.doe.gov

Office: 202-287-5470