Battery Storage Founder: 8 Months of Rejection, One Term Sheet He Refused

before the founder journey before Australia even you were in London Chartered engineer years of experience in clean energy in 2016 you were made redundant so could you um walk me through this time of your life I've been working as an engineer for about seven years at this point moved down to London at the end of 2015 to join an energy startup my first job at the startup was very very exciting and six months later I was made redundant by the company you know startups are good at many things this startup was very good at spending money so it was quite a difficult time for me I was um seven years as a professional I was 28 years old and um I just couldn't find work I was walking around you know I was in this great industry that was full of promise I had experience and I was very skilled and I had very good references but every place I went to was saying oh look you're not for us or it's just not right now um the EU referendum was happening around that time so it was May 2016 and the vote was scheduled for June so a lot of people were saying let's just wait and see what happens with the outcome of Brexit and then we'll make our decision and the outcome happened and they said well we weren't expecting that so now we need to make a plan for what's gonna happen so there were several months that went by where a lot of these job opportunities I was banking on just didn't come through they didn't materialize I had a lot of really difficult rejections um where you really commit and invest into a process you get to know the hiring managers and then they say look I'm really sorry but it's just not gonna work out um so that was that was really really tough when I was in university I worked in a pub kitchen whilst I was studying to try and make some extra money um so I actually went back to doing that for a period of time in 2016 I worked behind the bar for a bunch of breweries that I knew and I went to a kitchen Muriel's Kitchen in central London and I was doing pot wash um and I remember that was kind of my epiphany moment I remember just standing there it was July 2016 and I was just looking at a sink full of dishes it was July 2016 and I was just looking at a sink full of dishes and I was scrubbing them and I just looked at my hands and went Jesus Christ how did we end up back here no job was beneath me I just had to had to work and I think that's always been my mentality I just had to had to work and I think that's always been my mentality which probably lends itself well to being a founder now it lands so well to be a founder because you are the chief of everything um from running the company to figuring out where you guys are gonna get corporate presents for people I designed your cup for examples so really yeah really everything everything that isn't written code has been me everything everything that isn't written code has been me this is this is a really crazy experience and if you think about the job market right now it's probably one of the worst job market we've had in the last few years and a lot of really talented people like yourself back then are finding themselves redundant for the first time for people going through that gigantic life transition do you have any kind of words of wisdom from someone that's done it before I mean what matters is I got there in the end and one of my old colleagues from the starter that I had worked at for six months he ended up moving on to somewhere new and he needed help from a technical person who was also commercial so he reached out to me and got me into EDF Energy at the beginning of 2017 and EDF is one of the largest energy companies in the world so it was a huge opportunity for me so he got me in there and I ended up doing that and tutoring on the side for for several months afterwards I just kept going I kept hustling and if I were to give anybody advice it would be you don't get anything you're not gonna be successful if you don't keep trying but you also have to keep reinventing yourself through the process because the version of you that's being rejected is probably not the right fit for what you're trying to do that's why the rejection happened in some cases it's just not the right fit from a personality standpoint but if you can be honest and reflective and self aware enough to look into yourself and go okay why was I not successful what can I control about this situation that's gonna make the next opportunity better looking back do you think you were glad that the redundancy happened oh that's an interesting question um well for that company specifically it would have happened eventually because they ended up folding later that year the curse of working for startup right exactly but I'm glad the redundancy happened I am glad it happened because that was the first time in my life that I've had to think what is it about me that makes me employable not what is it about my skills but what is it about me and ever since then that has been how I pitch myself to every person that I've raised capital from or that I've asked for a job from or every client that I work with people buy you they don't buy your skills your skills are a commodity but people are buying you and how you apply your skills okay so speaking of career money and all the sorts so you said that finances were a constant challenge when you were a kid how did growing up watching that shape the way that you think about risk now I grew up in Sri Lanka and it was a we weren't very well off growing up and there's two things that that has created in me one of them is I did have a deep sense of kind of inbuilt guilt when I was a child because all I could think of was I can't wait to grow up so that I can get my family out of this mess that we're in but that has LED to me being one of these people that always takes on too much and burns myself out in my adult life I've ended up in a position where I go well risks are worth taking but you always got to manage the downside position yeah so my approach to risk is that it's that I if I feel like I can be the master of my own destiny when things go wrong I'll take any risk I started this business four months after buying a house in Sydney and that was the time when interest rates were at a peak back in 2023 but I decided to leave the security of a full time job I was about to be awarded you know 25 to 30% pay rise at that point as well but I just thought no I wanna do this thing because I really need to do it if I don't do it I feel like I'll go crazy so I went out there and found a bunch of contracting work on a day rate and I made sure that I could pay the mortgage at a minimum if you were to encapsulate Hachiko in two sentences how would you explain it to an energy novice sure um Hachiko is a software platform for maximizing the financial returns from portfolios of batteries uh stationary batteries mostly uh but you know transportation will come with time um the reason that that matters is because battery storage as a technology vertical is booming and people are building batteries across lots of sites that have different technical configurations and different uh market exposures so accounting for those differences is really tricky so we say to our customers we'll absorb that complexity away from you you just focus on building the biggest portfolio you can and we'll make it sing I love that beautiful so you mentioned you were going crazy not being able to build this so tell me where did the frustration come from I've always been an engineer building physical things so I I actually fit the profile of a lot of my customers the work that I've done in the past and I was trying to build I was trying to structure battery portfolios to get them through funding and then get them into operation which is quite a big job you're asking infrastructure investors to spend hundred to 2 hundred million dollars per transaction and then expecting a minimum of 12% internal rate of return which is a six to seven year payback um if you're lucky and of course they want it to be faster right so then these are assets that are built for a minimum of 15 years useful life so it's a complex transaction and I was finding that because a lot of the software products in market were not catering to that type of customer these projects were not getting funded so there was in 2024 I I was personally exposed to somewhere in the region of $500 million worth of project capital that could have been allocated but was not because the investors were not comfortable that the returns were gonna come at the rate that they wanted and I could see a very clear gap that software could have solved even in those transaction meetings so I thought well if nobody else is gonna build this I suppose I should do it because I can't feel like I can't do my job properly because this product doesn't exist so I went for it when you think about the increasing use of AI over time one of the big constraints is gonna be consumption of energy it's supposedly the biggest constraint I mean it's not computational power anymore it's about whether data centers can get access to the grid and have the energy they need in order to train their models yeah that's what a lot of people are saying at the moment your customers are large energy operators long contracts like serious trust required what does that sales cycle look like and how did you get your first one yeah the sales cycle is long because it takes it takes a long time for somebody to build the trust in you to hand over the keys to their hard earned projects to then generate the returns from them um can it'll take a minimum of nine months nine to 12 months for me from first meeting through to somebody signing a contract um which is obviously a very long time and once they sign the contract they start building that project and it's a construction project which can take another 12 to 18 months so the sale from first meeting through to first recurring revenue it is a very very long cycle um our first customer who gave us a real site to use our software on is somebody I actually met back in 2021 and when I was in a different role and he has followed our journey since then right he got to know me then I tried to sell him a deal at the time he told me to go myself because it just the product wasn't there he did it in the nicest possible way he was very transparent he said look I can see that you know what you're doing this product just isn't ready for me to use please leave me alone and it was really important feedback for me at the time then when I started Hachiko I started doing monthly newsletters building in public as they say which has been really useful cause he followed the journey every month and he would be replying to it saying keep it up I really like what you're doing and then after I sent out the newsletter back in July he replied to the email saying I think you're ready for me now and he brought a site to us and we onboarded it and we still have it he's made a ton of money he has um incumbent on some of his other sites and we're actually making more money than they are on a on a unit basis which is really exciting for us it shows our product has really come a long way very quickly because of the expertise that sits behind it um so that that sales cycle yeah that was that was how we came across our first customer trust is so important here because they're you know they spent a lot of money on the project they're expecting you to generate returns from it but it's all computers it's all robots that are doing the work but if they know you as a person know what you're doing that's what matters the most and they've seen me do this energy thing for a very long time now I've been in their seat before like I said you know I've worked in companies where it fits the profile of our customers today um and in all the times people have done business with me or had a conversation with me asked me a question I've never lied I've always been me I've always been genuine and I've always delivered and I think all those things together is really what made that sale happen but it was from a relationship that started four years prior wow okay so do you think for an industry like energy and for the types of products that you sell could someone with no experience or no relationship in the industry be successful it would take a while it's always possible but you've got to um the the challenges that people face in the energy industry which lead to them requiring solutions are incredibly complicated so if you can demonstrate that you understand and can empathize with those and that your product is actually solving the problem then absolutely anybody can come in and you know solve problems in brand new ways and and uh blow people's minds but it's it's track record it's you know when I when I turn up to somebody it's about the enterprise capital you know warm intro versus cold outreach right if you rock up somebody's office and say I got this software product it's gonna make you loads of money from your projects the first thing that person is gonna do is ask you how long you've been doing it after you left the office they're gonna be on the phone they're gonna be on LinkedIn who do I have share connections here call the person up and say what do you know about this guy is he any good and more often than not people have good things to say about me because I've been in the industry for a long time and I've never I've never screwed anyone over so if I failed at something I've been very open about why that was and people often know that it wasn't because I wilfully misled them um so that that kind of and I've of course I've delivered multiple times very successfully also so all those things combined nobody's perfect and energy we're all figuring it out you know we call the energy transition right now from coal and gas through to renewables it is messy as hell so anyone that's out there saying they've got all the solutions is lying but if you can show to a customer that you've lived it and that's where your solution comes from then you have a much greater chance of success than if you're brand new yeah for sure OK so you touch on fundraising a little bit so March 2024 you start fundraising for eight months nothing was there a specific moment or day where you genuinely thought that the business was over yeah there were several first one is we got our first term sheet after eight months of fundraising and I was just so happy we passed the investment committee and I sat there being told afterwards that we've been successful they're gonna give me a term sheet and I remember just being so elated at that point but then we got the term sheet and I took it to our lawyer and our lawyer said I don't think this is very good and because you don't have another one uh you have no leverage and I felt like I would actually rather not start the company than take that term sheet and potentially have this this kind of dynamic going forward and that was a bad day when I had that realisation I thought why is this ever gonna happen but the worst day by far was in August of that year when so we're five months in and there was an angel investor who had been really supportive very nice I'd built a relationship with him and he called me up and said look I don't think I'm gonna put money in here and I've been really hoping that he would because he's a big name in the industry and he would have brought a lot of other investors with him and the reasons he gave didn't make sense to me so I tried to have the conversation with him and eventually he said to me I haven't called you to have a discussion about this I called you to tell you that I'm not investing I remember that day being really hard and that was the day when I thought have I even got the right idea here is this ever gonna happen we got there eventually thank god but yeah those those days in particular were very very difficult so you got there at the end and then November 13 you meet the fund actually let your proceed round term sheet by the 29th so 16 days in total was there anything you think changed about the story that made them say yes after eight months of pitching four or five times a week at a minimum and all of those rejections that come you learn so many lessons here's the team that's gonna make this product happen here's the traction we have already and here's why we need the money now it's a problem that can only be solved with capital and not time this is the moment to invest you know in investing and in startups they talk about how the dream scenario is when the investor starts pitching your company to you and I had that experience in that meeting when you say they pitch your company back to you so you meant so what does that look like yeah I was I was describing the story and the the opportunity and they were starting to give me things about the opportunity that I hadn't said if you do it here then you can start doing it on bus depots in the future truck charges in the future think about all the electrification of transportation and how the addressable market grows from that it's not just about commercial rooftops and panels where you put solar and there's a battery next to it it's all of these other areas that you haven't even thought about so yes the opportunity is 100 x the market today but it's actually gonna be much more than that and they started to get really excited um and that was it was it was great to have that experience you've had quite an arduous pre seed journey and also a seed journey looking back what is the one thing that you would advise founders before embarking on the journey it's your company it's your story make sure you stick to that but I spent too much time solving for the optics rather than trying to build a great story of the company that I wanted to build and why the investor should invest um so I didn't build enough of a pitch around the unique context of our team and our company and our product I was just like if you're fundraising you need to do it this way tell them this story make sure you got at least 18 months runway or else they won't invest that kind of thing um I just took all that in too much early on and I think that's why I failed at so many of those pitches but if instead I had focused the story very sharply on this is who I am this is the company this is the story this is the product and this is why the opportunity is so exciting I think we could have got there quicker so as a founder now I say just make sure especially at the very very early stage you are the reason they're investing so you've got to make sure that you make that very clear to them why you are an investable resource the idea the market and everything is gonna change so much the only thing that's constant is you the founder um so indexing on that becomes really important um not only sort of telling the story of like your background but like why what drives you what motivates you who you are as a person your personality those are small factors I think play a big role that people don't really index a lot how do they know that when it's really hard and it will be hard that you're gonna be there you're gonna be working through it and making sure that you get results regardless you gotta you gotta be able to communicate that you sell a deeply technical product in a very boring industry but you're also a stand up comedian so what does comedy actually give you that the founder journey doesn't comedy has given me the ability to take a lot of hits and keep going and I've done thousands of gigs and you you you'd be lucky if you did thousands of gigs and 20% of them went well they may have gone well to the audience they didn't go well to you there's a lot of times where you kind of cop out of a set because you go I really want to do it this way but it's not happening so better just be reliable do my time and get off stage sometimes you try stuff and you get absolutely nothing is it give me the ability to read the room reasonably well and that translates to every area of life not just comedy there's something about stand up comedy that's really brave too and if you think about it the founder journey you really need to be super brave to embark on it because it's tough and it's long it's arduous and you're committing yourself to like you said getting punched every single day what do you think this entire journey has cost you it is truly all consuming in the most beautiful way possible it's all you ever think about it's it's the most exciting thing in your life and not everybody gets that so it changes the way you look at the other people in your life and the way you choose to spend your time and you're just much more ruthless with how you do that so going to parties going to dinners you know having inane conversations with people just isn't as attractive anymore I woke up this morning on Saturday going here's a bunch of stuff I can't wait to do today cause next week is gonna be so much better and I just never had that before the person you become when you're a founder is so different to most of the people around you and suddenly your network just isn't the right network anymore right think about it as you're making a living in a compressed period of time you know life is so beautiful why would you waste it working for so many years if you could compress that exercise into a 5 to 10 year period and then spend the rest of your life living what a great way to live you know and I don't think I didn't start this company for that reason but I'm having that experience now I'm able to think every day this is everything I do this is my life and I love it um which is very different to most of my friends are in the corporate world and can't wait to take their annual leave you know and go to Fiji or whatever I couldn't give less of a shit about Fiji I wanna build a company the founder journey is lonely in the sense that you choose to be lonely so you can focus on what you really care about and there's also a sense of kind of toxic radical positivity towards what's next which keeps you going and I can imagine as a solo founder that mentality is so important because there's no one that's gonna be there to take you out of your kind of do me and gloom so you are a solo founder do you advise it and what has been the worst part about being a solo founder it does depend on your temperament but if you're a person like me I do think solo founder life is the best life really really I work incredibly hard and I operate you know I'm very proud of the output that I can generate and the way in which I work the relationships I've built and the mentality that I have unless there was somebody like me who understood the the what we're shooting for and the importance of the quality of it and everything and was able to hustle as hard as I would want them to I had one originally and you know we had to part ways for exactly that reason day to day um day to day um life can be yeah really hard really lonely and when um you are the you are the emotional arbiter you are the emotional regulator of your company so if you've just taken a massive punch to the face and then you go into a meeting to talk to your team and that and that bruise is showing the whole team feels it so you need the ability to say alright now that that's already happened it's gone this next meeting or this next discussion this next interaction is a new thing and I need to make sure I don't take the baggage in with me or if I had a co founder I could say hey look that picture was an absolute uh bloodbath can you just go do this thing you might have that opportunity but to to get around that I have you know I have an executive coach and he's been great I'm able to pick up the phone and talk to him anytime my wife is great you know she's Learned a lot about energy in the last few years and software and she's really kind of committed to it also and you know she's able to kind of help me out um but one thing I found is probably the most important thing is other founders and I went to dinner on Thursday night and there was a bunch of other founders in there originally I didn't want to go to dinner because my week had been such a train wreck but um I went in and I was just talking to them and it became so lovely because they were all telling me about versions of the same experiences that they've had and how they've gotten through it and most importantly for me it was like I'm not alone experiencing this thing on my own building a village around you right um and yeah I think everyone yes it is always great to have a co founder but finding a co founder that really matches the way you work is actually really hard um and I've seen too many co founder breakups um to the point where I think unless a co founder relationship really works and you work together before and it like really gels maybe going at it alone could be the better course of action my experience has been that even if people think that it's going to go well until you're in it you do not know how you're going to respond that is true you can always do like a prenup and ask each other some questions if this scenario happened what would you do kind of thing um but even that you still never know how anyone would react in this situation cause emotions take over and the feeling becomes way more real thank you for coming on the podcast and for being super candor thank you for having me appreciate it and I was just looking at a sink full of dishes and I was scrubbing them and I just looked at my hands and went how have we ended up back here Rakhesh trained for years as an engineer when the work dried up after Brexit he washed dishes to get by I've called you to tell you that I couldn't give less of a shit about Fiji I want to build a company a lot of founders talk about resilience but rakhesh really lived it from the mountains of dishes to eight months of no to a term sheet that he couldn't sign hi I'm Rakhesh I'm the founder of Hachiko