The account
Our assessment method exists because of a position taken in 1999. This is the full account, published under the name of the person who took it.
1999
Industrial-scale battery storage.
I made this mistake, and I can be specific about it.
In 1999 I took a substantial position in industrial-scale battery storage. I had believed in the solar economy since I was a teenager and I understood — correctly — that grid-scale storage was the threshold solar had to cross before its economics worked. The technology thesis was right. It is right today.
I met the principals. I saw a demonstration. I read the business plan and the pro forma. By the standards I had then, I did the work.
What I could not do was assess any of it.
Three failures
Each one is now an assessment.
I watched a demonstration and had no way to evaluate how the system was actually engineered, or whether what I was shown was a working system or a staged result. I could not distinguish the stage claimed from the stage evidenced. Nobody independent had looked, and it did not occur to me that anybody should.
I read the plan and the projections and I saw what I wanted to see. My own conviction about where the market had to go supplied the demand those numbers assumed. I was not testing the commercial case. I was confirming it.
I was not a competent judge of the founding team’s character or their capacity to deliver. Nor was I a competent judge of the person who brought me the deal — whose position, as it turned out, my money largely retired. There were material things I was not told. I did not see them because I was not looking. I was too invested in being right about the technology and the timing to examine carefully who I was actually transacting with, or why the opportunity had come to me at that moment.
What it cost
Not only the capital.
It was a calculated gamble on belief, without instrumentation. It failed completely.
I lost a great deal of money. The larger cost was the reserve it drained and the positions I could not take for years afterward.
The technology was not the mistake. The absence of a method was.
Marc Strauch
Founding principal, Climate Sprints
Why this is published
A method built out of a loss is more credible when the loss is stated.
The industry cites instinct constantly, and only ever in the positive. Nobody publishes the one that cost them. The behavioral literature is clear about why: failure brings shame, and shame is what prevents the learning from being extracted. So the losses stay private, the lessons do not circulate, and every new angel starts from the same place.
Three of the four assessments in our method exist because of the three failures above. The fourth — capital readiness — exists because of what the reserve drain cost afterward.
The longer version, with the research behind it, is Section 3 of the founder guide.
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