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Energy> Cleantech 27 May 2024

Ian Bogado, CEO of Uali: “Cleantech has scalability problem”

Wind turbines in hard-to-reach areas or solar panels located in large semi-desert regions. How do we monitor these facilities without having to move human teams to remote areas?

A combination of drones and artificial intelligence, implemented by the Argentine cleantech Uali, provides innovative solutions for the automation and monitoring of energy-related tasks.

We spoke with Uali CEO Ian Bogado at the Energy Tech Summit held in Bilbao in April about this topic and everything else that new cleantech can do to decarbonize the world.

Bogado declares himself a lover of science fiction but treads on firm ground, especially when he talks about funding the cleantech ecosystem. He is also realistic about the challenges facing these entrepreneurs and the new climate technologies which, in his opinion, "have a scalability problem."

Question: We are here in Bilbao, at the Energy Tech Summit. A spectacular atmosphere. Effervescence. I wanted to start talking about cleantech, of course, and I wanted to ask you, what, in this case, is Uali contributing to the cleantech ecosystem? How?

Ian Bogado: Today, we find ourselves in this spectacular ecosystem where some ideas are being challenged. From an innovation perspective, we are the first ones who need to address these questions. At Uali, the question we're tackling is how we transition.

Today we are coexisting with two different sub-worlds within energy: oil and gas; and renewable energies. Large areas of land, sea, forests, deserts, etc. must be covered to produce the energy the world needs. And we understand that we need a tool to make the most repetitive and, so to speak, boring and inefficient tasks, make them more efficient and be able to transform the jobs of the collaborators who are operating today and maintaining these assets into better jobs, bringing everything as much as possible to digitization. And therein lies the challenge.

Q. A few years ago, there was talk of a fintech boom. Are we at a similar point in time if we now think about cleantech?

Ian Bogado: The most solid and established industries are those that can move at a different pace. The security and energy sectors, in particular, have always been characterized by their stability and long-term margins. These industries not only maintain steady growth but also provide support to startups. Why? Because decision making within our world takes time. So today we find two different worlds, a world that needs to develop capital in something, and then startups that need capital, but have another time frame. And at the same time there is a clock that is the world and there we are all dancing in this party.

Q. We are talking about sectors that are more difficult to defeat and that share this and that are with us beyond the fact that they are outside, which would be problematic?

A. Let's think about processes that take five to ten years to go into production. An offshore wind farm takes seven years from the time the idea is conceived and planned until it starts producing energy. It's crazy. These are processes that take a long time and you have to try to understand how to help them, not to go against them.

In the entrepreneurial ecosystem, our strength lies in our flexibility. Large corporations, constrained by their sheer size, often struggle to adapt quickly. In contrast, our agility allows us to innovate, experiment, and iterate rapidly. This nimbleness is precisely why they seek our expertise: to bring the speed and responsiveness they cannot achieve on their own. This is where I believe the ecosystem needs to expand. Our ecosystem is relatively small, especially when compared to other sectors and the energy industry we are targeting. There are only a handful of players in the market, and we are all familiar with one another on a global scale. This is a new process, and we need to foster greater collaboration to support it. It's time to set egos aside, focus on our work, and strive for ever-greater efficiencies. If we persist in our current approach, we will end up in the same place.

Q. Are you optimistic about the future? Because sustainability is clearly a duty, it is a must, for the sake of all of us, our children and our future. But it's also a business opportunity. What is your vision?

A. We often emphasize that a wind turbine or solar panel is the same whether in China, India, Australia, the United Kingdom, or Spain, making our efforts highly scalable on a global level. It's not just about claiming to be a global company; we must ensure that our solutions can function effectively anywhere in the world, which is a complex challenge. Energy companies understand this concept well. They have practiced it throughout their existence, enabling them to pivot and produce energy anywhere in the world. We, as contractors or partners, need to understand this dynamic and align ourselves with it.

We have encountered this with clients like Total Energies, which has substantial gas production in Africa and significant energy operations in Latin America. They find it easy to pivot between these regions, but for us, it’s more challenging. From a technology perspective, we must ensure that our solutions are highly scalable.

Today, the ecosystem faces a problem of scale. There are many excellent ideas and developments, but they often take too long to implement or are economically unviable. This creates several bottlenecks that the entire ecosystem must address. There is no single solution; it’s time to explore all the options available.

Q. Just to go deeper, how scalable are your solutions to large industry, for example. How do you have it figured out? Or how do you try to support your clients in this scalability? Something that is so complex for a startup?

A. It is complex. Currently, Uali is heavily involved in lithium mining. We have begun to explore how our existing technology can be easily replicated in other heavy industries that share similar characteristics.

Mining involves a large workforce and numerous suppliers, and its environmental impact is particularly crucial for the battery industry. Scaling solutions from one industry to others, especially in remote locations, is challenging. For instance, Australia has significant lithium reserves located thousands of kilometers away. We are learning that our technology is not just tied to energy but is broadly about sustainability and efficiency across multiple industries. We are currently endeavoring, for this year and the next, to extend our assistance and scale our operations in other heavy industries such as steel, mining, and ports. Our technology has already shown promise in an industry known for its operational complexity, often operating in some of the most challenging weather conditions worldwide.

Uali CEO, Ian Bogado, during his interview at the Energy Tech Summit held in Bilbao.

"Advancements are occurring at a much faster pace than initially anticipated"

Q.  You were talking about scaling up or tackling other industries: steel mills, mining for lithium. Any other projects you can tell us about? From other industries or terms of pipeline?

A. Absolutely, our current efforts involve full automation, including the deployment of autonomous drones operating from remote locations, digitally capturing entire wind turbines. This data can then be accessed by owners, even across continents. While such discussions took place four or five years ago, practical implementation and scalability were elusive until now. The world is witnessing a convergence of technologies, with robots deployed across various sites—a concept once considered science fiction but now a tangible reality. Progress is gradually being made, and what we're observing is that advancements are occurring at a much faster pace than initially anticipated.

Q. When we mention science fiction, are we discussing it as a distant concept or as something that has yet to be realized? Considering the significant number of players actively engaged in developing, researching, and working on projects that were once deemed science fiction, can we afford to be cautiously optimistic about what lies ahead?

A. That’s exactly right. I'm a fan of science fiction myself, but here, we're turning fiction into reality. Numerous fascinating technologies are clamoring to enter the field—they want to dive in, start experimenting, make mistakes, improve, and ultimately scale.

Here, we're also learning from the startup perspective. On the customer side, there's a growing demand for rapid experimentation, not waiting for a year or two, but rather, the ability to pivot swiftly. This underscores the importance of our agility, as we must grasp not only the technology but also the business domain, understanding how decisions are made on the other side. But, absolutely, we're both adapting rapidly, and it's fascinating to witness how science fiction is gradually morphing into science reality. It's truly remarkable.

Q. Let's delve into financing, a recurring theme for many. The infamous "death valley curve" is often mentioned, signifying a critical juncture. How does your company navigate this challenge? What financing strategies have you employed, and what's been your journey thus far? Could you share some insights into your history in this regard?

A. We secured funding through Globant, an Argentine unicorn—a software company with a global presence spanning over 30 countries. Their innovative approach resonates with our ethos, as we heavily rely on data-driven strategies to tackle challenges. In our industry, patience is paramount, often involving prolonged periods of waiting for results. We've found the financing options provided by banks, especially for companies like ours that have demonstrated diligence, to be particularly intriguing.

Q. Continuing our discussion on financing, what role can financial institutions play as both a business opportunity and a contributor to environmental sustainability, considering the finite resources and absence of a "Planet B"? From your perspective, what role do banks have or could they potentially play in this context?

A. Banks are increasingly recognizing the role they can play and what entrepreneurs need from their side. It's crucial for them to understand that entrepreneurs aren't simply seeking bureaucracy and strict requirements but rather collaboration and support. Even small adjustments can make a significant difference. We see promising signs that banks are starting to understand and consider the flexibilities they can offer to entrepreneurs, balancing risk levels to support their journey.

And we're seeing this trend with initiatives like BBVA Spark and similar efforts by other banks worldwide, although they remain relatively scarce. Just a couple of years ago, such options were virtually nonexistent. Previously, one had to establish a long-term relationship with a bank, which took years to cultivate. We've experienced this firsthand. Now, with these efforts to bridge the gap and get closer to entrepreneurs, any form of assistance becomes invaluable.

"The notion of banks engaging with startups from earlier stages strikes me as a prudent decision"

This shift is particularly relevant today, especially for startups, where options for financing have historically been limited—often restricted to personal capital, venture capital, or exiting the company altogether. Banks were typically viewed as entities solely focused on transactions, such as collecting payments or issuing credit cards, with little consideration for the specific needs of entrepreneurs. However, the recent trend of banks becoming more approachable and engaging with startups in a more organic and personable manner is noteworthy. This warmer approach fosters a sense of confidence among entrepreneurs, myself included, as it aligns with the direction we aspire to take as successful ventures in the future. Looking ahead, the guidelines of venture capital don't accompany you indefinitely. However, the practice of traditional finance is essential and requires cultivation, particularly as your startup begins to scale. It becomes increasingly vital. Therefore, the notion of banks engaging with startups from earlier stages strikes me as a prudent decision for the years ahead. It's a step towards preparing and training for the financial demands that come with growth.

Q. Specifically: What is your relationship with BBVA?

A. They've shed light on various financial instruments we hadn't previously considered, expanding our understanding continually. They highlight possibilities like allocating funds to specific areas or expanding into new regions. It's fascinating. The account executives we work with are approachable and adaptable, possessing the ability to navigate both worlds seamlessly. Our relationship with BBVA has evolved similarly to a courtship, starting with getting acquainted and gradually progressing to a deeper level of trust, where they understand our needs and can offer tailored solutions accordingly.

We often encounter a traditional issue—factoring, particularly in B2B transactions. It's a common challenge: dealing with substantial invoices and projects, with startups frequently bearing the burden of financing. Therefore, having the bank involved, especially when working with major clients, proves advantageous. Having the backing of the bank gives me confidence to explore opportunities and tackle challenges with assurance. While investors may not always offer this level of support, the bank provides a flexible financial safety net, which is invaluable in navigating potential obstacles.

Q. Before we conclude, I'd like to touch on technology. Could you share insights into the technology you rely on most for your solutions, as well as any ongoing efforts to deepen your understanding of the business?

A. More than anything else, our solution is based on three technological systems, so to speak. One is the devices or the IoT, which more than anything else is the hardware that collects the information that is on site. Artificial intelligence plays a crucial role for us. It enables us to transfer the extensive technical knowledge of industry veterans who can swiftly grasp complex situations. Additionally, robotics is essential, as it empowers us to navigate challenging environments effectively.

Furthermore, when it comes to decision-making, simplicity and practicality are paramount. Therefore, we utilize other technological stacks and platforms to handle the complexity of our physical operations. On the intangible side, where decisions need to be swift, the technology we employ is designed to facilitate quick and native decision-making processes. We're making significant strides—some pioneering, others following—but I'm confident that we're paving the way for future advancements in the ecosystem. By doing so, we're fostering a healthier growth trajectory and, most importantly, demonstrating our collective commitment to addressing sustainability challenges collaboratively.