Andrew Fuselier, CEO of Seraphim USA discusses the operation of solar power and the tech behind clean energy production!
Please excuse any typos in this hasty transcript.
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Well let’s get started. We’ve got a great segment going on, here, and this is going to be techie, technology, the latest trends, the type of stuff we like to do here on the show. I have in the studio with me Andrew Fuselier.
Andrew: That’s it-
Jay: And he is the CEO of Seraphim USA.
Jay: And that’s all about solar energy, so, we’re going to talk about solar energy. So, Andrew, thank you for joining us.
Andrew: Yeah, you bet. Thanks for having me.
Jay: I’m looking forward to this. This is going to be fun. So, what is Seraphim USA. What’s that all about?
Andrew: We manufacture solar modules, here in the USA. So, we’ve got a headquarters just outside of Houston, and we’ve got a plant in Jackson, Mississippi. We … I’ll try not to do too much industry terms without explanation. Our plant is about 160 megawatts and when you convert that in terms of units, called, about 450 thousand units we’re capable of producing a year. Units for us is a solar module, so when you think solar panels, solar module, when you’ve driven by and seen that very progressive neighbor on your street with panels on the roof, that’s what we produce.
Jay: So, the panel being not little bitty, but what, three feet by a foot or something, you see them-
Jay: Yeah, something along those lines, and you see them up on a standard home, there might be six or 10 or 12, but, you see them other places, they could be huge, right?
Andrew: Yeah, yeah. You’re spot on. About three by five is one of the sizes and, there’s two basic sizes that get used. A little bit smaller for residential, a little larger for commercial or for utility scale project.
Jay: Now, you’re the manufacturer.
Jay: You’ve got all the technology. You don’t do this for onesie twosie homes. You’re in to the big forms. Tell us who your clients are.
Andrew: Yeah, we do. We produce for large distribution, so that could be large, regional, what we call, EPCs, engineering, procurement, and construction groups. They actually design and will oversee installation for large, or we go directly to large distribution houses. These guys are pretty major guys, and they’ll supply large projects, or directly to the utility scale developers. These are the guys that are doing the big ones out in the middle of west Texas, you see, or if you drive across country, if you’ve ever seen a large solar farm, that’s who we supply. So, large volume.
Jay: Wow. So, there are experts out there that are developing these farms of solar, I guess, they literally are solar farms, and then, there’re groups of installers, like, if you had a big complex or something and you wanted to put it … There’s, what, general construction contractors, or-
Andrew: Yeah, the-
Andrew: The value chain, if you want to look at it like that, it looks something very similar to a residential development, or to commercial construction development where you’ve got to have a developer in the beginning who sees the concept and the idea. In this case, it could be the middle of a field in Nebraska where they think is a good location, and they put the project together from nothing, or later on in the value chain when the vision has been kind of baked, and you bring in a general contractor who’s going to actually build it and oversee the actual construction of it.
And then, you’ve got the guys who actually do it, the installers, the guys that pull wires and turn wrenches and all that. We sell to all levels of the value chain depending on who needs it and who’s transacting and what their purpose for it is at the time.
Jay: So, are you wholesaling, retailing or both?
Andrew: Yeah. All of the above.
Jay: You’re just selling, baby.
Andrew: We’re just selling. I mean, that’s right. We launched the business a couple of years ago, and the idea is, use the technology platform that’s available today to be able to distribute to everyone. Everything from the very large projects, where price is really key, competition is pretty fierce, and so, that moves the needle in terms of volume. But, we make a lot of margin at the lower levels. I mean, we’ve had guys, literally, with pick up trucks back up to our dock and-
Jay: No kidding?
Andrew: We load a pallet on there, and they take off, and so, yeah, we’re selling across the board. You know, and that’s, again, that’s just part of trying to be a start-up, right, be scrappy and get money where you can.
Jay: I know Houston is kind of the oil and gas center, but, why solar in Houston? Is that just coincidental or was that planned, or how did that happen?
Andrew: No, you know, it’s a good question. If you look at the … We like to consider ourselves an energy business, right. I mean, oil’s energy and solar is energy. And so, in some ways, it really benefits us to be in a place where people already understand the idea and the value of energy, and we’re not a whole lot different than how oil is kind of pulled from the ground and it goes though its life cycle when you look at a solar project and how it’s developed, as well. So, I think what we’re seeing is a trend in the people that traditionally serviced oil. They understand the infrastructure and the process of how to do that and so, now those businesses are starting to service the, called, the clean energy technology, as well. So, that’s everything from IT service companies to financing companies. We’re just a much younger business-
Jay: Industry, yeah-
Andrew: Yeah, and growing up. The reason, specifically, we’re located in Houston, is the group that backed us, originally, is a capital advisory, kind of, venture capital company, that’s based in Sugar Land just outside of Houston. So, they helped us get going. They’ve done this for other businesses going back 15 years, and the way they do it is similar to a kind of incubator program, where you actually use some of their shared resources in the early stages until you become a business of your own. Once you get big enough, kind of, get your own legs and you move out of their space and continue to grow up, and so, physically, that’s why our headquarters is here.
Andrew: But, there’s actually quite a bit of clean energy technology businesses in the Houston area.
Jay: Yeah, I’ve noticed that. Even the big oil companies are expanding, so, they’re not just in oil, anymore. They’re in solar, they’re in wind, they’re, you know, everywhere they could get, and I guess, Texas is a good market, anyway, if you’re producing electricity.
Andrew: Yeah, it’s, you know, building and developing solar is quite complicated. It’s been maturing as an industry quite a bit over the last 15 years. What we saw back in, probably, about the mid 2000s is a real fervor for the industry. There’s a whole lot of promise, and we’d just come off a big tech bubble. People were looking for places to put money and a new industry to put a lot of money behind, and what you had was way too much capital coming into the industry. Way too much money poured in to early stage renewables. And a lot of the majors weren’t in at that point. So, that’s when BP Solar and some of these more well known oil companies jumped in. The industry had no legs at the time to be able to support that much money and that much excitement-
Jay: That kind of hurt, didn’t it?
Andrew: Yeah, yeah, and it ended up collapsing just a few years later due to a number of things. Globally, there wasn’t much in the way of clean technology, and that’s really, really when it got a big push. Well, now, kind of fast forward post the 2008, 2009, 2010, really, really rough years for solar, you’re starting to see the major companies come back, right? The infrastructure’s developed. You’ve got, you know, going on 10 years, really, of what we call, stability, and stability comes from market certainty. It’s regulatory, that we can count on, that aren’t changing every two years with elected officials. It’s-
Jay: Yeah, right-
Andrew: It’s the price is coming down now where the financial returns make sense all across the board. So, we’ve got now, quite a bit of certainty, and that certainly has driven a lot of the majors back into it. Combined with the fact that those guys are now looking out 20, 30, 40 years, and seeing that the traditional oil and gas is going to be around, but there are cheaper alternatives.
Jay: So, now, you mentioned that it had gone from five dollars down to 50 cents, and it’s going to go even cheaper, huh?
Andrew: Yeah, absolutely. So, yeah, I think the solar research truists out there are going to probably poke holes at these exact figures, but just for relative terms, call it, 10 years ago, at five dollars a watt, for a solar module. We talk about everything in watts, but now, 50 cents a watt is a very common number. It’s out there.
Jay: So, we’re about to run out of time. So, if somebody wants to learn more about this, more about your company, and more about you, where would they go?
Andrew: Well, certainly, start with our website, SeraphimUSA.com. You could reach out to us. We can help you learn more about the technology as whole, but also, just, if you’re interested, we can refer you to a lot of our installation partners.
Jay: So, there you go. Andrew, very interesting story. I’ve been talking to Andrew Fuselier, and he’s the CEO of Seraphim USA. That’s solar panels. Folks, we’ve got to go do a little solar paneling, ourselves, pay a few bills, and we’re going to bring in another great guest. So, you want to stick with us. Don’t go anywhere. We’re going to be right back.
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Jay W. Curry
Along with hosting “Texas Business Radio”, Jay is a Professional Certified Coach and Master Chair facilitating four Houston-based Vistage peer groups. In addition to being a best selling non-fiction author, the 2015 release of his award winning novel, Nixon and Dovey: the Legend Returns, adds novelist to his title. Jay holds a BS in Mathematics from Oklahoma State and an MS in Computer Science from Kansas State. You can learn more about Jay HERE.