POTSDAM – LC Drives of Potsdam announced today $15 million in Series A financing from Koch Engineered Solutions to help them move forward with production of their innovative motors and generators.
CEO Russ Marvin said he expects to hire 20 more people in the next few months to ramp up production of motors at their facility at Clarkson University’s downtown campus.
“We’re committed to Potsdam. We’re here, and we’re going and we’re hiring,” Marvin said.
“I’m quite excited to be part of this,” he said.
With this new infusion of capital Marvin says “we expect to grow the business significantly with the launching of full production.”
“We have production purchase orders” that will move the company to “the next stage of growth.”
What they have been developing are motors and generators that are about half the size and weight of comparably powered units. They do that with a patented creative solution dispersing the heat buildup those units experience. They use less power per unit of output, with the promise of cutting the proportion of all electric power now used by motors around the world below the current 47 percent, the company says.
LC Drives is “focused on the development, manufacturing, marketing, and sales of industrial electric motors with industry-leading power density. The Company’s patented designs enable LC Drives to produce motors with half the weight and size of comparative products. The proceeds will be used to accelerate time-to-market activities including research and development, manufacturing, marketing, and sales. LC Drives is planning to expand operations and add additional staff in the immediate term,” their press release said.
The markets they are aiming at include marine, industrial, transportation, and wind energy applications, among others.
Marvin is “encouraging people to send resumes to LCDrives.com,” he said. They are looking for “engineers to manufacturing folks to marketing and communications people and manufacturing technicians – quite a range of people,” he said.
They will be expanding their footprint in Damon Hall at Clarkson’s downtown campus while maintaining offices in Peyton Hall there, and contemplating the next growth spurt as time goes on and “longer term needs are sorted out,” said LC Drives spokesman Mark Sperry.
The funding will be used for salaries, engineers and operators, for manufacturing and manufacturing support, and equipment in their Damon Hall facility, Sperry said. “We’re looking to double our operation in the four to six months,” he said. Just how fast that will happen “depends on how fast production ramps up and the size of the motors” in production.
What’s known as Series A financing, also called a strategic investment, is private funding from an investor who believes the company is ready to move beyond the startup phase, in this case to begin a push toward commercially sustainable production and sales.
The investment in LC Drives is even more significant due to the size and reputation of the investor, Koch Industries, in the top rank of private businesses in the world, which has an emphasis on science and engineering.
The funding comes from the Koch company Koch Engineered Solutions, “the unit of Koch Industries, Inc. focused on developing and delivering innovative technical and service solutions for industrial value chains,” LC Drives’ press release said.
“We are making a strategic investment in LC Drives as their technology shows promise in several of our core markets and strategy for future growth,” said Don Brown, Koch Engineered Solutions Vice President, Business Development.
In return for the investment, Koch will have two seats on LC Drives’ board of directors.
Marvin said the investment is understandably exciting to people in the company and even among customers, along with others who are watching LC Drives grow.
LC Drives has been developing its motors and manufacturing processes since its founding in 2012 with help from state grants and local support from the village in grant acquisition. Clarkson University has given the company support in its business incubator through the Shipley Center for Innovation and the Reh Center for Entrepreneurship.
“We are happy to have achieved this critical milestone for LC Drives and appreciate the confidence displayed by Koch in our vision and unique product and manufacturing process designs,” Marvin said in the press release. “Thank you to the dedicated team at LC Drives for your hard work and ingenuity and to Clarkson University, the New York State Energy Research and Development Authority, Empire State Development, and numerous other federal, state, and local organizations for their ongoing support,” he said.
“I moved back to Potsdam five years ago” to see if he could “grow the ecosystem” of the economy in the North Country.
He said he wanted to demonstrate that the success of a venture-backed company that “could be helpful to other companies looking to do the same. We’re an engine of economic growth in the community. Companies in the North Country are not taking advantage of this” model for growth. “It could make an impact, not just in the North Country.”
Original article here.