An interview with Kathy Hannun, CEO at Dandelion
Kathy Hannun and the Dandelion team are committed to mitigating climate change by making renewable technology, specifically geothermal, more accessible.
If the Old Faithful Geyser comes to mind, but you’re not totally sure what geothermal is, don’t fret. Geothermal is a renewable energy source that we don’t hear about as often. Geothermal energy is heat from the Earth, and geothermal heat pumps can tap into this resource to heat and cool buildings.
Can you briefly describe what Dandelion does? How would you explain geothermal to someone who isn’t familiar with the energy industry?
Dandelion is a home geothermal company that spun out of Alphabet's X. With geothermal, what happens is the sun heats the earth, and as a result of that, about 8 feet below the surface, the ground is at a constant temperature of about 50 degrees. In the winter, the heat pump uses that ground temperature and some electricity to heat a home. In the summer, the reverse happens. Heat gets pumped into the system and returns to the cooler earth. The result is an energy efficient way to heat and cool your home year-round.
In the renewable energy industry, it’s more common to hear about solar and wind. What excites you about geothermal and what do you think its potential is?
Geothermal excites me because there is such a large opportunity to convert homes to geothermal heating and cooling. The prime candidates for geothermal are homeowners that currently use fuel oil or propane to heat their homes. Fuel oil and propane are not ideal fuel sources, and they're expensive. We have initially focused on the 6-7 million homes using fuel oil or propane in the Northeast. The Northeast is a really strong market for us because there is a large differential in temperature throughout the year, which is ideal for geothermal. There are also big swings in seasons in the Midwest, which makes that area a good candidate for geothermal. Some other areas we have our eyes on are California and Texas.
Is Dandelion also looking at heating and cooling prices as you decide which markets to target?
Yes, the price of heating absolutely influences where we are targeting for initial rollout. The more expensive heating is, the more the customer can save.
You mentioned that geothermal is a great alternative for homes running on fuel oil or propane. Are there other heating sources that Dandelion is positioned to poach?
In addition to fuel oil and propane, some homes use space heaters powered by electricity. This is actually one of the most expensive ways to do it. You'd be surprised but I also recently met a guy who uses coal to heat his home in New York. This used to be a very common way to heat: if you walk down some streets in Brooklyn today, you can see little rectangles in front of some of the brownstones. These are actually abandoned coal shoots.
When purchasing a Dandelion Air, the customer receives a Nest thermostat. I also saw that there are financing options for consumers. Can you talk about Dandelion’s key partnerships?
We started at Google X, so the Nest Thermostat was an obvious choice to get started with. What we like about the product is that the Nest team also focused on improving the experience of using something as mundane as a thermostat, and they’ve created something people are proud to have in their homes. We are looking to do the same thing for heating and cooling equipment.
Right now, we give customers the option of paying no-money-down with monthly payments that are much lower than what they were paying for fuel oil. While our loan product works well for many customers, I’m looking forward to improving our finance products over time, so homeowners have more options for purchasing their conversion to geothermal heating and cooling.
Another group of partnerships we are looking at is utilities. There is certainly an interest amongst utilities in New York to promote heat pumps, so that presents a very exciting opportunity to pilot different models and understand how utilities can have an impact in making the technology more available. We also just completed our Series A Round. One of our investors is Lennar, which is one of the largest homebuilders in the country, so I think new builds will also be a great partnership opportunity. That’d be great if you can build a home outfitted with geothermal from the start.
Can you talk about your career journey and how you became CEO at Dandelion?
I graduated with a degree in civil engineering. I wanted to use that for energy or water. I was especially interested in natural resources, but similar to what you are describing, it was hard to find the opportunity that would allow me to do that, especially as a new graduate. So I decided to join Google, and my first job had nothing to do with water or resources or civil engineering in any way. Over time, I became involved with working at Google X, and one of the big advantages for me in working in that environment is that X is always on the search for businesses that solve big problems, and certainly water and energy are very big problems. That work eventually led me to geothermal heat pumps, which I believe is a huge, untapped opportunity. For a number of reasons, we decided mutually with X to spin the project out into a start-up, which is how I became the Co-Founder and CEO of Dandelion. When that happened, I had no idea how to build a company. It truly was a leap of faith. I didn’t have experience running or starting companies; I didn’t know anybody who had done it. I decided to just give it a shot.
It certainly appears to be going very well. I saw that you guys have some rock stars of the cleantech world such as Dan Yates, who was CEO at Opower. I am very impressed with the team you are building.
I agree. I think our team has been the number one thing that makes us successful. We are focused on how many really talented people we can bring on to tackle these problems that have historically held geothermal back. I’ll say, especially with Dan, who was introduced to me a few years back by NEA who led our Seed round, he has just been an incredible addition to Dandelion and an incredible addition to my life, too. He is a very talented and accomplished CEO who has 15 years of experience as CEO of a company that has been one of the biggest cleantech success stories, Opower. To have his mentorship and to have his talents applied to this set of problems has really accelerated our projects.
How big is the Dandelion team, and how would you describe your corporate culture?
We have around 40 employees. We have a New York City office, and we have two warehouses—one in the Hudson Valley and one in Albany. I would say that to be successful in our line of work, it’s really important to have a culture that values problem solving and attention to detail. I think we also really benefit from having people with a great sense of humor who work really hard day in and day out but can also laugh about the things that happen. I also try to have a very transparent culture. In my past roles, I’ve really valued when leadership is very open about the challenges and also the opportunities, so I try to do that as well.
As you are hiring, what are you and your team looking for? Do you have any advice for readers who may be looking to get a job at Dandelion or other cleantech companies in the city?
One thing my Marketing Manager did was very effective. We weren’t even planning to hire a Marketing Manager, but she cold emailed me and asked to meet but did so in a way that showcased the work she had done in the past and how that would relate to some of the challenges she thought Dandelion may also be having. She was right—she judged that correctly. I was interested in speaking with her, because I thought she may have some thoughts that could really help us out. When we met, she did a great job of understanding exactly what our challenges were and relating them to her experiences. She was proactive thinking about how she could solve those problems. We ended up hiring her as a consultant, which was less of a commitment for both of us. It was a very successful relationship, so she came on board as a full time employee. What I would highlight is that she did a really good job of anticipating the company’s problems and proactively suggesting how she could be useful and getting her foot in the door.
Notes from Watts Up:
Learn more about what Kathy and the Dandelion are up to here at the Dandelion website.
This video dives a little deeper into geothermal heat pumps.