By Tom Ballard, Chief Alliance Officer, PYA
Sanjiv Malhotra has big plans for SPARKZ Inc. and for the Knoxville-Oak Ridge region where he has been incubating the new venture in stealth mode until now.
While it is not his first start-up venture, it is one that has accelerated quickly, thanks to technology developed at and licensed from Oak Ridge National Laboratory (ORNL) and purchase agreements from two major corporations. There are also significant opportunities with automotive original equipment manufacturers (OEMs), particularly with Tennessee having an avowed goal of being the state where the most electric vehicles (EVs) are manufactured.
“I’ve found the right technology and, more important, the right mindset here,” Malhotra told us in a recent interview soon after executing his second exclusive IP licensing agreement with ORNL. The most recent license was for a battery cycling technology designed to enable the rapid production of lithium-ion batteries commonly used in portable electronic devices and electric vehicles. Just a year earlier, he had executed an agreement for five battery technologies designed to eliminate cobalt metal in lithium-ion batteries to accelerate the production of electric vehicles and energy storage solutions for the power grid.
Together with other patents for which he is in negotiations, Malhotra is focused on the sort of bold, high-impact project envisaged by the recent Techstars assessment of the innovation and entrepreneurial opportunities for the area. Specifically, his goal is to build a lithium-ion Gigafactory in the Knoxville-Oak Ridge region.
“We will provide a faster charging, safer alternative that is also not as susceptible to foreign countries for materials,” Malhotra says. He’s currently raising a seed round to provide working capital to meet the initial purchase order from a nationally-known forklift manufacturer and finalize agreements with an and another nationally-known brand.
“I want to raise the capital here so we can build the factory here,” Malhotra says. “If we raise capital elsewhere, I will be forced to build it there. I will be generating revenue this year.”
Noting it is the right time for SPARKZ, he cites a number of reasons. General Motors, which has a plant in Spring Hill, TN, has announced that it plans to be exclusively all electric by 2035, and Volkswagen will have capacity to produce up to 100,000 EVs at its Chattanooga facility when the latest expansion is completed in early 2022. Two global giants – Amazon and Microsoft – have launched billion dollar funds to address climate issues.
We met Malhotra, the first Director of the Energy Investment Center at the U.S. Department of Energy, during a meeting at ORNL in 2019. It was about the time that he was visiting various DOE labs to identify technologies for his latest start-up that was founded in mid-2019. Since then, Malhotra has set up shop at ORNL’s Manufacturing Demonstration Facility to jointly work with ORNL’s battery team headed by Ilias Belharouak for further developing and scaling-up of SPARKZ’s technology.
During our interview, he outlined a multi-part strategy to grow the company, starting with the forklift sector that he knows well, having grown a previous start-up that he founded – Oorja Protonics Inc. – that supported that market segment. Malhotra explained that the large commercial forklifts that are battery-powered can operate for about six or seven hours before needing to be recharged. The process to exchange batteries is cumbersome since they weigh 5,000 pounds and cost $5,000 each. Also, at least three batteries are required for one forklift to run a 24-hour shift.
By Q4 of 2023, he sees SPARKZ expanding to serve the delivery van sector with a further expansion into electric buses and the EV market where, by 2025, projections say there will be seven million EVs globally.
“Our batteries will also be cheaper than existing options and take less time to recharge,” Malhotra says. He also forecasts that SPARKZ will add at least six employees locally in the next six months and grow to about 20 employees by yearend before adding an additional 45-50 jobs next year.
“I want to innovate here, manufacture here, and deploy globally,” he says.