Jeffery Kostos, President and CEO, Spear Power Systems, Inc.
Nabtesco Technology Ventures is happy to announce its first investment.
Spear Power Systems is a six-year-old start-up based in Kansas City, Missouri, in the Unites States. The company designs and manufactures safe, reliable lithium ion battery storage systems for such demanding applications as defense, marine propulsion, oil & gas, and mining.
We spoke to Jeffery Kostos, Founder, President and CEO of Spear Power Systems.
Tell us about Spear Power Systems’ Technology.
When people think about batteries, they always think of the chemistry – for example, the lithium ion cell. But those cells are not usable by themselves; they need to be assembled in a way that provides the right amount of voltage, the right amount of current, and the right cycle life. What we do is we optimize the end solution: we choose whatever type of cell provides the most value to our customer, and we package it by adding our own best-in-class electronics and software.
Best-in-class safety
What we do is unique in two areas. One is safety. We have the ability to mitigate or minimize propagation of a thermal event – that’s the term the industry uses to describe a fire. A fire might occur in one cell, and you have to keep it from spreading to the cell next to it.
If you think of a small battery, like in a vaping device or a mobile phone, if it catches fire you could have a dangerous situation, but typically it’s not life-threatening because the amount of energy in those small cells is limited. But if you have a battery the size of a shipping container, and you aren’t able to control a fire in one cell, and it spreads throughout the entire battery pack, you could have a massive disaster on your hands. So being able to confine that fire to the cell where it was initiated is a huge safety advantage.
What we are able to do through our unique architecture, lightweight materials and some other technology is keep that fire confined to that cell. And then we extract the heat and gas, and get it away from the full system.
30-50% lighter
The other advantage we have is that we are able to do this in a way that the end solution – the full battery pack – is 30-50% lighter than our competitors’ products. The battery pack’s controls, and the mechanical packaging and thermal management system typically account for 40-60% of the overall system weight. For a small battery in a phone, that’s usually nothing – except perhaps a small circuit board. But in the larger systems, that extra material is very significant. Virtually everything we put our batteries on is mobile, so having a gravimetrically or volumetrically efficient system is very important.
So, to sum up, we have developed technology that has the best-in-class safety, while at the same time providing the most efficiency, even when using the exact same cells our competitors are using.
“This investment from Nabtesco gives us the ability to grow geographically into Japan and maybe other parts of Asia.”
What kind of synergies do you see between your business and Nabtesco’s?
We’re in a lot of the same markets and applications, but not with the same products. Nabtesco makes sensors and drives for the aviation industry, industrial vehicles, marine transportation – all the same applications we sell into, except they’re typically selling electromechanical solutions while we sell energy storage solutions. So they have access to markets. They have standing relationships. They have a dominant market share in many product categories. And geographically, they’re in a market where we have zero presence.
For Spear, this investment from Nabtesco gives us the ability to grow geographically into Japan and maybe other parts of Asia. And for Nabtesco, it’s a means of potentially collaborating on projects where they can have access to technology that they don’t have today. And also, maybe we can make introductions so they can push their technology into some markets where they don’t have relationships. I see a lot of synergy here.
Why is Japan an important market for Spear?
Japan is important to Spear because it’s quality-oriented, and they put a premium on safety and reliability, which is Spear’s focus as well.
“We are looking for someone who can help us drive demand and innovate, so that we can maintain our position as a technology leader.”
As a company, what are you looking for in a strategic partner?
We are looking for someone who can help us drive demand and innovate, so that we can maintain our position as a technology leader – a nimble, fast technology leader in the markets we’re in. We’re pretty small. Nabtesco is a big company, they have some great engineers and a very good technical team, and I’m sure there are things they could do to help us that we would be delighted to participate in.
What are your biggest hopes for your relationship with Nabtesco?
That we both benefit from each other. I hope we can have a relationship where both parties benefit – not just financially, but in terms of innovation, and expanding our networks. I’m expecting collaboration and synergies from a technology standpoint – that’s really what we’re hoping for.