I pull up outside a unit of a newly built business park in Claregalway and take in the view, which extends for miles as far as the famously low-lying fields of Athenry. Livestock are grazing emerald green pastures under stunning blue skies. I then turn around to be swiped into Xerotech’s new headquarters and meet the battery technology company’s founder, 28-year-old Barry Flannery. Within seconds, the bucolic feeling evaporates into a whirlwind of high-tech engineering and unabashed business ambition. 

We immediately embark on a whistle-stop tour, starting with the battery testing lab – a two-storey structure filled with equipment covered in English- and Chinese-language inscriptions. Here, engineers can subject batteries to temperatures of -60°C to 150°C, punishing vibrations and all sorts of catastrophic failure scenarios, Flannery explains.

Next door, an open-plan office space hosts a handful of engineers working on oversized computer screens. Through another corridor, the manufacturing floor where Xerotech’s prototypes are made is marked with tape rectangles where new machines are expected to land. A full container of gear is expected in the days following my visit. One team is installing equipment in a cherrypicker while another one is sculpting parts with a computer-operated machine below. 

“It’s all about speed,” Flannery explains. The comment applies as much to the instant communication between the design and manufacturing engineers as it does to the ramping up of Xerotech’s capacity – and to its founder’s personal demeanour. “Being able to make your own production equipment, make your own products, do all your own prototyping, you move ten times faster than the competition,” he says. “And it’s much more cheap and cost-effective, being able to develop in house.”

We finally make it upstairs, where electronic components sit on test benches and a meeting room, just like the rest of the building, offers a decor of white paint on bare concrete blocks. This is where I get a chance to understand what exactly is going on here. 

An interview with Norman Crowley earlier this year pointed me in Flannery’s direction. Crowley told me that the classic electric cars made by his Electrifi business would use battery technology from Co Galway. A quick investigation revealed Xerotech to be the only supplier fitting the description, and Crowley has recently confirmed this publicly.

Yet electric cars are really not what Flannery is banking on. “It just doesn’t work or make sense that a company could just enter into automotive,” he says. “The requirements are so crazily high, to be trying to say you’re going to go head-to-head against Tesla is just not credible.” Instead, he is targeting the rest. Xerotech aims to supply manufacturers of “non-road mobile machinery” in sectors such as construction, mining and agriculture. 

“A perfect example would be a road sweeper manufacturer who has to sell equipment to the city of London. They’re talking about these ultra-low emission zones, and even now, no emission zones. So eventually, they’re not going to be able to run their diesel systems there,” Flannery says. 

Manufacturers of such vehicles currently go to engine suppliers to buy the slice of diesel power they need, from 30 to hundreds of horsepower. Flannery estimates this global market to 4 million units annually, worth around €100 billion. 

According to him, there is no equivalent electric offering: “People are trying to buy this product, but nobody is providing it to them without charging very large customization fees.” He set up Xerotech to plug that gap. While electric car makers are racing to perfect models that can be produced at massive scales to reduce unit cost, Flannery argues that this approach doesn’t work for machines that are made in series of hundreds or thousands at most. 

“It has to work. Simple as that”

Instead, the Galway start-up has developed technologies – including eight patents – which can be deployed in a modular way. Where an excavator manufacturer in need of 35.6hp is happy to shop for a 35hp or a 40hp engine, Flannery says Xerotech can offer similar options in an electric version. “By using an off-the-shelf approach, it drops the cost massively and it enables electrification,” he says. The Galway entrepreneur essentially believes he has found the sweet spot between Elon Musk’s quest to mass-produce the new electric Ford Model T and unaffordable bespoke engineering.

Xerotech does not make battery cells – the small cylinders similar to those found to those in portable electronics, which are grouped by the hundred to make vehicle batteries. But the company specialises in everything that delivers the power in those cells to the machine: how to store, protect, charge, manage them – and, crucially, control their temperature. “When you think about your phone,  maybe it craps out if it’s really cold, or really hot. But if you have a piece of equipment in a desert or underground, and you pay tens of thousands of euros for a battery pack, it has to work. Simple as that,” says Flannery. “By being able to control that temperature precisely, you’re able to charge it way more aggressively, which is a big benefit.” Xerotech has also patented fire-proof foam to improve the safety of its battery packs. 

Flannery says the company is currently making prototypes he calls “A samples” for its first customers – apart from Electrifi, none have agreed to be named. Mining equipment is obviously in the mix as the day before my visit, Flannery was at Tara Mines in Co Meath. “They’ll field-try that, they want to make sure this thing is going to work on everything they want to do for a few months,” he says, estimating that this will trigger orders for serial production from next spring. 

As this ramps up, the company is lining up its series A funding round to expand into one, possibly two additional units across the road. “It will be a €12 to 15 million series A, in a May-June timeframe or thereabouts, as we scale with our serial production,” says Flannery. In the meantime, his priority is to expand the team, recruiting internationally to grow from 20 engineers now to 38 by February. 

It wasn’t always like this. I ask Flannery to take me back to Xerotech’s beginnings three years ago. At the time, he was on his own. 

Barry Flannery (BF): I have a first-class honours in applied physics and a PhD in mechanical engineering from NUIG. I would have graduated from the applied physics in 2013. Then I finished my PhD a little early in 2017. So really, the hard development has been ongoing since late 2017, right up until now. I knew that the world was going electric. It’s obvious to everyone now, I knew it was going to happen back in 2010. I like to always point out, I was following Elon Musk long before he became a household name. This was obvious, so the question became how can I become a part of it? What can I do with the reality that I always wanted to start my own company and do my own thing?

Thomas Hubert (TH): You had that idea before?

BF: Yeah, I wanted to do that. So the question is, what angle could you take to do it? My background was in thermal engineering, that was the initial idea and over the last few years, the whole concept has really crystallised into what we’re doing here today. It’s become something pretty compelling not just in an Irish context, but globally. There’s something different that we’re doing. 

If you were to compare us to all the other big startups that you’d see in this space, you know, the Rivians and Lucid and Arrival, these would be the big names that have raised huge sums of money. All those companies are building the end product, they’re going to build a new electric bus or a new electric car, whereas where we’re more focused on is not the end product. It’s just recognising that there’s dozens, hundreds of companies out there that buy an engine. Somebody is going to supply that. We really want to become the future supplier of that type, we supply the companies that build the end machines. 

The way I like to describe that is – I need to start trade-marking this, I keep saying it four times a day – the tier one suppliers of the next century are going to be decided in the next decade. So it’s a really critical time. For a company like us, that’s where a lot of the excitement comes. That’s why we get all the buzz. This hasn’t happened for free. 

Why people are so interested in what we’re doing and how we’re doing it is because there’s this massive, massive opportunity. This has not happened before. I’d say the last time there’s been this level of disruption, it’s like the Industrial Revolution. The change that’s hitting not just automotive, but all sectors – this powertrain shift – is going to just flip the table. It’s like a game of Monopoly, someone has just walked in and thrown the board across the room. It’s just unprecedented. 

A lot of the big names that would be out there today, they might not be big names tomorrow. There’s going to be new household names in this space and we have every intention of being one of those. 

I focused on that battery pack element, worked my way up through the Irish start-up ecosystem, backed by a number of state agencies, the usual names, and then a number of very wealthy Irish family offices.

TH: So that’s Enterprise Ireland…

BF:  …Western Development Commission, and then the others, we wouldn’t be able to disclose publicly, but you know, big private family offices within Ireland. Obviously, we are heavily supported here. We’ve been lucky as well in terms of the story we have, it’s been pretty compelling. When I first went out doing this, there was a lot of offers on the table to back it. So we had a bit of luck there, we’re able to be quite selective about who backs us, and we kind of really chose backers that not only could go a second time, but maybe a third and a fourth time.

“We don’t have to go out shaking the bushes looking for money.”

TH: Why not bring everybody in and take as much as you could?

BF: We’re focused on the larger scale here, because it’s becoming pretty clear that what we’re doing is going to massively outgrow the Irish context. This is a global company that we’re building here. The level of funding that is going to be coming at us on the scale we’re planning to reach – it’s huge. 

The reason you don’t take every bit of money on the table is that we’ve tried extremely hard that the investors we’ve taken on board are bringing more than just cash. We don’t generally treat investors as just a wallet, they bring maybe links to industry, or maybe they’ll have direct experience around manufacturing, or maybe technology, whatever way possible to try and leverage. It’s always trying to gain that unfair advantage to just be better.

TH: How we did that work out funding rounds-wise?

BF: We did a major – I don’t like to advertise it – in late 2019, we did a large series. It was very big for Ireland. The reason we don’t advertise it is that, again, we’re thinking globally. So while the number is huge for Ireland, compared to your global peers, then it’s probably not worth getting into. Because you’ve got to remember the type of companies that we’re engaged with and dealing with. These are very large companies, decades of existence, very high revenue. So you want to be strong. 

Our next big step is the series A, that’s going to really put us on the map globally. That’s a big number for Ireland, you won’t generally see that, especially for a hardware company. And that’s another thing that’s been a very interesting part of our journey. You won’t have as many references or signposts on how to do a hardware startup in Ireland. The only real precedent we have here are med-tech companies. They would be kind of similar. But beyond that, it tends to be quite heavily focused in Ireland on software. 

That’s something that’s really resonated on the hiring side. We’ve pulled a lot of really, really good people out of multinationals and other big companies. When I started this company coming out of college, I was like, how are we going to compete against multinationals and security? We get multiple CVs a week from huge names of people trying to join because what we’re doing is exciting. That’s a big part of the reason why we wanted to talk a little bit today, getting the word out there, that we’re here, and here’s what we’re doing. 

We’re still in stealth mode, we kind of control what we say and what we need to say, we don’t have to go out shaking the bushes looking for money and things like that. It’s just trying to get the word out there that we’re here, we’re hiring, trying to make a bit of noise. 

Replicating Elon Musk’s “special forces of engineering”

Several times during our interview, Flannery mentions Tesla and Elon Musk. I ask him what inspires him in the career of the US-based technology entrepreneur, and whether he draws the line around some of Musk’s more controversial behaviour. 

BF: I started following Elon musk back in, I think, 2004, 2005, originally with SpaceX. I  would have a big space interest as well. I would have obviously followed Tesla. From an engineering perspective, he’s right on the money about what he’s doing. He’s kind of overturned the industry. 

In broad strokes, the 1980s was all about outsourcing and outshoring and whatever else, we’re now talking about reshoring. We try and take a lot of that mentality, and even culturally within the company, that Tesla – mainly SpaceX approach as opposed to Tesla approach. everyone who works here is here because they love engineering and they want to be here. We don’t really have a nine-to-fiver culture around here. It’s really – I’ll steal Elon’s line – the special forces of engineering in terms of trying to get the best possible people. 

Honestly, the people we have hired have come from companies that have hundreds of people, thousands of people and they’d be recognised as being the best person from that team, from that division, whatever it is, because the story is strong here. 

In terms of what Elon is doing and the view of him, he’s accelerated this whole transition by decades – two decades – and he’s been the tip of the spear for electrification. It’s made it a lot easier for everyone else to come in behind him. He can be, I don’t know the best way to describe it, eccentric in some capacities, but I tend not to be too deeply involved in tracking what goes on in the media. I’d be more interested in what Tesla is doing, what SpaceX is doing. 

I’ve never met the guy but from an engineering perspective, what he’s done, I think, is really impressive. He’d be a strong idol to, hopefully, follow into similar footsteps, different approach. 

TH: In terms of the team, who started this with you?

BF:  It was me. I was the sole founder of the company.

TH: Completely on your own? How long did that last?

BF: A tough year, a year and a half building this. I don’t want to come across as a complete Einstein, serial inventor type, but yeah, I would have developed the technology myself, actually, in the back garden. That’s where the company started. I guess it went from one Steeltech shed to to a bigger one. It’s more than a Steeltech shed now. 

There were two garages. I had a state-of-the art fit-out and did it myself. But it started there. Then with further validation, you’re going through the obvious Irish startup supports – strong support of Enterprise Ireland, we would not be here without them, no doubt about that. I’ve been through a lot of the entrepreneur training programmes, and support even from the local enterprise office here in Galway have been one step of validation on top of another. 

But the real breakthrough, I suppose, was the initial major seed funding of this facility, the massive scale-up with the team – still scaling based off of that. And our next step forward is really, as I said, the push as we go to serial production towards the end of next year. That’s got obvious footprint requirements as well, which is why we’re getting buildings where we can get buildings.

“The whole world kind of came to a standstill, it sort of gave us an opportunity to catch up.” 

TH: How long did that take to get this building where you’re today? There was Covid and all that.

BF: Covid was interesting. It was obviously a dire situation, but the build kicked off in about February, and we completed it in August. So we’ve managed to stay on timeline. It obviously created difficulties around the basics. It got very dire in April, just the availability of blocks and things like that. But, you know, we managed to pull through. 

In terms of being an early-stage company, it has not been an easy year across the board. We have been lucky, though, insofar as we were fully funded, we’re still fully funded for a long time to come. The way I view it is that the whole world kind of came to a standstill, it sort of gave us an opportunity to catch up. It was a little bit of a benefit in that regard. So there was some element of a silver lining, at least for Xerotech. Mind you, it is still a difficult situation, by all means.

TH: The team you have now – what are the skills and also the nationalities? Because you say it is international? What’s the profile?

BF: Very engineering-heavy right now. I’d say about 80 per cent, 85 per cent engineers here, and it’s a mix of hardware and software. To build a battery system, it might look like a big physical box, but I’d say it’s even split 50-50 in terms of the software that goes into that. It’s a little bit different to, say, app developmen. This would be embedded software that goes into microcontrollers. It’s all mission-critical, safety-critical software. It’s like your steering controller in the car, it can’t break or bug out, so it’s tricky. We’ve got four people on the hardware-software side at the moment and a mix of the others are production engineers. You’d have mechanical engineers, test engineers, people focussed specifically on battery development, battery algorithm development. 

In terms of nationalities, we have one Polish person, Italian, Russian, Mexican, Spanish… It would be great if I could get these people locally, but there just aren’t many building batteries here. Pulling abroad from the UK and mainland Europe, we’ve had good benefit from that difficult market out there in the automotive industry. There’s been a lot of shedding of really experienced people. Again Brexit has been a silver lining. Unfortunately, the automotive industry in the UK is in a difficult period right now, but it means that it’s quite easy to get people over from the UK to here. And generally, they would come from further afield as well.

We generally head-hunt everyone we hire. Most people come through a sort of vouched scheme. We’d get one super hire that’s built a whole vehicle control system and they’d know four or five people we can then pull in. For an early-stage company, you just can’t afford to make a hire round. Losing six months is just not acceptable.

TH: You’re competing for talent. How are you bridging that competition gap? Do you have to pay people more? Is it, “look at the view, we’re in Galway”? Or just the excitement of the project? 

BF: It’s a mix. We don’t lowball people on pay, we’re competitive when it comes to salary and compensation. But a huge, huge part of this is the excitement. And what I mean by that is not just we’re building electric vehicles, it’s not the approach that we took. Working in Xerotech is like an engineer’s dream, in terms of being able to go out there, use equipment and operate equipment. 

Certainly in an Irish context, if you’re in a multinational, that just doesn’t happen. From building production line equipment to getting stuff done, generally, everything would be subcontracted or outsourced, it’s just the way of doing things. Whereas here, engineers love the idea that there’s a battery test lab there, and there’s CNC machines there, you can actually do real engineering. Serious stuff happens here and we have hard deliverables, but it really is a bit of an engineering playground. That’s one of the strongest pulls we’ve had.

The second one has been just the different angle that we’re taking on electrification. And that’s what I mean by going after this segment. It’s been a global differentiator, because it’s one thing to say: “I’m building a car.” How are you different to Tesla, Lucid, Rivian, Zoox, Canoo, 20 others that all have billions to throw at this? This is the answer here, this is totally different, the approach we’re taking. We’ve been successful, not just in an Irish context – we do have a lot of Irish employees obviously – but pulling people in from abroad.

TH: When you say it’s cheaper to do things in house, that’s surprising. You would assume getting something in from Eastern Europe or Asia would be cheaper. Why is it cheaper for you?

BF: There’s two sides to it. First of all, the time element. When you source something from, say, China, straightaway, you’ve got a three month time lag for a container to come from China. The second thing is, not just with East Asia, but around the world, the more things that you outsource, you have intellectual property concerns. Wherever possible, we want to minimise the number of schematics, design plans that go out. 

But the reason it’s cheaper is that actually, nowadays, it’s not that expensive to buy pieces of equipment and just get the people.What’s happened for us in the last, I’d say 12 months, is that it’s such a pull for engineers, it’s become easy for us to simply buy the equipment and we can easily hire the best people from the suppliers if we need to. Say we want to make a component; we can get the piece of equipment that does the stamping and we can just look around us: “Do you want to join Xerotech?” And the answer is usually yes. 

“You just move fast and break things. That’s the way to do it.”

Other times, saving time is a huge factor in this. When you outsource something like making a metal component, it is super, super expensive to get things made. A machine you saw out the front there would cost you like €150 an hour to outsource. And think about what has to be done there: we’d have to produce schematics on our site; we’d have to then get purchase approval internally. That gets sent out, there’s probably a mistake,  so it comes back again, fixed, goes out again. They make it, it’s probably wrong. So you’ve got to send it out a second time. Each one of these loops here is like a three-week loop. And you’re paying a huge amount of money for it. So if you can just instead buy a machine for 30 grand, in the space of two months, you’ve probably paid for the machine. 

Not only that, the guys and the girls downstairs can just say: “Let’s go and  make the part, make a change.” The person at the manufacturing machine comes back in and says: “Not gonna work.” Great, I’ll update the computer and fix it, go back out again, and in the space of an hour you’ve fixed the problem. That’s really how we compete against huge companies – that’s been the unfair advantage. 

You might look at a smaller early-stage companies: “How can you compete against someone with 5,000 employees and billions?” The answer there is it takes five months to do anything. By the time they have got their purchase order out for the first go, we’ve probably done ten iterations before they’ve even started. And that’s been the big winner for all the startups in this space. You just move fast and break things. That’s the way to do it.

*****

“Can you do this from Ireland? The short answer is yes”

The discussion turns to the location of Xerotech in Galway, for which Flannery confesses a “bias” as a native of Oranmore. Yet in keeping with the concern for hiring evident throughout our interview, he notes that good transport connections allow current employees to commute from a catchment stretching between Westport, Limerick and Athlone. 

“Obviously, I’m a huge fan of the west of Ireland. I’d like to stay here, but it’s not all bias. It does make sense, where we put it,” he says. He believes the company can continue to grow locally as the high value of its products renders shipping costs negligible. “We’ve shown you white boxes in there, white boxes like that could be €30,000 or €40,000. You could fit 20 of those in a container. So let’s say you’re going to a customer in Germany, container shipping is like €2,000. Sure what’s €2,000 euros on an order that cost a few million?”

Xerotech is in a different situation to that of suppliers to the automotive industry, who need to locate close to car factories in continental Europe and deliver high volumes of parts at low costs. “If you take our core market, it’s a lot of little,” Flannery says. “Do you put it in South Africa next to a mining company? Do you put it in Poland? Do you put it in Germany? Do you put it in Sweden? It’s actually fine where we are.” 

From Ireland, the company can work with customers across a wide range of time zones. Flannery adds that he enjoys the country’s stability: “Political stability, geological stability, weather stability – there’s no sort of strange things that can happen here.” While expansion into the US or Chinese markets would require manufacturing sites in those markets to reduce transit times, he is confident that all of Europe can be serviced from Ireland. 

“One of the core questions will be, what about the cost of labour on this? Is Ireland too expensive to do that? The answer is no, but only if you do high automation,” Flannery says. This brings us back to his priority for doing things in house: “We have highly competent engineers that have come from high-volume manufacturing environments and run these lines. They can actually design and build them themselves.” 

While the low corporation tax is a benefit, Flannery says it’s not a deciding factor.

Shareholders “involved beyond just being a wallet”

There is no doubt that Flannery has grand plans for Xerotech, and the breakneck speed at which he plans to expand in the coming year is the turning point where many entrepreneurs get things wrong. I ask him if he has given as much thought to corporate engineering as he has to battery technology. 

“It’s not just me,” he says. “Obviously, there’s a senior management team. We also have a board of directors, a board of advisors. As I mentioned at the start, we take quite a proactive approach to shareholders so that they’re involved beyond just being a wallet. So we do have two very strong people on the board.”

These two high-profile names, who joined the board of Xerotech just one year ago, are Bryan Campbell, who sold his stake in the Cork-based sensor maker SensL in 2018; and Owen Murphy, a former founding member of ACT Venture Capital.

Flannery points out Campbell’s successful recent exit and adds: “Owen has done over 250 successful VC deals. So a very strong finance background. And then on Bryan’s side, an extremely strong commercial background.”

He adds that more directors are due to join and expand the corporate expertise available. “The way the company is being geared, structured and prepped – we’re ready for what’s about to come out at us. That’s the key thing we’re emphasising here: Watch this space, it won’t be a traditional Irish one, to put it that way.”

I ask Flannery how advanced he is in closing the €12 to 15 million round he is targeting for mid-2021 and he replies: “Pretty advanced.”“Raising the money isn’t too difficult in this space,” he adds. “More than batteries, the electrification space is absolutely red-hot. The valuations are off the scale entirely, off the planet even.”.

*****

Since Flannery has clearly defined Xerotech’s market, I want to ask him about competition. 

TH: You said it’s an overlooked space, but I’m sure somebody else has noticed that. Would that be the Ivecos, the old engine manufacturers? 

BF: Not as much. There are battery pack companies, right, so let’s just benchmark against European battery pack companies. There’d be a handful, maybe a list of five, six, seven, focused on different areas, different things. In terms of us versus them, first of all, that whole-platform approach, nobody’s doing that, we’re sure of that. Then on the technology side, the heating and cooling of the batteries, the safety, all these other things, we’re certainly a generation ahead, if not beyond. So when we benchmark against direct competitors, someone who might sell to our exact customer, the best way we describe it is: We’re bringing automotive-grade technology to this space, whereas they’re maybe not doing that today. We’re sort of taking what Tesla would have in their vehicles, bringing it into these markets that it just hasn’t been accessible to. 

But another differentiator for us is that we’re doing more than them. We’re doing the charging bit and the heating and the cooling, giving a more complete solution, whereas the existing market today would typically just supply a battery and there’s quite a strong burden on the customer, then, to figure out the rest of it. We’ve seen that as a big, big stumbling block for customers. They simply can’t do it. It’s just new technology. 

In terms of engine manufacturers, some of them are making electrification pushes, but nothing like what we consider our direct European competition. They have the same problem as our customers do. You might think, okay, the engine guys have to go building batteries. But their entire overhead structure, their decades of experience is pistons, engines, O-rings and whatever else. They should be treated no different to an early-stage company in terms of capability. They might have a bigger balance sheet, but the same problem.

Often it’s actually harder to attract talent to a company like that, because you’d have more entrenched thinking about, is this electrification a really going to happen? Is all this battery stuff going to go away in a few years? You do have that element of mentality. It’s the same way in the automotive industry, you’ll find some companies are going a hundred miles an hour towards going battery, other ones are biding their time, and some are going in the opposite direction. There’s elements of that, that the senior leadership of some companies are maybe towards the end of their tenure and ride it out into the sunset.

“The battery space, it’s the wild west out there. Prices are all over the place, technology hasn’t been finalised.”

TH: Do you see yourselves as competing against other technologies, when you’re talking about heavy vehicles, excavators? I’m thinking hydrogen, maybe biogas?

BF: Not as much. That was something that shocked us. We actually asked most of the companies we’ve engaged with: “What do you think about batteries? What do you think about the whole electrification thing?” This was me expecting them to turn around and say: “We’ll do one or two, but it will be diesel for the next 50 years.” 

It was unanimous, they all say there’s no doubt about the battery thing. It is going to be it, the issue is just the cost. And it’s a different answer, when they talk about cost, to what you hear about in the electric car space. In these markets, the cost is like 2x what we talk about in automotive. The cost for these guys is that sort of external cost. 

You might be familiar with the cost per kilowatt-hour of battery. That doesn’t come into play, really, in this market, because the engineering costs of your tooling, your production and your customisation will dwarf the cost per kilowatt-hour. So that’s the one that’s really killing these guys today. 

But in terms of the competitors, at the end of the day, it’s a question of supply. There’s enough, there’s 10 times, 100,000 times as much market as there is for competitors. I don’t even care about what the competitors are doing. Suddenly, there’s just gonna be a knife switch moment that everyone’s forced to electrifiy, and it becomes a capacity thing. 

Engine manufacturers are all broadly the same, broadly the same price, competing like that. The battery space, it’s the wild west out there. Prices are all over the place, technology hasn’t been finalised. That’s something you even see in the car industry. If you take three different diesel cars and pop the bonnet, it’s virtually the same: engine, battery, windscreen wash tank, radiator here, standardised because it has been engineered over the last 60 years. Iterated. 

If you look at three different electric cars, take the Jaguar I-Pace, Tesla Model 3, Audi e-Tron, you pop the frunk and you look in there – the architecture is completely different. There’s no similarity between the ways they’re approaching it. What that tells you is that the industry hasn’t converged on what’s the best way to do this. 

That’s what breeds a lot of value for a company like us. Obviously, there’s shareholders backing this. The ultimate potential exit is that if you’re one of these companies that’s happened to stumble across what the platform solution ends up looking like, it’s huge. And even if you don’t, you’ve got to remember that most of the companies out there have to buy these solutions. We don’t want to be supplying the next generation to Tesla. It’s more a case of, if one person has an electrification solution, the most attractive customer for us is the guy who doesn’t, because he’s standing there saying: “Oh my God, we’re gonna lose our entire market now.” They may not have engineering capacity, but they probably have deep pockets. 

TH: When you see the German, French, Spanish governments putting tens of billions into their hydrogen industries, are you not worried that maybe in five years’ time, somebody’s going to say: “Oh, we have a heavy duty engine, hydrogen-powered, for a fraction of an electric motor”?

BF: I strongly doubt it’s going to be at a fraction of the price, but every hydrogen car has a battery. Hydrogen fuel cells would be only good for steady state. There are very few operating usage profiles that run steady state. So every hydrogen vehicle is an electric vehicle. Hydrogen generates electricity which drives the motors. But there’s always usually a battery in there as well to buffer the load.

TH: Essentially a hybrid.

BF: Yeah, pretty, much, so there is actually a battery in them. But broadly speaking, the better question might be for the ultra, ultra heavy duty, so we’re not talking cars and trucks, I’m talking about a 200-tonne mining vehicle. It may become prohibitive to have a huge, huge battery in that. 

Having said that, we’re seeing in the mining industry that the solution there is battery swapping. I don’t think this makes sense for for the automotive industry, but in the mining sector where you’ve got a battery that’s got maybe five times the capacity of a Tesla Model S, and they need to recharge every two hours, the solution there is that they’re basically dropping the back of the vehicle off on the ground, picking up a new one, or putting in special infrastructure in a mine to have an engineer there that will just swap the battery in the space of five minutes and put a new one in. For some markets like that, that makes sense. 

As regards hydrogen I still think the jury’s out on that one. You’ll see it localised, probably in Japan and places like that. 

*****

As we come to the end of the interview, I ask Flannery to look ten years into the future. Will Xerotech have grown organically, expanding into overseas markets out of Galway? Or is the idea to find a Tesla or a JCB to take it over? 

“We think this could grow into a massive-scale company just by selling batteries,” he says. “The end game here isn’t that we build five or ten and then hope someone comes in and takes it out, and I ride off into the sunset.”

By expanding into the next unit alone, Xerotech is planning to install capacity to produce between 3,000 and 4,000 battery packs from next year. Each of them will be worth between €20,000 and €40,000. “You can do the sums on that, it’s a big number,” says Flannery. “Because these are expensive products, you don’t have to sell a huge number of those things. A couple of thousand and the numbers are already getting very exciting.”