Steven Kropper, MBA ’86: WindPole Ventures LLC
The answers are blowin' in the wind
The answers are blowin’ in the wind
by Irene Kim
Steve Kropper sells wind data. His company, WindPole Ventures, leases over 12,000 broadcast towers, each taller than the Statue of Liberty. When wind developers are prospecting a new site, WPV mounts sensors and instrumentation on a tower near the project and records wind-speed data — vital information to wind-farm developers, power traders, and government agencies.
With existing towers, Kropper found a capital-efficient way to collect valuable data. WPV can accurately measure wind speeds at 80 meters or higher — the same height as wind turbines (most wind data are supplied from too-short airport-observation towers). Since the towers are already in place, developers don’t need to erect their own towers.
When he first conceived of using the towers back in 2008, the plan was to install turbines directly on 1,200 massive Cold-War era towers built by AT&T. But he found that the stress would topple the towers. That, and the funding drought for wind-power developments in the depths of the credit crunch, prompted his much-thriftier plan of creating data. Says Kropper, “Information about energy is more profitable than generating power itself.”
He founded WPV in July 2008, and broke even by the fourth quarter of 2010. But this rapid growth was hard-won. “I’ve never worked so hard to raise so little capital,” Kropper says of the first round of financing. In addition, WPV had to overcome daunting engineering challenges, such as mounting instruments on 20-foot booms extending from the towers. Now, for each new client, they design and engineer the equipment configuration, install the sensors and instrumentation for the specific application and site, and deliver the data in 68-90 days.
Kropper was inspired by (now emeritus) Professor Alan McAdams’ perennial exhortations not to knuckle under to influential private interests, and by (former) Professor Dick Thaler’s dictum, “Business and pricing are more about psychology than math and science.” He advises students to learn from his mistake of ignoring the powerful network that existed among his classmates. “I had to build all my finance networks from scratch,” he says.