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Asif Ansari, John Paul Morgan, and Nicolas Morgan of Toronto-based Morgan Solar. (Andrew B. Myers/Andrew B. Myers)
Asif Ansari, John Paul Morgan, and Nicolas Morgan of Toronto-based Morgan Solar. (Andrew B. Myers/Andrew B. Myers)


Solar legend guides startup across Valley of Death Add to ...

But even with a knockout technology, selling solar is a chore. "It's harder than any other technology company because you're signing a 20-year power-purchase agreement with an electric utility that needs iron-clad energy delivery guarantees," says Ansari. "And there are huge penalties if you don't deliver, or even under-deliver. The financial risk is huge."

Bankrolling CPV projects is particularly difficult. The technology doesn't have nearly the track record of fixed PV. "The concentrated PV space is still an emerging niche," says Jon Worren, co-founder of ClearSky Advisors, a renewable energy research group. "The older technologies have a long record that people are confident in. That's a bit of a hurdle for a company like Morgan. Proving their reliability is key."

Part of the reason CPV has been in the shadows so long comes from the complex arrangement of mirrors and lenses, which have to be aimed directly at the sun to work. That requires a tracking system that will constantly align the panel to the sun. That's a whole extra layer of complication that scares off some investors.

By hiring Ansari, Morgan Solar gained instant credibility. So, what's next? Cash is one part of the answer. At press time, the company was in final negotiations for $10 million-plus in additional funding.

Another part of the answer lies in a cavernous warehouse space adjacent to Morgan's office. Inside, sparks fly, hammers thud and winter seeps through the walls. It's a crude laboratory and fabricating site where the company pumps out prototypes. "Here's our generation-two product line," says Morgan, pointing to a lens that looks no thicker than a CD case and no more complex than Saran Wrap. "They're now in three test sites, in Toronto, Ottawa and California." He shows off the components of a finished installation - five simple pieces, all of them manufactured using off-the-shelf machines. The company has 30 patents in the works and some forthcoming products that Ansari calls "out of this world." Morgan will move beyond this R&D stage soon. Thanks to Ontario's feed-in tariffs, mass production for customers will begin in Ontario later this year, slowly ramping up around the world over the next three years.

"For me, the imperative right now is getting to revenue," says Ansari. "Venture-backed start-ups have this habit of getting used to easy money. You haven't earned it, but you spend it. That's a bad habit."

And by 2015, 2020? "We expect to be a multibillion-dollar company," says Morgan with a straight face. "If you set your costs of energy low enough, people will buy it. If the cost per kilowatt hour of natural gas is 12 cents and we can offer solar for 10 cents, people will line up to buy it. At that point, you can sell as much as you can make."

It may sound optimistic, even far-fetched, but they have some high-profile believers. Morgan's biggest investor is Iberdrola, a $50-billion Madrid-based company and the world's largest renewable energy firm.

That's the kind of backing that persuaded Mr. Solar to leave the Golden State. Actually, Ansari says he didn't need much prodding. "I told the Morgan board that if the company was in any city in the world other than Toronto, I wouldn't move." He grew up in Alaska and went to school in Minnesota, so he's no stranger to snow. And the city is packed with so many relatives that the Ansaris hold a reunion there each summer. "I actually get disappointed when I come to Toronto in the winter and there's no snow. I'll take Toronto snow over this California rain any day."

This story originally appeared in the June, 2011 issue of Report on Small Business magazine.

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