When he was a sophomore at Babson College, Dinesh Wadhwani had what he calls "a life-changing moment" while meeting with a large telecom company in Manhattan. The enterprising student had started a business selling LED lighting systems to companies that wanted to reduce energy costs. "They were looking to upgrade to LED in their retail stores and their warehouse," recalls Wadhwani. "So we went back with a solution that involved ripping out all the existing fixtures, and they said, 'The ROI on this sucks--it's seven to eight years.'" To add insult to injury, the manager made it clear that even if he were to go forward, he'd be unlikely to give the job to a little-known startup.
Turning on innovation
That's when Wadhwani realized he had to stop being a reseller of products made by companies such as General Electric and Philips, and start being an innovator.
Wadhwani thought that switching to LED should be as easy for large companies as it is for homeowners. All homeowners need to do is buy new LED bulbs. In this vein, he designed an LED bulb that would fit into fixtures designed for, say, fluorescent lighting. That solution would eliminate the need for new fixtures and reduce the ROI time frame from seven years to two, he says. Fast-forward to 2014, and ThinkLite posted $8.5 million in revenue. It's on track to reel in $15 million this year. And Wadhwani, joined by his older brother, Danny, did it all with just $6,000 in personal savings.
"We figured out the [design after going back and forth] between Massachusetts and a facility in Munich," he says. "One of the metals we use is a derivative of a metal that's used to cool down an aerospace engine." By the beginning of 2011, the brothers had their supply chain nailed down. Components were manufactured in Korea, while assembly was handled in China. "For any customer, I can custom design a light bulb, and have it in your hands three weeks later," says Wadhwani. "It's mass customization, and it's a game-changing proposition."
Upping the ROI ante
ThinkLite's customers include large corporations such as AT&T, Boeing, Kodak, Men's Wearhouse, Honeywell, and Dunkin' Donuts, among others. Jeff Linn, executive director of Weymouth Club, brought on ThinkLite to install LED lights at his 9,500-member health club in Weymouth, Massachusetts, after members complained of lighting issues at the club's indoor tennis courts.
"Our total investment was $150,000, and there was a 50 percent rebate from National Grid," says Linn. The new lights--in the tennis courts and in other areas of the club--have been in for six months, and Linn says he's seeing the impact already. "We're underbudget on what we budgeted for electricity, and since some of these bulbs don't need to be changed for seven to 10 years, we're saving on manpower as well." Reductions in manpower and energy usage result in savings of between $1,500 and $2,000 a month. While that's not quite the two-year ROI that Wadhwani claims, it's still a significant savings.
Wadhwani says that ThinkLite is currently the only company that offers a true retrofit solution for companies that want to switch to LED lights without installing new fixtures. The company's bulbs are now sold in 13 countries, and Wadhwani reports that revenue is doubling every year. The company has taken no outside investment. "We've had a couple of offers from private equity firms," he says. "But I believe we have a lot more growth ahead of us. We go head-to-head with the Philips and the General Electrics of the world."