Before the "Great Recession," the state of Michigan was in its own one-state recession of sorts thanks in part to our well-documented over-dependence upon the struggling auto industry. Yes, the economy is still recovering, and things are still dark, but I can see the light! Yes, dear readers, I have seen the light at the end of Michigan's proverbial economic tunnel, and that light shines bright with LEDs. Can I get an "Amen"?!
For the uninitiated, LEDs are Light Emitting Diodes (LEDs), and they have taken their first steps toward global domination of the lighting industry. Sorry, Thomas Edison, but alas, one of your most brilliant and enduring inventions (well over 100 years!) looks like it may finally be put to rest; R.I.P. Incandescent Light Bulb.
For years, we have all seen LEDs begin to encroach on every aspect of our lives, TVs, cell phones, even Christmas tree lights -- and this is a great thing. Why? LEDs use 25-75% less energy than fluorescent and incandescent lights (hooray lower energy bills, hooray less carbon in the atmosphere!). Also, quality LEDs should last significantly (years) longer than existing lighting technology (less streetlight maintenance cost for cities, less burned out lights/dark streets which in turn boosts safety -- hooray for shrinking municipal expenses). Lastly, LEDs' brighter white light color, which can be better directionally controlled, leads to less light pollution (light only going where it is desired to go -- hooray for darker skies) and is more vibrant and pleasing to the eye as well.
It has taken LED technology several decades to get to the point where it is cost effective and worthy enough (from a product quality standpoint) to be used in a pervasive manner. However, one of the longest standing applications of LED technology has been inside automobiles -- first in indicator lights, then in headlamps and brake lights. Now, nearly every light source in a car comes from LEDs. Okay, you're probably thinking "big deal, cars have lots of LEDs -- who gives a rip?"
Since historically most cars were made in and around Michigan, and given that cars have lots of LEDs and have done so for several decades; it should come as no surprise that there are many people in Michigan who know an awful lot about LED technology. In fact, Michigan has over 20 LED technology-related companies and is the only state in the country with a trade association dedicated to LED lighting -- the Michigan Solid State Lighting Association. (LEDs are also known as "Solid State Lighting," if you want to get nerdy about it). Simply put, one would be hard-pressed to find a greater concentration of engineers with deeper experience in working with LEDs for consumer applications than in Michigan. This geographic cluster of world-class, cutting edge LED technologists is a welcome legacy of the automotive sector that could serve as an important building block of Michigan's new, green economy.
I'm not just a Michigan flag-waver, offering a feel-good, "rah-rah" speech about economic hope for Michigan when it comes to LEDs -- my firm has put our money where our mouth is because we believe it. We backed a company, Relume Technologies, an innovative LED lighting technology leader/manufacturer with a focus on the emerging, and expected-to-grow-rapidly, outdoor LED lighting market. I mention Relume not to hype up one of our investments, but because it is an excellent case study of my assertion above that LED technology/companies will rise from the ashes of the once-glorious Michigan auto industry as a potential important pillar of Michigan's new green economy.
Simply put, in the late 1960's Relume's founder/inventor, Peter Hochstein, worked for General Motors and later with other auto OEMs and suppliers engineering in-car LED lighting applications. Hochstein has taken that expertise, formed a company and is now applying it to outdoor lighting, one of the fastest growing segments of the LED lighting sector -- and is doing so here in Michigan. There are no guarantees in life, (certainly not in venture capital investing!), but we are big believers in the future of outdoor LED lighting (which I will detail in my next post). We like Hochstein's technology and his company's chances to make an impact on this rapidly growing and emerging market.
As an optimistic evangelist of LED lighting technology, I proclaim to have seen the light, and I like what I see... Now, my hope is that we all may witness the day when the light of Michigan's emerging LED lighting industry burns brightly enough to dispel some of the economic darkness that has choked our state and serve as a pillar of the foundation of Michigan's clean technology economic future. Say it with me now, brothers and sisters, Amen!
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