About this episode

My guest this week is Clay Alexander, the inventor and founder of Ember. Ember is a temperature control brand that seeks to disrupt how the world eats, drinks and lives. Their very first product was a Travel Mug and was launched in 100 Starbucks locations. Since their launch they have expanded to other product lines.

Clay has an incredible founder story that I hope more people discover because I think it brings encouragement and inspiration to so many. Let me be clear, when I say "encouragement" I am not talking about the type of fuzzy-feelings you get when you receive a Hallmark card. I'm talking about the actual meaning of the word "encourage", to place courage inside of. That is what Clay's story will deliver to you, courage to keep moving forward despite the obstacles or challenges you might be up against.

See Clay grew up incredibly poor, in fact to use his words "dirt poor." Aside from his economic challenges he was diagnosed with ADD and dyslexia, and he still is. Yet despite all these challenges he has founded two amazing companies and invented numerous patented products, that I'm sure when the story is over will deliver well beyond $1-billion in revenue. I know this episode will quickly become one of your favorites but like all other founder episodes we need to start at the very beginning.

In this episode, you'll hear:

  • How Clay's upbringing was not one where entrepreneurship was an inevitable journey for him. In fact, everything about his upbringing would have pointed towards obtaining a steady 9-5 job to help simply put food on the table.
  • About how his creative and inventive mind was at work from a young age and how he even replicated the famous Inspector Gadget bicycle, including switches for smoke screens
  • The journey through college helped set the stage for him to refine his lighting expertise and led to his inventing the brightest LED bulb in the world
  • The steps he took to negotiate a licensing deal with GE for that very bulb he invented
  • How cold scrambled eggs became the catalyst for the first temperature controlled coffee mug on the planet
  • The reason why the Ember mug, iPhone, Macbook Pro, and Apple iPad all look so good together
  • Why any inventor or entrepreneur should never accept the answer of "No" as final and complete
  • Clay unpack the future of Ember and the various industries that will benefit from his many temperature control solution ideas

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Ember website: https://ember.com/

Ember Giveaway: https://www.thestartupstory.co/ember

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Episode transcript

Clay Alexander: My name is Clay Alexander, the founder and CEO of Ember, and this is MY startup story.

  • Every wildfire began with a spark. Every superhero has an origin story. And every single startup has a moment that they point to as their beginning. And every founder has a purpose that drove them in the midst of all obstacles. THAT is The Startup Story. *

00:31

James McKinney: Hello everyone and welcome to another episode of The Startup Story. Today is the day. In fact, we've been hyping up the release of this episode all month long through our Ember mug giveaway. Leading up to today's episode release, Ember has provided three sets of the Ember Mug 2 to be given away to you, The Startup Story listener. For those that are not aware of Ember, Ember is the very first temperature regulating coffee mug so that your coffee hits the perfect temp and holds the perfect temp until the very last sip. Now, even though Clay's episode is now live, you can still enter for a chance to win an Ember mug at thestartupstory.co/ember and of course, we're going to include a link in our show notes for easy access. But you only have until July 9th to enter, so make sure to visit thestartupstory.co/ember as soon as possible.

One last thing before we jump into this week's episode. I want to read a listener review from Doc FN who gave the show a five star rating and wrote: "Asks the questions that are useful. I never write podcast reviews ever, but after listening to the interview with Dylan Jacob I was immensely impressed at the quality and direction of the questions. I'm in the middle of founding my first company and I am re-listening to your interviews, taking notes, because they are chock full of great information. Subscribed for life." Man, thank you so much Doc FN. I am thrilled that you love the episode and show so much that you felt compelled to write your first review. I'm also glad you find so much value within each episode. The only thing I would have added to your review was your URL so that I could have given you a plug as a way of saying thank you for taking the time to write this review. In fact, for everyone listening, that is how you can advertise your business or brand on The Startup Story for absolutely free. All you have to do is leave a written review on Apple Podcast, and when you do make sure to plug your brand and include a call to action for my audience. That way, when I read your review in an episode, and I read all reviews, your brand, URL, or social media account will be advertised to my entire audience. It's just my way of saying thank you for taking the time to write your review. All right, now let's jump in to this week's episode.

My guest this week is one I've been hyping up all month. It's Clay Alexander, the inventor and founder of Ember. Ember is a temperature control brand that seeks to disrupt how the world eats, drinks, and lives. Their very first product was their travel mug and they launched in 100 Starbucks locations. From their launch, now the details of this story are amazing, I'm not going to spoil it because their launch story is remarkable and Clay goes into great detail in that is episode. But due to the success of the show, I want to give you a little background on how this engagement came to be. I do very little outreach to get top notch founders on the show. At this stage, most founder stories are pitched to me through either external or internal PR reps. But Ember was a brand that I went after for directly. The reason being is that I remember the moment Ember launched in those Starbucks stores. I remember thinking to myself this looks like something that should be sold in an Apple Store. To this day, I still tell people that Ember is the Apple of coffee drink ware.

What I didn't realize is that there is a reason for that, and again I'm not going to spoil it. Clay is going to cover it in this episode. But what I also didn't realize was the incredible founder story that was behind the brand. Clay's story is one that I hope more and more people discover, because I think it brings hope to so many. See, Clay grew up incredibly poor. In fact to use his words, he grew up absolutely dirt poor. Aside from his economic challenges he was diagnosed with ADD and dyslexia, and he still is. Yet despite all these challenges he has founded two amazing companies and invented numerous patented products that I'm sure when the story is over will deliver over $1 billion in revenue. I know this episode will quickly become one of your favorites. But like all other founder episodes, we need to start at the very beginning.

04:16

Clay Alexander: I was not exposed to this idea of building my own company, okay? And except for one member of my family, which is my Aunt Cheryl, and for about a year after high school I lived with my aunt and uncle in Temecula and they had their own company. It was called Ballpark Maintenance. They would go out and maintain all these ball fields around the various counties. I got to see firsthand what it was like to like not have a real job. It shocked me. I remember just being like wait a minute, so you don't have to be at the office at 8:30? And my aunt and uncle would be like, "Well no, well this is our business so we just kind of do what we need to do." They were great at running the business. They had a flourishing business. But it was their company and they didn't have a boss. I had never been exposed to that until after high school. So that was a major learning for me, James, big time.

05:22

James McKinney: Now being that your parents had normal jobs and you had this experience with your aunt and uncle, obviously entrepreneurship probably had a very narrow perspective for you, because you probably didn't see all the cycles of entrepreneurship. You didn't see the highs and the lows-

05:38

Clay Alexander: Yeah, because they already had their business established by the time I got there. So when I ended up eventually starting my own company, I had to learn all the highs, the lows myself, and especially scaling these multi-million dollar, now I'm scaling a billion dollar company. So yeah, to your point I've been very kind of like I'm self taught, yeah.

06:01

James McKinney: So when you think to your early days and you think to let's say the end of high school which is a natural chapter for us. What did you want, if you can remember back then, what did you want to become as you were ending your high school journey?

06:14

Clay Alexander: Yeah, I was really into special effects. I wanted to be a special effects technician. I had studied lighting and sound design for theater in high school. I was fortunate enough to go to Idyllwild Arts, which is one of the top arts high schools in the country, if not is the top. Just an amazing school. I really got a lot out of that program. From there I went to Cal Arts which was almost kind of an extension of Idyllwild Arts. Cal Arts was founded by Walt Disney. But I really had this vision to go into the performing arts, show business, but on the technical side. I was always a tech nerd. I thought that I was going to be going off and being a special effects technician. That was like my big dream.

07:10

James McKinney: Now can we put a date stamp on that, because obviously in that particular field time and place matters. There were lots of opportunities let's say mid nineties maybe.

07:20

Clay Alexander: Yeah, so 1994 I graduated from high school and at that time there wasn't really anything, any such thing as CGI. So special effects back then were 100% real. They were made from scratch. If you were going to have a car fly through a building, you had to take an actual car and drive it or fly it through a building. So I was like so into that, because it's tangible. That's why today I make tangible consumer products, because I love getting my hands dirty and building things. So special effects back then, that's what it was. Today, I'm not sure if I would have been so interested in special effects because it's almost all computer generated.

08:07

James McKinney: Yeah, absolutely. So during your time at Cal Arts, there's lots of areas to focus in. If we were to think back to your Cal Arts time and place, what you focused on at Cal Arts, is it applicable to what you're doing now or was it a completely different field that you focused on?

08:24

Clay Alexander: Yeah. So I studied lighting and sound design for the performing arts at Cal Arts. I did mostly lighting I was lighting all the major dance concerts, the big theater shows. But I was really into the tech side of it. We would hang, I would do a lighting design for a show and I would hang 100 lights, and I was so interested I would take the lighting fixture apart. I was so interested in how does this thing work from a fundamental physics level. Optometry or photometric and such, and I would try to understand these devices that I was using in tech theater. I was particularly interested in the light board and the dimmer packs, and all that kind of technical side and show control where we could tile the systems together. So I learned like my foundation of kind of being a technical person at Cal Arts. But I'll back a little bit too. I've been an inventor since I came out of the womb. My mom has pictures of me, I used to take apart everything, James. My mom, you know I was raised poor. So when my mom would want to get me an electronic toy because that's what I was really into - electronics, gadgets, anything like that - she had to like save up for months to get said toy. I remember I got a Tyco Hovercraft for Christmas. I don't know if you remember those.

09:59

James McKinney: Remote control version, right?

10:00

Clay Alexander: Yes!

10:01

James McKinney: Yes, I do remember it.

10:02

Clay Alexander: It was so awesome, so awesome. It was my dream to get this thing. So I get it, I play with it for about two days, okay 48 hours, I love it. I'm driving around the street, putting it in the bathtub, it goes in the water. And I immediately take it apart. I've got this thing fully taken apart into all kinds of different pieces. And I decided to make an electronic bedroom door opener and closer mechanism out of it. So I rigged up pulleys and strings all over my room, and I took the motors from the hovercraft from the fan motors, and I put pulley bells on them and such, reels on them. And I rigged this whole thing up so that I could come home, and I could take the remote that used to be the remote for the hovercraft, and I would hit the remote and my bedroom door would open. Then I would hit it again and it would close. So I was always taking everything apart. I lived in 12 houses in the first 18 years of my life.

11:14

James McKinney: wow.

11:15

Clay Alexander: We were always moving around and the one thing my mom did for me, which I am so grateful to this day, she always made sure that I had an inventor shed in the backyard.

11:27

James McKinney: Oh wow.

11:28

Clay Alexander: So I mean we're talking about a plywood shack. That's all I needed. I need a place to go. My friends were always out playing sports, they'd say, "Hey Clay, you want to come play?" "Sorry man, I'm inventing today." You know? I was 9, 10, 11, 12, 13, and I'd go in this dark shed and I had this little clip light, and I had a soldering iron, and that's where I would take apart all my toys and rebuild them into some other invention. That's a little on my past. I've definitely always been an inventor. But what's interesting is I went into the performing arts because it had the tech side. Because frankly, James, you can't go to school for being an inventor. There's no inventorship college, at least to my knowledge. So you have to find the closest thing to it. For me, it was technical theater because it was super cool, it was very technical, and learning about stuff. So I had gone to theater and started a whole entertainment career which we'll get into in a little bit. But the ironic thing about it is I ended up with Ember, and with Journee with the light bulb that I invented and sold, I ended up going back to my inventor roots but not until I was like 30.

12:43

James McKinney: Interesting.

12:44

Clay Alexander: Yeah.

12:45

James McKinney: So before we get there, I want to spend a little bit on this inventor gene that you have as a kid. Because again, I graduated in '95 so I'm in the same age demographic as you. I think to the evolution of creativity, if you will. Back when we were kids, it was really self driven. Let me rephrase that, the influence we had was much more localized than the influence that kids today have. So as you're talking about creating and inventing, I'm thinking to the influence you must have had must have been around friends, and maybe some television shows. Maybe there's some hobby magazines that you were into at the time.

13:27

Clay Alexander: Oh.

13:28

James McKinney: Whereas I think now, and you have a daughter I believe, correct?

13:32

Clay Alexander: Yes, that's right. She's nine. Her name is Charlotte.

13;35

James McKinney: Nine, right. So I have a son who is 13 and I'm thinking of YouTube.

13:40

Clay Alexander: Oh, yeah.

13:41

James McKinney: Mark Rober, for example, if you don't know him he's a NASA engineer who retired and he does a lot of creating and inventing of gadgets and things that my son loves to watch. And I think to myself man, if Mark Rober or somebody like that was around when you were a kid, the opportunities for what you possibly would have tried to create and invent probably would have just been exponential.

14:04

Clay Alexander: Oh, tenfold, tenfold. Because I love this conversation, because and you're right back when I was a kid, born in '75, going to high school what in late eighties, early nineties, and junior high and high school. We didn't have the internet. So it was like honestly, Inspector Gadget was my favorite show.

14:31

James McKinney: Oh yeah.

14:33

Clay Alexander: And you'd watch any-

14:35

James McKinney: And MacGyver too, right?

14:36

Clay Alexander: MacGyver!

14:37

James McKinney: Yes!

14:38

Clay Alexander: I knew there was another one. I'm like what's the other one? Yeah, MacGyver, okay. Oh and Knight Rider. Those were my three shows, and man the lights on KIT that would go back and forth, and KIT would talk, and KIT was my favorite car in the whole wide world. And then Inspector Gadget, I would watch like Inspector Gadget have a helicopter pop out of his hat or his arms would extend, or his shoes would turn to skates. And so I started making some of those things.

The other thing that I watched was Pee-wee Herman's Big Adventure. And do you remember he had his bike, where he had a smokescreen on it?

15:15

James McKinney: Yes.

15:17

Clay Alexander: So I'm like I've got to make that. So I get my bike, and I take a tennis ball can and a hose, and I run the hose to the tennis ball can. I mount the tennis ball can to the back of my bike. I fill it with baking soda like powder, and I put a little kind of flap on it, and then I run a hose up to my handlebars. And then I did another can next to that for oil slick, and I filled my little can on the back with oil and it had a little flap that was actuated with some pulleys and strings that went up to my handlebar. So I would drive around my little town, Marietta, and I would push these little levers and I could open up these cans, and I could do with the oil slick it would dump all out on the ground. With the smoke screen I would have to put the hose in my mouth, and I would blow really hard and all that powder would just go poof, right out the back of my bike, and it would create a huge smoke screen.


16:18

James McKinney: Okay. You should be able to get a sense that this episode is going to be absolutely incredible. But before we continue on, I need to ask you a question as it relates to your business or startup: when I say the phrase content marketing what comes to mind? Maybe you hunch your shoulders forward a little bit out of frustration because it feels like a constant chore that never delivers results. Or maybe your internal temperature rises because you've created so much content, but it has never driven the business success that you thought it would. Either way, I am fairly confident that the thought of content marketing is viewed more with disdain than it is excitement. So with that in mind, wouldn't it be helpful to learn proven tactics directly from founders that have executed well in this area? Even more so, would having their tactics delivered to you every quarter be helpful to you as you build your business? That is the experience and knowledge sharing that is delivered to you each quarter when you become a Grindology member.

Grindology is an entrepreneurial subscription that ships every quarter full of resources to help fuel your grind and your hustle. Now what's included in your Grindology shipment? Well first and foremost, every single Grindology shipment includes a copy of the latest issue of Grindology. Every single issue of Grindology will be chock full of real tactics from real business builders, not journalists. Within the pages of the Grindology magazine we will be delivering to you tactics and strategies you can integrate into your business immediately. How great would it be to receive proven tactics on how to leverage existing content that you've created already to drive new business and deliver new revenue? Or how about hearing operational tactics used by a founder that saw nearly 400% growth in one year that he directly attributes to his content marketing efforts? Or even better yet, how a founder that actually stopped creating curated content and started documenting everything, and it saved their business in 2020? Tell me those founder direct tactics wouldn't be helpful? Well those are the exact types of tactics that will be found in each issue of Grindology. Like I said, real tactics from real business builders.

Our Q2 issue is now available and you can access it at grindology.com. Everything about Grindology is about helping to fuel your grind and your entrepreneurial journey. So visit gridnology.com to learn more. And of course we're going to include a link to grindology.com within our show notes for easy access. Now let's jump back into our episode with Clay Alexander as we continue to unpack his entrepreneurial journey that led him to creating Ember.


18:37

James McKinney: I would love to know, again time and place, if you were a kid now with YouTube, just the things you would have thought of and created. Again, what you've invented is amazing and we'll get there for sure. To think it started with the Inspector Gadgets. To think now the kids and the access with YouTube, and all the different levels of creativity an invention that are out there, and the advancements that they're seeing now, what is going to happen in 15 or 20 years because of the kids today? It blows my mind when I think about it.

19:08

Clay Alexander: I agree. It's exponential growth. And now that I'm a grown up and I have access to those things, it's just more information coming into my mind. You watch SciFi movies now, you walk down a hallway, the door opens up, things are all automated, and you go oo, I want that for my house. Everything is just you have more access to things now.

19:31

James McKinney: Then as we get older we watch movies like Minority Report and it doesn't seem so farfetched. It's like oh wait, we have that already.

19:38

Clay Alexander: Yeah, that's right. That's right.

19:40

James McKinney: So back to your story. When you are coming to the end of Cal Arts, what was your next step? What was your first job? I assume you did not go into your own venture. I assume you did not come out with a product ready to invent.

19:52

Clay Alexander: I wasn't ready yet. It wasn't my time, right? I had to go out there and get some world experience. I got a job at Universal Studios as an intern doing lighting design for the theme park. I loved it. I just loved that job. By the way, I was super fortunate. There were a whole bunch of people that applied. It was the first internship that they had ever opened up and I landed the job. I was so, so happy about that. I busted my hump. I mean I was still in my final year of college and yet I lived at Universal Studios. I was doing these lighting installs all through the middle of the night because when the park is open, you can't drive trucks in and do big rock and roll lighting installs. You have to do it at night. So I was school during the day and I was at Universal all night, and sometimes I'd need to be at Universal during the day for planning meetings.

I went into my mentors office and I said, "Hey John, look I'm out there getting real world experience at Universal Studios. Would you rather that I sit in a classroom here and read about stuff in a book, or would you rather that I'm down there literally mounting shows and doing real world stuff? And would you grant me permission to miss some of my classes so that I can be more involved at Universal?" He was awesome. He was like, "You know Clay, absolutely." And he trusted me. And by the way, that's a Cal Arts thing. Not all colleges would do that, but that made my final year because I was super involved at Universal and just doing these huge shows. I mean I was, I was 20 years old or 21 or something, and I had like saggy pants. I was a kid and I was doing these huge projects at Universal Studios because I was the only lighting designer for the park. It was just a huge… it was a great experience for me and taught me responsibility, it taught me teamwork, taught me all that good stuff.

21:52

James McKinney: How do we get from there to your first invention that ended up being the Journee? I don't know if it was called the Journee light or the company was called Journee.

22:02

Clay Alexander: Yeah. My first, so my light bulb, Infusion. So after Universal Studios, I started my own lighting company. This is when I got the entrepreneur bug. I had started, I went and filed a DBA with the county's office while I was at Universal. I always had an entrepreneurial bug, and I went and got my business license and everything. I would do side hustles while I was at Universal for several years. I would go and do lighting jobs for Radiance, which is my lighting company, on the side. Eventually, I got so busy with Radiance-

22:39

James McKinney: What's a side hustle for lighting gig? I think theater jobs. What's a side hustle for you?

22:47

Clay Alexander: Yeah, exactly. I was doing theater jobs. I would literally drive to downtown LA and I would do lighting for a dance concert in one of the big theaters in downtown LA.

22:58

James McKinney: So doing that is when you had this idea for a brand new light?

23:02

Clay Alexander: Well no. So I ran Radiance for a long time. The Radiance story is really interesting because Radiance today is 22 years old, is one of the largest lighting design companies in the country. I still own it 100% outright. It's kind of, I always call Radiance like the American dream. I started from scratch, I was raised poor, started from scratch. I was rubbing nickels together to start Radiance. I had no money. And I convinced my first customer after I left Universal and started Radiance, convinced my first customer to give me a 50% deposit. What I did is out of the gate I set up my kind of business model so that all of my jobs were 50% profit margin. So what that meant was if I could get a 50% deposit for the customer, that would cover the entire cost of the job. Then, I also convinced them to give me a net 15% on the back end so it was quite quick, then I'd take the net 15% of remaining 50%, and I would use that to kind of pay the bills and keep the lights on until the next job. So I literally was like, I always say I was duct taping money together in the early days. And you really can build a business from scratch with nothing. I've proven it. The Radiance story is pretty awesome. I've done some amazing jobs all over the world.

24:31

James McKinney: You're still operating Radiance even with Ember?

24:34

Clay Alexander: Well, no, now I have a president. Her name is Jen and she runs Radiance, and she is amazing. She's run Radiance for the last five years. I have very little involvement with Radiance these days, but I still own it. So Jen and I will get together maybe once a quarter and we'll go over the numbers. We'll go over any new customers, we'll go over the business. Then she goes off and runs the business.

24:59

James McKinney: So I want my listeners to make note of this. So Radiance is existing throughout the rest of our story, our time together, know that Radiance is something that Clay started and is operational. So as you're building Radiance, as you now left Universal and you're building Radiance, you have a successful business doing these jobs, explain to me the Journee light and what problem was taking place in your world that needed this new invention.

25:27

Clay Alexander: Yeah. So I was doing a bunch of projects for Mattel toys. We were doing their lighting all over the world at toy fairs and such. There was a toy fair in New York. They had a situation where they needed to put in 1,000 lights into this old building. We were worried about the load that it was going to put on the building, the HVAC was going to suffer because when you put 1,000 halogen lights in, your heat output from the lights is just tremendous. So the HVAC wasn't going to be able to hold up. We also didn't have enough power in the building. So at that time, LED was just starting to come up on the scene. It was LEDs at that time were kind of indicator lights on your cell phone and they just started to become like really kind of cheap like flashlights with just the teeny bit of light out. They had started to kind of make the move into like actual illumination.

After doing research all over the world to try to find a light that would work for Mattel for 1,000 light fixtures in this space in New York, we came up short. There was no such thing as an LED track light. I thought to myself well hey, I'm an inventor, why don't I just create the world's first LED track light? And I did. I created a track light. It's still online and you can look it up. It's not for sale anymore, but there's all kinds of legacy stuff online. It's called the Journee Lotus, and it looks like an airplane jet, like a turbine from an airplane. It's super cool. But anyways, I created the world's first LED track light, but through creating that I thought wait a second, all the LED fixtures that are out there today you have to bolt the LED into the fixture so that the waste heat can kind of wick through the fixture and out into open air. No one had figured out how to get the LED out of a light source so that you could make it replaceable. So I had invented the world's first twist lock LED light bulb, and it's called the GE Infusion. It's still for sale today. What happens is you twisted it into its socket, and when you make the twisting motion we make a thermal coupling between the light bulb and the socket. Here's why that matters. You need to wick the waste heat off the LED in order for the LED to burn brighter and longer. So if you look at the history of light bulbs, all light bulbs up until mine created an electrical connection between the light bulb and the socket. My light bulb created an electrical connection between the light bulb and the socket, but it also created a thermal connection between the light bulb and the socket. So that way you could make the thermal connection wick the waste heat off, and then have a super bright LED. My LED light bulb was the brightest LED light bulb in the world when I sold it to GE in 2009.

28:32

James McKinney: So let's talk about that for a second. So you create this product to solve for a client need. What year was the Mattel engagement that caused you to solve this problem?

28:43

Clay Alexander: Let's see, because I sold my light bulb to GE in 2009, and that was about a three year process, so I would say somewhere around '06, James.

28:52

James McKinney: '06. So you solve this problem for a client. Now did you see a larger market opportunity? And if so, why not try to go to market yourself? I assume you had the patent for it so-

29:06

Clay Alexander: Oh you mean on the light bulb?

29:07

James McKinney: Yeah, on the light bulb itself.

29:09

Clay Alexander: Yeah. So okay, so Journee Lighting was my first company after Radiance. We made the light fixtures, we made the light bulb which is now called GE Infusion. At the time GE, Sylvania, and Phillips dominated the light bulb industry. They were called the big three. Here I am, I create this light bulb, I'm thinking, "Man, do I want to go up against the big three with this light bulb?" And also, James, I was not venture capital backed. I was self- funded. You know that makes a big difference. If you've got tens of millions in the bank and you can go up against the big dogs, go for it. That's what I'm doing with Ember now. But with the light bulb I thought you know what, instead of trying to compete with these guys why not license it to them?

So what I did is I did a 20 year royalty bearing licensing deal with GE where I was able to license my light bulb patents to GE, and it was amazing. I actually had Sylvania and GE in a bidding war for my light bulb.

30:32

James McKinney: That's incredible. Now was there any mentor in your life? Again, so far in your journey there wasn't a formal business education. You kind of learned as you went. You built Radiance, successful business so obviously you were doing well. But the idea of taking this product that you have invented, and one knowing who to approach in the big three, knowing how to handle the negotiations of it, knowing what are some interesting revenue models that could bode well for you in the long term, did you have a mentor who was kind of guiding you along the way in this? Or was it all-

31:03

Clay Alexander: Well not at that time. I've had hundreds of mentors throughout my professional career, and I have never been shy about asking for advice. That's one thing I would say to your listeners. Anybody that knows more than you about something, just go ask them. Ask them to lunch, ask them to coffee, ask them to dinner, and pick their brains. I've done that my entire career. So what it is, James, is I would pull little nuggets of ideas from people. Then I would kind of formulate them together in my mind. When I knew that I wanted to license my light bulb to GE I thought okay, I'm going to be going up against one of the largest companies in the world. I need the best intellectual property patent attorney that's out there. So I hunted, and hunted, and hunted. I found Art Rove, who at the time literally was one of the top IP licensing attorneys in the country. I convinced him to take my project. He was my mentor, and also I was his client, you follow me?

32:03

James McKinney: Yeah, yeah.

32:04

Clay Alexander: So you can pay people to be your mentors too.

32:09

James McKinney: That's exactly what I was thinking.

32:11

Clay Alexander: Yep, yep.

32:13

James McKinney: I love it. So you license this again for 20 years, and we won't go into the details of that, but I do have to ask a question because when I think of technology and I think of lighting specifically since we're talking about it, I feel like the evolution of lights has progressed so quickly that a 20 year deal might have stopped paying after like five years. Am I missing something in how a deal like that would be constructive?

32:38

Clay Alexander: The idea behind, and that's a good question James, so the idea behind my invention was that it was sustainable. So my light bulb had a microprocessor and a circuit board within the bulb. So you could upgrade the technology, continue to make the what we call lumens per watt more efficient over time, and continue to upgrade and upgrade. That's why, honest to goodness think about it, I sold it in 2009. What are we 2021, if you Google GE Infusion it's still all over the internet, they're still making models. Because they've been able to upgrade the technology within the light bulb, but the core invention is what I had created and patented, which was the mechanical and electrical interface if that makes sense.

33:31

James McKinney: Absolutely. And before we leave this topic, I want to ask this question because there might be some inventors in my listener base. Maybe some new listeners that are coming on because you are a featured founder for the show. Actually now that I'm thinking about it, I've had past founders who have invented products and I did not ask that is question because they did not have a licensing black to their story, but you do. And so for my listeners that may have something that they are being told, "You know what don't try to go to market and sell this yourself, license it." Could you give us a quick, I don't know top three, top five things to consider when it comes to licensing deals? What are some things that my listeners should have in the back of their mind when it comes to a licensing deal?

34:19

Clay Alexander: The first thing that I would make sure to do is to make sure that your intellectual property is buttoned up. There are so many stories of inventors going to big companies saying, "Hey, check this thing out I invented," and then the big company steals the idea. So I didn't want that to happen to me. So I spent years filing patents, robust patents… So there's design patents and utility patents. You won't really want to get utility patents. There's very, very few licenses that ever happen off a design patent. Utility patent is where it's at, that's the meat. That's more the technical stuff. So you really want to make sure that you've got a really solid patent filing. I was at a patent pending status at that time. I did not have a grant yet. It's okay to be in patent pending status, but you want to work with your patent attorney to make sure that there is a very high probability that you will get a grant off of what you file. Because when you go into those big companies, the first thing they're going to do, and let me tell you I've been through this many, many times, is they will put their lawyers on it. Their lawyers will go and search all the intellectual property that's out there relating to your idea.

For me, it was a light bulb. I remember I showed up to Sylvania in Boston to meet with the CEO on that is deal. I walk in the room to meet with the CEO and before the CEO comes in, their general counsel comes in. He sits down and we're talking, and he slaps down this massive pile of patent in front of me. He says, "Okay, Clay. Here's all the patents in the world related to LED light bulbs, and I need you to tell me why yours is different and how your patent is going to get granted around all these patents." So I had to, and I knew luckily because I consider myself a mini patent attorney. If you're an inventor you need to get good patent law. So I was able to sit there and combat every single patent that they had thrown out at me. And then he goes, "Okay, you made a great case," and then he walked out of the room, the CEO comes in, we ended up making a handshake deal. I didn't end up going with Sylvania. But so the patent side of it is huge. A big company most likely will not license your idea without a patent. So I would say really, really spend the time and money on building up your IP portfolio.

36:50

James McKinney: I love that. Now what about some of the ideas around monetization? I think right now for the listener, a lot of people are thinking monetization is a royalty off of sale, but maybe from your experience, maybe there's other models out there. What are some revenue considerations for an inventor listening?

37:09

Clay Alexander: For me I always look okay, do I want to sell this thing outright or do I want to license it. If you sell it outright you can do that. That's a model and you get a lot of cash fast. But if you're in it for the long game, let me tell you something when those checks were coming in, in the mailbox once a quarter, it was amazing. You're like hang on a second, I didn't do any work this last quarter against this light bulb and yet here's a check in the mail. That is like the Holy Grail of licensing deals. So for me, I was in it for the long game and I probably could have sold the patents outright, but I decided to license it. You really want to kind of consider your life goals when making that decision.

37:57

James McKinney: Out of curiosity, when it comes to royalties now I'm starting to think of my time working for Disney and understanding some of the licensing deals that they would do. There was always the royalty, but there were minimum requirements. When it comes to an inventor, can an inventor say, "Okay, I'll do a royalty deal but there's a minimum three year payout of $1.5 million," or whatever. Can they do a floor of any type?

38:23

Clay Alexander: Yeah, that's awesome James. Yes, you can do that. In fact, in all of my deals we put a minimum guaranteed royalty. Here's why that's important. You don't want the big company to sign the deal, walk away, and then never commercialize your product. That's the fear. If there's a minimum in there, they either have to pay you your minimum or commercialize the product and hope that it hits your minimum. So you really need to have that protection mechanism in there, for sure.

39:04

James McKinney: I love that. I love it. That was such an incredibly rich guidance, Clay, and I appreciate you sharing that with my audience.

39:11

Clay Alexander: You bet. I could talk about licensing all day long.

39:14

James McKinney: And it's interesting because I really feel, and again maybe this perspective is a bit dated, I feel like for a lot of people I'm going to say 35 and under, 30 and under, licensing is a little bit misunderstood and really didn't even become part of their vocabulary until Shark Tank. I feel like Shark Tank talks about licensing all the time, and that's where most people are like huh, I wonder what licensing is, and yet the nuances and the finesse to licensing is never discussed. I think there's so much inside of that.

39:45

Clay Alexander: So I'll give one word of caution when you're trying to decide if you're going to license something or commercialize it yourself. This is my big life lesson. When I had licensed my light bulb to GE, the moment I signed that contract I lost control of my invention. I knew that I would. But let me tell you something, it's harder than you think. When the big company goes and wants to turn left and you think that they should turn right, there's nothing that you can do about. They've licensed your patent. So when I built Ember from ground up, I said you know what, I'm going to take this thing to market myself so that I can control every single aspect of these, from how they're created, what they look like, the design, how the touch and feel is, how they function, how we market them, what our ads look like, what retailers we're in. you can truly control it.

40:46

James McKinney: I love that. Okay, I want to fast track your story because I want to get to Ember and I want to spend a lot of time on Ember because it's one of my favorite products, especially in the coffee category. I became introduced to it through Starbucks years ago, and I know that's part of your launch strategy and we'll talk about that. But how do we get from your lighting company? Again you licensed, I'm going to mess up the name again, not Juno-

41:15

Clay Alexander: The GE Infusion.

41:17

James McKinney: The GE Infusion. You licensed the bulb and you're still doing this lighting business that you have, this production company. How do you come across this need or this problem that you solve with Ember?

41:29

Clay Alexander: Origin. So I'm sitting there in my kitchen, it's 2009 and I just sold my light bulb to GE. I had come off of two or three years of thermal science engineering so I had heat energy in my mind. I'm eating scrambled eggs with my wife, and I get about half way through the eggs on my plate and my eggs get cold. I remember thinking to myself okay, every time I eat scrambled eggs they get cold before I'm done eating. I'm thinking okay, this is the 21st century. At a bare minimum my plate should be able to keep my food at a decent eating temperature. So I decided to start strapping RC car batteries and temperature control circuitry to the bottom of the dinner plates in my kitchen, and I made the world's first self warming dinner plate. I started eating meals off them.

James, this plate would crack you up, man. There's wires hanging off the side of it, there's like a big old toggle switch on it, RC car batteries and everything. My wife would make like an amazing salmon or something and I would put it on the plate, I'd take a bite, it was amazing. And I'd kind of slowly eat it over a 30 minute period. At the very end, the last bite 30 minutes later you'd cut into the salmon, steam comes out, and it has the same flavor and same heat level as the very first bite you took. So I was like wow, this heated dinner plate thing, it actually works. It was amazing. I remember looking around the kitchen and thinking soup bowls, chafing dishes, coffee mugs, baby bottles, and all of the things that could benefit from temperature control.

From there, I decided hey I'm going to do this. I started filing patents all over the world. Because remember, I'm a patent guy right? I'd just come off of licensing my light bulb. So I started filing patents all over the world on this concept of embedding temperature control into all forms of drink ware and dishware. That was kind of the very beginning. Since I had a windfall from my sale to GE, I was able to self fund Ember for the first five years.

44:02

James McKinney: That's incredible. Let me ask this question right, because one of the things that I think as entrepreneurs it's kind of easy for us to drink our own Kool-Aid sometimes, where it's this is the product that is going to change the world, this is the product that people need. That solved a problem for you. What was it or how did you validate this was something that actually consumers would want?

44:29

Clay Alexander: Well, okay so part of the story is that as I was developing this technology and I made the plate, and then I made a coffee mug, then I made this baby bottle, all prototypes in the lab to prove out the technology, we decided, the big decision moment because I've got to get to the mug from the plate first, so the big decision moment was what are we going to go to market with first? How are we going to introduce this concept of temperature control to the masses? At that time, this is in like 2012 or 2013 I was making this decision, at that time the coffee industry was huge on the rise. Starbucks was coming up, all these third wave coffee shops were coming up. People were starting to pay $10 for a cup of coffee, right? Whereas when you and I were growing up you'd pay $1 for a cup of coffee, right? So maybe $1.50 if you were splurging.

45:34

James McKinney: Or you went to like the 7-11 and got 64 oz. of coffee for $1.

45:38

Clay Alexander: Yeah, that's right, the Big Gulp, yeah. So I'm watching and that's the thing about being an inventor, you've got to follow the trends as well just in terms of what's going on in the world. You've got to use your intuition. Because look, there's no book that you can read that says, "Hey, if you invent a temperature control technology you should go to market with a mug for it." There's no books for this. So you literally have to use your intuition. So that's what we did, and we decided to go with a mug first. From there, it was like okay well I've got this… so then I started building this mug. I wish I could show you this prototype of the first mug that I made. It had like batteries on it, wires hanging out the side, and like heat sinks and all kinds of stuff. I would go around town drinking out of this contraption that looked like a bomb.

46:37

James McKinney: That's what it sounds like.

46:38

Clay Alexander: But I had dip switches on it, and I had a little code and I could set the dip switches for certain temperatures, and I figured out that I liked my coffee at 135 degrees. I would go around town drinking out of this, and I just loved it. So it thought okay, I've got to make this thing pretty because I can't go to market with this. So the thing you'll see about Ember, James, is that we're really big on design. So I knew that for my product to go to market and not be conceived or thought of as an invention that it needed to be beautiful. So we went through all kinds of industrial design firms. I did a whole project with a firm down in Southern California, and they gave me the final deliverables, "Okay, Clay, here's the mug. Here's what it looks like," and I just didn't like it. I was like can't get behind this. I'm going to build a whole company around this thing.

And that's actually a life lesson as well. I could have went to market with that first design, but I didn't feel it in my gut. I was also running out of money at that time too, but I knew that it had to be perfect. So I like dug a few more dollars up out of the couch cushions, you know figuratively speaking, and I went back out on the hunt to try to find a better design firm. We interviewed all these design firms across the country. I ended up with a design firm called Ammunition. They're up in Seattle and the founder is a gentleman named Robert Brunner, who was Steve Jobs' business partner. He was the head of design for Apple and created the original Macintoshes. You know the Macintoshes that had the cool colored backs and all that?

48:22

James McKinney: The egg shape, yep.

48:24

Clay Alexander: So once I connected with Ammunition I just knew. I mean so Robert is the chief designer for Beats by Dre as well.

48:33

James McKinney: Oh wow.

48:34

Clay Alexander: So if you look at Ember products, you can kind of see a DNA there, an Apple DNA, being that Robert comes from Apple and there's that kind of Apple DNA. Also, if you put a pair of matte black Beats headphones next to our matte black travel mug, you can get the DNA thing going on.

48:53

James McKinney: You know, it's interesting you say that because just for my listeners to know, at this stage in the game with The Startup Story I don't do a lot of outreach to get founders on this show. I have a lot of publicists or internal PR people that will reach out to me to get their founder on the show, and I select from there. But you were one I went out and got because I wanted to have your story on here. One of the things that I said to your team, and I think it was the general press email that I reached out to, one of the things I said why I'm so fascinated by your story is I view you as the Apple of drink ware is how I phrased it, so it's fascinating to me to know that your first designer had the attachment, and as you said the DNA. Because you look at the design, for those who have never seen Ember products, check out the Ember website. It is remarkably, everything is so clean. The lines are so perfect.

49:50

Clay Alexander: I love that, James. Trust me, that is music to my ears. We put so much pride into design at Ember. We have a saying at Ember, "Design comes first." We'll be in these huge senior leadership meetings and it's like, "Wow, we've got to grow the product because X, Y, and Z reasons. We can't get the batteries in there and this and that." It's like no, we're not growing the product, it's got to fit perfectly in every human's hands. It's got to feel right, it's got to look beautiful from up close and across the room. We just put so much energy into design. So we start with the design and then we back the technology into the design. Let me tell you something that is a very hard thing to do.

50:34

James McKinney: Yeah. You know let me ask you this question as an inventor, as someone who has seen consumer products through various stages, both commercially for residents and citizens as well as at a business level when it comes to lighting. How much of our current day consumer expectations when it comes to user experience and design is shaped by I'm going to say the iPhone specifically?

51:01

Clay Alexander: Oh yeah. Look, let's all give major thanks to Steve Jobs because he came along, doubled the price of a cell phone, made it twice as beautiful, made the user interface twice as easy, and it was just a leap frog kind of situation with technology. I'm a big Steve Jobs fan. I'm not a fan of his management style. I don't go around and yell at my people. I don't think that I do, I hope that I don't. But man did he have an incredible vision for just creating beautiful objects. That's what I like to say, that I create beautiful objects, or objects of desire. And they also, at the same time, work for you. They do something useful for you. I never want an Ember mug to end up in a junk drawer.

And that's why we've made the Ember mug so simple to use. You don't even have to turn it on. Everything is automatic. You just walk up to the coffee maker, put your mug in it, the coffee goes in, it sense that you put the coffee in, it turns on the microprocessor, it turns on the heating system, and it keeps the coffee the exact temperature preset that you selected. We're just trying to make our products very simple and easy to use. I think design is just so important. To answer your question, I think yes I think the iPhone had a huge effect on design and how design is perceived in society. Think about it, a coffee mug before Ember, $5. Now, our cheapest Ember mug is $99 and we're selling them like crazy. Our growth rate this year, James, will be 100% year over year.

52:56

James McKinney: That's incredible. That is incredible. It's fascinating, because you know a friend of mine was one of the co-creators for the video game Call of Duty. He was part of Google with building Ingress and was the brains behind Pokemon Go. He's entrenched in the term user experience, and so because of my proximity to him I'm always thinking through the lens of user experience. But I've never, until this last probably six months or so, I couldn't tell you what episode, what interview it was, have I started looking at product design as the consumer product version of user experience. It very much is. To your point, my wife not technically gifted, but she didn't have to know anything about how to work the Ember mug, the travel mug to be specific. She didn't have to know anything about it. She just turned it on, saw it was charged, put coffee in it, and it was good for her to go for a couple of hours.

53:58

Clay Alexander: So I love that you're sharing that with me because when we were creating our very first product, which was the travel mug which we launched with Starbucks, but I remember sitting in the design meetings with my engineer designers. The original version of the Ember mug had a lot of kind of buttons on it and stuff. We didn't launch that one, that was the previous version. I thought ah, it's too technical. You've got to do stuff before you drink a cup of coffee, nobody wants to do stuff. You just want to pour that beautiful sweet nectar into your coffee mug and you just want to start sipping on it. You don't want to do stuff. So I said to our design team, I said, "Guys, this product has got to be so easy to use that my grandmother can take it out of the box, pour coffee into it, and start drinking out of it."

54:54

James McKinney: Yes, I love it. It's remarkable. Again, I can't shout it from the rooftops enough, everyone needs to have an Ember mug. But when I ask this question, when it comes to the adoption side of things… actually, let me ask a question about your launch strategy first. So the very first product, was it the travel mug or the mug?

55:14

Clay Alexander: It was the travel mug. I started with the more complex product which is a little bit unusual, but it's kind of along the lines of if you look at the Tesla story or any of these kind of big successful tech companies, they usually start with the most complicated product first. And you get a lot of press and accolades when you come out of something that just like is so next level. So when I created the travel mug and we made it, we went through the design process, we went through all the engineering which holy cow that was a change because I had never created consumer product before Ember, let me tell you something it was a best of a project between trying to onboard electrical engineers, mechanical engineers, thermal scientists, firmware engineers, software engineers for the mobile app, on and on and on. All these disciplines have to work together like a family, and everything has got to fit together and work. And so going through that process was a major learning experience.

Now at Ember we do it in our sleep, but that first was quite hard. I'm skipping ahead a little here, but we had the product and we thought how are we going to get this thing out to the world? At the time, Kickstarter and Indiegogo were I don't want to say new, but they were like I don't know maybe just a handful of years old at that time when we launched the Ember mug. But it was kind of the hot new platform to get your idea out there. We decided to go on Indiegogo, and we had a very successful campaign. We did I think $370,000 in just a few weeks, two or three weeks. That was awesome because to me it was an indicator, you asked me earlier hey Clay how do you know as an inventor if the idea that you came up with is going to be a niche or if the masses are going to like it? I think Kickstarter and Indiegogo is a great platform for that, because you'll find out pretty fast.

57:23

James McKinney: Yeah, absolutely.

57:25

Clay Alexander: So that was kind of how we got the word out on our product, and we did preorders and all that good stuff. But I always knew that for my product to be a huge success and not be seen as a gadget that I would need to partner with a very high end retailer in the coffee space. As you know, Starbucks in the 1,000 lb gorilla in this space. I always knew that I wanted to launch with Starbucks. Let me tell you something, I pitched to Starbucks for probably about two years as we were creating the mug. I got a lot of very friendly "no." Like, "Oh, thank you Clay, this is amazing, this technology is great, but we don't sell consumer electronics in our stores," or, "It's a little too progressive for us." But as an entrepreneur, I'm telling you you've got to have grit. It's like if you ask a pretty girl at a dance and she says no, you've got to have the courage to just keep going back until she says yes. I suppose you could relate that to this story, but I just kept going back and kept going back, and I didn't give up.

I eventually got an introduction to both Howard Schulz and Kevin Johnson, not at the exact same time but very kind of similar. Howard Schulz the founder, and Kevin Johnson the current CEO. They loved it, both of them actually liked it. Once the two kind of visionaries at the top, Kevin Johnson was the COO at the time, and once they liked it, it was like okay let's do this. I was up there on a plane, I was up at headquarters pitching to a whole room of executives. We were the fastest launch in Starbucks history. From the time we did the pitch to the time we were on the shelves was I believe two months. That's a big deal.

59:20

James McKinney: Oh my goodness.

59:22

Clay Alexander: Yeah.

59:23

James McKinney: Just out of curiosity because when I think of that, I think of manufacturing, I think of inventory. How many units did you ship to Starbucks for that first launch?

59:34

Clay Alexander: So the first launch, I don't have the units memorized but I'll tell you the first launch that we did with Starbucks was in 100 of their top stores in the country, because they were testing us. But the good news is they were testing us like in the middle of Times Square and Beverly Hills. So it was they were the right test stores. We sold out all across the country within 7 days of launching at Starbucks.

60:02

James McKinney: Wow.

60:03

Clay Alexander: And keep in mind, this is a $150 SKU in a store-

60:10

James McKinney: And also too, has your product been in consumer hands anywhere before this?

60:13

Clay Alexander: No, nowhere.

60:14

James McKinney: So you're also testing your customer service side with any complaint issues.

60:16

Clay Alexander: Yep.

60:17

James McKinney: Oh man, okay.

60:18

Clay Alexander: Big time.

60:19

James McKinney: That's a big launch.

60:21

Clay Alexander: Oh it was a big launch. And let me tell you something, that launch was so successful that we ended up, Starbucks came back and said, "What else do you have, Clay? This travel mug is selling like crazy," and they were placing emergency PO's, James, and we were air freighting from our factory pallets and pallets and pallets of Ember mugs in. that's just for the 100 stores. So they come back to us and they say, "Hey, you know this product is selling like crazy. What do you have next up your sleeve?" So I show them our ceramic mug, the one with the handle on it which is very popular today, and they loved it. Starbucks then agrees to launch our Ember ceramic mug in 4,600 Starbucks stores, okay?

61:07

James McKinney: Oh man.

61:08

Clay Alexander: And we sold between Starbucks and Ember.com, we sold 110,000 units in the first six weeks. We did $14 million in our first year in business.

61:19

James McKinney: Wow, that is incredible. Were you, at this point obviously there's lots of ways to finance deals like this. Are you still bootstrapped yourself on this or have you now got some investors in this?

61:31

Clay Alexander: Yeah, by that time I had finished my Series B. I bootstrapped for the first five years and then I raised an A and a B, then we went to market. Had huge success and then after that I raised a C and D.

61:47

James McKinney: Okay. That's incredible. That is absolutely incredible. So when you think of, again your launch going through Starbucks is huge because there's so many inventors out there. People creating any type of product where they would love a partner with that kind of reach and visibility from the get go, but oftentimes again the fact that you got there… Actually, my understanding based on how we told the story which isn't always linear, is that you were pitching a prototype at this point. You didn't have the finished product yet.

62:16

Clay Alexander: That is totally correct, yeah, it was a prototype.

62:19

James McKinney: That's amazing to me.

62:20

Clay Alexander: And I said, "Hey look, this is what it looks like and this is how much it's going to weigh." I think maybe I could get the screen to come on, but let me tell you there was a lot of trust and faith between the two partners. Honestly, that's what it takes to cause disruption.

62:38

James McKinney: That is incredible. Absolutely love it. So when you think back to what you know now versus how you started, is there any modifications or adjustments you would make because of some pain points you experienced early on, and how you learned on the back side?

62:55

Clay Alexander: Yeah. I probably would have commercialized the light bulb on my own because I didn't … I guess I didn't realize as an inventor that when you license something you really truly lose control. Now, there are some forms of licensing agreements where you can put control strings in, like you know owner of technology needs to approve any product adjustments, et cetera before launching. But let me tell you something the big companies, they don't like to give those kind of clauses. Can you image you're a giant multi-billion dollar company and you're going to give a clause to an inventor that says they can block you going to market on something? So those are very, very rare deals.

So for me… but James, this is the thing. Completely like human specific, there are a whole bunch of great inventors out there that all day long they create great things, they patent them, and they license them, and they've got these amazing checks coming in the mail every month. That is an awesome lifestyle and an awesome business model. But if you're like me, and you have this kind of control thing where you really want to control from how the product looks all the way to what it says on the billboard on the freeway when you drive by… and by the way, that's one thing Steve Jobs did really well that I really have modeled after. When I'm creating any new product at Ember, I'm always thinking literally every curve we put on it, every color, where we put the logo, how it looks, I'm literally imagining in my mind how I'm going to market it. How's it going to look on a billboard, how's it going to look on a digital ad, how's it going to look in a commercial. That's a really… I don't think a lot of people draw that connection when they're creating something new. I think it's really important.

64:50

James McKinney: I love that. I love it. You know let me ask this question as an Ember user, talking to the creator and inventor of it. You have a vision in your head of the integration of Ember products into the every day consumer lifestyle. You have a vision of how Ember sits within a consumer's home. What does that vision look like? Is it a one or two mug per household? Is it a, to your point of plates, when you do get the plates is it a setting of 8? What is integration into a consumer home look like for you?

65:25

Clay Alexander: I love that question, and honestly part of the beauty of having drink ware is that once people buy their first Ember mug and they fall in love with it, honestly the repeat business is fantastic. Because they go oh this is great, oh Ember just came out with a 14 oz, I'd love to have a 14 oz and give me a little bit more coffee. And we're doing all these new metallic lines. We just launched a beautiful Rose Gold Ember mug and it is just flying off the shelf. We can't even keep that thing in stock. I found that once you kind of become an Ember lover, just like any great brand that you might love, like I've got a Mac Book Pro here because I love the Apple product. Of course I have an iPhone and all that good stuff. It's hard to imagine myself going off that platform. So we're trying to build that same kind of a platform.

So we started with the mug business. That's growing like crazy. We're now in over 10,000 retail locations and Ember is now in 27 countries around the world. When I say we're in 27 countries, we are in 27 different countries with distribution, customer service, retail. Like in London you'll see us in Harrods and Selfridge's. We're all over the place and we've done this very, very fast. We're in every Apple store in the world which is obviously a big accomplishment for us. We've been in Apple for I think going on over two years, and they're very, very picky about what they put in their stores. We just launched in Target, we're in all the Best Buy stores. We launched in Costco; very successful in Costco. Bloomingdales, William Sonoma, Bed, Bath & Beyond, so our retail footprint is just really expanded. We pulled the data recently and said, "Hey, where are people using Ember mugs around the world?" Because we're for sale in 27 countries, and we found out that in all 195 countries in the world, people have an Ember mug, somebody has got an ember mug.

67:25

James McKinney: That's awesome.

67:26

Clay Alexander: And it's pretty cool because you pull the data and you look, and you can see a map of the world, and you can see people drinking coffee all over the place. But back to your question, so that leads us to our future inventions. I'm about to launch the world's first self warming baby bottle. You better believe it's going to be gorgeous. It's going to be the most beautiful baby bottle in the world, and also it's going to warm the milk or formula exactly to body temperature while you're on the go.

67:53

James McKinney: That's awesome.

67:55

Clay Alexander: I came up with this, my daughter who I mentioned earlier, she's 9, when she was born my wife did most of the feeding but every once in a while when it was my turn to feed or I would feed, it was like okay, baby wakes up in the middle of the night, turning red and screaming and crying, hungry, and you're trying to warm up the bottle in a bowl of hot water. You're like squirting milk on your wrist, trying to tell the temperature, it's just so archaic. The best thing that society has brought forward is a plug in appliance where you put the bottle and it boils the water on the bottom with an egg timer. It has no accuracy whatsoever. The Ember baby bottle will heat to exactly 98.5 degrees on the nose and deliver perfect milk or formula at the temperature that nature intended for your baby.

68:45

James McKinney: That's incredible. You know let me, let's talk about future products real quick. I want to honor your time so we won't go too much longer, but when you think of future products, I read an article about some cargo transport solutions you were trying to come up with.

69:00

Clay Alexander: Yes.

69:01

James McKinney: And I want to ask this question because when I think of Ember, I think of design, I think of elegance, and yet the article is about cargo transport. I don't link the two. Can you talk-

69:14

Clay Alexander: James, when you see this box that we've created, it will make… it looks like the iPhone of shipping boxes. I'm going to have fun with this one. So we've invented the world's first self refrigerated shipping box. If you look at the cold chain today, you've got a cold chain for the medical industry and cold chain for the food industry. We're starting in the medical industry. Hundreds of billions of dollars in medicine is being moved around just in the United States. You're talking about the COVID vaccine, you're talking about insulin, you're talking about Humira, Enbrel, all these biologic drugs. They're all being moved around today using ice packs, Styrofoam, and cardboard. These shipments are going one direction. They're going from the distribution center to the hospital or clinic. The hospital or clinic opens the box, pulls out this little small payload of medicine, puts it in the fridge, and then all of the boxes go to the landfill.

So there's I mean hundreds of millions of pounds of waste each year going to landfills because of this unsustainable way that we're moving medicine around. Our technology, the world's first self refrigerated shipping box, actually returns itself and is reusable. So you pack it, you ship it, and on the front of the box we actually are using e-ink for our screen, so you don't have to print a label anymore. It actually all of our boxes have cell radios so we go up to the cloud and communicate with the cloud. The cloud comes down and prints a FedEx shipping label.

71:03

James McKinney: Oh my goodness.

71:04

Clay Alexander: Yeah, and then the box goes to the destination, you take your medicine out. There's one button the box, only one button, that says "Return to Home." You push the button, we use the cell radio, goes up to the cloud, communicates with the cloud, schedules a FedEx pickup, comes back down, prints a return shipping label on the box. So it's all automated. So the box literally returns itself back to the DC, and then it is used over and over and over again. So we're going to be saving tens of millions of pounds of waste even just within this first partnership deal that we already have on the table.

71:45

James McKinney: I'm telling you I have so many questions still. Again, we're not going to get to them because of time, but I want to ask just a few. I hear what you're talking about with these boxes and I think to myself, okay that's a cooling agent, we've been talking about heat. Is it easier to solve for heating a product or cooling a product?

72:06

Clay Alexander: Another great question. It is easier to invest and create a heating product than a cooling product because cooling, what cooling is by nature is the removal of heat. So most people don't realize this but your refrigerator in your house it's not like making cold energy, it's removing heat from inside the refrigerator. That's why if you go to the back of your refrigerator why is there warm air blasting out of the back? Well because it's pulling all the heat out of the inside of the refrigerator. So cooling is by nature a more difficult technology, but Ember we've got boatloads of patents on cooling technology filed all over the world. In fact, we have all the patents already granted on the invention that I just shared with you on our box, including the return to sender feature. That's already been patented. So we have all that. The cooling side is a challenge because we're putting a semi conductor refrigeration system inside of our box. We have some other consumer, just to drop a few hints here, we have some other consumer products that will have cooling in them in the next couple years, and I'm very excited about that.

73:23

James McKinney: That's awesome. We'll have to have you back on the show when it comes time for that product launch. So let's talk about power versus heating. Ember, again the mug, it is a promise to keep my coffee warm for so long, however long the typical battery lasts right now in the Ember mug, and I don't know because I tend to drink my coffee pretty fast anyways. My wife, however, will have coffee last forever, but that's a whole other story. How challenging is managing power and design?

73:54

Clay Alexander: Oh man, you're full of great questions. Thank goodness for the advancement in battery science. When I first started creating this technology way back in 2010 and 2011, battery science back then was nowhere near where it is today, but yet I as an inventor, I was cracking the improvements of energy density in battery science over time. What I noticed is that the improvements of energy density was going up and up and up, not even linear, not even had kind of an exponential curve to it. And I thought okay if I make this mug or plate et cetera today, it's going to be too big. In 2011, would have been too big. The battery is too big, too heavy, too big. But I knew by mapping battery science technology that it wouldn't be too big in about three or four years.

So I filed all the patents super early and back then, James, it was a land grab. There was no other IP filed for temperature control drink ware the way that I had created it. So I was just filing all over the world. Because part of the thing too is the battery science wasn't caught up yet. By getting all those filings in early, now Ember we're sitting on this mound of intellectual property that's so broad where it's like a drink ware vessel combined with battery, combined with heating element. Boom. We own that. So it's because I filed way early. But back to your question, battery science is a big deal in all of our products. Our products today are using the same cells that are in the Tesla cars, and in most all electric vehicles. They're very robust, they're very safe, and they have a very high energy density or watts per cubic volume, if that makes sense.

75:51

James McKinney: My goodness. Clay, it has been an absolute joy but I now need to honor our listeners with the final three questions that I ask every founder at the end of every episode. But really, this has been everything I had hoped it would have been for an episode. It was an absolute joy to unpack your journey. But the first question has to do with just the general idea of entrepreneurship. The media will paint a picture that entrepreneurship is a "if you build it, they will come." It's the land of infinite riches, and it tends to be an overnight success story, which we all know just isn't true. Knowing what you know and your personal journey and experience, do you think anybody can be an entrepreneur? Or is there a genetic makeup?

76:31

Clay Alexander: I believe that anyone can be an entrepreneur. I believe that I'm proof of that. I was raised dirt poor. I had ADD, dyslexia, still do. A lot of ailments, right, and I was able to kind of fight through that and by capturing learnings and always listening, and going and seeking advice from advisors and mentors, you can do anything you put your mind to. In fact, my mind used to always say that to me when I was a kid and obviously it stuck. So that's what I believe.

77:09

James McKinney: I love it. Another narrative that's out there when it comes to entrepreneurship is that it's this Lone Ranger journey. It's something you do in isolation, something that you just park yourself on your buddy's couch, pounding away at code until the wee hours of the morning, and you're just eating Ramen for the first couple years. But again, it's just not true. Let me rephrase that, those are the anomalies. There are those stories of success in that way, but those are the anomalies. So when you think back to your journey, who are all the people that you point to with such immense gratitude for their contribution to where you are today

77:42

Clay Alexander: So James, my journey is a pretty long one, and I've had well over 100 mentors and advisors through my journey. Billionaires, multi- millionaires, people that are just amazing at certain disciplines. I am just forever grateful to all of them. I would say like if I had to kind of think about one person, my wife is amazing. I would not be here today if it wasn't for my wife. She has stood by my side through thick and thin. And when I say thin, I mean we've almost gone bankrupt five times in the early days. She's been with me since I even started being an entrepreneur, when I started my very first company 22 years ago. I think that just having a really great partner is so critical, and I just… I can't say enough about that.

78:48

James McKinney: I love it. I say it many times that if I had to trim the show to 20 minutes, that question would never be trimmed.

78:55

Clay Alexander: I could keep going on that one, yeah.

78:57

James McKinney: I know you could, and that's just the reality of entrepreneurship is that people need to understand it is not a Lone Ranger journey. Those are the anomalies that make the headlines because they make for a captivating headline, and click bait. But that is not the norm. you need to be connected within community, you need to find people that can speak truth to you when all you see is the mess in the darkness and no hope for what your venture is. You need to have people around you that can see outside of that darkness because they're not in neck deep trying to figure out cash and payroll.

79:23

Clay Alexander: That's right, yeah.

79:24

James McKinney: So that brings us to our last question, and unfortunately I cannot afford the opportunity to have each of my listeners to have a moment and a call with you, so I consider this a mentoring minute. I might have some inventors in my listener base right now, and maybe they have these ideas and they just don't know how to go to market with it. Or they think that their idea is too small and isn't worth the patenting and the licensing. Or maybe they're the inventor that has made a bad deal and something was stolen from them, whatever the case may be. I'd like you to speak to the inventors of my listeners, those who have ideas or products, and whatever persona of that inventor stage resonates with you. What would you say to them right now in 2021?

80:11

Clay Alexander: Honestly, that's a great question. The biggest message that I would deliver is to never give up, okay? When we started you asked me can anybody be an entrepreneur, the answer is yes, but you have to put in the sweat equity. I have almost crashed and burned like 400 times in the last 22 years. Less so now because all my kind of businesses are super stable, but you just can't give up. I would say that's the number one thing is that I would be right on the edge, just going oh my gosh I've got to throw in the towel, and then I would just find this burst of energy and say no, I'm not throwing in the towel. You've just got to keep pushing. I consider it pushing a boulder up a hill. You've got to keep rolling that boulder up that hill, because eventually you will get to the top, and that thing when it gets the momentum coming down, you won't even believe it. Ember is just on fire right now. All my businesses are, and I'm just so blessed. It's because of the 10 or 15 years of pushing the boulder up the hill.

81:23

James McKinney: Once you've had a few moments to process all the value that Clay Alexander brought us in this week's episode, please hit me up on LinkedIn, Facebook, or Instagram and share with me your thoughts on this episode. And if you've been around The Startup Story for any length of time then you know how much emphasis I put on the idea that entrepreneurs support other entrepreneurs. For that reason I hope every one of you will visit ember.com to check out all of their incredible products and maybe even consider buying something for yourself, or move them to the top of your gift idea list for those in your life. What am I talk about, visit ember.com and treat yourself! Life is too short to not have your coffee sitting there within reach at the absolute perfect temperature all day long. I mean it, visit ember.com. And like always, we're going to include a link in our show notes for easy access. And now for my personal ask.

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June 22 2021
Clay Alexander, founder of Ember

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