Olli Kangas is coming for your CO2 spewing furnace--or at least help you find you a cleaner, maybe cheaper, way to power your plant. With cofounder Pasi Hakulinen, he launched Finnish software startup Intergrid in 2023. It has digital tools that let factory owners estimate their energy use, find the best sustainable alternatives, and forecast the cost of the switch. Since launching, Intergrid has secured $13 million in funding from funds including True Ventures and Lifeline Ventures. “Fossil fuels offer a very good customer experience,” he said. “What we need to do is not only match that experience, but build something that is as simple, easier, cheaper for the customer.”
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LifestyleTranscript
00:00The next years and decades will be all about now picking and choosing among the technologies that we already have, the winners, and then scaling those out into the world.
00:14Hi, we are here with Ali Kongas, the co-founder and CEO of InnerGrid. Thank you so much for joining me today.
00:20Pleasure.
00:21So you are the co-founder of InnerGrid. You are focused on the energy sector, the manufacturing sector.
00:27Can you give me a little bit of a 30-second rundown about who you are and what you do on a basic level?
00:33I'm Ali Kongas, the co-founder and CEO, and the mission is really simple.
00:37So we really want to make the electrification of industrial energy use a no-brainer for all industrials.
00:44You know, today there's like more than a million industrial sites all around Europe and the U.S. that still run on oil and gas boilers.
00:51All of those will need to go, right?
00:53And we want to make it as easy as economical for these customers.
00:58How did you realize that this industry was something you wanted to be a part of?
01:02Well, I used to work as a consultant and as a VC in the area.
01:06So I saw that there's a lot of potential, a lot of cool innovations coming along.
01:10There's a lot of willpower on the industrial side, but somehow it's not clicking.
01:14So even though we have the technologies available, we have the willpower, the economics start to make sense.
01:20Somehow the transition is not going along as we would hope.
01:24And so when you first set out to create this transition, what were the first steps you took?
01:29You know, for someone who doesn't have like a technical background, how would you describe what you had to do step by step?
01:35Well, we went really deep both into the energy system.
01:38So really thinking about how will the future energy system take shape with a lot of weather dependent renewables coming online.
01:45That means that we can't rely on having a steady source of power anymore.
01:50And what are the implications of that then in the rest of the system?
01:54We have to have more grid power capacity.
01:56We have to have storages and we have to have more flexible demand.
02:01And the other side then leads us to the demand side.
02:05So you can think about a lot of factories, residentials, EVs having to flex, not when they are consumed, but actually when the power is available.
02:16So bring this all together as a smart system.
02:20It's not a it's not easy to it, but we really wanted to go deep into that.
02:24What from your VC and consulting background did you bring into this?
02:29Then did you have experience in the industrial space as well?
02:32Or how did you kind of, you know, decide what the what the next steps are going to be?
02:38I think the main thing for us and all across the team is that no one wants to sell the customers an algorithm.
02:45What the customers really need is an easy way out of the fossil fuels.
02:50So working as a consultant, really helping the customers figure out the right pathways for them side by side, geography by geography, really puts you into the perspective of the customer.
03:03Often it's not just as simple as, you know, coming up with a nice technology, buying it, but it's actually you need to take in a lot of local variables into account.
03:12And then also do some change management on site to get also the local team on the floor on board with it.
03:21Definitely. So you right now are working on transitioning away from fossil fuels into heat and steam.
03:28Correct. How and correct me if I'm wrong.
03:30Yeah.
03:31How would you describe what this transition really looks like?
03:33Yeah. So today, roughly a third of all global energy goes to industrial use, but around 75 percent of that is actually already heat and steam, but it's produced with fossil fuels.
03:44Gotcha.
03:45So what we want to achieve is that a majority of that currently, you know, basically oil and gas fired up boilers, boiling up water could easily be replaced with renewable alternatives, just like heat pumps, electric boiler systems, different kind of thermal storages.
04:01And where are you then looking in terms of these alternatives?
04:05What are some of the most effective ways to do this?
04:07What are some of those effective alternatives that you're seeing on the market today?
04:11It really depends on the geography and the nuances of how the power market is taking shape.
04:17So in countries like France, when there is a cheap, stable supply of power from a lot of nuclear generators, a heat pump system often is the way to go.
04:30Because then you can get the coefficient of putting in one unit of electricity and actually getting multiple units of heat to steam out.
04:38But then in geographies with more volatility in the power prices and the availability of renewables, e-boiler and a thermal storage combination could really will be the way to go.
04:51Who are your clients today?
04:54Where exactly is Intergrid in practice right now?
04:57We're today already trusted by more than 40 industrial sites in Finland and the Netherlands.
05:02Okay.
05:02We work across more than 10 industrial segments from food processing, milk and dairy, process manufacturing in materials, district heating, facility heating, greenhouses, even industrial laundries.
05:17And the kind of common denominator between all of those is that they use a lot of heat and steam.
05:22Is your pitch to those different sectors different on why they might want to partner with you guys?
05:28Yeah, there are certain differences on the pull and push factors depending on the sector.
05:33What we see is that the closer you go to the end customer, the consumer, the more the kind of green values and the sustainability factors come into play.
05:43But then again, when you're more behind the scenes, let's say you're doing material manufacturing for construction industry, there is more about costs and efficiency.
05:54What has been one of the biggest challenges, especially like a lot has grown in terms of like the mission for environmentalism, alternative energies.
06:02But there's also a lot of hesitancy, I think, to change over. Has that been a challenge for you guys?
06:08Definitely. I think, you know, the fossil fuels are putting a good effort in.
06:13So it is actually a very good customer experience to just keep on running oil and gas.
06:20What we need to do is not only match that experience, but build something that is as simple, easier, cheaper for the customer.
06:28And is that the case right now? Easier, cheaper, all those sorts of things?
06:32It's really coming nicely together.
06:33Yeah. What have been the ways that you guys have achieved that?
06:37Because I think, you know, with a lot of different industries, when you start making these transitions over to something that's like better in a lot of ways, it is those things.
06:43It takes a little bit longer. It's a little bit more expensive. How have you guys avoided that?
06:46I think the main thing is that a lot of companies like ours start off with the power market expertise.
06:52And that's your focus. You know, how to extract the most value from trading in the wholesale, intraday and grid balancing markets.
07:00But that's not the everyday for the customer. The customer is all about safe, undisturbed operations at the factory with their industrial process.
07:10So what we've done differently is we go really deep together with the customer to understand the day in the life so that we can really understand the constraints of how much we can actually play around with the energy consumption, but also what are the opportunities there.
07:26And so then what are the services you are providing on like a very practical level?
07:31One is probably just deciding where you might want to innovate and then what do you do from there?
07:36Yeah, so every transition consists of three parts.
07:40There's the discovery part where the customer is still thinking about, OK, what are the alternatives?
07:44Should I electrify? Should I wait out for hydrogen?
07:47Or should I just stick with the fossils and maybe buy some carbon credits to offset that?
07:53Then there is the execution phase where you really need to navigate all these different technologies.
07:58It's not easy, as you said, you know, to compare, do I need a heat pump, boiler or what kind of a molten salt battery?
08:06And then finally, when you reach the conclusion, OK, this makes sense, you've got the right equipment in from the right suppliers at the right price, then we come to the operations.
08:16And that's the tricky part because you can't just, you know, set it up and forget because you have this volatile power market that is like a stock market.
08:25It's changing every minute and it's a living organism of some sort.
08:29So you have to think about the whole mindset differently on how do you operate the heat and steam production in your facility.
08:36Yeah. And then are you guys implementing your own people into those, you know, when you're having to kind of manage it at that point?
08:44Is that your own team doing it? Are you training them on how to do it?
08:46What does that kind of very end of the line look like for you guys?
08:49So for us, we really want to match our offering to these three steps.
08:54So for the discovery phase, we have integrated insights.
08:57So we basically do custom simulations based on the customer's historical data so that we can actually show them, quantify it hour by hour.
09:06This is how much you would have saved in the past years if you had the electrical alternative.
09:10For the execution phase, we have our platform offering.
09:15So we have this curated menu of different concept bundles so that you don't have to go do the heavy lifting for this one-off project.
09:24But we actually do it every day for all of our customers.
09:27So that way we can make the whole procurement, installation, commissioning phase much more efficient.
09:33And then finally, for the operation stage, we have integrated flow, which covers everything from forecasting your energy consumption, forecasting the status of your system.
09:44You know, what do we have available?
09:46Do we still have room in the storage?
09:49Do we have flexibilities in the boilers that we can ramp up or down depending on the power market?
09:54And then we connect all of that information, kind of where to play, into efficient trading strategies in the power markets.
10:01Gotcha. So you are in some ways a middleman as well as the service provider yourself, correct?
10:06Yeah, we really want to see ourselves as a tech-enabled platform.
10:11Speaking of tech enablement, how has AI impacted what you guys are building?
10:16I think AI is a great tool to add into our toolkit.
10:19If you think about a lot of the things in the transition are tricky, they're tedious, but they need to be done.
10:27So AI enables us to get over with a lot of those more tedious, more manual work together with our customers more efficiently and more scalably.
10:37But in the end, what we're really trying to reinvent is the customer experience throughout the whole transition.
10:43And to do that, you need much more than AI.
10:45And what are some of those other components that you feel like are really critical to your success today?
10:50I think it all boils down to not only focusing on hardware innovation, software innovation, but really thinking about it holistically.
10:57What is the customer experience and innovating on that?
11:00In terms of the future of the energy space, do you have any predictions on what's coming next, things that you guys are getting ready for at Integrid?
11:08Yeah, I really feel that, you know, the past decades, it's all been about incubating these cool new technologies, seeing if fusion could be the silver bullet to save us all.
11:18But I think the next years and decades will be all about now picking and choosing among the technologies that we already have, the winners, and then scaling those out into the world.
11:29How have your conversations with investors looked?
11:31Are they excited about what you've built, what you're building?
11:34Has there been any hesitancy that you've had to talk people through?
11:38I think, especially in this world and age, building a climate tech company, but with the angle that we never talk about climate with our customers, has a very strong message.
11:49So, of course, we and our team cares very fondly on the mission.
11:54That's how we have built the whole company.
11:57And, of course, many of our investors share the same values.
12:00But I think it's really differentiating us, that we're not waiting for some subsidy or some regulation to come in, or we're not relying on the customer to pay a green premium.
12:11We're actually just building something that is better.
12:14What has the pitch looked like for investors?
12:17How have you gotten them on board?
12:19I think I'm a very curious person.
12:20I think our mission is a very curious problem.
12:24You know, how do you make the transition a no-brainer?
12:27So, we've taken the stance of being really open with our investors and also potential future investors.
12:34So, we really put it out on the table.
12:36This is how we see it.
12:38These are the known unknowns.
12:41And this is what you need to believe to believe in Integrid.
12:43And I think they really like this approach.
12:45How has the younger generation and a lot of their focus on sustainability, environmentalism, impacted what you're building or how you're talking about it?
12:54I think myself, I went through this whole loop of being, you know, first anxious about climate change, then being frustrated for the lack of action, and then actually, you know, rolling up my own sleeves to do it.
13:06And since 2018, I've been trying to allocate all of my capacity into figuring out ways on how can I magnify my own carbon handprint, not just minimize my footprint, but really have an impact broader than myself.
13:21And I think when we talk to new talent coming into the industry, they're all excited about AI, but they're also, of course, super excited about the mission that we are on.
13:31And I think a lot of our team members feel that Integrid really is the vehicle for them to amplify their impact the most.
13:40Yeah. And speaking of youth, being under 30, this young cohort of changemakers, business owners, leaders in these different industries, how do you feel like age comes into play as you are building this company?
13:53I think for us, very early on, we knew that we can't build a company just with, you know, university students in a garage.
14:03We're building a very holistic, one-stop shop offering for the customer.
14:08We're working with a very established industry.
14:12So we knew from the beginning that we need to be able to bring in a lot of talent from different sectors, different disciplines.
14:21So I think for us, of course, we want that, you know, young, passionate, energetic talent to join us on the mission.
14:29But we've had to build a culture where, you know, also people with families and with, you know, 30 years of experience in the industry feel like at home.
14:37My last question for you is looking into the rest of 2025, what are the plans for Integrid?
14:43How are you guys innovating? What are you excited about? What's coming next?
14:46So if you look at 2050, the Western world wants to be net zero by then.
14:51If we have more than a million industrial sites that need to be phased out from fossil fuels, that means 100 sites a day, Monday through Sunday for the next 25 years.
15:03So we really need to bring it to the level that it's a no brainer.
15:08It's easy. It makes sense in all levels for the customers to make the switch.
15:13And then we just need to get it done.
15:15Yeah, cool. Well, thank you so much for joining me today.
15:18It was so cool to hear about all your building and all the changes you guys are making at Integrid.
15:21Thanks a lot.