q&a

How Greentown Houston accelerated the local energy transition in its inaugural year

Greentown Houston's Juliana Garaizar and Emily Reichert look back on the climatetech incubator's first year. Photos via greentownlabs.com

This Thursday, Greentown Houston officially celebrates the completion of its first year in town, as well as the impact its made in just the 365 days since its grand opening.

Emily Reichert, CEO of Greentown Labs, officially cut the ribbon on the organization's first location outside of the Boston area last Earth Day. Reichert, along with Juliana Garaizar, head of the Houston incubator and vice president of innovation, joined InnovationMap for a Q&A looking back on this past year — including what surprised them most and where members are moving in from.

Greentown Houston's anniversary event is Thursday, April 21, from 1 to 7 pm, at Greentown Houston (4200 San Jacinto St.) or livestreaming online. Click here to learn more.

InnovationMap: Looking back on the first year of Greentown Houston, what was the thing that most surprised you about the process and the community you created here?

Juliana Garaizar: What really surprised me the most was the eagerness to be a part of Greentown. We were very surprised by the pandemic — it caught us in, in the middle of fundraising and we thought things were gonna slow down and actually it became sort of a of a blessing in disguise for the community here in Houston. The Boston community had to go virtual, and then when they did, we realized that we were much more connected to the Boston team, but also why can't we offer the same services to the Houston community since we didn't have a building yet anyway. That created a huge opportunity to convene a community even before our building. We had these early access members and when we finally opened our building, they all converted to in-person members because they had already felt what the community could bring. In Boston, they took a little longer to fill in the space at opening, but we came in at grand opening with our inaugural member list in Houston — all of them super eager to join us. That conversion happened so fast happened because of the virtual aspect of COVID.

Emily Reichert: For me, there were really three things that were surprising. Throughout the whole process of building the momentum towards Greentown Houston and from the very first meetings I had with the GHP and potential supporters of a future Greentown Labs, there was this warmth of welcome. I can't compare it to anything else. Houston just really embraced this opportunity, embraced Greentown labs, and embraced our team — as well as really embracing having a climate tech incubator located in what has traditionally been called the oil and gas capital of the world. I just wanna note that that is very meaningful and it just shows that when Houston gets behind something, Houstonians go all the way they are committed and they take action. And we just felt that from the very beginning,

Second, I think that the momentum of the energy transition itself surprised us, but also felt it felt to us like we were riding a wave that wasn't just about Greentown Houston. It was about all of these different businesses, business leaders civic leaders, and just general citizenry in Houston understanding that the future of energy is different than the past of energy. And that, that was something that was going to need to happen more quickly than folks had anticipated. And again, I feel like Houstonians are leaning into it and thinking about, "well, if we've been the energy capital of the world, can we now be the energy transition capital of the world and how do we do that?" The speed with which this transition is happening is just incredible. And, increasingly in the circles that I move in outside of Houston, people know about it. It's changing the outside perspective as well. That's been really exciting to see.

Finally, the amount of talent that exists in the energy industry and in general in Houston and in the local universities that can be deployed and is interested in being deployed in climate tech and addressing climate change and the energy transition — it's really remarkable. Whenever we have a job posting out there for Greentown Houston, we are getting a lot of applicants. And now when we're going to universities to engage with students around — whether they're interested in building a startup that could address a challenge in the energy transition — it's just overwhelming the interest, the excitement, and the level of talent that I think is going to be available to apply to this energy transition that Houston can absolutely lead.

IM: Greentown Houston has not only attracted Houston-based companies, but also companies outside of Houston that want to be able to take advantage of Greentown Labs and the support there. You have both virtual and in-person membership options. Tell me a little bit about how that came to be.

JG: This was something also that the pandemic exacerbatedAgain, if you compare Boston to Houston — Boston is much more difficult to find prototyping lab space and wet labs. I would say that the cost of space is much higher there than in Houston. You there's plenty of space available for coworking, for prototyping, but the connection services to the whole ecosystem, to investors, to corporate partners, to universities to mentors — all that is key for our startups. And that means that space takes a second place. That's what we've seen. Member companies from Austin join Greentown Houston because they are connecting to a community that is more like hard tech driven and less software driven than in Austin. They wanna connect to the customers and the pilots, right? Even some of our Boston companies have moved or at least established a presence in Houston. There's also the diversity aspect that Houston is the most diverse city in the U,S. There are plenty of companies from Latin America coming over and choosing Houston as a landing pad and choosing Greentown as the place to start settling. We help them with funding. We help them with hiring local people.

IM: As you mentioned, Greentown Houston's membership grew really fast — how did you grow your team to support that?

JG: Our Houston team has quadrupled since last year and, and that's a lot — we were three and now we are 12, but we also had the whole Boston team behind us. The way we did it was through this matrix model where our team members report to someone in Boston. And although it creates an extra layer of complexity I think it was perfect for such a rapid growth because we were able to download the DNA of Greentown Boston to Houston at a much faster pace. We thought it was very important for us to distill that DNA but without forgetting about also having local people in Houston. It was the best of both worlds.

ER: We really needed to have the Houston local knowledge embedded, just like we needed to have the way that things have been done in Boston embedded. But I think as we look forward from now, you're going to increasingly see that we have embedded a lot of the practices and ways of doing things that we've done in Boston, but we're doing them with a Houston flavor, and we are doing them in a way that meets the local needs. And I think that you will see as we grow and continue to evolve, that we're gonna take our learnings from being in Houston and continue to evolve what we doin Houston. Our mission is to create an inclusive community and to convene connect, and inspire entrepreneurs and ecosystems to address climate solutions — and that's going to be the same in both locations. But how we do those specific pieces, I think will be a bit different. Now, Houston is a young ecosystem in terms of climate tech, so that convening piece is a little bit different from how we have done it in Boston.

IM: What's next for Greentown Houston — and what's next for the energy transition in Houston?

JG: For Greentown Houston we've figured out that our members need different things, and we wanna make sure that we listen and we adapt to them. It seems that a wet lab might be a need that we need to incorporate. So we're trying to figure out how, how to do that. We're growing at a much faster pace than Greentown Boston did, of course, because of the timing of the energy transition. That means that we need to think about, about expansion. We've become the convener place for climate tech.

In general in Houston for the energy transition, there's gonna be three pillars that I think are very important and that Greentown has to be apart of. One of them is the workforce development and the transition of the workforce. We're working with key partners like the Greater Houston Partnership and the Houston Energy Transition Initiative, and we're putting together a program with universities to make sure that we also extract the, the entrepreneurs of tomorrow to Greentown and to the energy transition capital.

The second aspect os access to capital there's a lot of capital of available in Houston and a lot of capital in general being poured into climate tech, but we need to make sure it comes earlier. We are very early on, and there's still a gap there for early stage investing. I think one of the key elements to be able to unlock that capital early is to make sure that our companies have pilots and demonstration at corporations.

I think the third part for the energy transition in Houston is unlocking the potential capabilities we already have, like in hydrogen by trying to become a hydrogen hub. And that will only happen if we all work together. So I think Greentown also has to play a role there of convening.

ER: Continuing to support entrepreneurs in Houston to really bring talent in, to not only help our entrepreneurs build their companies, but in general into the energy transition and climate that's something that will be leaning into the deployments of the technology at scale. That's something that Houston can uniquely do.

IM: What can people expect from both the livestream and the in-person event on Thursday?

ER: We're gonna have some great voices on that from across industry, and we are going to be showcasing our startups, both through pitches and then through a startup showcase where folks will be able to see and touch or at least talk to our entrepreneurs and learn about their companies and the opportunities to support them. I believe there will be a few other surprises, which I won't reveal.

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This conversation has been edited for brevity and clarity.

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Building Houston

 
 

A Houston founder shares an analysis of relationship banking, the pros and cons of digital banking competition, and an outlook of digital banking inroads to develop relationship banking. Photo courtesy

After our doctor and our child’s school, a bank is an institution with which we share the relationship that is most personal and vital to our well-being in this world. Some might put a good vet third, but other than that, no private entity is more responsible for escorting us to a healthier and happier outcome over the course of our lives.

The bank vault is a traditional symbol of security and prosperity, and not just for our pennies. We safeguard possessions in banks that are so important we don’t even trust keeping them in our own houses. Wills, birth certificates, and the precious family heirlooms of countless families are held in safety deposit boxes behind those giant vault doors, and banks have been the traditional guardians not only of our wealth but our identity and future as well.

The importance of relationship banking

Faith and confidence in our banks is so fundamental to the customer relationship that it has evolved into a unique and otherwise unthinkable arrangement for any good capitalist in a healthy marketplace: banks pay us to be their customers. Imagine a doctor offering you $20 for trusting them to give you a colonoscopy and you’re on the road to understanding the sacrosanct union between bank and customer.

In fact, this trust is so deeply anchored in the American psyche that a new generation of digital banking companies has sprung up on the idea that it doesn’t need to exist in physical reality. The fintech industry has exploded in the last decade, and today, over 75 percent of Americans are engaged in online banking in one form or another. Every single one of those 200 million customers are taking for granted that they will be well served, despite having no personal guidance through any of the financial products and services that these online entities provide.

Benefits of fostering relationships with banking customers

In the late 90s and early 2000s brick-and-mortar banks realized that greater personalized care for their customers was going to be a critical point of competition. The in-person experience is an opportunity to offer advice and incentives for a wide range of products and financial management assistance. It’s rooted in an incredibly simple axiom that is taking hold in every aspect of modern society: everyone benefits if we all get along better.

There’s a lot of statistical traction behind this theory. Customers who report they are “financially healthy” are down 20 percent over the last year, which means people are looking for guidance. 73 percent of customers who visit a local bank branch report having a personal relationship with their bank, while only 53 percent say the same of their digital institution. Most importantly, although many digital banks are offering similar products and services to their real-world counterparts, customer engagement remains very low.

It starts with your products

The truth is, today’s bank customers still want that same personal relationship their great-grandparents had before they engage with deeper financial products and services. They believe it makes them more financially successful, and confirm that human connections and economic prosperity go hand-in-hand.

Products that are Challenging for Digital Markets

Residential mortgages, for example, are an $18 trillion dollar industry that deals in durations longer than most digital banking services have even existed. The perception of continuity and stability is highly valued by clients in the mortgage relationship. Today, most customers feel that only comes with a handshake and a smile from an employee who has to fit in a meeting before they pick their kids up from school.

While digital firms have proven themselves capable of offering savings and checking services, most have fallen flat on the mortgage front because of the premium on personal relationships. Loyalty is the reward for time, service, and shared experience, and financial institutions that cannot provide that package for their customers are never going to access a deeper and more meaningful portfolio of services.

Finding Well-suited Products for Digital Finance

The message for the digital finance world is as clear as it is pressing. The future of the industry will revolve around more personalized experiences, interactions, and long-term products. At the same time, the American public has embraced digital banking, and we are looking at a new generation of bank users who may never walk through a branch door in their life.

In order to compete, the digital industry will need to identify and develop a range of long-term products and services that make sense for customers in today’s environment. Mortgages may be out of the question, but the safety deposit box holds great promise for industry in-roads. Optimal services for deeper, more personal customer engagement include things like:

  • Legacy and estate planning
  • Will preparation and safeguarding
  • Preservation of cherished photos and videos
  • Important personal data storage


Because these things are product-based, they are well suited to the digital ecosystem. The cryptocurrency industry and modern online banking have solidified consumer confidence in the digital bank vault, and there is a great deal of faith in the perpetuity of electronic documents and storage.

The IRS estimates that upwards of 90 percent of Americans are E-filing their taxes and that only comes with a widespread belief that our highly sensitive information can and will be preserved and protected by digital architecture.

Secure your future

Digital banking firms that want to thrive in the upcoming decades are going to need to innovate in long-term financial planning products that bring their customers into a closer, more personal relationship with them.

The finance world will continue to change and develop, but the hopes, fears, and dreams of people trying to build and secure a better future for themselves and their children will remain the same for tomorrow’s customers as they were for their parents and grandparents.

It is up to the digital finance industry to adapt and develop to provide the customers of today—and tomorrow— with these invaluable services and securities.

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Emily Cisek is the founder and CEO of The Postage, a tech-enabled, easy-to-use estate planning tool.

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