Interview with Kathy Hannun, Founder & President of Dandelion

Interview with Kathy Hannun, Founder & President of Dandelion

Congrats, Kathy Hannun & Dandelion Energy, on closing a $30M funding round led by Bill Gates’ Breakthrough Energy ! Women-led startups received just 2.3% of venture capital funding in 2020, as this is a major accomplishment. I spoke w/Founder & President of Dandelion, Kathy Hannun, about raising funds while pregnant, how her leadership style has grown over the years, as well as the expected proliferation of geothermal energy in the coming years.


Catherine: I’m Catherine McLean, Founder and CEO of Dylan Green. And today I have with me Kathy Hannum. Welcome Kathy!

Kathy: Thanks so much for having me. 

Catherine: So Kathy is the Co-Founder and President of Dandelion. I absolutely love that name. It puts a smile on my face. I want to hear a little bit more about you and tell us about Dandelion. 

Kathy: So Dandelion is a home geothermal startup. What we do is we replace a boiler or furnace that the homeowner was using to heat their home, and we put in what is called a geothermal heat pump. That system actually just harvests renewable thermal energy, so renewable heat energy from the ground, and uses it to heat the home at a very high efficiency. So it’s a way of taking what’s typically a fossil energy source, so fuel oil, propane or gas, and replacing it with renewable [energy]. And then that heat pump also does cooling. So it’s a replacement for air conditioning and it does some hot water as well. 

Catherine: Great! Well tell us a little bit about you and your background

Kathy: I actually studied civil engineering in college and then ended up doing a masters degree in computer science. And then sort of took a detour, it felt like at the time, by working at Google. So I originally wanted to get a job, probably at a non-profit, doing something with water or energy but no one was hiring someone without any experience. So I thought that’s kind of a conundrum because if you’re just starting out and you don’t have any experience and you can’t get any because you don’t have any, then how do you get some? But Google was hiring so I decided, you know I’ll take a job there; I’ll learn and I’ll get some work experience and then I’ll get to do what I want in energy or water. But that one year at Google turned into seven and there was just so much to learn there. So I felt like I was always learning. I ended up at X, Alphabet’s X Lab, in the role of product manager. My job there was to find new opportunities for businesses for X to start. Dandelion actually originated as one of those projects. It was envisioned as one of those projects that X would do. But then ultimately we decided to spin it out. 

Catherine: How did you come up with the name, out of curiosity?

Kathy: What I learned, from a naming expert, who I worked with at Google, is that there are three types of names for companies. There are literal names, so if I called it Kathy Hannun’s Geothermal Heat Pump Company, which actually most heating and cooling companies have literal names. There are metaphorical names and then there are fanciful names. So Google and Yahoo are totally fanciful. Dandelion, because everyone else in the space of heating and cooling is literal, we wanted to do something more fun and fanciful and not literal at all. To make it clear it was a modern different take on heating and cooling. What I liked about Dandelion is the dandelion flower, or weed, some might call it a weed, has a taproot which kind of looks like our ground loop. But then it changes based on the season. So sometimes it’s yellow, sometimes it’s that puffy seedy thing. 

Catherine: Yeah, I like it! You came up with the name, yourself!?

Kathy: Well, I didn’t come up with it by myself. I got to work with this naming expert.

Catherine: Oh I see. But still. It took me forever to come up with my name, Dylan Green. Dylan’s my son. So I’m Green after renewable energy, obviously. It took forever to come up with, it seems so obvious now. So I want to talk a little bit about, speaking of sons and daughters and children, I want to talk a little bit about you and your family. You obviously had a child recently. You said in a recent interview that while you were pregnant you were raising funds for Dandelion. And also gave birth, I believe, the day after closing a funding round. What was it like to be pregnant during that crazy time?

Kathy: It was a little harrowing because, you know, especially in the early rounds, which it was- it was a seed round for the company, so much of the investors’ decision making comes down to their belief in you as an entrepreneur and a founder. We were already so much in the news and in the public conversation about how little funding women receive, and I felt like to be pregnant on top of that, and I felt like to be pregnant on top of that. Like not only am I a woman with no track record trying to start kind of this weird geothermal company, but add being pregnant to that mix. It kind of felt like I was making something that was already very hard, even harder, but then again, I had consciously made the choice that I was going to start a family, even though I was starting a company because I didn’t want to be in the situation where I delayed doing what I wanted to do, which was have a family, for the sake of the company. And then like, what if you make a very big life decision like that? I’m not going to have kids, even though I want to right now because of this company. And then the company, who knows what’s going to happen with the company.? I guess I just didn’t want to put myself in this position where I was changing something important about my life for the sake of the company. I thought it would be better just to do what I want in my life and still make the company work if I can.

Catherine: Did you have a good support network? Because I can imagine that’s kind of important.

Kathy; Yeah, I did. I mean, I would say that the most important part of that network was just having a spouse who was willing to move to New York. You know, we were in California, we moved to New York because the company was based there. And I think he shares that, that workload, that very high workload of having a kid. And then we also were lucky to have my in-laws relatively close and spent a lot of weekends there and got help from them. And I don’t know. Yeah. It would be much harder I think without that you’re right. Without that.

Catherine: Did you feel like the need to keep it quiet when you were pregnant, like talking to investors and stuff, you knew that sort of the zoom option?

Kathy: I did. I mean, and it wasn’t COVID world, so we weren’t always in zoom, but I had the advantage, as some might call it, of not looking pregnant even when I was fairly pregnant. And so I didn’t raise it and it was like a dilemma for me to know, should I disclose this? Am I hiding something if I don’t? But I think the thing that was tricky for me is there’s no protocol for announcing very personal things in early investor meetings. So it would be, it’s like in the same way, this is an analogy I’ve used before, but it’s like in the same way that having a male entrepreneur announced in his early round of conversations with an investor, by the way, I’m getting divorced. I’m going to manage it. It won’t take up too much of my attention, but it’s just this thing happening in my life. That’d be such a weird thing to react to. I think it could be fine, some people would be like, yeah, that’s good that he’s so transparent. But as an entrepreneur, how do you get the conversation back? How do you get it focused on your business? If you’ve just told these strangers that are thinking of whether they want to invest, it’s a very personal thing about your life. And I kind of felt the same way about pregnancy. It was totally unrelated to geothermal heating and cooling. It seemed sort of not related to the merits of the business and producing. It felt like it could derail or de-focus the conversation. And probably only like the best case scenario in my mind is like bringing this up in the best case will not detract from this meeting. It was like the best case is it wouldn’t be a negative, there was really no case that I could think of where it wouldn’t be a positive. And so I ended up just deciding not to disclose it.

Catherine: That really resonates with me that analogy that you used, I’ve never thought about it that way. And you could really argue that some divorces take up more of your time and energy than a pregnancy, you know, I have not been through them, but yeah, I’ve never, I’ve never thought of it that way. Let’s talk a bit about leadership because I think leadership is something that evolves over time and maybe it evolves as you become a mom as well. I don’t know if you felt that way. I definitely felt that way. How has your leadership evolved over time?

Kathy: I’m much more comfortable being a facilitative leader. So trying to bring the right people to a conversation and ask the right questions to have the conversation that I feel needs to happen. And I think that that can be a good style because it’s very inclusive and I think it’s empowering. And I do think that you get to good decisions that way, especially if controlling for having the right people in the conversation and sort of like asking the right questions. But there’s obviously times when that’s not going to work, maybe you don’t have all the right people around or like maybe there isn’t, there’s no consensus that comes out of that or you just need to make some decisions quickly. And so I think starting Dandelion, and so the mentors that I’ve had along the way have really have really shown me the power of just like the opposite type of leadership, which is a little bit more directive and like, okay, this is the plan. This is what we’re doing. And there’s a time and place for that too. And I think like being comfortable, just setting the direction and open to counter information, right. Always open to learning, open to new information, but confident in setting the direction with the information you have. It’s something that I’ve been able to add to my reference since then. 

Catherine: Yeah. It’s a constant evolving thing. Isn’t it? Um, what do you see dandelion in the next five years?

Kathy: I see the wind starting to shift in terms of the conversation about renewables, right? Like for a long time, it’s been very solar focused. And I think now we’re starting to see more of an awareness of all of the other opportunities. Right? And of course, like the most recent example of that has been electric vehicles, which went in a fairly short time period products to now GM is saying all electric by 20, right? So it’s like completely, that industry, it’s just so fast, how quickly it’s evolved. I think we’re going to see something similar for heat pumps. So like today, most people have furnaces or boilers and burn a fuel in their homes for heating. I think we’re starting to see the very beginnings of an awareness that that’s not very healthy, first of all. But second of all, you know, you can do this in an emissions freeway that would flow with heat pumps. Yeah. And I think we’ll see something similar to what we saw recently with electric vehicles. And then before that was solar, just like, it will transition from this niche to this mainstream product that seems inevitable. And the role that I aspire for Dandelion to play, it’s just like really leading the charge for how to do that. Right. Let’s solve all the problems to make that, that growth path very smooth.

Catherine: Yeah. It’s that zero to hero. I think that people who aren’t in the industry, they look at that and they think, Oh, it just happened. And they don’t see like all that, the work that went on previously. I’m curious, you all focus obviously on the residential sector, are there any initiatives that you have looking specifically at low-income housing?

Kathy: You know, New York does a good job of this as a state. So they have some, for example. So one of the hallmarks of geothermal heating, which is true of most renewables is it’s more expensive upfront, but then much less expensive to operate over time. So the cost of ownership is less, even though like upfront, it’s a little bit more. And so financing becomes really important in those cases, like we’ve seen with solar, for example. So what New York state does is they offer or low interest loan for homeowners that meet the eligibility around income levels. And that allows those homeowners to buy geothermal for no money upfront and then have a very low monthly payment. And so we do offer, we encourage homeowners to take advantage of that and some do. And so we’re able to serve some homeowners in that way, but I would say there’s much more work to be done, just more products like that available and make them available outside of New York.

Catherine: Yeah. And just some education, just letting people know that it’s an option and it’s not healthy and you can, you can fix it, that sort of thing.

Kathy: Yeah. Especially for no money up front, because a lot of people have like extra money to just spend on a heating system. So it’s really useful when you can do it at no cost and then still save right away because the cost of operating these systems is so low. Yeah.

Catherine: So my last question is, what do you think has been the most crucial part of your and Dandelion success?

Kathy: I think the most crucial part honestly, has just been, we’re offering a product at the right time. Like people are ready to switch away from fuels. I think they, the fact that now it is less expensive to use geothermal then fuel oil for example, it’s like that combination of the awareness that I think people now have that they would prefer something that’s not combusting inside their home. That’s not polluting the atmosphere with greenhouse gas emissions. And the fact it’s actually less expensive to not do that right. It’s like that combination has led to an embrace of geothermal heat pumps at a scale that’s allowed us to grow and allowed us to attract more investment and really compound the progress we’re able to make. 

Catherine: Thank you so much for joining me today, Kathy.

Kathy: Thank you.