When Edward Fenster was young, his preschool teacher asked him to name his favorite thing. “Electricity!” he said.
Fast-forward to the present. Fenster, MBA ’07, is the co-founder and executive chairman of San Francisco-based Sunrun Inc., a designer of solar energy systems that provide houses with inexpensive and sustainable electricity. But he did take a detour or two before making a career of his childhood passion.
In 2005, a few weeks before beginning his classes at Stanford GSB, Fenster joined a student-organized trip during which he met classmate Lynn Jurich, also MBA ’07. The two discovered that they had much in common, including the fact that each had spent several years working in private equity. Fenster saw an opportunity for new financial structures in the sector and set out to explore them with four classmates, including Jurich, in the two-quarter entrepreneurship class Startup Garage. Some good ideas came out of the process; the next challenge was where to apply them. Fenster kept looking.
When a high school friend mentioned an interest in solar energy, Fenster saw an opportunity waiting to be realized. He decided that he wanted to start a solar energy company with a disruptive business model: providing clean energy to homeowners without requiring them to purchase their own solar panels.
But he didn’t want to undertake the project alone.
“The journey of founding and building a company is enormously stressful. It’s much more pleasant and you’re much more likely to succeed if you have a business partner,” Fenster says.
There was an obvious pool of talent awaiting him. “One of the great things about the GSB is the risk tolerance of people,” Fenster points out. “And it’s an enormously supportive environment.”
He approached his friend and classmate Jurich, and she agreed to sign on.
Clearing Financial, Regulatory Hurdles
The two could not have taken on a bigger challenge. After launching Sunrun in 2007, they set out to raise capital at the height of the 2008 recession. They succeeded, but not without a tremendous amount of personal stress. The wisdom of having the right co-founders to balance each other’s skills and push one another to improve was never more evident.
Sunrun is now the largest dedicated residential solar, storage, and energy services company in the U.S. One of its main challenges is navigating the increasing regulation in its field. Major utility providers initially underestimated the company’s potential and stayed out of the way. But now that Sunrun’s success is undeniable, utilities see it as significant competition, and some have fought its growth by lobbying regulators.
So far, the Sunrun team has successfully opposed excessive regulation and worked to ensure that the public is on its side.
“The Stanford GSB class on nonmarket forces that impact business growth, including regulation, was really helpful preparation. I think I could teach the class at this point,” Fenster says.
Sunrun’s co-founders have not only created a thriving business; they’ve also defined an industry, changed consumer behavior, and affected regulation. And it’s been fun.
“Before working in this field,” Fenster says, “I hadn’t bought the idea that you could love your work. I thought work is what you do to afford to do something else.”
Now Fenster has seen the light, thanks to lessons learned and friendships forged at Stanford GSB — not to mention his lifelong love of electricity.
— Dana Mauriello