At Apple, Joseph Kao, MS ’24, worked on advanced optical films for the company’s first wearable displays. Yet the more he developed cutting-edge consumer technology, the more Kao wondered about the fate of products at the end of their lives. What would ultimately become, for instance, of the plastic inside the lens module he’d helped make for the Apple Vision Pro?
Such questions brought back memories of his childhood in Taipei with his grandparents. Kao remembers helping his grandmother return empty yogurt bottles for cash and repurposing other items for art projects. “They literally told me, ‘Your trash is someone else’s treasure,’” he says.
After nearly a decade of leading teams and solving corporate hardware problems at Apple, Dow, and Meta, Kao felt increasingly driven to prevent waste and maximize the use of limited resources — especially for valuable, hard-to-replace materials.
The Heart of the Issue
While pursuing a master’s in management at Stanford GSB, Kao received a Stanford Impact Founder (SIF) Ecopreneurship fellowship to develop a high-impact startup.
Kao and Yutong Zhu, MBA ’23, founded their company, Magnefy, to shore up the safety and reliability of electrical grids and other critical aspects of the power infrastructure. Their mission? To ultimately extend the life of hardware, prevent catastrophic infrastructure failures, reduce waste, and promote energy resilience. In order to achieve these goals, Magnefy pairs affordable, novel sensors with machine learning to predict failures on aging transmission lines, data centers, and power plants.
The cofounders balanced their technical experience with their academic backgrounds in creating their company. Kao’s doctoral research focused on materials science and engineering, exploring biodegradable plastics. Zhu’s MS is in chemical engineering. Their business school education added an additional knowledge base for their company’s foundation.
Kao likens their technology to an electrocardiogram — but instead of assessing heart health, Magnefy gauges the health of transformers and other critical power assets.
“Our vision is that with our AI-powered magnetic sensing, we can listen to what we call the heartbeat of all types of electrical equipment and really see the unseen and predict the failures,” Kao explains. Doing so produces better results at a fraction of current costs to help utilities rapidly detect problems, reduce maintenance, and keep equipment in use for longer. Even though Magnefy currently focuses on the power infrastructure, their approach could benefit a variety of other sites that can’t afford downtime, including data centers, hospitals, airports, manufacturing plants, and campuses.
Given the current state of the power infrastructure, now is the perfect time to address the issues at hand. As just one example, hardware failures throughout power grids have ignited catastrophic fires in recent years, causing hundreds of billions of dollars in damage. And given that the United States’ grid has 70 million transformers, most of them decades old, the threat of failure is imminent.
Despite the looming threat, there are challenges to overhauling the grid. It can take a utility an average of two years to replace an aging transformer, and prices have doubled in the last six years. Once installed, new systems offer limited warnings, providing little chance to halt an unfolding crisis.
That’s because the typical sensors on transformers, cables, and inverters only offer indirect indicators of performance such as current, voltage, vibration, or temperature. These measurements have limited diagnostic value, just as blood pressure and heart rate readings offer an incomplete picture of heart health.
“For example, you sometimes sense that the temperature may be getting higher,” Kao says of a sensor reading that indicates grid equipment suffers from an electrical overload. “But is the temperature actually increasing, and if so, what’s causing this increase? Is it the insulation failure in the transformer or the core or somewhere else? Even with current and voltage, it’s hard to interpret the data.”
More Signal, Less Noise
Magnefy is developing an Internet of Things (IoT) device featuring transformative magnetic sensing technology invented at Stanford. The sensor operates at a high frequency, which means it can detect electrical anomalies that happen in nanoseconds, which have been difficult to capture by older sensors that operate at low frequencies. In addition, Magnefy’s sensors offer a detection rate greater than 99 percent, picking up anomalies months ahead of a potentially high-risk failure. And because they are rated to withstand temperatures up to 300 degrees Celsius, they can operate in even the most extreme conditions.
The IoT device originated with research by Debbie Senesky, associate professor at Stanford School of Engineering. The Stanford High Impact Technology Fund ;matched her with Kao early in 2024.
Senesky’s research team invented a groundbreaking signal processing method that eliminates noise from the sensor to offer a clean reading. Operating at more than 50 megahertz, each sensor can provide 250 times more high-quality data than older iterations limited to 250 kilohertz, according to Kao.
“Otherwise, going back to the ECG analogy, you can’t really see what’s happening,” he says. “You don’t know if it’s noise or actual useful data because of the high signal-to-noise ratio.”
Kao sees a rising appetite for grid infrastructure improvements. He hopes that analyzing readings across multiple sensors with custom artificial intelligence, and perhaps eventually a digital twin, will capture $1.5 billion within the serviceable $9 billion U.S. critical power asset monitoring market by 2030. Magnefy is also keeping pricing relatively low, at a fraction of the cost of legacy systems and with a nominal annual analytics fee, in order to promise a payback period of less than a year to customers.
Pivoting with Support
When Kao was originally thinking of ways to commercialize Senesky’s research, his idea wasn’t focused on the power grid. Instead, Kao wanted to create sensors that would extend the lives of lithium-ion battery packs in electric vehicles. Yet that plan unraveled within months after an oversupply of batteries, expected to be long-lasting, caused the market to plunge by 60%.
As a SIF-Eco fellow, Kao had conversations with utility professionals that opened his eyes to a potentially larger market and impact. They noted that the sensors Kao had originally planned to use on batteries sounded ideal for predictive maintenance on electrical grids.
Executive coaching through the fellowship helped Kao quickly pivot to the power grid market. Through Stanford, he talked to a variety of industry leaders, including Jane Woodward, a founder and managing partner at WovenEarth, and Brock Mansfield, managing director of the Meliorate Partners family of funds. Mike Lin at Dangerous Ventures, David McColl at Echelon, and Jay Goldin at Sonoma Green Advisory were also integral.
“Continue to listen to the market” became a mantra for Kao and Zhu. “They really helped us navigate when we hit the Valley,” Kao says of his conversations with the experts. In addition, being a SIF fellow provided a buffer to explore and evolve at the early stage of the venture. “The moment I got out of the battery world, it just became a blue sky,” he notes.
Kao is already thinking about ways to expand and scale Magnefy. If the company can break into other grid verticals such as cables, inverters, and generators, it could make a significant difference in preventing outages — as well as conserving energy, lowering costs, and potentially even saving lives by averting catastrophic failures. On grids running renewable energy, the technology could prevent the release of 500 million tons of CO2 by 2050. That’s roughly equivalent to half of U.S. household energy use for a year.
“I can see how this could impact not just the grid but also the manufacturing industry,” by extending the lifespans of assets by over 30%, Kao explains. In addition, data collected over the lifetime of the hardware will inform responsible end-of-life decisions about managing valuable metals and rare earth elements.
Next Steps
Right now, Kao is pursuing an aggressive timeline that includes prototyping and field testing studies with major transformer manufacturers, including Prolec GE. Eventually, he hopes this will lead to a joint development agreement and pilots with manufacturers, a data center, and a utility.
To support the prototyping and industry validation projects, Kao is seeking $1.5 million in pre-seed funding. To complement that, he’s applying for National Science Foundation Small Business Innovation Research funding. The venture aims to pilot with strategic partners over the next 15 months. In 2026, the plan is to secure initial sales contracts and lay the groundwork for seed funding.
Finding Community at Stanford
The founders-first approach and community aspect of the Stanford ecopreneurship program helped Kao to stay true to his vision. That’s essential, he says, because the journey of an impact founder differs from the more common scenario of launching a service in a mature market without a climate angle.
“I your value and your mission statement don’t align with your business, there’s no way you can push through to survive all the inevitable ups and downs and make it work,” he says. An investor [may say], ‘I want you to help me build this company,’ or ‘I think your business should go this way or that way.’ With that, you have to know what your value is and stick to it.”
Bringing together other innovative leaders from across Stanford also provides a strong support system. “You’re building a great network,” Kao says. “You meet all kinds of investors and founders.” ”
Kao’s time at Stanford has been a flurry of activity. He received the Miller Social Change Leadership Award, given to outstanding contributions to the Stanford GSB community. Kao also operated the Stanford GSB Impact Fund portfolio and won an Emergence Accelerator program fellowship. He even carved out time to serve as VP of the All About No Waste group at Stanford.
When Kao meets MBA students interested in climate entrepreneurship, including future SIF applicants, he braces them for the twists and turns ahead. He recently tried to help one ambitious student let go of the impulse to plan every future detail.
“I’m sharing my experience to tell her, sometimes, just lean into the journey,” he says. “Talk to people you know in the field, find the supporters in your community at Stanford, and things will happen organically.”
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