Big Easy Bootstrapper

A Fort Worth engineer and entrepreneur, transplanted to Cowtown after Hurricane Katrina, turns his passion for the environment into a startup producing chargers and charging stations for electric cars.

Little more than a decade ago, Edward Morgan was working as an engineer for Bell South in New Orleans and growing a couple of computer stores on the side. Hurricane Katrina forced him and his family out of Louisiana and to North Texas, where he continued with AT&T as a senior technical engineer.

Morgan has a new venture he’s trying to move along: rechargers and recharge stations for the growing numbers of plug-in vehicles.

Morgan, 46, is planning to leave his full-time job in mid-January – after 17 years with the company - to go full-time into his Revitalize Charging Solutions business, operating out of a small office at the Tech Fort Worth incubator on the south side of Fort Worth.

A pilot test with the city of Fort Worth earlier in 2016 went well enough that Morgan was poised at the end of the year to enter into an agreement to place one of his charging stations on the campus of Fort Worth’s Business Assistance Center, the complex that also houses Tech Fort Worth and the Idea Works incubator. Morgan also was on the verge of signing an agreement to put a charging station at a restaurant. And he’s working on plans to build a charger that he would sell into the residential market.

There’s competition nationally in the space, but Morgan points to statistics showing 520,000 plug-in cars – all-electric cars and other vehicles that have some sort of plug-in feature – on the road and growing fast.

“This is a young industry,” he says. “There is a lot of room for any company to grow, given how spread out the infrastructure is.”

Indeed, the number of electric car charging stations nationally was 42,011, up from 13,392, according to the federal Alternative Fuels Data Center. That counts the number of plugs, meaning the actual number of locations is lower.

For Morgan, RCS is his latest entrepreneurial venture. When he was a teenager, Morgan, whose mother worked for the state of Louisiana and dad was a carpenter, would pick up aluminum cans and sell them to recyclers. As a college student at Prairie View A&M, he sold baseball hats, T-shirts, and costume jewelry door-to-door. “We would always sell out,” says Morgan, who later earned an electrical engineering degree from a technical school.

In New Orleans, he opened his two computer stores and sold one before Hurricane Katrina, which wiped out the customers for his other store. He and his wife moved to Fort Worth in 2007; his wife is a Fort Worth public school teacher.

Morgan says he began noodling on the idea for rechargers and recharge stations in 2013. An allergy sufferer, he was thinking of environmentally-friendly businesses he could build. “I always thought electric cars were going to be the [industry] future,” he says. “Obviously, infrastructure is a challenge.”

A friend put him in touch with an employee who worked at another competing company in the space, who offered advice. TMAC, part of a public-private consultancy hosted by several Texas organizations including the University of Texas at Arlington, helped Morgan create the schematics for chargers and find a manufacturer in APS Industrial Services of Arlington, Morgan says. Tech Fort Worth helped him define the need and scalability, he says.

That led to the six-month test with the city of Fort Worth, where he put one charging unit at Taylor Street and West Lancaster Avenue downtown for two months, with little publicity. “Would people find it, and would they use it?” Morgan said. The station turned in typical usage of two to three sessions per day.

By mid-December, Morgan had reached a tentative agreement with the City of Fort Worth to place a charging station on the grounds of the Business Assistance Center at Rosedale Street and Interstate 35E. “The most important of this is we finally have a draft agreement, but the ultimate goal with the city is to be a bigger partner and have these things throughout the city,” he says. “We’ve identified six [city-owned] locations of high interest.”

Morgan has also been in touch with malls, restaurants and retail stores to try and reach deals to place stations on their property, in revenue-sharing partnerships. In mid-December, he said he had reached a tentative agreement to place a charging station at a restaurant in the Interstate 35 corridor between Hillsboro and Waco.

Morgan is also finishing the engineering schematics for a residential charger that he wants to roll out to the residential market by June. It would charge an electric car in two and a half hours to six hours, compared to a typical residential charge that can take 15-16 hours and is “very, very slow,” Morgan said.

Morgan’s working with two kinds of chargers. He’s designed – and an Arlington manufacturer is building for him – “Level 2” chargers, an industry standard in which a full charge can take two and a half  to six hours. He’s also planning to purchase so-called “DC Fast” chargers that can charge an electric car in as little as 20 minutes.

The Level 2 chargers cost Morgan about $8,000 to produce, he says. The DC Fast chargers cost about $35,000 to make.

Morgan says he’s bootstrapped the company so far and has $100,000-$130,000 into it, including software development and the manufacture of six Level 2 chargers, without having to seek outside investment. Morgan has one employee and has used contractors for the software development.

He’s working on several revenue streams, teaming up with TCU MBA students for market research. The commercial chargers, which stand five feet tall, will have media screens that will show a constant stream of 30-second advertisements, ideally from nearby restaurants and stores, Morgan said. The machines can also be branded with ad wraps, he said.

“If we can make our revenue off our advertising, it’ll help keep the costs of the session low,” compared to competitors, he said. “It could be 10, 15 years before revenue from charging stations can sustain a company. I think we can sustain what we’re doing at a bootstrap level, as long as we’re generating revenue from our ads.”

Morgan is pitching partnerships with advertisers in exchange for being allowed to install his machines on-site, offering 10 percent of advertising  revenue generated at the charger and 50 percent of the electricity revenue after paying costs to the utility company. For 2017, Morgan says he’d like to deploy 25 chargers, largely in Fort Worth and has tentative commitments for 10 of those.

Still, residential will be “our focus,” Morgan said, citing industry statistics estimating 95 percent of electric car charges occur at home. That's  another reason why he doesn’t want to invest in manufacturing his own DC Fast charger. “It’s very expensive,” he said. “The entry into the commercial market is much easier, but we believe residential is going to be a big side for us.”

Morgan wants to sell his residential chargers direct-to-consumer from the company’s website. “But we’re also hoping to partner with car dealerships,” he said. “We may have a play toward getting into [big box retailers], but we haven’t gotten that far yet."

There are numerous challenges to the company, he acknowledges. U.S. consumers have been wary of electric car technology, even though the numbers have been growing substantially.

Other major competitors are already in the market, such as NRG and Blink. Retailers, like auto dealers and big box retailers, sell residential chargers.

Manufacturers of residential chargers have sought to differentiate their products with features such as remote-controlled set and start. Morgan declined to discuss what features he’s putting on his residential charger – other than that it will feature the same capability of a Level 2 charger - and what it will sell for.

It would make sense in the future to locate electric car charging stations at existing gasoline service stations, Morgan says, but that’s a difficult sell at this point, given the nascent nature of the industry. “We’ve approached gas stations to offer additional services,” he said. “Too early.”

At some point, Morgan says he’d like to consider setting up his own electric service stations on land owned by the company. Morgan’s efforts thus far earned him a 2016 Impact Award in Tech Fort Worth’s annual competition.

Morgan says he’s not worried about competitors. “The expectation is, by 2020, there’s going to be a million electric cars on the road,” he says. “There’s going to be opportunity."