ChargePoint: Leading the EV Charge - [Business Breakdowns, EP. 70]

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Aug 19, 2022

In this insightful discussion, Mark Tomasovic, a principal at Energize Ventures and expert in EV charging infrastructure, shares his expertise on ChargePoint, the U.S. leader in electric vehicle chargers. He delves into the challenges of navigating a commoditized market and the strategies ChargePoint employs to capitalize on growing EV demand. The conversation also touches on trends in American EV adoption, the competitive landscape versus companies like Tesla, and the potential for future growth in the charging sector amidst evolving technology and regulations.

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INSIGHT

ChargePoint's Business Model

ChargePoint primarily sells EV charging hardware and software, but they don't own or operate most chargers.
They act as an OEM, selling to site hosts like businesses and residences.

INSIGHT

ChargePoint's History

Founded in 2007 as Coulomb Technologies, ChargePoint capitalized on growing EV interest and government support.
They secured early clients, partnered with automakers, and went public in 2021.

INSIGHT

EV Market Growth

The EV market is growing rapidly, with a tipping point expected at 5% adoption of new car sales.
Improving battery technology and affordability drive EV adoption, impacting charging infrastructure demand.

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This is Jesse Pujji and today we’re breaking down ChargePoint. ChargePoint is the clear market leader in the United States for electric vehicle chargers. Founded in 2007 by five technical founders, the business has ridden the wave of EV growth and has manufactured some 40% of charging points in the US.

To break down ChargePoint, I’m joined by Mark Tomasovic, a principal at Energize Ventures and a previous guest on our show. We discuss the challenges of a commoditized business, how ChargePoint is leading the EV land grab, and why the US is at a particularly interesting point for EV adoption. Please enjoy this business breakdown of ChargePoint.

For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

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Show Notes

[00:02:16] - [First question] - What ChargePoint is

[00:03:26] - Their size, scale and revenue today

[00:04:21] - The history of ChargePoint and the EV charging sector

[00:06:25] - How the industry has evolved and important metrics to understand

[00:08:18] - Who the main players are in the EV charging infrastructure layer

[00:10:46] - The role auto manufactures play and their relationship with this world

[00:12:05] - Tesla’s closed wall network and ChargePoint’s open network

[00:13:05] - Competitive advantages in the EV charging landscape

[00:15:45] - Whether or not sales and marketing is unique to ChargePoint

[00:16:47] - Other unique arrangements that will unlock the pace of their land grab

[00:18:37] - The various lines of P&L and how to think about them

[00:19:34] - The three levels of chargers and costs associated with them

[00:21:52] - What goes into their gross profit margins and cost of revenue

[00:22:50] - How their gross margin compares to their competitors

[00:23:41] - What they’re trying to accomplish with their high R&D spend

[00:24:49] - What they’re investing in and betting on for the future by spending cash

[00:25:38] - Expectations of future growth for the next couple of years

[00:26:46] - Growth over the long-term trajectory and the car to charger ratio

[00:29:14] - Their main flywheels that give them a competitive advantage

[00:30:53] - The big buckets of customer segments and end point leverage

[00:32:09] - What the life expectancy of a charger is

[00:33:13] - The regulatory environment writ large

[00:34:39] - Bull case for ChargePoint over the next five to ten years

[00:37:36] - Reasons why ChargePoint might not succeed over the next five to ten years

[00:38:58] - Lessons for builders and investors when studying ChargePoint

[00:39:51] - Learn more about ChargePoint; energize.vc