Thoughts, essays, and writings on Liberty. Written by the heirs of Patrick Henry.

“There's no such thing as a free lunch.”     Milton Friedman

September 28, 2011

Solyndra: Delusions Of Grandeur, Or Just Colossal Balls?

by Brad Warbiany

Wow. It’s one thing to carry the necessary delusion that comes with most people in a startup… That self-delusion, the belief that you can’t fail (despite the high proportions of startups that fail), is what is required to overcome the often monumental odds most startups face. But is it merely delusion to submit THIS* to the House Energy & Commerce Committee’s Oversight and Investigations Subcommittee on June 23, 2011? No, I can’t think so. This is balls. Pure, shiny brass ones:

Solyndra does not publicly release quarterly results but is on track for this year. The ability to command a slight pricing premium as a result of substantial differentiation and product benefits continues and our cash production cost per watt is dropping rapidly at pace with the industry. In a highly competitive global marketplace Solyndra continues to win large projects on commercial rooftops around the world and we are confident we are competitive on the merits of our differentiated, lightweight, simple to install cylindrical rooftop and greenhouse products.

Evidence of Strong Momentum

  • 1166 employees and growing, 49 open jobs on website
  • Exporting more >50% of product
  • Over 1000 installations >20 countries
  • Over 100MW shipped
  • 2010 revenue ~$140M
  • 2011 shipments expected to double over 2010
  • Fab ramp to 300MW on target
  • 14th largest shipper from the Port of Oakland, more than 1000 containers this year
  • Doubled U.S. sales and marketing team in past 6 months

I can imagine Solyndra issuing mindless press releases like this — maybe in 2010 or 2009. I can even imagine them issuing such optimistic letters to the US Congress at that time — they still had enough free gov’t money in the coffers to at least try to justify themselves as an ongoing concern. But to do so in the middle of 2011, when you know you’re headed for the skids? That’s just asking for trouble! You have to think they’re going to wonder where all this optimism came from when the excrement hits the air circulation device.

Of course, there is no mention of profitability. Startups, when they have at least a hint of a viable road to profitability, would undoubtedly at least claim such. I have to think that whoever wrote this letter was deliberately focusing on revenue & jobs created, and not on profitability [not altogether unusual for a startup, to be sure] to deflect attention from the entity who had just loaned them $535M regarding when it might get paid back.

I note it’s titled “Exceeding Expectations”. I agree: I had no idea someone with barely money to keep the lights on would be capable of spewing out this much bullshit.

Hat Tip: Reason, who has a lot more of the timeline of the Solyndra saga at this link.

* Original here — I’m not sure how long the .gov website will keep this available, but wanted to keep a link to the original source of the PDF if anyone is interested.

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