214. Startup Lessons from a Founder Who Discovered a Billion-Dollar Idea in Bolivia

0:00Imagine this, you're about to lose everything. Payrolls due, the dreams slipping away. So you do the unthinkable. You sell your house for$2 million and wire half of it to your company just to stay alive. That's not a movie. That's Teague Egan, founder of Energy X just weeks before landing a game-changing investment from General Motors. But it all started years later on a salt flat in Bolivia when a tour guide mentioned the world's largest lithium reserve. As a Tesla owner, Teague instantly knew this was the new oil and no one was tapping it. That spark became obsession. Today, EnergyX is revolutionizing how we power the future.

0:39I'm Ryan Atkinson, and this is the Upflip Podcast, where we interview successful entrepreneurs about successful strategies to grow their businesses. We're here to sit down with Teague to share how he started EnergyX, the vision behind the company, and the story that almost broke his company. Teague, thank you so, so much for being here and talking about entrepreneurship with us. Ryan, what's up, buddy? Thanks for having me. I'm excited to have you. An important part of your story is you love to travel. You've been to all seven continents. How has traveling all over the world shaped you and how you spot opportunities?

1:08Dude, traveling's amazing. You never know what you're going to see or find when you're traveling. And being exposed to so many different cultures and locations, ethnicities, it really opens your eyes. A lot of people live in a bubble. Today, traveling's a little bit more accessible. There was a time when people didn't really leave their neighborhood or city. Traveling has been the inspiration for starting EnergyX. You mentioned my trip to Bolivia and coming across one of the largest salt flats and lithium reserves in the world that spawned my idea. So it's had a profound impact on my life. Well, let's really zoom in on the Bolivia piece, because as I alluded in the intro, I mean, that's how EnergyX like really got started.

1:51Talk to us about what that moment was. And you're standing on salt, how did this lead to EnergyX? the moment that something happens you don't necessarily realize it like looking back you're like oh wow that was my aha moment and you know i think that when i was out on the salt flat with our tour guide like we were in one of those kind of like land rover four by fours and we were out there and it was me and my buddy and the tour guide and another couple and he started telling us about how you know this was the world's largest lithium reserve i thought that was obviously super interesting. But never in my wildest dreams would it have been the origin moment of what EnergyX has become.

2:32But looking back, it changed my life. It's all about taking that next step and then the step after that. And all ideas, all companies start with a small seed in an entrepreneur's mind and then grow into whatever they become. But looking back, it was pretty cool. Yeah, I feel like a lot of entrepreneurs, they always struggle. It's just getting the ball rolling, like taking that first step of like, you identify this opportunity, take the first step of action there. What was your first step of action? Okay, this seed is now planted in your mind. Do you go home and raise$50 million and you're off and running?

3:09Like what's that next step of fatigue? Well, for me, I didn't know anything about lithium or really the battery supply chain. The realization was that I had been driving a Tesla for five years and I had never thought about where the actual material in the battery came from. So what I did, I started learning, I started researching, I started reading, and I tried to learn and read as much about lithium as I possibly could. And then I started trying to reach out to people that were also in, you know, not even necessarily in the lithium industry, but in the mining industry in general, like, I didn't really know anybody in mining.

3:44So I remember the first person I reached out to my buddy, Andrew, who started a copper technology company. And he was like, you know, this is pretty different than what you're doing. But I know a guy you should talk to, you know, this guy. And so then I was talking to the second guy and then the third guy and then, you know, the momentum started. I want to like kind of give like the high level overview. So you identified the guy to like actually do this. But like, how do you form this into a company? Like, how do you get your first like customer? I'm sure you're not door knocking on Tesla saying buy my lithium.

4:13Like, how did you like really formulize this and like get this off the ground or like what it is today? You literally are doing that. Like it's all about networking. It's all about trying to find customers. We're in a little bit of a different type of industry where there's no business without customers, right? But we need to build something pretty big in order to produce the product, the lithium that customers are looking for. And it's a lot of cold emails. It's a lot of cold outreach. It's going to conferences and meeting people. Like I've gone to conferences is just to meet one person to try to get that in to land a customer or land a partner or land an investor.

4:50And, you know, a lot of entrepreneurs get scared when they hear no and like think, oh, you know, that this may not work or, you know, this may not be a good idea. You just have to continue going and continue hearing no a thousand times before you land, you know, that first big investor or customer or whatever it is. That's interesting. Talks about landing your first customer? Like, how did it come about? Because obviously, lynthiums, I mean, that's like, oh, smokes, like I have something here, like I can actually work off of this. How did you like land your first customer and talk to us about that moment?

5:21Our business model has actually shifted since the inception, we started developing technology, they could extract lithium from brine water, which lithium is a salt amongst other minerals dissolved in water. And we try to extract just the lithium out. So we were actually trying to sell technology to existing lithium resource owners, people that are producing lithium today. And we said, Hey, we have a better way to do this. Use our technology instead of the traditional evaporation pond methods that lithium is produced from today. That proved really hard. We got a lot of interest in testing. So people ship us their brine and pay us really as low as like$30 ,000 up to a few hundred thousand dollars to test so that was promising and we started learning and making our technology better and that was key like in the beginning we didn't know if our technology worked or not because we weren't testing it on real brine real product so we started getting our technology better and better and better but there was always a reason why they didn't want to adopt our technology whether it was you know a huge investment decision like you have to go build a multi-hundred million dollar plant, or they've already spent a bunch of money on their existing method, or they didn't want to accept the economics that we deserve, like a royalty model.

6:43And ultimately what we had to do was shift our whole business model and say, we're going to go acquire our own lithium resource and vertically integrate our technology and then sell lithium into the market as a commodity provider. We'll still license our technology to big players that want to adopt or want to modernize. But it was a huge shift. And I think that's also another important lesson for entrepreneurs. You have to be agile, you have to be able to pivot, you can't just stay stuck in something that was your original idea, you have to be flexible and adopt to, you know, what's working, what's not working, what the market needs, you know, where you're seeing resistance, things like that.

7:25How do you know, like, when you should pivot first, like when you not? Because I feel like a lot of entrepreneurship is like, oh, like stick it out, like be super resilient, like get through the really hard times and like eventually you'll make it out. But like there comes a point where like that is like a brick wall, like you're not going to get past this brick wall here. Like how do you know, like to not pivot too early, not too late? Like how would you approach that? It's a gut feeling. You know, there's really no right answer to that. And I think even though we had this pivot that I just described, we're still open and excited about licensing.

7:58So it's not like we scrapped that whole business model because we know that other people will need this. And we know that we've developed the best technology, but it was kind of an issue of timing, right? Like timing is very important. And we were just a little bit too early where the technology that we had developed wasn't yet fully commercialized. So resource owners didn't want to take a big risk and spend a lot of capital on something that wasn't fully proven. So we ultimately had to go prove it ourselves and are doing that. And now we're starting to see interest on the licensing business. So, you know, I think that timing has a lot to do with like knowing or not know, like pivot, do you not pivot?

8:39There's no right answer to that question. Are you working a nine to five, but dream of entrepreneurial freedom? Look no further than the Uflip Academy, the number one entrepreneurial platform with 20 plus step-by-step courses taught by active business owners, live workshops, hands-on skill training, a business idea database, and a thriving entrepreneur community to keep you accountable. Click the link in the description below to join the Uplip Academy today and make this the year you stopped dreaming and started building your business without guesswork. It is such a hard question now that I answer it because like truly I feel like it is gut feeling.

9:17There is something of like, oh, like battle through, but like I feel like the market will tell you like if you should be pivoting if you should not be pivoting here. I want to ask about, you know, with entrepreneurs, obviously, it's the valleys. And I want to talk about this story about the payroll and the house. Talk to us about that. That is insane. That might be one of the first times I heard that on this podcast. Someone sells their house and wires the company. Tell us about that story and like kind of what led up to it. Man. So when we were doing our Series B investment, which ultimately was led by General Motors, which was huge for us, as well as some other large strategic institutional investors, the deal was taking a lot longer than anticipated.

9:57They just go through the legal department just crushes you, right? And we had probably like 8 million bucks in the bank to start the year 2022. And then as we're going, the bank account is going down and down. and we're negotiating this deal and we get the term sheet over the summer of 2022 and then you know come fall like it's getting really really low and how low are we talking here we're talking you know like i could make this friday but i couldn't make two fridays from now type thing more will feel i know that feeling too and it was you know i knew that the money was coming because we got a signed term sheet and we were like you know inches away from signing the definitive agreements.

10:44But it was a risk, like for sure, like their deals that fall apart all the time. And it was like, am I willing to go all in on this and, you know, make a sacrifice that will take me all the way or, you know, and the company like, you know, what was I supposed to say to GM like that, you know, they they knew about this, right. But it was like, well, they can't fund until the deal is right. Right. So and so I pulled the trigger and took the leap. And it paid off. you know i gave the company like another like month and a half or two months of runway and that was all we needed to close the investment and here we are today three years later like just on a rocket ship talk to us about like the emotions you're feeling because i want to say like i've been through this as well obviously on a much smaller scale like my own company where like last q4 like like holy smokes like talk about like a deep battle scar about like oh god i don't know if i'm gonna make payroll like i'm starting to get sick because i'm so stressed out i'm always stressed out, like so much like anxiety.

11:44Talk just about that. I mean, you see, okay, I covered this payroll. I can't cover the next payroll. What was going through your mind at that time? Sleepless nights. Like I can't imagine it's, uh, I heard somebody say like, as the stakes get higher, like the stress doesn't increase. The stress is always the same. It's just the dollar figure is more like you feel that pit in your stomach, like whether it's, you know, your company's 50 ,000 bucks or 50 million bucks. And I always tell myself to like, not let anxiety get to me. And I feel like I do a pretty good job. Like you can only control what you can control, but like you can control how hard you work.

12:25Like you can control how many emails you sent out in a day. Like it was just sleepless nights. Like it was because there's so many people riding on you like their jobs all the investors that have believed in you and given you money like you owe all those people to like do everything you can to make it work and that's the most stress I've felt you know there's there's been other valleys not that not that low it was a crazy feeling like I like tear up when I tell the story sometimes uh just because it was it's such an emotional thing, even thinking back, like, wow, I did that, you know, but that talks about entrepreneurship, I would say 97 % of people would probably just fold it in that moment by love, like the risk that you like took on yourself.

13:13And you talked about it's like, obviously, you're not in that valley, like now you're obviously growing. So talk to us about some of the levers that you uphold to really grow. Talk to me like the GM partnership, like, how are you guys like really feeling this rocket ship? Now I want to be actual for listeners as well here. So give us any tips that you can, you know, I'm wearing this suit, because I'm actually going to the annual GM Ventures event in 10 minutes. I didn't wear the suit for you. Yeah. Yes, you did, Tia. Don't lie to me. But GM has been an awesome partner. They make 8 million vehicles a year.

13:45They're trying to transition the majority of that to electric. If that happens, they'll need 400 ,000 tons of lithium per year, which is way more than we plan on producing in the near term. We plan on producing that in the long term like a big vision right now we're developing two projects that are each 50 000 tons of lithium and the projected price of lithium is around 20 000 escalating so that would be a billion dollars of revenue from each project and we have really low cost so they're very profitable high ebita projects and you know gm it has not only supported us from an investment standpoint leading the series B.

14:25They also are a built-in customer. So like I mentioned, they need a lot of lithium plus just their credibility, having a grade A credit institutional company as a partner means a lot. We have others as well. In that series B, we had Any, which is the Italian multinational oil and gas company, similar to people in the US know Chevron and Exxon. In Europe, you have Eni, Total, Shell, BP is British Petroleum. So Eni is like on that level and they're a great partner. And then we also have Posco. Posco is a Korean conglomerate that's on the order of LG and Samsung. They just don't make consumer electronics.

15:06So fewer people know their name. But, you know, as we are scaling, we're leaning on those partners to help us go from pilot to demonstration plant to commercialization. And right now it's all about scaling. You know, we know that our technology is the best and the lowest cost. And it's just about scaling that up to a full commercial plant that, you know, is relatively expensive to build. Talk to us about how the vision has changed as you've gotten bigger. I see on LinkedIn, you know, you got 97 associated members. or so, 100 employees, let's call it. How has the vision changed since it was just you compared to like where you're at now, like working in some of the biggest companies in the world, raising series Bs, like has the vision changed?

15:47And like, what tips can you give to entrepreneurs about painting a good vision that's bold, but not realistic? I don't know if that's the right word. But you know, talk to us about the vision. I think that it's worthwhile to me to set a completely unrealistic, realistic, ambitious vision in the order of, you know, what Elon has done, right? Like, I'm going to go to Mars, and I'm going to colonize Mars. And like, that's the vision, right? And everybody in the company needs to be on board with that vision and truly believe that that's going to happen. I mean, in the beginning of the company, my goal is to build the biggest lithium company in the world.

16:21And I don't see any reason why that's not possible. Like, to be frank with you, the biggest lithium company in the world is actually pretty small, You know, they're only producing about 200 ,000 tons. And, you know, now you have much bigger companies entering the space like Rio Teto, who could easily surpass that and grow bigger. But like if we actually commercialize our technology, which is so disruptive that we could easily jump those numbers. I've already changed the vision of the company from not only being the biggest lithium company in the world, but being one of the biggest technology and critical materials producers in the world.

17:02So lithium is one material that's essential for the energy transition. But there are other materials that make up, you know, energy storage and batteries that are equally as critical. And there are also super critical materials that are needed for the nuclear renaissance that come from metals and mining. And EnergyX is going to be the company that produces the most critical materials and the technology to do such over the next 50 years for this whole energy transition. I love it. Super, super good and super, super bold. So that'll be one of our takeaways. Let's do one more question before we dive into fan blitz.

17:40If you go back to that moment in Bolivia, would you do it all again? And what would you tell your younger yourself before starting EnergyX? I mean, absolutely. I would do it again. Like, you know, I go back to this famous kind of like story from Mark Zuckerberg when he got offered a billion bucks by eBay to buy Facebook, eBay or Yahoo. I think it was Yahoo. And he was basically like, if I sold the company, like, what would I do? Like probably just go try to build another social network, right? It's the same thing. Like I'm only 37 years old and it's all about the journey, not the destination. Like I enjoy getting up each and every day and trying to solve these problems to build the biggest critical materials company in the world with the most cutting edge innovative technology.

18:30I'm blessed that I get to travel around the world as part of my job, whether that's down to Chile for our project there or to Korea with our investors or Europe or, you know, in Detroit today, like wherever it is, right. I get to speak on panels. I get to meet people like you. I get to meet entrepreneurs. Like I wouldn't change a thing. Like I'm so blessed that the company has kind of unfolded in the way that it has. I would tell my younger self to always have confidence. I feel like I do, but like you have to be the most confident person in yourself that you can execute the vision that you're selling to investors, that you're selling to partners, that you're selling to customers.

19:09At this stage of a company, everybody is believing in you. And I think that that's one of the most important things for all entrepreneurs to hear. You are the one. You can't rely on anybody else to execute the vision that you are setting forth. And you have to be the one that relentlessly pursues it. Super, super good. Let's dive into our fan blitz questions. These questions are submitted from our community listeners. If you want to join in on rural class entrepreneurs, go to www.youtube.com slash upflip and submit your questions there. But T, ready for our last five questions here? Let's do it.

19:41Cool. What's one country every entrepreneur has to visit at least once and why? Well, in my case, it was Chile because that's where our project is. We started in Bolivia, but I would say the United States. That is where entrepreneurship and innovation is bred. So for global entrepreneurs, come see what the United States is all about. That's good. I really like that answer. If you could have dinner with any innovator in history, who would it be? It would have to be Elon. I think that he's the greatest innovator of all time. I say this in my Wall Street Journal article. There's others that come close, Jobs, Edison, DaVinci.

20:22but Elon has unequivocally changed the world and come up with some of the greatest inventions that will propel us into the future. What's a book or podcast that shaped how you think about business? So I just finished reading Steve Jobs' biography by Walter Isaacson and his mindset. I also read Elon's Walter Isaacson biography And those two books are just the portal into these individuals' mind has taught me so much about what it means to build a great company, innovate, manage people. I learned a lot from those two. Two phenomenal books. I have both of them actually right there. And the Da Vinci one by Walter Isaacson is also phenomenal.

21:09So I'd recommend that one. Two more for you. What's the best risk you've ever taken outside of EnergyX? it's related to energy x but in order to start energy x i moved to puerto rico i was living in los angeles and i realized that when i was living there i had no self-discipline i had so much fomo about going out every night meeting up with friends just the next party the next like whatever it was. And I moved to Puerto Rico to isolate myself. And, you know, that was a life changing decision to move to like, it's technically a US territory, but essentially a foreign country. I moved with one buddy, we shared a house together, I made lifelong friends, I attribute it to one of the main reasons that I was able to focus so much on building the company.

22:00And that also kind of falls in line with my passion of travel. So moving to a foreign country kind of on a whim away from all my friends and doing it, you know, that was a pretty big risk. I like it. Last one for you. When you finally take a break, what's your go-to adventure or escape? I love golfing. I take calls on the golf course, but theoretically you get to detach and be in, you know, a beautiful in nature. Also skiing, you know, I've been a skier my whole life, but I started heli skiing and being out kind of in the middle of nowhere with helicopter and skiing is also just such a beautiful, you know, natural environment.

22:41I'd say those two things are my passion outside of work. Well, Tick, thank you so much for taking the time today. Talk more about your story, the great story about the payroll and then like shaping a vision. If someone's like, oh my gosh, I want to learn more about T and learn more, more about EnergyX, where can they contact you or just learn more about you? Yeah, just EnergyX's website is one. I'm on Instagram, so you can follow me there. I'm on LinkedIn. You can follow me there. The Wall Street Journal article is a pretty good read. My website, my personal website is just teague.co. You can find me in a lot of places.

23:12Listeners, that was a great episode with Teague. Happy we could get him on there. Three quick takeaways for you. Number one, take action. Early on, he was describing his trip to Bolivia and how his idea sparked, but how he also took action from it. I think that's super important for entrepreneurs. Number two, set vision and set a vision that is super unrealistic. It just helps you paint the bigger picture of what you can be doing and maybe you'll get there. It's really helpful to do that. Number three, he ended the conversation with this, but be confident. You have to be confident in yourself.

23:40That's how you're going to sell your company. That's how you're going to sell yourself to investors. Super important tidbit right there. If you guys enjoyed this conversation, please give us a five-star rating wherever you get your podcast. It helps us get more amazing entrepreneurs like Teague on the show. And with that, we will see you next Monday. Teague, thank you so much for your time today. Yeah, Ryan. Thanks, buddy.