Just as a minimum viable product must serve its first customer, a minimum viable factory must be ready to build its first unit.
In episode 133 of Deep Tech Catalyst, I sat down with Philip Farese, CEO of Mojave Energy Systems, to explore what it takes to turn a working technology into a commercial hardware business.
Conversation Highlights
00:19 Introduction
03:37 Managing Multiple Startup Priorities
04:53 Building the Early Startup Team
06:26 Inside the Startup Hiring Process
08:07 Customization vs. Standardization in B2B Sales
11:39 Building the Minimum Viable Factory
14:41 Outsourcing vs. In-House Manufacturing
16:45 Matching the Cost of Capital to the Risk It Funds
18:29 What Changes From Seed to Series B?
19:38 The Next Phase of Mojave Energy Systems
About the Guest
Dr. Phil Farese is CEO of Mojave Energy Systems, which is changing the nature of air conditioning with its Humidity-First Climate Systems for commercial and industrial buildings, powered by liquid desiccant technology. His prior roles include Chief Strategy Officer at Enphase Energy, CTO of Advantix Systems, senior energy analyst at NREL; he began his career at McKinsey & Company.
BEYOND THE CONVERSATION
Strategic Insights from the Episode
One of the most interesting insights from this conversation was how early manufacturing decisions can shape a company’s economics long before it reaches meaningful scale.
The concept of the “Minimum Viable Factory” captures this particularly well.
Manufacturing capacity doesn’t have to be built all at once. Early production decisions can reflect what a company actually needs, while leaving room to develop more efficient processes as demand and resources grow.
What I found particularly interesting was how these decisions connect to the broader challenges of commercialization.
Technology development, manufacturing, and sales often need to advance simultaneously, even when each comes with different risks, dependencies, and timelines.
The conversation also highlighted some key aspects of building an industrial business.
A relatively simple component can significantly affect manufacturing costs. A product that meets nearly all customer requirements may still struggle to sell.
These observations made me reflect on how many consequential decisions in Deep Tech concern the allocation of limited resources, and how their implications often become clearer only as the business develops.
Below, I’ve collected my strategic notes from the conversation, exploring the principles, trade-offs, and questions I found most valuable for Deep Tech founders, investors, and operators.
Enjoy the read!
Don’t make every milestone wait its turn.
Hardware startups often need to address several forms of uncertainty before reaching the market. Technology must perform reliably, manufacturing capabilities must be established, and a viable commercial channel must emerge. These activities involve different organizations, resources, and timelines, many of which remain outside the startup’s direct control. Completing one workstream before beginning the next can create unnecessary dependencies and extend the time required to reach commercialization. Where the activities allow it, advancing technical validation, production planning, and market development in parallel gives each process time to progress independently. This can be particularly valuable when dealing with suppliers, customers, and other external partners whose decisions may take longer than expected. The sequence of execution ultimately influences not only the development timeline but also how much capital the company needs to sustain itself.
The last five percent can decide the sale.
