Lyndon Rive, 37, is the co-founder and CEO of SolarCity, the country's largest installer of rooftop solar panels. Successful as the company is, Rive gets far less attention than his older cousin, Elon Musk, who is the founder of Tesla and SpaceX. But his company is innovating at the same torrid pace.
Rive sat down with EnergyWire recently to discuss his mindset as a CEO, the future of SolarCity and what it's like to build a company when your cousin (and the chairman of the board) is one of America's most famous entrepreneurs.
One thing that he and Musk have in common: "Our tolerance for pain is very high."
On the competition
Rive said he is fiercely competitive, even if he doesn't need to be. Only about 20 to 30 percent of the time is one of his customers entertaining a bid from another company, a ratio that he said hasn't changed in the eight years since SolarCity was founded. Nonetheless, he said, "You don't want your customer because he doesn't know about the competition."
"I go to bed thinking about our competition. I'm paranoid. I think all the time about who they are and how to beat them," said Rive, whose hair is noticeably grayer than in his earlier publicity photos. "As soon as a company gets complacent, it's destroyed."
He added, "In every single circumstance, I'm competing against the utility."
On the company's 'gigafactory'
In June, SolarCity jumped into making solar panels with its acquisition of Silevo Inc. (Greenwire, June 17); in September, it broke ground in Buffalo, N.Y., on what it expects to be the largest solar-manufacturing plant in the Western Hemisphere (EnergyWire, Sept. 25). It is projected to produce a gigawatt of solar panels a year by 2018.
By then, however, Rive estimates that SolarCity will be installing 4 gigawatts a year on rooftops, meaning that the record-breaking plant will satisfy only a quarter of the company's needs.
SolarCity's chief reason for moving into manufacturing, he said, is to control costs, and with it maintain both competitive rates and a reliable profit margin. He sees SolarCity as better able to stay profitable than SunPower, another vertically integrated solar company whose solar panels are highly efficient, but also expensive (EnergyWire, July 8).
SolarCity's gigafactory begs comparison to that other gigafactory -- the battery-manufacturing behemoth being built in Nevada by cousin Elon (EnergyWire, March 3). "We can't have dinner and not both have gigafactories," Rive joked.
On the pace of innovation
In the prior six weeks, Rive pointed out, SolarCity had introduced a new solar-panel system that it says can improve output on flat, commercial rooftops by 20 to 50 percent (EnergyWire, Sept. 17); announced a gigantic solar manufacturing plant; hatched a new financing structure that allows customers to buy solar panels instead of just leasing them; and launched an offering of solar bonds that it hopes can net $200 million in financing (EnergyWire, Oct. 16).
"And we're announcing another product tomorrow." Rive shook his head. "Or is it today?"
On his relationship with his cousin, Elon Musk
The idea for SolarCity, and its groundbreaking model for leasing solar panels, was the brainchild of Musk, who shared the idea with Lyndon during a visit to the Burning Man art festival in the Black Rock Desert in Nevada in 2004. Musk also is SolarCity's chairman and is the single largest shareholder, with 22 percent of the stock. Musk "lets us run the company," he said.
To illustrate Musk's ongoing involvement in the company, Rive gives this analogy.
It is, Rive said, as if he is at the wheel of a car. Musk is in the passenger seat and sometimes instructs him to swerve into a pothole. But why would I do that? Rive asks. "The pothole will be less harmful than the invisible wall," Musk says. To which Rive says: What invisible wall?
"Without Elon, we may have hit a few walls," Rive said.
Rive compared his cousin to Neo, the star character of the movie The Matrix, who can stop bullets because he understands the nature of reality. "He can see the zeroes and the ones," Rive said. "He sees the infrastructure of the game differently."
He admires that Musk can "manage exponentially more" as he runs both Tesla and SpaceX. Meanwhile, Lyndon and his 40-year-old brother Peter, SolarCity's CTO, "have one company, and there are two of us."
"He teaches us to continue to sprint," Rive said. "Don't jog the marathon, sprint the marathon."
The Musks and Rives are an extraordinarily entrepreneurial bunch: Kimbal Musk, Elon's brother, founded a chain of restaurants in Colorado, and Rive's brother Russ runs SuperUber, a cutting-edge design shop in Brazil. What is it that prepares the Musk/Rive clan to take on such big risks?
"Our tolerance for pain is very high," Rive said.
The clan's mothers, Almeda Rive and Maye Musk, are twins and expect great things of their children. As an example, Rives said that when he was 5, he told his mother Almeda he wanted to try karate. His mother said he could, but on one condition: that he not stop until he earned his black belt.
Rive agreed. But a year later, a wiser 6-year-old Rive told his mom he wanted to move on. She wouldn't let him. Rive continued to practice karate for the next decade, until the age of 15, when he earned his brown belt. The only reason his mom relented on the black-belt pledge is that one can't earn a black belt until 18.
From that, Rive learned perseverance, as well as that "stupid rules based on age are dumb."
The cousins have an ability to consider a goal or obstacle, evaluate the pain associated with it and recalibrate. Rive said they call it their "shit recalibrator."
When Musk talks about starting another company, Rive said, he and Peter yell at him that his shit calibrator is off.
On where SolarCity will be in five years
After thinking a moment, Rive said that will be not merely a solar rooftop company, but a full-fledged energy-services company. An integral part of that will be a residential battery system that stores the energy from those solar panels and a system to exchange that energy with the power company. It's no surprise that SolarCity is working with Tesla to provide the batteries (ClimateWire, Dec. 6).
Customers in states that have some of the highest energy prices -- California, Hawaii, New York, New Jersey and Connecticut -- will have storage baked into every solar system, Rive said. In these states, SolarCity will provide services to the grid, like shifting the load and stabilization, that will earn money from the utility, and those proceeds will be shared with the customer.
As of today, Rive expects that the company will be 80 percent residential and 20 percent commercial.
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