Welcome to the very first episode of Cool Air, Hot Takes, the podcast that keeps HVAC pros ahead of the curve with the latest industry insights, trends, and of course a hot take or two.
Hosts Charlie Jelen and Dan Gentry - HVAC experts with over 30 years of experience between them and a friendship dating back to middle school - kick things off with their hottest takes on where the industry is heading. Geothermal? Getting big. CO₂ refrigerants? Gaining traction. Residential cold climate heat pumps? A game-changer.
Venture Capital in HVAC – We sit down with Jon Horne, Managing Director at Idea Fund, to break down how venture capital money is shaping the industry. Where do the best HVAC startup ideas come from? How do investors decide what’s worth betting on? And why is now the most disruptive time HVAC has seen in decades?
Hot or Cold? – AHR Expo Innovation Awards edition! Are stainless steel boilers really that innovative? Is CO₂ the refrigerant of the future? And what’s the deal with LG’s cold climate heat pump?
Got a hot take? A funny job site story? A new tool saving you time and money? We want to hear it! Email us at CoolAir.HotTakes@Trane.com for a chance to be featured. To learn more about the show, check us out here.
If you liked the show, hit follow, rate, and review wherever you get your podcasts. Until next time, stay cool, and keep those takes hot.
Chapters
Welcome to the very first episode of Cool Air, Hot Takes, the podcast that keeps HVAC pros ahead of the curve with the latest industry insights, trends, and of course a hot take or two.
Hosts Charlie Jelen and Dan Gentry - HVAC experts with over 30 years of experience between them and a friendship dating back to middle school - kick things off with their hottest takes on where the industry is heading. Geothermal? Getting big. CO₂ refrigerants? Gaining traction. Residential cold climate heat pumps? A game-changer.
Venture Capital in HVAC – We sit down with Jon Horne, Managing Director at Idea Fund, to break down how venture capital money is shaping the industry. Where do the best HVAC startup ideas come from? How do investors decide what’s worth betting on? And why is now the most disruptive time HVAC has seen in decades?
Hot or Cold? – AHR Expo Innovation Awards edition! Are stainless steel boilers really that innovative? Is CO₂ the refrigerant of the future? And what’s the deal with LG’s cold climate heat pump?
Got a hot take? A funny job site story? A new tool saving you time and money? We want to hear it! Email us at CoolAir.HotTakes@Trane.com for a chance to be featured. To learn more about the show, check us out here.
If you liked the show, hit follow, rate, and review wherever you get your podcasts. Until next time, stay cool, and keep those takes hot.
What is Cool Air, Hot Takes?
Welcome to Cool Air, Hot Takes, the podcast that’s as smart as your building’s thermostat and twice as fun. Hosted by Charlie Jelen and Dan Gentry—two HVAC pros with over 30 years of combined experience and a lifetime of friendship—this show is your go-to for the latest in Heating, Ventilation, and Air Conditioning, industry news, and cutting-edge HVAC trends.
Charlie is a building-systems expert passionate about solving complex problems, and Dan, an Applications Engineer with a knack for energy-efficient design and HVAC troubleshooting, bring their expertise (and plenty of hot takes) to every episode. Together, they dive into topics like the latest trends and systems redefining buildings and Industrial systems , and the future of AI in the industry, from smart thermostats to data centers. They’ll look at what’s up with all these tech companies buying nuclear power plants, and what does it mean for the future of climate control?
Expect in-depth interviews with industry-leading experts, practical tips for engineers and contractors, and funny stories from that job that went sideways. Whether you’re designing ductwork, conducting energy audits, or upgrading to sustainable HVAC systems, this podcast is built to keep you informed and entertained.
We want to hear from you! Email us CoolAir.HotTakes@trane.com with your questions, HVAC hacks, or the funniest thing that’s ever happened on a job, and we might feature it in an episode.
Follow Cool Air, Hot Takes from Trane wherever you get your podcasts, and join us as we tackle the big questions and the finer points of thermodynamics—one hot take at a time.
About Trane Commercial
Trane Commercial, part of Trane Technologies, is a leading provider of innovative climate control solutions and energy services tailored for commercial environments. The company focuses on optimizing indoor climates through advanced HVAC systems, building automation, and sustainability initiatives. With a commitment to decarbonization, Trane aims to reduce the carbon footprint of buildings while enhancing comfort and efficiency.
Learn more at: https://www.trane.com/commercial/north-america/
Meet the Hosts
Charlie Jelen has been working with HVAC systems for over 15 years, specializing in sustainable solutions. At Trane Commercial North America, he focuses on advancing cutting edge building and industrial systems. With a background in consulting and system engineering, Charlie is committed to delivering solutions for the hardest challenges facing clients today.
Dan Gentry is an Applications Engineer. With expertise in chiller plants, heat recovery, and heat pump systems, he focuses on reliable and efficient system design.
Charlie:
You're listening to Cool Air Hot Takes. Welcome. Welcome. Welcome to the first episode of Cool Air Hot Takes, a brand new podcast that we're gonna do this every two weeks.
Dan:
We're gonna talk about anything and everything from the world of buildings, HVAC, and energy.
Charlie:
We're your hosts. I'm Charlie Jelen. And I'm Dan Gentry. And between us, we've got over thirty years of industry experience. So I started at Ferris State University and honestly fell in love with HVAC at a
Dan:
modular equipment manufacturer. After that, moved over to train in product support, and now I help design some of the most complex systems as an applications engineer.
Charlie:
And my background is in engineering with Stinson Energy Modeling, product management, application engineering. I spent a few years on the contracting side of our business, and now I'm a sales leader for some of our next generation technologies.
Dan:
And, amazingly, we've been friends for even longer.
Charlie:
A friendship that started at Longfellow Middle School. Dan, do
Dan:
you remember the mascot? Those were the Longfellow Trojans.
Charlie:
The Trojans. The Trojans.
Dan:
Green and white.
Charlie:
And we somehow both found our way back into this exciting and sexy world of HVAC, and we're starting a podcast to bring you along for the ride.
Dan:
We've got everything. We're covering stuff from industry insights, cool new tools, big trends. Think about decarbonization. We're gonna talk about energy efficiency, of course, and really cool new upcoming things like artificial intelligence and how that affects you, your operations, your buildings. So whether you're listening in your van, rolling between jobs, sitting at your desk, catching lunch, or you just wanna catch up on what's going on in the industry, we are excited to have you guys here.
Charlie:
My hot take for the week is definitely going to be, I think, geothermal systems. From the amount of geothermal system projects we do today, we are going to triple the amount of geothermal projects. Maybe not this year, maybe not in one year, but by 2030, we are gonna do way more geothermal systems. We're gonna have to do a a whole episode on geothermal.
Dan:
I was just gonna say, I mean, geo's getting hot.
Charlie:
It it's getting hot. It works.
Dan:
It is there's a lot of geo going on and new advancements. It's exciting.
Charlie:
So anyway, that's my hot take. There you go. That's my hot take. What what do you got? What's your hot take for the episode?
Dan:
No. That that that's that's pretty hot. I tell you what, what I really like I wanna go for my hot take. I just think this episode and this podcast is hot.
Charlie:
I am even talking about this. Can we do that?
Dan:
I'll have to think about my hot take.
Charlie:
That's a self serving hot take right there.
Dan:
Well, I'm gonna tie to your geothermal. Like, there's I think there's been a lot of there's a lot of new prod there's there's been a lot of geothermal products out there, but there's more and more geothermal products out there. Like, I'm gonna I could even say geothermal could be hot. I think it's very exciting because it's a very efficient system, can be very sustainable. I like that.
Charlie:
Well, just like seventh grade math with missus Motter
Dan:
Just copying right off. Right over the shoulder. Right over the shoulder.
Charlie:
Alright. So here here's the lineup for today, listener. We are gonna go through some HVAC headlines. We're gonna get you up to speed on on some of the things that we saw in headlines that that looked interesting, and we wanna get out there. We're gonna talk with one of our good friends, John Horn.
Charlie:
He's the managing director of a venture capital company called the Idea Fund. We're gonna talk about where VC funds are at, what they're into today, and what that looks like over time. And then we're gonna go into, I talked about this earlier, the innovation awards for the HR Expo in a little feature that we like to call cool or hot. Or hot or cold. Hot or cool.
Charlie:
Either one. HVAC headlines. Your news today. Alright, Alright, listener. It's 05:00 in Shanghai.
Charlie:
That means it's time for your headlines. First one, startup aims to decarbonize big buildings without hassling tenants. This one is from Canary Media. The startup name on this one is Hydronic Shell Technologies. What caught my eye on this one is a lot of large cities are looking to reduce their emissions and and primarily electrify.
Charlie:
And large multifamily high rise residential buildings are going to struggle with this with electrification, primarily moving to heat pumps. Kind of the core of this is the current heating technology is a lot of high temperature heat or steam heat probably, a lot of steam heat for for older cities. And so when we look to electrify these systems, we wanna try to use heat pumps. One of the things that we need to do there is we need to move to lower hot water temperatures. With that transition, we need to start to replace the terminal units.
Charlie:
We need to move to more rows, bigger pipes. And so for those who don't understand what I'm saying here, the terminal equipment is that thing in the room that actually makes the space hot or cold. Alright. So what this company is looking to do, what the startup is looking to do, is actually create a new facade on the building in order to make it easier to replace the terminal equipment and run the pipes. And so if you're you can imagine if you own a large building in one of these big cities and you want to electrify with heat pumps and you have to replace all the terminal equipment that means you have to get into every space, right, which means you're going to have to displace renters or you're gonna have to significantly hamper their day to day schedule.
Charlie:
Sounds expensive. It sounds very expensive. And so what this startup is looking to do is on the outside of the building, it's like Lego blocks or like Tetris, is build up this new facade that runs the pipes and new terminal equipment on the outside of the building so that you can put air to water heat pumps on the ceiling, water to water heat pumps in the basement, and you can run all that pipe work on the outside of the building. On top of that, you increase insulation. You have better infiltration.
Charlie:
It's a really interesting way to try to get at that problem.
Dan:
That is very cool. It's a really innovative idea. I I like it.
Charlie:
Yeah. I like it too.
Dan:
I mean, if it's I think if it's cost effective, it looks very cool. It's a very neat idea.
Charlie:
Yeah. The cost effective.
Dan:
The cost is reasonable. I think this could be a I could see that.
Charlie:
Yeah. We'll see where the cost goes. The first demo project is in Syracuse, New York. It looks like it's scheduled for completion mid twenty twenty six. So it's a ways out, but very cool concept.
Charlie:
Can't wait to to follow-up on the case study there. Alright. Next headline. I think this this one caught my eye and and instantly knew we were gonna put it on here. Headline, most lucrative states to be an HVAC technician.
Charlie:
Oh, yeah. This one's from ACHR News.
Dan:
Here we go.
Charlie:
Alright, Danny boy. Top five most lucrative states. Take a guess. What do you got?
Dan:
I mean, I'm gonna guess something like, I don't know, like one of those big state out East, Massachusetts, New York.
Charlie:
Massachusetts, not on the list. They are number 36.
Dan:
Oh, wow. So, we gotta go somewhere else. We go to we go South. We go Midwest. What about the Dakotas?
Charlie:
Good guess. So the way that they did these rankings, they looked at the average annual technician salary, and then they also looked at the cost of living ratio. So they they put the cost of living ratio at a hundred for the average across The US. If you're under a hundred, that means your dollar goes further. If you're over a hundred, it does not go as far.
Charlie:
So at number five, very good guess, North Dakota, average annual salary for a technician, sixty four thousand dollars a year. The cost of living ratio at 95.
Dan:
Look at that, there
Charlie:
you go, North Dakota. All right, next on the list number four, New Jersey, dollars 70 eight thousand that is I believe the second highest average for technicians. Cost of living ratio a little higher 114, but right up there way to go New Jersey. Third, number three, Missouri, 60 two thousand dollars a year, 89 ratio for cost of living. Number two, Minnesota, 70 one thousand dollars, 90 four ratio.
Charlie:
Number one, the Fighting Illini, Illinois, 70 7 Thousand Dollars for the average HVAC technician and a cost of living ratio of 92.
Dan:
Well, because we're here, what about the Badger State? Just because, you know, it's self interested.
Charlie:
There you go. Wisconsin came in at number six. Okay. Okay. 54,000.
Dan:
It's respectable.
Charlie:
All right. Let's look at the other side of this. The five worst, the lowest paying average annual HVAC technician. What do you got for a guess?
Dan:
Doctor. Oh, I'm going to guess Louisiana. Doctor.
Charlie:
No. I mean, I don't know why you're calling out Louisiana. I'm just I don't I don't know. I got to pick a state.
Dan:
I only got 52 places.
Charlie:
They're not on the top five lowest. Number five, in terms of worst, is Maine, dollars fifty six thousand a year for an average
Dan:
see that coming.
Charlie:
I know. Me yeah. I agree. $1.10 for cost of living up in in Maine. Florida, number four, $51,000 a year for an average annual technician.
Charlie:
That is the third my mind. Yeah. Don't you have a ton
Dan:
of cooling? I did too.
Charlie:
That's exactly where my head went to. It's like tons of chilled water plants, big stuff. Wow. Yeah. 51,000 is the third lowest in terms of average annual HVAC technician.
Charlie:
Yeah. Number three, Vermont, 70 thousand dollars a year, which is actually pretty high for Vermont, but their cost of living is $1.47. Wow. Yeah. $1.47.
Charlie:
That means they basically pay 50% more for for everyday life. There you go. Number two, Washington, DC, also $70,000 a year. Not a surprise there. Number one, though.
Charlie:
Number one, the worst place I shouldn't say the worst. In terms of being lucrative for a Verne HVC technician, Hawaii. Okay. And now, this is quite interesting. They have the highest annual average salary at $80,000 a year, but the cost of living ratio is one eighty, 80 percent more than the average annual state.
Dan:
I I guess I'm surprised by the list, but it's the cost of living.
Charlie:
It's cost yeah?
Dan:
Cost of living.
Charlie:
Yeah. Managed family, I guess. Well you know what they say in, in the real estate business?
Dan:
Buy low, sell high.
Charlie:
I think that's the stock market. Location, location, location. That's what I
Dan:
was getting at. Interesting.
Charlie:
There you go. And to be fair, across the board, I think all of these are going to go up significantly in the space because we are looking for more and more HVAC technicians every day. We have a shortfall there. So, hey, if you're looking to be an HVAC technician, now's a good time to get in.
Dan:
They deserve it. Pay them more. We need more.
Charlie:
I love it. Here we go. There we go. Alright. So that's it for the headlines today.
Charlie:
Next up, we are going to interview John Horn. He's the managing director at a venture capital fund called the Idea Fund. Stay tuned. Alright. First episode, first interview.
Charlie:
Welcome, John Horn, to Cool Air Hot Takes. Before we get into the the actual part of this, I gotta give you a little background on John. John is a key member of the downhill ski team, Vildsoe. He was the ace on the Central High School pitching staff. He is an avid snowmobiler.
Charlie:
He scored a 36 on his high school ACT. He is probably the smartest person I know. If you're wondering how I know all this, no, it is not on his Wikipedia page. Myself, Dan, and John, we go way back. We all are proud alumni of Central High School.
Charlie:
So, John, thank you for coming.
Jon:
Charles, thank you for the invite. I'm honored to be on the first and what hopefully is not the last episode of
Charlie:
your new podcast. Oh, thank thank you for the confidence. Very, very much appreciated. Alright. You know the title.
Charlie:
Cool Air Hot Takes is where we're gonna start. What's your hot take? You can go anywhere with this one. You can go in venture capital. You can go outside it.
Charlie:
Our industry personal. What do you got?
Jon:
Okay. Well, first thing that popped in my mind when you guys thought I should do this and told me what a hot take was was that this podcast is either going to end or massively accelerate the career of one or both of you at, train company. But I guess and that's not meant to be a dig. I kinda thought about it as, like, you guys are the ones who are like, hey. Here's what we're gonna say and take it down to the corporate communication department and get the approval and everything.
Jon:
So that was my honest first take. But I guess for purposes of you could edit this out, I assume.
Charlie:
Yeah. Yeah.
Jon:
We can
Charlie:
we can take that. Okay. Yeah.
Jon:
Yeah. My my actual thought was if you look at the next five to ten years in, you know, the HVAC market taken broadly, I think you're gonna see more change in the next five to ten years than you have seen in the last fifty to a hundred years.
Charlie:
Oh, interesting. What do you think drives it?
Jon:
Well, so you look at just all industries, and they've been impacted by technology and disruption at different rates. And so some of the first to be disrupted were things like retail, travel, media. You know, like, what's CBS? Right? You know, streaming turned that upside down.
Jon:
Amazon turned retail upside down in a lot of ways. You have not seen that fundamental sort of reshuffling of the deck in a number of other industries, and HVAC building management is one of them. You guys maybe will tell me I'm wrong on that. But, you know, the fundamental products are the same, and more importantly, the market leaders have essentially been the same. Mhmm.
Jon:
Mhmm. You know, when you look at, like, the auto industry with fifteen years ago, Tesla is not a public company. Today, Tesla has more value than the next nine auto companies combined. Right? Like, you have not seen that unseating of incumbents in this industry that you have in others.
Jon:
And so I think it's very timely that that you guys are initiating this podcast because, you know, innovation is really starting to strike in this industry where it really in ways it hasn't over the last any number of years.
Charlie:
I mean, I gotta tell you, I had a high bar for you coming on the show, and and you just you just went past it. That was that was great. I could not have been for a good start. Alright. Well, let's get to you.
Charlie:
Tell us about the Idea Fund. What's the background? What are you guys into?
Jon:
Sure. So Idea Fund's a venture capital fund. So that means we manage money on behalf of third party investors, and we invested in very early stage technology companies. And our strategy is technology companies based sort of generally in our part of the country, which is the Upper Midwest. And, you know, when you look at venture capital, it's highly concentrated in a few geographies.
Jon:
Right? About 80% of venture capital goes into California, New York, Boston, you know, the top three to four states. The other 20% is distributed across the other 46 states. We're specifically focused on Wisconsin, Minnesota, and Iowa because we believe the kind of innovation that's coming is the kind of innovation that this part of the country is strongest at. This kinda ties into the original point where a lot of the stuff that's really been changing, you know, over the last twenty years of venture innovation is kinda consumer driven and mass market stuff.
Jon:
You know, it's not a lot of the nitty gritty b to b industries. So, like, you know, you still want your Stanford dorm room kid or whatever on the team. But to found a new company in the HVAC industry, you know, in supply chain and, you know, in in the traditional b to b industries, you know, you really need industry expertise. So that's the kind of companies and founders that we really tend to invest in. There's people coming in with deep industry expertise and areas that our part of the country is strong in.
Charlie:
Yeah. We're gonna get into a little bit of that, where those ideas are coming from and and who should be on the lookout for them. But in general, you're talking about, like, the trend of venture capital. Is is venture capital growing, or is it more of like a zero sum game where the the money's relatively similar and it's just getting shuffled around between what's hot and what areas of the business are are are going? Or is venture capital growing like crazy?
Jon:
Well, there's a couple ways you can look at it. You know, venture capitalists and venture capital funds in general, it's it's really California centric, and it's they're really kinda herd animals where you see these big sort of cyclical swings. You You know, we saw the .com boom and then the .com bust.
Charlie:
Mhmm.
Jon:
And then we are on sort of the bust side of another cycle right now where, you know, 2021, '20 '2, we saw massive amounts of money flowing into venture capital. Now we saw a just as massive pullback, where 2024, there was this was the lowest year for venture capital fundraising out of the last ten years, twenty twenty four was. Wow. Okay. So there's, like, been this massive pullback in venture capital.
Jon:
And now, of course, we're on sort of into the next cycle of AI and, you know, this massive investment in AI and infrastructure and all this that's going on right now. So, I mean, you see huge swings. It's a really cyclical industry. But in general, that's venture capital. When you think about, like, taking a step back at, like, the innovation economy Mhmm.
Jon:
You know, that is just consistently up into the right. Right? As you get sort of compounding returns from technological innovation, I mean, that is just only accelerating how much technology is impacting industry.
Dan:
How do you think the Midwest is different than, you know, those those states that you mentioned are kind of like boomer bust. Do you think the Midwest is any is gonna be different?
Jon:
You know, I think you you gotta look at the it all comes down to the people. You know, that's really what all all this boils down to. And when you think about, you know, the traditional venture centers, there was a lot of real heavy technical innovation that came out of them. You know, Silicon Valley means the Silicon chips, you know, that were there. I mean, it was, like, really the foundational computing elements and stuff like that that sort of, like, gave birth to to that.
Jon:
You know? So we don't have, like, as much of a fundamental computing heritage and deep technical heritage, you know, in this part of the country. We have, you know, industrial, agriculture, supply chain, you know, those industries that make up 68% of US GDP. Right? And the industries that happen to be the least disrupted by technology today.
Jon:
So, you know, Silicon Valley was in the right place for innovation over the last seventy five years, whatever you wanna call it. You know, now you've got this huge portion of the economy that has not been fundamentally transformed yet by technology. It's been changed by degree, right, but not fundamentally. That's where I think you're gonna see the rest of the country sort of come in, and you're gonna see some really new and innovative and, I think, potentially massively valuable companies ultimately created out of, you know, the heritage that we have here.
Charlie:
We kinda dive down in there a little bit on the trends. Can you back us out a little bit? In our industry, when we talk about technology, you'll hear people talk about, Wow, this is at, you know, RMI, Rocky Mountain Institute or it's at a Pacific Northwest National, like it's in a it's at a university stage or it's in venture capital or it's early commercial versus commercial. Can you kinda walk us through that spectrum on how technology goes kind of from in its infancy to, like, a company, like, train company or or the likes having a commercial offering?
Jon:
Yeah. It's it's interesting. And when you think about sort of innovation generally, I mean, you would think of just Amazon, for example, as, like, an innovative company that completely turned industry upside down. Mhmm. But when you think about the value that Amazon delivers to its customers, you know, its customers being you and me and other Amazon subscribers, you know, the product is identical.
Jon:
Right? You're still getting essentially all the same crap you can get at Walmart or anywhere else through Amazon. Right? It's it's the delivery mechanism. Mhmm.
Jon:
So when you think about innovation, like, as it relates to the HVAC industry, one big category of innovation is product innovation, like what you're talking about, a new new refrigerant, right, or, you know, something like that. That's like a a highly technical product that starts in a lab or starts in the brain of, you know, some engineer and somehow is funded to develop, ultimately commercialize, validate it to the point that a train company could acquire it. A whole another category of innovation is everything else that happens in the value chain. Right? Not just a new product, but how about, like, a new way to sell the product.
Jon:
Right? So how you how you reach your customers. You know, hot fulfillment, right, services, whether that's a live human service or a software product delivering service. But at the end of the day, they're all what do you think of all these? I mean, it comes out of a product innovation, and somewhere in somebody's head, there's a product innovation.
Jon:
Right? Whether it's, you know, refrigerant or it's a process, right, or whatever. And you you need that. You need the management talent, and you need capital. Mhmm.
Jon:
Right? Those are, like, the three pieces. Right? And sometimes That's
Charlie:
all I said.
Dan:
Easy peasy.
Jon:
Right. When you start to categorize it and slice it up. And so, like, if you've got there's I guarantee there's somebody sitting at every large industrial HVAC equipment OEM with a brilliant product innovation in their mind. Maybe they've tried to run it up the flagpole and hasn't gotten interest from the senior people on the team or whatever. I guarantee there are people out there right now that have that idea.
Jon:
And if they don't do something with it, it's never gonna get out into the world.
Charlie:
There you go, listener. There you go, listener. In in the show notes, we'll we'll give we'll give you John's, company's email address, your inbox. We'll flood it up.
Jon:
Idea Fund VC comes straight to my email.
Charlie:
There you go. Alright. So let's let's talk about something that you have invested in that's that's kinda close that our listeners are probably more interested in. We talked about this earlier. Enoration.
Charlie:
Can you give us a little background on on what that is and what your role is with them?
Jon:
Yeah. It's it's a really interesting company. At their core, they provide efficiency services to health systems, building efficiency services. Okay. So what they're doing is it's a sophisticated services offering where they're making health care buildings more efficient.
Jon:
You know, that's established. Their history is is really interesting where they originally developed as an internal initiative at Gunderson Health System, which is, you know, a large Upper Midwest predominantly rural health system. The CEO probably twenty years ago made a you know, put a stake in the ground and said we're gonna be net zero on campus and actually went out and got it done through combinations of generation, you know, building efficiency, all the kind of things that you guys are working on. And they did it. Then they had hired a number of people from Trane that came in house to sort of build this out.
Jon:
Mhmm. At Gunderson, they accomplished it. And then they got all this attention nationally, and other health systems started calling us and saying, hey. Look. We wanna become more efficient.
Jon:
We've always put, you know, the patient first. Right? So we can't take risks on reliability and things like that, but it sounds like you guys have figured out a way to do this, right, without taking risk. And in fact, maybe making your system more resilient. So they started doing sort of consulting projects for other health systems and turn it into this little internal business.
Jon:
And then a few years ago, they made the decision, hey. This isn't our core. You know, we're very good at this. Right? It's very important, but it's not our core job.
Jon:
Right? Our core job is patient care. And so they took the business. They're spinning it out, it's called, where they actually separated it into its own entity. The health system still owns a piece of it, and then they raise capital from outside investors.
Jon:
And we're we're one of the outside investors, and now we're, you know, we're working with management to try to, you know, just grow the business and make it a large stand alone business.
Charlie:
So I think that's pretty maybe maybe it's not obvious, but, like, the differentiation that they have versus just any engineering company walking into a health care system is the innate knowledge, the internal knowledge that they've developed, that they've incubated over the years. Is that kinda is it
Jon:
Well, you know, you get a lot of pitches, and 80% of them are, hey. Look at this awesome product I've got. Right? Mhmm. And okay.
Jon:
That that's great. Right? Like, to be a successful company, you need a credible, valuable product. It's necessary, but not sufficient. Right?
Jon:
You also need, you know, a way to talk to your customer, a way to sell it efficiently. You need trust with your customers, all this kind of stuff. And when you think about a health system buyer, yes, they wanna save money on that percent of their budget that is, you know, spent on energy costs. Mhmm. But they also want a % reliability.
Jon:
They want their physicians to understand this isn't impacting the humidity in the Operating Room or specific considerations that a health system might have that other building owners do not have. And so part of what Enoration offers is a really high level energy consulting business, but it's also a way to reach a certain customer population efficiently and in a way that builds trust very quickly because these guys really know their industry. Right? And the customer understands that they do right from the start.
Charlie:
Got it. So from your spot, what is a a successful turn on a company like Enoration? What did they get into, and then where do you get out of that as a successful venture?
Jon:
So when you look at our economics so I manage money from third party investors. Right? And especially when we started, a lot of the investors are individuals investing personally hundred thousand to a million dollars, something like that. And, you know, you go to them and say, hey. I'd like you to commit 500,000 to Idea Fund.
Jon:
I'm gonna go invest in 20 technology companies. They're all in the Upper Midwest. When we make our initial investment, they're between 0 and 2 or $300,000 a year maybe in revenue. Mhmm. You know, they're so early.
Jon:
Our plan is at least half of them are gonna be complete loss of capital.
Charlie:
Wait. What's the what's the what's the percentage?
Jon:
At least half. At least 50%.
Charlie:
Okay.
Jon:
And those are national averages, right, of companies nationally that raise this type of capital. Mhmm. At least half of them % loss of capital. Okay. So, like, let's just say I'm coming to you guys.
Jon:
You got $5,000,000 in net worth. I'm looking for a hundred thousand bucks from you. What kind of return do you have to expect out of the investment in idea fund
Charlie:
Ten x? To say
Jon:
yeah. Like, think about an annual return. Right? Like Mhmm. What's the stock market return over on average?
Charlie:
Ten percent? Five percent? Eight?
Jon:
Yeah. 10 yeah. Ten, eight, 10, 12, whatever. So if you're gonna get eight, ten, 12 out of the stock market, right, which is a % liquid, essentially 0% failure rate, global diversification. You know, if you want your money out, you call me.
Jon:
You got it two days later. What are you gonna need out of idea fund?
Dan:
Do people looking for 25%?
Jon:
Yeah. Yeah. I mean, twice, large cap equities, you know, something like that. Then that's just to be in the ballgame. Right?
Jon:
Like, that's just to sort of be okay. Right? So, like, say I need net 20% return out of the portfolio. Okay. Then you take the next step, and you say, alright.
Jon:
Half of them are out. Half of them are zeros, national average. You know, one or two maybe get your money back, a couple returns. And then really one or two out of 10 will typically drive your portfolio return. Okay?
Jon:
So if I'm gonna get 20% net and one out of five of them is gonna drive the return, I mean, do you guys know math? You're gonna need, you know, % annual return on the winners to make up for all the losers and get you even at parity with the stock market.
Dan:
Yep. Right? So is that is that stressful?
Jon:
Well, you get a lot of chances.
Dan:
You know?
Jon:
Yeah. We lose one. I mean, yeah, it's they're just getting close to really executing a plan. Right?
Charlie:
Well, a friend of ours once said, I gamble every day of my life. Oh, that's good.
Jon:
So back to your question short answer to your question is, I mean, I've always people say 10 x. Like, you need a big result out of these companies for it to be worth all the risk you're taking on.
Charlie:
Well, John, we've held you for probably too long in your day. But how can people get ahold of you? If they think they have something, what's the best way to get ahold of you?
Jon:
Yeah. I'd love to talk to anybody. Idea Fund, v c as in venture capital dot com. We've got a submission form on there. It goes straight to my email.
Jon:
So I'd love to talk to anybody. And we're you know, we you don't need a business. I mean, we've we've come in and actually cofounded businesses. So we can work with a product inventor and put something together around it. Love to talk to him.
Dan:
Super cool.
Charlie:
There you go, listener. Reach out to John.
Dan:
Next opportunity. Thanks for having me, guys. Thanks for joining us, John. Very interesting. Up next, we're gonna talk about the AHR Innovation Awards in a feature we like to call hot or cold.
Dan:
Don't go anywhere.
Charlie:
Is it hot or cold?
Dan:
Alright. We're back. We're gonna talk about, the AHR innovation awards in our hot and cold segment today. So for those of you that aren't, say, familiar with the AHR Expo, really, what I like to compare it to is kinda like the Detroit Auto Show of HVAC. You're gonna have some, you know, cars that are gonna be readily available today or tomorrow.
Dan:
You're gonna have some new interesting things, some crazy concepts just to kinda get people thinking about, oh, that's cool, or, oh, that's kind of a strange idea. So there's a whole bunch of different categories.
Charlie:
Yeah. There's 10 different categories. It spans a lot. We're not gonna talk about all of them. We're gonna concentrate on three and we're going to go hot or cold.
Charlie:
Hot means you'll like what they've got going there. Cold means you don't like it so much. Alright. So number one, the category is heating and the winner of this year's innovation award is ERCO with their CFR boiler. A little description here, CFR is the world's first stainless steel condensing boiler that can be installed in a category one vent making it an ideal solution for the commercial retrofit market.
Charlie:
Danny Boy, what what say you?
Dan:
You know, I'm in a it's a boiler. I'm seeing it. It looks like a boiler. It is a boiler, so I'm not thinking it's, like, that crazy and innovative. So it makes me a little cool.
Dan:
If category one vent is like a game changer and we can install these in a a whole new place and it changes everything, it could, I could get hot on it, but I I I I think I'm cold. It's it's a boiler.
Charlie:
I'm with you on this one. And, you know, no offense to ERCO and CFR. I'm sure it's a great, great product. But when I was thinking like innovation award, bleeding edge, like what's out there for the especially for the heating category, which you know, our industry is going through a massive change right now. Yeah, I'm gonna say cold on this one too.
Charlie:
Okay. Okay. There you go. All right. Next category is the refrigeration category.
Charlie:
And the winner of this, this year innovation award was Danfoss Bak CO two transcritical six cylinder CO two compressor that has expanded range to enable larger refrigeration and heat pump applications with a smaller footprint, strong energy efficiency performance.
Dan:
This is an interesting one too where I kinda like, you know, I'm I'm, I'm not I haven't seen a lot of good c o two stuff around here. It's a it seems like a little more of a difficult, more specialized, application, if you will. I know, over in Europe, they've done some really cool things with some large scale stuff. So I'm I I'm, like, kinda leaning towards, like, hot. It seems like kinda
Charlie:
in in the the fence. Pick one.
Dan:
In, but,
Jon:
I'm hot on
Charlie:
it. Yeah. You were leading cold the whole time when hot. I am definitely hot on this. I I think CO2 is gonna be a refrigerant.
Charlie:
We're going to leverage a bunch more in the future. Where we're at right now, going from, you know, higher GWP refrigerants to lower GWP refrigerants, incorporating more natural refrigerants. I think the more we can use c o two in applications, it's gonna push the industry forward and just definitely some limitations to it. But I like the innovation. I think
Dan:
it's the change going.
Charlie:
I'm I'm hot. I'm hot on that one.
Dan:
Where's the hot guy right there?
Charlie:
Alright. Last category. The last category is sustainability category. The winner here was LG for their residential cold climate heat pump. I'm not even gonna offer this one up.
Charlie:
We're both hot on this. There are a bunch of different companies that that entered into the cold climate challenge, the DOE that have passed through it. I think LG was part of that. Trane was part of that. Carrier, I believe, was in there too.
Charlie:
The number of companies that are going after this segment, it is absolutely critical for our industry to move forward. We have to be able to use air to water heat pumps in all the climates that we're we're operating in.
Dan:
It's kind of a slam dunk. I mean, whoever can get there, good for you. Good job. Thank you. Let's do it.
Charlie:
Alright. Before Dan steals another one of my hot takes, and we close out the episode, we are going to do a stat of the day. For those of you who listen to Sports Talk Radio, this is a absolute 100% rip off from the Dan Patrick Show. So thank you, Dan and the Danettes. I'm sure you guys are gonna be listening to the show.
Charlie:
Here we go. Stat of the day.
Dan:
Here it comes, Joe.
Charlie:
Stat of the day. Stat of the day.
Dan:
Stat of the day. Alright, Charlie. What do we got? What's the stat of the day, bud?
Charlie:
Alright. This is gonna be applicable mass mass market here. The stat is the slowest depreciating cars in America today, model year 2018 to present. So which cars have lost their value the least in the last five years? Take a guess at top 10.
Charlie:
I'm gonna run through them quick.
Dan:
I'm gonna give, like, a Toyota Corolla, a, Honda Civic, a, Toyota Tacoma,
Charlie:
a
Dan:
a minivan of some sort.
Charlie:
I would have definitely put a minivan on there. You did really well. That was three of the top 10. Okay. So number 10, Toyota Corolla, 25% depreciation.
Charlie:
Number nine, Subaru Crosstrek. Number eight, Toyota CR V. Okay. Number seven, Chevy Camaro.
Dan:
I did not see that coming.
Charlie:
That one surprised me. Wow. Number six, Subaru BRZ. Honestly, don't even know what that is even. Number five, Honda Civic.
Jon:
Hey, there
Charlie:
you go. To Scott Wenger. Number four, Daniel, this one should be as close to home. The Jeep Wrangler. How did you not get that one?
Charlie:
Number three, Toyota Tacoma. Okay. Rob Jordan, the squire of the night. 20% depreciation. Goodbye.
Charlie:
Number two, the last two the top two are both Porsches, which okay. I I
Dan:
wouldn't have guessed that.
Charlie:
No. But,
Dan:
there you go.
Charlie:
So remember, number two, Porsche Cayman, 18%, and number one, the Porsche nine eleven at only a 9% depreciation. Maybe go five
Jon:
years.
Dan:
Myself up a Porsche after this.
Charlie:
There you go. Thank you. Thank you for listening to the first episode of Cool Air Hot Takes. Thank you to John Horn for joining the show. A very special thank you to our wonderful producer, Elena Guthrie.
Charlie:
And finally, a thanks to Christy Upton for getting this all pulled together. Please join us next time. We have a very special guest, a friend of the show and therefore a friend to you, mister Joe Heger. He's a compressor engineering leader and he'll be giving us a peek behind the curtain on some of the latest compressor technologies. If you wanna get in touch with us, please reach out coolair.hottakes@train.com.
Charlie:
We wanna hear what you have for questions. We wanna hear what you have for hot takes. Anything funny from the jobs you've been working on, any funny stories, like that one time that you got called out to fix some ductwork because an inmate tried to escape through it. It? Whatever it is, maybe it's some new tools you have saving you time, saving you money, please reach out.
Charlie:
We'd love to feature it on the show.
Dan:
If you like the show, please like and subscribe, give us a rating, and review for the podcast wherever you listen. So until next time, stay cool and keep those takes hot.