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Interview with Greg Fasullo, Eltek Valere

Richardson-based Eltek Valere (www.eltekvalere.com) is a provider of equipment to the telecom market, and has been seeing outstanding growth in recently due to demand for its DC power systems. To try to better understand the firm's business and why it's been doing so well, we spoke with Greg Fasullo, co-founder and CMO of Eltek Valere.

For our readers who aren't familiar with Eltek Valere, describe to us about what your products are used for, and what your primary market is?

Greg Fasullo: The company makes power systems, mostly for telecom customers but also for some industrial applications. These power systems convert AC power into DC power and are used to supply the electricity needed by all of the equipment in a carrier’s network. A consumer analogy for what we do is the “brick” that powers your PC – converting the AC power from the wall into DC power that is required for the semiconductors, fans and other components. Now take the 65 Watts that is needed for a typical laptop and scale that up to 2,000 Watts and you get a sense of the type of systems we create.

You've seen some very rapid growth in the last few years, what's driving the demand for your DC power systems, and do you see that continuing in the future?

Greg Fasullo: Eltek Valere was formed in June of 2007 when Eltek Energy and Valere Power were merged. I helped co-found Valere right here in Richardson as a start up in this market just about the time that the telecom market was going bust. After we convinced investors that we indeed had the technology to succeed in this market we went on to grow very rapidly to about $100 million in sales, winning several Fast 50, Fast 500 and Dallas 100 awards. Eltek Energy was based in Norway and was also known for its fast growth, but mostly in Europe and in Asia.

Two things have powered our growth up to now: in the U.S., it’s been the explosion of wireless and broadband services that needed the small and cost effective power systems that we invented. Outside of the US, it’s been the very strong demand for telecommunications services in developing markets in Asia that have fueled great demand for our products.

Tell us a little bit about this recent announcement and focus on "green" power -- how does your company contribute to this, and why the new push?

Greg Fasullo: Telecom companies are huge power users – consuming nearly 1% of the world’s annual electricity output or nearly 160 billion kilowatt hours annually. And many of these companies are very environmentally responsible, having looked a very innovative ways to reduce their corporate power consumption. But in the end, nearly 70% of what they use goes through a system like ours to power network equipment. These systems waste some of the electricity when the AC power is converted to DC power – the industry standard for this inefficiency is about 8% of the power is wasted, but some older products have 10% to 20% waste.

It’s becoming very clear that we all need to play a role in reducing electricity consumption and thus CO2 emissions. In the company we knew that we could cut the inefficiency in half, which would dramatically reduce the power consumption by carriers as well as their greenhouse gas emissions. In a typical nationwide wireless network – one with about 20,000 base stations, adopting this new product could reduce electricity usage by 34 million kilowatt hours reducing CO2 emissions by more than 27,000 tons and saving the carrier $5 million annually.

We were the leader in bringing efficiency to 92% and we’ve seen that our competitors have responded and now that’s the industry norm. We’re hopeful that will be the case as well with the higher efficiency “green” products.

Eltek and Valere merged last June -- what was the reason behind the merger?

Greg Fasullo: Our customers are large telecommunications service providers and telecom equipment manufacturers, which are themselves merging and creating worldwide giants. These companies need global suppliers that they can certify once for use around the world.

Beyond that, we were keeping an eye on each other and found that there was tremendous synergy between the companies – we were strong in different markets, we were both strong innovators and had very little product overlap. It was really very complementary pairing of companies.

How big is Eltek Valere now, and how many people are here in Texas?

Greg Fasullo: We’re now a $500 million company that’s second in our market right now and we’re continuing to grow. There are about 130 employees in our Richardson headquarters.

Finally, what's next for the company and how do you see the market for DC power shaping up in the next year?

Greg Fasullo: We’re confident that these two trends will continue and that our growth will be fueled by a wave of upgrades of older equipment as well as new opportunities driven by our global presence and our new high efficiency – or green – product family.