Meet Florian Zerhusen of BayWa r.e. Wind

Today we’d like to introduce you to Florian Zerhusen.

Florian, can you briefly walk us through your story – how you started and how you got to where you are today.
In 1997, I first came to San Diego as a student and received a soccer scholarship for a semester. I fell in love with the town and permanently moved here in 1999 after finishing college back in Germany. The first two years in corporate finance got me exposed to the energy sector and realized that the renewable energy was in its infancy. So, I wrote a business plan and convinced Germany’s biggest wind developer at the time, WKN to meet with me. It took some tough discussions, negotiations and certainly convincing work, after all, I was 25 years old, and knew nothing about the multi-million-dollar business of developing and building wind farms. They took a bet, provided the funding for the business plan and in September 2001 I set up a small office in UTC.

During the first year, I traveled to many different states and saw beautiful parts of this country and met interesting people I would not have met otherwise. In essence, imagine ‘knocking’ on people’s ranch doors and convincing them to grant you a lease for the next 60 years to develop and eventually construct a wind farm on thousands of acres that has been in their family for generations. Not that my name and age was a tough starting point, most people did not know what ‘windmills’ were. Next, you sit with the local college, hospital, school district etc. to negotiate complex tax abatements. I remember vividly having such meetings in a morgue with a Texas rural hospital because they had no conference room. These were just the first pieces of the big puzzle and it was true pioneering greenfield work.

Within three years, I was able to finalize the development of the first wind farm in Snyder, Texas, raise $101Mio USD within four weeks and hired the first people to manage the construction. This project has been recognized in the industry to be the tallest hub height in the U.S. for over a decade. In this picture, I am standing on top of the Americas tallest wind turbine generator that we built back in 2007. That experience required me to rethink the overall strategy of the company and the need for a new investor. After ten years, German conglomerate BayWa AG bought out WKN in 2011. Since then, we have received hundreds of millions of dollars from BayWa to develop, construct and operate renewable energy projects throughout the United States.

For example, we acquired 500 wind turbines in Palm Springs and are currently developing a project north of Santa Barbara, CA. We just completed the construction of a nice wind farm in Montana in addition to those in New Mexico, Oregon, South Dakota and Texas over the past years. During Earth Day week back in April, we announced that the Portland Trailblazers bought enough green certificates from our Oregon project to supply its Moda Center with 100% of green energy, the first team in the NBA to do so. With an average team member count of 15, we have been very efficient and focused on enabling us to generate tens of millions of dollars in revenue with a healthy profit margin.

Overall, has it been relatively smooth? If not, what were some of the struggles along the way?
No, not at all. The road has been very bumpy for a long time, especially when growing up.

Along the way, it certainly was somewhat smooth but always brought back to being bumpy. I think if you don’t have challenges then you have not tested your limits. Each project itself and growing the company bear challenges. I certainly made my fair share of mistakes but the key has been to learn quickly and make decisive decisions to correct them.

A huge existential challenge early on was raising the $101Mio needed for the construction of the first wind project within five weeks (Snyder wind farm). Various milestone deadlines would have rendered the project near worthless if we didn’t begin construction. The mistake was not to break off negotiations earlier with a large multi-billion investment fund that promised to close within the deadline.

With less than five weeks away from these deadlines, I terminated exclusive negotiations with that multi-billion investment fund and contacted one of Europe’s largest utility, Italy’s Enel. Within four weeks of that cold call, we closed the transaction, began construction and earned millions of dollars more.

Alright – so let’s talk business. Tell us about BayWa r.e. Wind, LLC – what should we know?
Since our founding in 2001, our first shareholder of ten years allowed us to develop wind projects. However, in order to be more competitive and increase our earning potential, we needed a partner that allows us to not just develop but also construct wind projects. In 2011, Germany’s $15Billion conglomerate BayWa AG bought in and we have been subsequently operating as BayWa r.e. Wind, LLC.

Our core business plan is to acquire, develop, construct and operate wind projects. We earn our money by divesting the assets and have successfully sold wind projects to big investors like Goldman Sachs or Macquarie. Our unique approach has turned many projects into success stories through rethinking each project’s individual strategy. I am proud to have a great team and a strong investor with BayWa entrusting us with a lot of money.

What were you like growing up? Personality wise, interest wise, etc.
The best kid ever of course. Joking aside, growing up in Germany, my parents were strict and my father gave me good advice, or maybe warnings, that helped me stay focused early on. As a kid already, I fell in love with America and always wanted to come here. When I was 16 years old, I applied to at least thirty different summer jobs in the U.S., from picking pineapples in Hawaii to some radio station in the Midwest.

Then one Sunday morning a fax came in from YMCA camp in Steamboat Springs accepting me for a summer counselor position. You can imagine how excited I was to receive the news and I immediately started studying Visa laws. This was in 1992, before the internet so research was not that easy.

In short, getting a work Visa for a high school student was impossible and if I went without one, the risk of being rejected by the INS in future years was too big. My goal was to live here and did not want to jeopardize it for an exciting summer program. So I did not go and focused on the path that got me here permanently right after college in 1999.

Contact Info:

• Address: 5901 Priestly Drive.
  Suite 300 Carlsbad, CA 92008
• Phone: 858.450.6800
• Email: info@baywa-re.us

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