Key Learnings from Episode 23: Building Deep-Tech Hardware and Scaling Magnetless Motor Technology with Michael Wise, Founder of Cooled Motors

In this episode, Dr Michael Wise, Founder and CEO of Cooled Motors, shares his experience of building deep-tech hardware businesses and developing a new generation of magnetless electric motors. Drawing on lessons from previous ventures, he explores the realities of hardware fundraising, choosing the right investors, building specialist teams and balancing technical development with commercial progress. He also discusses why experience, leadership and long-term thinking are essential when scaling a technology business.

Developing Magnetless Motors Without Compromising Performance

Cooled Motors is developing a new type of magnetless electric motor designed to match the performance of conventional magnet-based motors while potentially reducing costs by up to 70%.

The challenge extends beyond cost. Rare-earth magnets are a significant component of many electric motors, and their supply chains are heavily concentrated in China. This creates concerns around pricing, resource security and manufacturers' ability to access the materials they need.

Michael explains that removing magnets is only commercially meaningful if performance can be maintained. Manufacturers are unlikely to adopt a cheaper technology if it compromises the power, efficiency or reliability they require.

The company's ambition is therefore to combine competitive performance with lower manufacturing costs and reduced dependence on restricted materials.

Key Takeaways

- Cooled Motors is developing magnetless electric motors intended to compete with conventional magnet-based technology.

- Reducing reliance on rare-earth magnets could improve supply-chain resilience and lower manufacturing costs.

- Cost savings alone are insufficient if the technology cannot meet demanding performance requirements.

- Achieving competitive performance without magnets could open significant opportunities across the automotive industry.

Why Previous Startup Experience Changes the Approach

Michael's route into electric motors has been unconventional. Originally trained as a chemical engineer, he worked in oil and gas, academia and several technology businesses before co-founding Concrete for Change, subsequently renamed Vaterus.

Having helped develop previous hardware ventures, including taking one through Series A funding, he approached Cooled Motors with a clearer understanding of the challenges ahead.

One of his biggest lessons has been the importance of prioritisation. Early-stage founders face an almost unlimited number of opportunities, from grants and accelerator programmes to investor meetings and technical projects. Attempting to pursue everything can become counterproductive.

Michael now places greater emphasis on understanding which activities will genuinely move the company towards its next milestone.

His advice to his earlier self would be to slow down occasionally to make faster progress overall.

Key Takeaways

- Previous startup experience helps founders recognise challenges before they become major problems.

- Prioritisation is essential when opportunities and demands exceed the time available.

- Not every grant, programme or commercial opportunity is worth pursuing.

- Taking a more deliberate approach can help founders allocate resources to the activities that matter most.

Fundraising for Hardware Requires a Different Strategy

At the time of recording, Cooled Motors was raising a £1.5 million pre-seed round to support its next stage of development.

Unlike many software startups, hardware companies cannot necessarily produce a complete working product before seeking significant investment. Prototypes, specialist equipment, tooling, materials and testing all require substantial capital.

Michael explains that the challenge is deciding what can realistically be built with the available funding and which technical achievements will provide sufficient evidence to secure the next investment.

That might mean developing and validating one critical component rather than attempting to build an entire system immediately.

The fundraising strategy therefore has to be closely connected to the engineering roadmap, with each investment round supporting a clearly defined set of technical and commercial milestones.

Key Takeaways

- Hardware development requires substantial upfront investment before a complete product may be available.

- Founders must identify which technical milestones will provide the strongest evidence for future investors.

- Funding decisions should be based on what can realistically be developed, tested and validated.

- A clear connection between the engineering roadmap and fundraising strategy is essential.

Finding Investors Who Understand Deep Tech

Not every investor who expresses an interest in deep tech fully understands the realities of developing physical technology.

Michael has learned to examine investors' previous investments, professional backgrounds and experience of supporting hardware businesses.

He also believes that the value of an investor extends well beyond the amount of capital they provide.

An investor who understands the automotive industry and can introduce Cooled Motors to manufacturers, future investors or commercial partners may be more valuable than someone offering a higher valuation without those connections.

For Michael, choosing the right investor is about identifying who can help the business progress through its entire development journey.

Key Takeaways

- Investors' previous experience can indicate whether they understand the demands of hardware development.

- Industry knowledge and commercial connections can be as valuable as financial investment.

- A higher valuation does not necessarily represent the best overall investment deal.

- Maintaining investor relationships matters because an investor who does not participate in one round may support a later stage.

Balancing Investment in Technology and People

For Cooled Motors, the majority of funding is expected to support research and development, hardware manufacturing, tooling, materials and testing.

However, Michael recognises that developing the technology also depends on having enough people with the right capabilities to deliver it.

Rather than treating recruitment as a separate activity, he works backwards from the technical milestones the company needs to achieve.

By identifying the equipment, engineering tasks, specialist skills and working hours required, he can determine the size and composition of the team needed.

This creates a more structured relationship between the development plan, recruitment decisions and available capital.

Key Takeaways

- Hardware and people are the two principal areas of investment for an early-stage engineering business.

- Recruitment requirements should be calculated against specific technical deliverables.

- Understanding the time and specialist skills required for each milestone helps prevent unnecessary hiring.

- Strong technical employees can improve the development plan rather than simply execute instructions.

Connecting Technical Milestones to Commercial Demand

Cooled Motors' next major objective is to develop motors that can be tested within customers' own platforms.

Reaching this stage involves completing the motor, developing the required tooling, conducting dynamometer testing and demonstrating performance to potential customers.

Michael describes the importance of engaging original equipment manufacturers (OEMs), Tier 1 suppliers and other industry partners throughout development.

The objective is not simply to prove that the technology works. It is to demonstrate that the motor meets real customer specifications, including power requirements, physical dimensions, manufacturing feasibility and the elimination of magnets.

For Michael, technical and commercial progress are inseparable. A successful engineering milestone only creates meaningful business value when it moves the company closer to a product customers are willing to buy.

Key Takeaways

- Technical validation must reflect the requirements of potential commercial customers.

- Independent testing and customer trials help establish confidence in new hardware.

- Engineering milestones should be linked to measurable commercial progress.

- A technically successful product still needs to meet customer specifications and manufacturing requirements.

Why Retaining Early Employees Matters

In a small hardware startup, losing one employee can have a disproportionate effect.

Michael explains that early employees often develop knowledge far beyond their original job descriptions. A mechanical or control engineer might become involved in design, testing, manufacturing, equipment selection and numerous other aspects of the business.

This creates valuable organisational knowledge that cannot easily be replaced.

Recruiting and training a replacement takes time, but the greater challenge may be recovering the practical experience accumulated while developing the technology.

For that reason, Michael sees retention as an important consideration from the earliest stages of building the team.

Key Takeaways

- Early employees accumulate knowledge across multiple areas of a startup.

- Losing a team member can create significant disruption when specialist knowledge is concentrated in a small group.

- Retention protects both technical expertise and the experience gained during development.

- Building a team for the long term is particularly important in complex hardware businesses.

Hiring for Independence, Capability and Cultural Fit

Michael looks for more than technical qualifications when recruiting.

The first requirement is whether someone can perform the work. Beyond that, he wants people who can think independently, solve problems and develop solutions without constant direction.

He also places considerable importance on whether candidates genuinely share the company's vision and will work effectively with the existing team.

In a small organisation, one person who consistently struggles to meet expectations can affect everyone else.

Michael believes the strongest employees combine technical ability, independent thinking and personal pride in the quality of their work. They are prepared to challenge assumptions, take responsibility and develop solutions that may be better than those originally proposed.

Key Takeaways

- Technical competence is essential, but independent problem-solving is equally valuable.

- Employees need to understand and genuinely believe in the company's long-term vision.

- Cultural fit becomes particularly important when small teams work closely together under pressure.

- A commitment to producing high-quality work can distinguish exceptional employees from technically capable ones.

Creating a Vision That People Believe In

Michael sees communicating the company's vision as one of the founder's most important responsibilities.

However, he makes a distinction between a vision created for a presentation and one that genuinely shapes how the business operates.

Employees need to see that the founder believes in what the company is trying to achieve and demonstrates that commitment through their actions.

This is particularly relevant in deep-tech businesses, where development timelines can be long and progress is not always immediately visible.

When employees understand the wider purpose of their work, they are better positioned to make decisions, overcome challenges and contribute to the company's long-term ambitions.

Key Takeaways

- A company's vision needs to be reflected in leadership behaviour, not simply communicated through presentations.

- Founders play an important role in helping employees understand the purpose of their work.

- Genuine commitment from leadership can strengthen motivation during difficult development periods.

- A shared vision helps align individual contributions with the company's longer-term objectives.

Testing Hardware Without Taking Unnecessary Risks

Developing new hardware inevitably involves testing the limits of materials, components and designs.

Michael argues that effective experimentation begins long before physical testing takes place.

Engineering calculations, simulations and carefully developed hypotheses help teams understand how a component is likely to perform and where its limitations may lie.

He uses the example of pressure-testing a seal. Understanding when and how a component fails can reveal whether the design is appropriate or unnecessarily expensive.

A component that significantly exceeds its required performance may be over-engineered, using more material than necessary.

The objective is to learn through controlled testing while maintaining appropriate safety standards and avoiding unnecessary cost.

Key Takeaways

- Careful design and simulation should precede physical hardware testing.

- Controlled experiments can reveal both weaknesses and unnecessary over-engineering.

- Understanding failure limits helps engineers improve performance and manage costs.

- Effective hardware development requires a balance between experimentation, efficiency and safety.

Navigating a More Challenging Investment Environment

Michael believes the climate-tech investment environment has become more difficult, particularly as economic and political priorities have shifted.

He distinguishes between technologies that primarily address environmental objectives and those that also deliver clear economic benefits.

In his view, solutions that reduce costs, improve efficiency or strengthen resource security remain attractive because their commercial value extends beyond climate considerations.

For founders, this makes investor selection increasingly important.

Michael recommends researching fund activity, recent investments, portfolio companies and the age of investment funds to identify those most likely to have both the capital and appetite to support a business.

Key Takeaways

- Climate-tech fundraising has become more challenging in a changing economic and political environment.

- Technologies offering clear economic benefits may have stronger investment propositions.

- Investors' recent activity and portfolio history can help founders prioritise fundraising conversations.

- Targeted investor research can reduce time spent pursuing unsuitable funding sources.

Why Competition Can Strengthen a Market

Michael has an unusual perspective on competition: he welcomes it.

While some founders might prefer to operate without direct competitors, Michael believes competition can help demonstrate that a market has genuine demand.

It also provides opportunities to learn from other companies' successes and mistakes.

He argues that competing businesses can encourage each other to develop better products, particularly in markets large enough to accommodate multiple successful suppliers.

For Cooled Motors, the broader objective is to prove that magnetless motor technology can become a credible alternative to existing solutions.

Key Takeaways

- Competition can indicate genuine market demand for a new technology.

- Other businesses' experiences can provide valuable lessons and accelerate development.

- Competing solutions can encourage higher standards of performance and innovation.

- Building a successful market may be more important than attempting to eliminate competitors.

Experience Is One of a Founder's Most Valuable Resources

Reflecting on his previous ventures, Michael repeatedly returns to the value of experience.

Technical intelligence alone cannot replace the practical understanding gained from building businesses, managing people, developing hardware and making mistakes.

He also believes that founders should establish structured hiring and people-management processes as early as possible.

As businesses develop, their understanding of the skills they need becomes more sophisticated. Michael has found that recruitment decisions often improve through experience and successive iterations rather than one transformational hire.

His advice to deep-tech founders is to bring experienced people into the business wherever their own knowledge is limited.

The greatest value often comes from people who can recognise risks and challenges that the founder does not yet know to look for.

Key Takeaways

- Practical experience provides insights that technical intelligence alone cannot replace.

- Structured hiring and people-management processes should be established early.

- Recruitment decisions often improve as the company and its leadership develop.

- Experienced advisers and employees can help founders recognise problems they would otherwise overlook.

Looking Ahead

Over the next five years, Michael wants Cooled Motors to move from fundraising and technical development into manufacturing and large-scale commercial deployment.

His ambition is to see hundreds of thousands of motors using the company's technology installed in vehicles, ideally including those produced by established automotive manufacturers.

For Michael, success is not defined solely by sales figures or company valuation.

He wants Cooled Motors to develop technology that respected manufacturers trust, demonstrating the reliability, performance and long-term commercial potential of magnetless electric motors.

That credibility would represent something more lasting than a successful product launch: the foundations of a sustainable engineering business.

Final Thought

Michael's experience highlights how much of building a deep-tech company depends on decisions made beyond the technology itself.

Choosing investors who understand the development journey, hiring people who can work independently, protecting accumulated knowledge and knowing when to prioritise all influence whether an engineering innovation becomes a commercially viable product.

The technology may be difficult to develop, but that difficulty can also become its greatest advantage. Years of experimentation, specialist expertise, manufacturing knowledge and practical experience create something competitors cannot easily reproduce.

For Michael, building a successful hardware business is ultimately about combining technical ambition with the experience, people and discipline needed to deliver it.