Curtis VanWalleghem

CEO

Company:

Hydrostor

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The Unconventional Path: How Hydrostor Reimagined Energy Storage Go-to-Market

$322 million in funding isn’t the interesting part of Hydrostor’s story. What’s fascinating is how they convinced risk-averse utilities to adopt a revolutionary energy storage technology that involves drilling massive caverns 2,000 feet underground.

In a recent episode of Category Visionaries, Curtis VanWallenghem, Co-founder and CEO of Hydrostor, revealed the counterintuitive go-to-market strategy that helped his company secure $2.5 billion in contracts for their innovative air-battery technology.

The Ultimate Pivot Point: Your Niece Asking “What Did You Do?”

Most startup origin stories begin with identifying market opportunities or technological breakthroughs. Curtis’s started with his niece Shay. “This is our generation’s world war, this climate change,” Curtis recalls thinking. “When Shay grows up and the world’s burning, she’s like, ‘what did you do about it?’ And I said, ‘nothing. I just watched it burn and made some money and made myself comfortable.'”

This personal connection to climate impact drove Curtis to take an unconventional approach to building Hydrostor. Rather than following the traditional cleantech playbook of seeking government grants or pursuing rapid scale, he focused on building trust through a series of strategic decisions.

Reframing Risk: The Pay-for-Performance Model

The traditional approach in energy infrastructure is asking utilities to fund billion-dollar first installations. Curtis took a radically different path: “We kind of took a different approach, saying we’re going to develop and win the contracts and they don’t pay you a dime if you don’t perform.”

This pay-for-performance model shifted the risk equation. Instead of utilities betting on unproven technology, Hydrostor assumed the execution risk. “Our bet was that would be an easier path given the amount of money sloshing around looking for climate sort of investments,” Curtis explains.

The Trust-Building Triangle: Patents, Pilots, and Proven Components

Hydrostor’s GTM strategy rested on three pillars:

Framing their innovation as an improvement rather than a revolution: “We’ve just tweaked what was already kind of a proven asset class,” Curtis notes about their compressed air technology.
Using only proven components: “There are no new widgets in what we’re doing. It’s more integration of proven components.”
Building small pilot plants to demonstrate viability before pursuing large contracts.

The Regulatory Long Game

Rather than viewing regulations as obstacles, Hydrostor actively shaped the regulatory environment. “Getting the first our pilot system in Ontario was done through a storage pilot program that us, and we created an association of other storage companies, lobbied and got this program launched,” Curtis reveals.

This proactive approach to regulation became a competitive advantage. “We’ve set a fair number of precedents with our projects being kind of the first of a kind to do something in a certain regulatory construct,” Curtis explains. “That’s, I think also why we’ve been successful is we’ve leaned into that as opposed to assuming they’re going to figure it out.”

The White-Knuckle Moments

Success wasn’t guaranteed. When COVID hit, Curtis recalls, “We only had six or seven weeks of cash left… every investor just said, I’m not getting involved or I’m not making commitments until we know where it’s happening in the world.”

The solution? “Me and a bunch of others mortgaged homes and put more money in to get the company to survive.”

The Three-Year Horizon

Today, Hydrostor’s focus is clear: “Get our first big plant running and have a couple more under construction and another ten contracted,” Curtis shares. “Once you’ve done that, the machine almost will run itself because there’s construction companies out there that do this.”

The lesson for founders? Sometimes the best go-to-market strategy isn’t about moving fast and breaking things. In regulated industries with high stakes, success might come from methodically building trust, strategically sharing risk, and playing the long game.

For Hydrostor, this meant spending twelve years laying the groundwork for what could become a defining company in the energy transition. As Curtis puts it, “Every time we contract a plant, you’re shutting down a giant coal plant or a gas plant and you’re enabling a whole bunch of wind and solar.”

That’s the kind of impact that will give his niece Shay a different answer about what he did when the world needed solutions.

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