WisBusiness: Orion Energy Fills A Lighting Void

By Heather Akin

PLYMOUTH — It only takes one bright idea to start a thriving business such as Orion Energy Systems.

Neal Verfuerth, the CEO and founder of Orion Energy Systems in Plymouth, noticed there was a void in the market for energy stingy industrial lighting.

Manufacturers and building planners were struggling to manage rising costs energy costs and reduce consumption. Yet many of the lighting systems available were wasting most of their energy with heat and vibration, instead of converting it directly into light.

Verfuerth set to work developing the Illuminator, a lighting system that uses two to eight lamps hanging at the most effective height, maximizing the energy used by framing the lamp and directing the light to where it is needed. Efficiency is also maintained by motion sensors and by detecting when there is sunlight to reduce interior lighting.

It didn’t take long for the Illuminator to capture the industry’s attention. In 2000, Orion earned the World Pork Expo Product of the Year Award and the Farm Industry News’ New Product Award, the National Food and Energy Council New Product Award and the Wisconsin Manufacturer of the Year.

The next year, he got the Wisconsin Governor’s New Product Award, and in 2004, Verfuerth accepted one of Wisconsin’s most prestigious awards, earning the title of Ernst & Young Entrepreneur of the Year.

In addition to lighting systems and accessories, Orion patented another innovation that has proven to be an effective sales tool – a meter connected to the lights that measures the energy being saved and converts it into dollars.

“We now have 15 patents, and four to five more that we’ve applied for,” said Jim Prange, Orion’s chief financial officer. “And we will continue to enhance our products.”

But even the best and brightest ideas need help getting started. When the company began seeking capital in 1999, Verfuerth decided to take advantage of Wisconsin’s Issuer Exemption, allowing the company to sell up to $5 million in shares to “non-accredited” investors, or individuals with a net worth of less than $1 million.

“The beauty of Issuer Exemption is that you can advertise,” says Prange. “We prepared an ad and ran it in local newspapers like the Plymouth Review, Sheboygan Press, and other smaller community newspapers. We were able to generate a lot of interest.”

The program allows people in smaller marketplaces to learn about investment opportunities and support local businesses.

“How do people know if there is an investment opportunity unless you know a lot of people? You have to have a means to reach investors,” says Prange.

Orion was equally innovative in helping companies finance the installation of their lights. They created the Orion Throughput Agreement program, allowing companies to have the lights installed without putting anything down.

Instead, businesses can use their energy savings to pay the monthly basis over a five year period. By simply allowing Orion to install the lights, they end up with money in their pockets.

In addition to a cost-effective and innovative product, Orion can also attribute success to their commitment to their employees and their community.

The company has stock options, a health insurance plan without a premium and a gym. To meet rising demands for their lighting systems, Orion’s staff has grown from 18 employees to 140 in just five years.

Orion has expanded to more than 350 investors and is working with venture capital firms to increase national exposure. But they continue to sustain their relationship to the investors in Wisconsin.

“It’s local people helping local people,” Prange said. “With other investments in bigger companies, as an investor, you’re just a little statistic. Here there is a pride of ownership.”

Akin is a graduate student in the Department of Life Science Communication at the UW-Madison.