At the end of November 2012, Atul Kapadia and Sujeet Kumar hosted the staff of their startup company for a holiday lunch of Mexican food at a Palo Alto, California restaurant. For days, the pair—the CEO and CTO, respectively, of a lithium-ion battery company called Envia Systems—had awaited an email from General Motors.
It was to contain a deal rare to an industry newcomer—a contract worth tens and possibly hundreds of millions of dollars to provide the electric central nervous system for two showcase GM models including the next-generation Chevy Volt. Untested small suppliers almost never get in the door of the world’s major automakers, which regard them as too risky to rely on. But GM was won over by what seemed to be the world’s best lithium-ion battery—a cell that, if all went well, would catapult the company to a commanding position in the industry with a middle-class electric car that traveled 200 miles on a single charge and rid motorists of the “range anxiety” that disquieted them about such vehicles. GM would have the jump on the high-end Tesla S, the only other major model with that range but one that would cost much more. For Envia, the contract could lead to an IPO that would make both men rich.