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Innovation Economy

Buddy, can you spare some butane? My phone’s fading

By Scott Kirsner
Globe Correspondent / November 22, 2010

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Highlights from Scott Kirsner’s Innovation Economy blog.

Could a few sips of lighter fuel keep your mobile phone going for a week?

A product Lilliputian Systems has been developing for the better part of a decade sounds promising: a compact fuel cell that could power consumer electronics, using replaceable $2 butane cartridges.

The energy density of butane (a.k.a. lighter fuel) is of course much higher than a lithium ion battery’s. And who would not want a cellphone or a laptop that could run for a week or two, rather than requiring nightly assignations with a wall socket?

Lilliputian, of Wilmington, has been slowly improving its fuel cell prototypes and wending its way to the market.

Company executives still will not say when you will be able to buy one, but last week they said Intel Capital is making an investment in Lilliputian. The Silicon Valley chip maker will produce the silicon wafers — a crucial component of the finished fuel cells — at its Hudson manufacturing plant.

The Lilliputian Mobile Power System will cost about $100 and will be sold by partners, said Mouli Ramani, a company vice president.

Initially, it will be used to recharge devices like mobile phones, Bluetooth headsets, digital cameras, and music players that have USB ports.

Power-thirsty laptops require more than the Mobile Power System’s 3 watts of electricity, and Lilliputian’s initial product won’t be capable of recharging them.

Ramani said he’s already traveling around with a prototype of the system, using it to keep his BlackBerry juiced up.

“I now don’t even think about what my cellphone charge is,’’ he said. “It’s like having a wall outlet in my pocket.’’

And yes, the Federal Aviation Administration has cleared portable fuel cells for takeoff.

Eventually, Lilliputian’s power systems could be integrated into new mobile phones or laptops, rather than sold as accessories. Instead of plugging a device into a wall outlet once a day, you would just jam in a new butane cartridge every week or two.

When Lilliputian gets its first product on the market, it had better hope it sells well: Prior to Intel investment, the company had raised about $90 million in venture capital and taken a $5 million low-interest loan from two state agencies, MassDevelopment and the Massachusetts Clean Energy Center. The company’s backers include Atlas Venture, Stata Venture Partners, and Rockport Capital, as well as Kleiner Perkins in California.

Game changers wanted I had a chance to spend some time on the phone this month with Peter Thiel, the PayPal cofounder, venture capitalist, hedge fund manager, and early Facebook investor. He was in town Tuesday to speak at the Massachusetts Institute of Technology.

We started by talking about Thiel’s new fellowship program, which will provide 20 grants of $100,000 to potentially world-changing young entrepreneurs in the for-profit and nonprofit sectors. To be eligible, you must be under 20. (Incidentally, Facebook cofounder Mark Zuckerberg was 20 when Thiel first met him.)

Here’s an excerpt from our conversation:

Kirsner: You’ve gotten a good amount of criticism for the program, which some see as encouraging students to leave school. You went to Stanford, and finished, and then went on to law school and got a degree there, too.

Thiel: There are certainly a number of things that are quite different from when I went to college a quarter-century ago. The big issue we zeroed in on — which really hit me over the last year or so — is the extraordinary amount of student debt that people are racking up, and the ways that is effectively changing the kind of decisions they can make later in life. When you rack up enormous amounts of debt, it sort of tracks you toward the higher-paying job, but away from something that is less remunerative in the short run, but maybe more entrepreneurial — or a nonprofit — or something that’d be socially useful.

Kirsner: What about someone who is studying chemistry or molecular biology? That seems like an important foundation if you want to develop a new drug.

Thiel: It depends a lot on the subject matter and the field. But I’m actually not convinced that even in some of these harder technology type areas, the incremental value [of advanced education] is quite high.

Kirsner: I saw you interviewed about the Facebook movie “The Social Network,’’ and you said that the one good thing about it, even if it is not accurate, is that it lets people know Silicon Valley is a great place to build a company. Do you feel like it’s game over, Silicon Valley — or do you see there being successful clusters in Boston, Seattle, or wherever?

Thiel: I do think Silicon Valley has been the most successful area, over the last decade, in the US . . . Within the US, I think you have various different places — certainly there’s the Boston area, Austin, some pockets in Southern California. In general, there is less going on than people think, and less than is desirable. I’m sort of biased toward Silicon Valley, but I think there’s less happening there than people think — and less happening in Boston than people think.

Kirsner: Every time I see you quoted about Facebook’s valuation, you seem to think people are undervaluing it. Is Facebook the most valuable company in the world?

Thiel: I actually shouldn’t speculate too much on Facebook’s valuation. I was extremely bullish on Facebook early on, and it has done better than I had thought possible three or four years ago. . . . It has a lot of potential, and there are a lot of execution challenges the company has to meet in the year ahead. But of the larger Internet properties, and of the Web 2.0 companies, I think it is probably the most undervalued.

For the full Innovation Economy blog, updated daily, visit www.boston.com/innovation.