David Gramnaes brings Budo to the Board

I leave the European route E6 and drive along the old coun­try road. It winds across fields and mead­ows and through groves and ham­lets. After a few kilo­met­ers, the light changes to some­thing you can only exper­i­ence near the coast. A long line of parked cars tells me that one of the province of Halland’s many miles of sandy beaches is nearby. I drive on, and Kat­tegatt – the sea between Sweden and Den­mark – grows lar­ger and more prom­in­ent in my view. Soon I pass the legendary ice-cream par­lor Tre Top­par, where the line stretches far into the street. I fol­low the main street until I find the house with the same num­ber as on my note in the seat next to me. I’ve arrived at Dav­id Gram­naes’ home.

Dav­id Gram­naes is a part­ner and CEO of Gramtec Ven­ture, an invest­ment com­pany with­in the Gramtec group – Smoltek’s largest single share­hold­er. I have seen him sev­er­al times at Smoltek’s office in Gothen­burg, where he is always busy in meet­ings, but I don’t know much about him. All I know is that the man­age­ment val­ues his advice and efforts and that he is the son-in-law of Finn Gram­naes, about whom I wrote an art­icle a few years ago.

Curi­ous as I am, I used his elec­tion to Smoltek’s board of dir­ect­ors at the annu­al meet­ing on May 14, 2024, as an excuse to con­tact him and ask if I could inter­view him for Smoltek’s IR blog. He agreed, and that’s why I find myself parked in front of his villa in the sum­mer idyll and fish­ing vil­lage of Träslövsläge – or Läjet, as the loc­als call it.

But I can’t sit here all day, so I get out of the car, go to the door, and ring the bell.

Aikido black belt

Dav­id Gram­naes opens the door and greets me. He asks if the trip went well. Can he offer me some­thing? Cof­fee? Tea? Yes, please, tea, I reply. While the water is boil­ing, I take the oppor­tun­ity to look around. I see traces of someone inter­ested in mar­tial arts and ask if it’s him.

“Yes, that’s me. I’m an Aikido nerd,” he replies with a laugh. “I’ve been prac­ti­cing budo for dec­ades and spent much time in dojos.”

There’s no mis­tak­ing that Dav­id Gram­naes is pas­sion­ate about Aikido. He has been the head train­er for chil­dren and teen­agers at Varberg Aikido Club since 2012, has been a black belt since 2016, and holds the rank of 2nd dan. Dav­id Gram­naes also co-foun­ded a large nation­al youth camp and par­ti­cip­ates in devel­op­ing a young lead­ers pro­gram in Aikido. Since 2021, he has also been chair­man of the Varberg Aikido Club.

Will this exper­i­ence help you in your work on the Smol­tek board?

“Abso­lutely! Over 20 years of Aikido train­ing has truly shaped me. It has taught me that achiev­ing your goals and mas­ter­ing new skills requires focus and a lot of prac­tice. You should nev­er give up. More import­antly, the jour­ney (do in aiki-do) mat­ters, not the goal itself. I believe the same applies to entre­pren­eur­ship and build­ing new businesses.”

Fostered in two family businesses

What else has shaped you and con­trib­ute to how you will serve on the board? I ask as we walk into the liv­ing room, where we settle into a com­fort­able lounge suite.

”I have been fostered in two fam­ily busi­nesses. Firstly, my family’s recyc­ling com­pany, Pet­terssons Miljö, which I grew up with and worked for ten years in vari­ous oper­a­tion­al roles, includ­ing CEO. And my wife Lisa’s and fath­er-in-law Finn’s com­pany, Gramtec, where I have been involved for almost ten years now.”

What fam­ily busi­ness prac­tice do you bring to the boardroom?

”Entre­pren­eur­ship and long-term think­ing. Fam­ily busi­nesses typ­ic­ally focus on long-term rela­tion­ships with cus­tom­ers, sup­pli­ers, and employ­ees. This mind­set has def­in­itely shaped me. My com­mit­ments and invest­ments are often long-term, as is my com­mit­ment to Smol­tek, and I will bring this approach to my work on the board.”

Worked his way up in life

Dav­id Gram­naes’ resume shows he has worked his way up in the fam­ily businesses.

He gradu­ated from Blekinge Insti­tute of Tech­no­logy with a Mas­ter of Sci­ence in Soft­ware Engin­eer­ing shortly after the dot-com bubble burst. So, he star­ted work­ing in the fam­ily busi­ness as a trans­port coordin­at­or. In this role, he was respons­ible for plan­ning the garbage truck routes in Halmstad muni­cip­al­ity. In par­al­lel, he ran his own con­sult­ing busi­ness, which included web­site development.

He soon became respons­ible for the fin­ances and account­ing of the fam­ily busi­ness and, after a few years, took over the company’s day-to-day man­age­ment as COO. After six years, he took over as CEO of the fam­ily busi­ness. As CEO, Dav­id was respons­ible for a sig­ni­fic­ant trans­form­a­tion; the com­pany launched new waste man­age­ment and recyc­ling ser­vice offer­ings and doubled its annu­al revenues.

First contact with Smoltek

He brought his change man­age­ment exper­i­ence to Gramtec, which he joined in 2013 as a busi­ness developer and invest­ment manager.

Is this when you came into con­tact with Smoltek?

“Yes. In 2015 Finn nego­ti­ated a buy­out of Smol­tek togeth­er with Pro­fess­or Peter Enoks­son. Finn asked if I could help with the nego­ti­ation. That was my first con­tact with Smoltek.”

Finn Gram­naes and Gramtec had been small minor­ity share­hold­ers in Smol­tek since 2007, almost from the begin­ning. The main share­hold­ers were Chalmers Innov­a­tion Seed Fund and Almi Invest. How­ever, they had reached their max­im­um invest­ment lim­it in Smol­tek and wanted to exit. So Gramtec, Finn, and Peter Enoks­son bought them out and became the largest share­hold­ers, respons­ible for provid­ing the com­pany with the needed capital.

“In the pro­cess, Smol­tek Nan­otech Hold­ing AB was estab­lished, and I was giv­en oper­a­tion­al respons­ib­il­ity for it,” says Dav­id Gram­naes. “I held this pos­i­tion until Smol­tek was lis­ted on Akti­et­or­get (now Spot­light Stock Mar­ket) in 2018, at which point the CEO of Smol­tek AB also became the CEO of the hold­ing company.”

After com­plet­ing his assign­ment at Smol­tek, Dav­id Gram­naes was appoin­ted CEO of Gramtec Ven­ture. A role he still holds today.

An empty seat on the board

Gramtec was rep­res­en­ted on the Board until 2023 by Finn Gram­naes, Gramtec’s founder and largest share­hold­er. He declined to stand for re-elec­tion in 2023. Why was this?

“When Finn, at the age of 75 and after 15 years on the board, felt it was time to step down, we dis­cussed how we would work at Smol­tek in the future.”

“At that time, Smol­tek had been on a jour­ney of change for sev­er­al years and seemed to be on a steady course: We had a new man­age­ment team with indus­tri­al exper­i­ence. We had a pro­fes­sion­al nom­in­a­tion com­mit­tee. I had worked for sev­er­al years with Lena Olv­ing and oth­ers to devel­op the board so that it con­sisted of people with the right skills and exper­i­ence to lead Smoltek’s next step to a prof­it­able and suc­cess­ful com­pany. And we had a good plan for indus­tri­al­iz­a­tion and com­mer­cial­iz­a­tion with Yageo.”

“With this in mind, we con­cluded that we could best con­trib­ute in the future as mem­bers of the nom­in­at­ing com­mit­tee and as act­ive owners.”

But…

So how is it that, after only one year, Gramtec has dir­ect rep­res­ent­a­tion on the board again – by you?

“The situ­ation changed in March 2024, when Yageo decided not to con­tin­ue dis­cus­sions regard­ing the license and ser­vice agree­ment that they and Smol­tek had nego­ti­ated for quite some time.”

For Gramtec, as for all share­hold­ers and the man­age­ment team, Yageo’s decision came as a surprise.

“We were under the impres­sion that the sign­ing of the agree­ment was well under way.”

At first, they didn’t under­stand the reas­on for the sud­den dro­pout. Was Smoltek’s tech­no­logy not good enough? Had Yageo’s mar­ket ana­lys­is changed? But after a couple of days, the pic­ture star­ted to become clear­er. There was noth­ing wrong with Smoltek’s tech­no­logy, and the ana­lys­is was unchanged.

”Yageo told Smol­tek that the reas­ons for their with­draw­al were entirely intern­al. They still have a lot of faith in Smoltek’s tech­no­logy and think that CNF-MIM capa­cit­ors will be a game-changer in the market.”

As the dust settled, Finn Gram­naes, Dav­id Gram­naes, and Pro­fess­or Peter Enoks­son, who Gramtec works closely with on own­er­ship mat­ters in Smol­tek, sat down to dis­cuss their con­tin­ued involve­ment in Smoltek.

“We decided to keep invest­ing in the com­pany but felt we needed to get more involved again. Finn and Peter, there­fore, thought it would be a good idea for me to rep­res­ent Gramtec on the board.”

The Chair­man of the Nom­in­a­tion Com­mit­tee had pre­vi­ously asked me the same thing. So, at a meet­ing that, of course, Dav­id Gram­naes didn’t attend, the Nom­in­a­tion Com­mit­tee decided to pro­pose him for elec­tion to the Board at the Annu­al Gen­er­al Meet­ing on May 14, 2024.

Bring to the table

After this short cat break, I con­tin­ue the inter­view with Dav­id Gram­naes: What can you bring to the table as a board member?

We must demon­strate the tre­mend­ous value of Smol­tek to poten­tial part­ners or buyers

“I’ve been involved with Smol­tek since 2015, so I under­stand the com­pany and its devel­op­ment over the years. This has helped me con­trib­ute in dif­fer­ent ways, often as a sound­ing board for Finn in Gramtec’s own­er­ship role and hands-on in vari­ous pro­jects. For example, I’ve helped with Smoltek’s latest fin­an­cing rounds, which were suc­cess­ful des­pite a chal­len­ging fin­an­cing cli­mate. So, I think my know­ledge of Smol­tek, both tech­nic­ally and fin­an­cially, is some­thing I can add.”

“I have also served on sev­er­al cor­por­ate boards over the years, provid­ing valu­able experience.”

“Fin­an­cing is a big part of this exper­i­ence. I don’t have a fin­ance back­ground, but I’ve been deeply involved in rais­ing cap­it­al for Smol­tek and oth­er tech­no­logy start-ups. So, I’ve got exper­i­ence from both sides of the nego­ti­at­ing table. I think it’s a real strength to have both the investor and entrepreneur’s per­spect­ive on cap­it­al and funding.”

Personal qualities

What per­son­al qual­it­ies will help you con­trib­ute to the work of the board?

“I’m an entre­pren­eur at heart and choose to focus on exist­ing oppor­tun­it­ies. I truly believe that any­thing is pos­sible. As an entre­pren­eur, I’m not very struc­tured, but over the years, I’ve learned to appre­ci­ate the import­ance of being struc­tured to stay leg­al and compliant.”

After a brief pause, he adds: “I have found that I some­times think dif­fer­ently than oth­ers, so I hope to bring some ‘out­side the box’ think­ing to the table. I am also an act­ive and involved per­son. And I talk a lot. Some­times too much. But I think that helps cre­ate a good atmo­sphere and encour­ages healthy discussions.”

Pursuit of shareholder value

So far, I’ve played him soft­balls. Time to level up the game, so I ask him what he wants to push on the board.

”The Board’s cur­rent focus is to secure a com­mer­cial deal, part­ner­ship, or sale of one or more applic­a­tions based on the tech­no­logy or all or part of the sub­si­di­ar­ies. In doing so, we must be care­ful not to under­value our com­pany. To cre­ate the greatest share­hold­er value, we must demon­strate the tre­mend­ous value of Smol­tek to poten­tial part­ners or buyers.”

”It’s the same for share­hold­ers. To cre­ate share­hold­er value, we have to show the stock mar­ket what we at Gramtec see in Smol­tek, which isn’t reflec­ted at all in the share price.”

“If there’s one thing I think is par­tic­u­larly import­ant, it’s investor rela­tions and com­mu­nic­a­tion with the stock mar­ket. I think Smol­tek has improved sig­ni­fic­antly in this regard over the past year, and I’ll work to ensure this continues.”

Smoltek’s past and future

I’ve saved the most chal­len­ging ques­tion for last. I take a deep breath and start my ques­tion with a back­ground description.

Next year, Smol­tek will cel­eb­rate its 20th anniversary. The com­pany spent many years focused primar­ily on R&D without much emphas­is on bring­ing products to mar­ket. Recently, the com­pany has focused on CNF-MIM capa­cit­ors and cell mater­i­als for PEM elec­tro­lyz­ers, put­ting all oth­er product ideas on the back burn­er. It looked like Smol­tek would finally bring CNF-MIM capa­cit­ors to mar­ket, but that all fell through when Yageo backed out of the deal. To keep afloat, the com­pany has relied on investors for two dec­ades. Those who inves­ted early, includ­ing Gramtec, have essen­tially seen their invest­ments dis­ap­pear. What are your hon­est thoughts about Smoltek’s past and future?

Smol­tek will be Gramtec’s best invest­ment ever

”Smol­tek grew out of a research lab at Chalmers Uni­ver­sity of Tech­no­logy. Going from lab to com­mer­cial product takes a long time, espe­cially for cut­ting-edge tech­no­logy with many skep­tics initially.”

”Finn saw the poten­tial of the tech­no­logy in many dif­fer­ent busi­ness areas and inves­ted in the com­pany in 2007. In 2015, Gramtec became the largest share­hold­er and, togeth­er with Pro­fess­or Peter Enoks­son, took the sole respons­ib­il­ity for fin­an­cing the oper­a­tions until the IPO in 2018. Gramtec has con­tin­ued to invest in Smol­tek and is com­mit­ted to sup­port­ing the com­pany in the future. We’re more con­vinced than ever that Smol­tek and its developed car­bon nan­ofiber tech­no­logy will be used world­wide in the next decade.”

”Look­ing back, I can see that a lot of time has been spent devel­op­ing the tech­no­logy and build­ing rela­tions with com­pan­ies in the semi­con­duct­or industry. This has been a good thing and has helped many glob­al com­pan­ies in the elec­tron­ics and semi­con­duct­or industry to know about Smol­tek. But some­times too much resources have been spent on pro­jects and rela­tion­ships that didn’t res­ult in busi­ness or partnerships.”

”In 2019, Smol­tek took a decis­ive step from a com­pany that only devel­ops tech­no­logy to one that cre­ates busi­ness units based on the tech­no­logy. Smol­tek has cre­ated two such busi­ness units: Smol­tek Semi, which devel­ops and mar­kets CNF-MIM capa­cit­ors for the elec­tron­ics industry, and Smol­tek Hydro­gen, which devel­ops and mar­kets cell mater­i­als for PEM elec­tro­lyz­ers for the hydro­gen and energy mar­kets. I think it was wise to cre­ate two busi­ness units because it’s hard to know at this early stage which busi­ness will take off first.”

”A lot has happened in the com­pany in the last few years, and Smol­tek, with its two busi­ness units, has posi­tioned itself to achieve major deals and part­ner­ships. I think in the next two or three years, we will see sev­er­al major events. It will take time but I’m con­vinced that in the long run Smol­tek will be Gramtec’s best invest­ment ever.”

Reflections

As I sit in the car, driv­ing along the E6 towards Gothen­burg, I think about everything Dav­id Gram­naes has told me, not least how he and Lena Olv­ing and oth­ers have recruited people with the right skills and exper­i­ence for the board.

As I run through the names on the board – Per Zell­man, Gust­av Bris­mark, Emma Rön­nmark and now Dav­id Gram­naes – it strikes me that Smol­tek has a board that few deep tech com­pan­ies can match.

Admit­tedly, the board mem­bers are not the most well-known people in the busi­ness world, but what they lack in name recog­ni­tion, they make up for in highly rel­ev­ant and valu­able know­ledge and exper­i­ence. They have hands-on exper­i­ence from Smoltek’s tar­get mar­kets, the semi­con­duct­or and energy indus­tries. They have deep expert­ise in intel­lec­tu­al prop­erty man­age­ment and cor­por­ate fin­an­cing. They excel in product devel­op­ment and mar­ket­ing – which are the only core func­tions of a com­pany, accord­ing to the fath­er of cor­por­ate man­age­ment, Peter Druck­er. And, let’s not for­get, they all have years of exper­i­ence sit­ting on boards and run­ning companies.

This diverse and robust set of skills provides Smol­tek with a Board of Dir­ect­ors that, through its act­ive and com­mit­ted par­ti­cip­a­tion in the company’s man­age­ment, provides clear dir­ec­tion and scope, as well as assist­ance and sup­port to the Exec­ut­ive Man­age­ment in the day-to-day run­ning of the business.