Reducing Food Waste: Martin Flusberg Of Powerhouse Dynamics On How They Are Helping To Eliminate Food Waste

The data we’re able to generate helps our customers ensure that as little waste as possible happens as a result of problems with food preparation, storage, or cleanup.

It has been estimated that each year, more than 100 billion pounds of food is wasted in the United States. That equates to more than $160 billion worth of food thrown away each year. At the same time, in many parts of the United States, there is a crisis caused by people having limited access to healthy & affordable food options. The waste of food is not only a waste of money and bad for the environment, but it is also making vulnerable populations even more vulnerable.

Authority Magazine started a new series called “How Restaurants, Grocery Stores, Supermarkets, Hospitality Companies and Food Companies Are Helping To Eliminate Food Waste.” In this interview series, we are talking to leaders and principals of Restaurants, Grocery Stores, Supermarkets, Hospitality Companies, Food Companies, and any business or nonprofit that is helping to eliminate food waste, about the initiatives they are taking to eliminate or reduce food waste.

As a part of this series, I had the pleasure of interviewing Martin Flusberg.

Martin Flusberg, President of Powerhouse Dynamics, has spent most of his career developing innovative technologies for a more sustainable world. His current company harnesses the Internet of Things (IoT) to help multi-unit restaurants, food service companies and retailers to reduce food waste, enhance food safety, save energy, and decrease their carbon impact — all while saving money and working more efficiently. Martin has an MSCE from MIT and a BEE from City University of New York.

Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a story about what brought you to this specific career path?

I’ve always been a passionate environmentalist, but the entrepreneurship part of my life happened by accident. When I saw that becoming a business leader would help me to improve sustainability in an impactful way, I jumped in with both feet.

It all began when I joined an MIT faculty software startup focused on various aspects of transportation, including energy efficiency. They recruited me as a technology expert, and to my amazement, I eventually became CEO — something that was not in my career plans.

That led to a series of opportunities to create and lead companies whose technologies addressed sustainability. For example, after a couple of other ventures, I co-founded Nexus Energy Software, a pioneer in delivering online energy and carbon analysis to consumers and businesses. Nexus — which was eventually sold to ESCO Technologies (NYSE:ESE) in 2005 and is now part of Aclara Technologies — became a global provider of software to the utility industry, focusing on smart grid, smart meter, energy efficiency and demand-response.

When I left Aclara I was approached by a fledgling start-up in the home energy management space about possibly joining as CEO. I was impressed by their technology for monitoring energy use but, based on my experience with utilities, felt strongly that the real opportunity was with restaurant and retail operations which were not being served by either utilities or traditional energy management companies. This was the start of Powerhouse Dynamics. While the original focus was on energy management, our understanding was that what really mattered to these companies was their equipment — and everything their equipment was used for — and that is what we set out to do. Over time, based on customer feedback, this morphed into monitoring food safety and food waste. Today, this is a major focus of our Open Kitchen® IoT platform which has a large number of household name restaurant and convenience store chains as customers.

Can you share the most interesting story that happened to you since you began at your company or organization?

There have been several watershed moments that have reinforced why I love entrepreneurship. These are times when I encountered unexpected opportunities that changed the course of the business — but in an evolutionary not revolutionary way. It’s so important to embrace those moments and let your company’s evolution happen.

For example, after working with the franchisee of a major restaurant chain on monitoring and controlling their HVAC equipment and monitoring the energy use of their refrigeration equipment to spot performance issues, the CEO asked us if we could also monitor refrigerator temperatures to help them with food safety. Our answer was “of course” — while internally my reaction was “why didn’t we think of that?”

Another occurred when a major restaurant brand-customer asked if we could find a way to directly integrate with their ovens to better manage food preparation and help automate food safety reporting. That’s when the lightbulb really went off. These customers weren’t in typical offices. They were in the food service business, and their equipment could make or break their top and bottom lines.

This central truth led to our invention of the Open Kitchen® IoT platform that enables restaurants with hundreds or even thousands of sites to connect and manage their equipment from one central platform — pre-empting problems that lead to food — and energy — waste. Is a freezer about to break down, ruining $20,000 of meat? Does a chicken have to be discarded because it went into the oven before it was defrosted? Every day, we’re helping restaurants stay strong and minimize food waste using our IoT platform to answer questions like these — and empower restaurants to pre-empt problems in real-time. It’s all in the data this equipment is feeding back to us.

Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?

One of the entrepreneurs’ greatest skills is learning from every mistake and pushing fearlessly onward. One of the rookie errors I made was neglecting to double down on due diligence when choosing channel partners. In one instance, when I was looking for business development help, the partners who claimed to have a stellar track record just weren’t qualified. We managed to “fire” well over 100 channel partners the first year.

The best leaders not only choose senior staff whose skills surpass their own; they do the same with their outsourced partners. That requires extra care upfront.

How do you define “Leadership”? Can you explain what you mean or give an example?

Leadership is the ability to carve out a direction, and ensure that your people understand it, embrace it, and join together to reach that North Star.

Where this becomes both fun and tricky is when your company needs to evolve. Even in large companies, it’s important to have an entrepreneurial mindset and be nimble on your feet.

Certainly we’ve seen this in the restaurant industry since COVID-19 began. Large brands are now using more technology and pivoting into new segments like ghost kitchens to maintain their strength. Their leaders have turned adversity into longer-term opportunities — with help from companies like ours.

Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?

I am inspired by Winston Churchill’s quote, “Success is not final, failure is not fatal: it is the courage to continue that counts.”

As an entrepreneur, I’ve learned that you can never rest on your laurels, and you can survive serious mistakes as long as you don’t repeat them. For instance, early in my career I learned the importance of prioritizing cash flow when I was trying to launch some groundbreaking technology and allowed my investors to tell me not to worry about cash since they would be there when we needed more — which turned out not to be true. That lesson is now part of my DNA, and has repeatedly proven useful as I’ve grown and sold companies — including Powerhouse Dynamics which is now part of The Middleby Corporation (NASDAQ:MIDD).

OK, thank you for all of that. Let’s now shift to the main focus of our interview. Let’s begin with a basic definition of terms so that all of us are on the same page. What exactly are we talking about when we refer to food waste?

I am in the restaurant world, so for me it’s the act of discarding food, unnecessarily, that could be used to feed people — or animals for that matter — who need it. Not only is this a social sustainability issue; it’s also an environmental issue. It’s well known that much of this wasted food winds up in landfills and produces methane, a damaging greenhouse gas.

Can you help articulate a few of the main causes of food waste?

There are many causes at all stages of the supply chain, from “farm to fork” or even “boat to fork” for seafood. We see the impact everywhere — in manufacturing plants, during transport, at the wholesale and retail levels, and in homes.

For restaurants, this could be the result of not carefully planning food purchases against actual demand for specific foods — or serving customers portions that are larger than they can comfortably consume — which raises compounding issues given our country’s challenges with obesity.

I’m gratified to be in a position to help. Our technology enables restaurants and other foodservice organizations to make sure that their safety and quality procedures are followed so they don’t have to discard product. For example, if proteins are being cooked before they’re fully defrosted, or a walk-in cooler is on the verge of breaking down, they get immediate alerts. This real-time information can prevent their wasting huge amounts of food.

What are a few of the obstacles that companies and organizations face when it comes to distributing extra or excess food? What can be done to overcome those barriers?

One of the biggest obstacles is matching surplus food with parties who would benefit from it — before the food is discarded. Fortunately, there are now multiple innovative marketplaces that have jumped in to fill this gap, tapping into their technology and logistics expertise.

The COVID-19 pandemic, ironically, has opened up more opportunities. Takeout and delivery services can help alleviate the problem of excess supply at restaurants, for example.

Can you describe a few of the ways that you or your organization are helping to reduce food waste?

This is a huge part of what we’re doing day to day, as our Open Kitchen platform connects with the full range of kitchen equipment, from refrigerators and freezers to ovens and fryers to hot holding cabinets to dish machines to coffee and shake machines — and more.

At any point in time, foodservice and food retail managers using our platform can monitor, analyze, and automate important processes and pre-empt potential problems. The data we’re able to generate helps our customers ensure that as little waste as possible happens as a result of problems with food preparation, storage, or cleanup.

Are there three things the community/society/politicians can do to help address the root of this problem?

Absolutely:

1. Increase public awareness that these problems exist; not everyone understands their scope or implications.
2. Recognize the nonprofits and businesses that are making meaningful, positive changes.
3. Educate restaurants on the impact of excess food portions on customers’ health. There is more awareness of the obesity problem since COVID-19 — especially given the seriousness of the disease for people who are already struggling with their weight. This could be a chance for restaurants to step up and revitalize their brands by taking action — e.g., proactively reducing portions and offering healthier items.

What are your “5 things I wish someone told me when I first started” and why. Please share a story or example for each.

1. Cash is king. When you’re building a business, pay total attention to it. When we are talking about saving the planet, there is no margin for error in predicting cash flow. I learned early in my career that, even when venture capitalists are providing funding and support, responsibility for stewarding the mission always rests with the chief executive.
2. Running and building a business with a social mission is gratifying. Before I became an entrepreneur, I was focused on developing technology as an individual contributor. I didn’t see any attraction to business whatsoever. Once I joined a company that addressed sustainability, I wanted to do everything I could to advance it. At that point, I realized the power of companies to advance social change, and business leadership became attractive to me.
3. Business to consumer technology businesses requires an astute understanding of how people are hardwired. My previous company began as an e-commerce platform designed to help consumers purchase energy-efficient products based on an energy analysis. When this turned out to be a bigger challenge than expected, we pivoted to having utilities as our customer base. When I joined Powerhouse Dynamics, I inherited a “smart” technology platform for consumers also based on energy analysis but immediately began developing the technology for restaurants and others more attuned to reducing their costs.
4. Businesses are like people; they evolve over time. I love watching how companies can stay rooted to their original mission and value system but evolve into adjacent but new areas. I never imagined Powerhouse Dynamics would evolve into as many areas related to food as it has — or how this would expand the focus on sustainability — but am delighted by the transformation.
5. Focus is critical but doesn’t overdo it. I’ve watched other companies fail when they expanded too quickly into other segments or regions. At the same time, being too rigid is a recipe for lost opportunity. The evolution of my companies demonstrates that companies can and should evolve — as long as that is not done radically.

Are there other leaders or organizations who have done good work to address food waste? Can you tell us what they have done? What specifically impresses you about their work? Perhaps we can reach out to them to include them in this series.

I’m impressed with the British company Winnow. They combine scales, cameras, software and AI to monitor waste in a food service environment.

You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)

I’m passionate about galvanizing the restaurant industry to tackle food waste in a positive way — from smart purchasing to portion control to monitoring safety procedures. There have to be novel approaches to sharing unused restaurant food, too — from connecting with shelters to feeding the animals at rescue leagues (whatever is safe for them, of course).

Is there a person in the world, or in the US with whom you would love to have a private breakfast or lunch, and why? He or she might just see this, especially if we tag them.

I would love to meet Bill Gates because of both his incredible success with building a leading technology company and his commitment to ensuring a better and more sustainable world.

How can our readers further follow your work online?

We welcome them to visit powerhousedynamics.com or to contact me at martin@powerhousedynamics.com.

This was very meaningful, thank you so much, and we wish you only continued success.