How Anker found billions in batteries and chargers
Steven Yang left his job as a software engineer writing algorithms at Google in 2011 to solve what he saw as a product gap: the lack of inexpensive, high-quality laptop batteries and chargers. A decade later, the company he started — Anker — has become a multibillion-dollar business.
The big picture: Though many people recognize Anker as a significant name in the world of charging cords and battery packs, few realize just how large a company Yang has created.
Driving the news: Anker now makes a wide range of electronics from headphones to projectors, bringing in about $2 billion in revenue last year and paying the salaries of roughly 3,000 people.
- More than half of those are engineers and product managers, Yang told Axios. But, he acknowledges, those who know the name generally only think of it as the brand on the cord or power bank that charges their iPhone.
- "If I make people underestimate me, that’s my fault," Yang said, in a recent Zoom interview from the company's headquarters in the Hunan province of China.
Anker has been working toward a modest but worthy goal since 2018, Yang says: He wants to replace the tangle of cords in your home with a fast-charging hub in each room.
- Many of today's devices are capable of being charged far faster than happens when you use the cord that comes in the box, Yang says. But electronics makers mostly don't want to pay for the fastest-possible charger — they're not going to put a $30 charger in a razor.
But Anker can make a hub or power bank that can charge that portable razor, along with a smartphone and many other types of devices, in just minutes.
- Many of Anker's newest products use gallium nitride, an alternative chemistry that can charge devices three times as efficiently as traditional silicon-based battery systems. That means chargers that can hold more energy in the same space and also deliver power faster.
- Yang also hopes to get rid of the dreaded box or drawer most people have filled with cords and chargers to devices they no longer use, or perhaps no longer even own.
- "What if we can get rid of that box in the next five years to 10 years," Yang remembers asking the crowd at a New York press event in 2018. Both the company and the industry have made progress, with Anker broadening its range of products and the industry moving toward fewer, more standardized chargers.
All this might not completely change your life, Yang says, but "we hope it will actually make the world a better place and make your home a little bit neater."
Catch up quick: In just a decade, Anker has gone from a little-known option on Amazon to a brand sought after by consumers for its range and quality as much as for its price. The company started with laptop chargers and batteries, but Yang said he quickly saw consumers' more pressing needs were with their smartphones and shifted his focus to cell phone battery banks and charging cords.
- Amazon's marketplace served as the firm's launchpad, and Amazon provided the core of the company's online-only business until it started selling through Walmart in 2015. Now it gets about 40 percent of its sales from offline retailers.
- The company has also broadened its geographic reach. The Americas account for 40% of sales, and Europe and Japan are its second and third biggest markets. China, Anker's home market, accounts for only about 5% of revenue.
Between the lines: Anker has been buoyed by a number of trends, most notably Apple's decision to stop including chargers with the iPhone in 2020.
- "There was a lot of controversy around that," he said, but it also spurred other companies to follow suit. "Apple is the brand that every other brand looks up to."
- At the same time, the EU has led an effort to standardize charging small electronics, with a rule set to go into effect in 2024 mandating phones and other small electronic devices have a USB-C port.
Faster charging has been a big focus of the battery industry since the total capacity of batteries isn't growing very fast.
- Yang says that for most people, very fast charging can effectively function the same as a battery with very high capacity. It's kind of like choosing which soda to buy, he says: "If you carry a big enough cup you don’t need to refill it. But if you refill it very quickly, you don’t need that big of a cup."
Yes, but: Anker struggles not only with the limits of battery physics but also with the crosswinds of geopolitics.
- Like other China-based companies, Anker is trying to avoid getting caught up in the growing economic tensions between the U.S. and China.
- Yang notes that the company speaks English in its offices, which are modeled on Silicon Valley-style open floor plans. "It’s kind of like a global company that lives in China," Yang said.
- Anker has also expanded its manufacturing to Vietnam and elsewhere.
What's next: Anker is staying in the accessories space, but keeps expanding into new areas — most recently, 3D printers.
- Yang notes that there are probably 100 to 200 categories generating several billion dollars per year in revenue that could play to Anker's strengths. The company will probably enter two or three new categories this year, he said, but was coy about just which products those might be.
- Yang did rule out some areas the firm sees as beyond its capabilities: "You will never see Anker do a phone, do a laptop, do a TV, do a tablet," he said.