1. 6A Pacific Coast Business Times June 3-9, 2016
Technology
www.pacbiztimes.com
As a relative newbie to the
region, I’m always amazed by
whatfuturistictechnologylies
in the dorm rooms and class-
roomsinourownbackyardon
theUCSantaBarbaracampus.
At the university by the
sea, Shuji Nakamura, winner
of the 2014 Nobel Prize in
Physics,honedtheblue,green
and white LEDs he helped invent in 1996.
Theynowlightupourhomes,sportsstadi-
umsandjustabouteverything
else.
I’d also be remiss if I didn’t
give a shout out to fellow
Sioux City, Iowa native Alan
Heeger for all he’s done with
his contributions to UCSB
and the tech world.
In 1982, Heeger moved
west and has flourished as a
UCSB physics professor ever since. His
mostfamouscontributiontothetechworld
istheorganicsemiconductor,forwhichhe
won the 2000 Nobel Prize in Chemistry.
Today,radiofrequencyidentificationtags,
solar cells and LEDs are just a few of the
technologiesthatuseorganicsemiconduc-
tors.
Galen Stucky, another UCSB profes-
sor whose name has been kicked around
as a Nobel Prize candidate, also roams the
halls of the physics and science buildings
By Philip Joens
Staff Writer
Working out of a small lab in Goleta in a small office at
the Cabrillo Business Park is a company that could change
skyscrapers forever.
Next Energy Technologies is developing technology that
could turn the exterior windows of skyscrapers into giant
translucent solar panels, an important step in the renewable
energy revolution, company founders said.
Now,withitswindowsstilltwoyearsfromhittingthemar-
ket,thecompanyisdevelopingwaystotakeproductionoutof
the lab and into the factory.
Nextcreateswindowsthatgenerateelectricity.Todothis,
itprintssolarpanelsontoawindowusingtranslucentconduc-
tive inks and translucent metals.
The team uses a special semiconductor called an organic
semiconductor.UCSantaBarbaraprofessorAlanHeegerwon
the 2000 Nobel Prize in Chemistry for developing the tech-
nology. The inks use long chains of molecules called poly-
mers to conduct electricity.
Inaconferenceroom,a2.5-foothighgreensquaretestwin-
dow sat lying on a table. Another one to the left looked light
blue. From a distance, the windows appear to be completely
transparent.Getwithinafewinchesoftheglass,though,and
clear lines just a few millimeters apart appear.
All windows in commercial buildings are coated with sub-
stances to prevent ultraviolet light from fading color on fab-
rics, paints and wallpapers and giving occupants sunburns.
Infrared light is simply heat energy that can come into
buildings. These coatings, known as Low-E coatings, mini-
mize the amount of ultraviolet and infrared light that come
into buildings but maximize the amount of visible light al-
lowed in.
Next’swindowcoatingessentiallydoesthesamethingbut
it captures some of that extra energy.
“Instead of just blocking or reflecting it, we convert it for
use in the building,” said CEO Daniel Emmet.
A typical solar cell is basically a silicon window sandwich.
Two layers of silicon create a positive and negative electric
charge when hit by solar energy. Because oxygen and mois-
tureneedtobekeptoutofthecell,awindowisplacedontop
of the solar cell.
Traditional photovoltaic cells absorb types of light on the
visible color spectrum, though some infrared light is also ab-
sorbed, so the cells appear to be black.
Next Energy Technologies CEO Daniel Emmet looks through a window panel that converts light into electricity.
PHILIPJOENSPHOTO
see NEXT ENERGY on page 8A
QAD funds technology
upgrades at schools
QAD, a Santa Barbara-based provider of
enterprisesoftwareformanufacturingcom-
panies, announced recipients of its annual
Project Upgrade technology grants. Each
year, QAD coordinates with the Santa Bar-
bara County Education Office to fund local
schools for technology upgrade projects.
This year’s recipients include:
• El Camino Elementary School to pur-
chase Sphero SPRK Edition Robots and Ap-
ple iPads to help create Maker Spaces for its
fourth through sixth-grade classes;
•EllwoodElementarySchooltopurchase
new iPads for older students whose current
iPads will be passed on to first-grade stu-
dents;
• Mountain View Elementary School to
expand its STEM program through the pur-
chaseofiPads,DashandDotRobotsandthe
Little Bits program;
•KelloggElementarySchooltopurchase
iPads for its kindergarten through second-
grade classrooms;
•BrandonElementarySchooltopurchase
iPads and Apple TVs;
• Santa Barbara High School Art Depart-
menttopurchasea3Dprinterforadvanced
art projects.
Next-generation device
unveiled by Inogen
Goleta-basedInogenhaslaunchedanext-
generationportableoxygenconcentrator,the
Inogen One G4.
The new device weighs only 2.8 pounds
andis40percentlighterandalmosthalfthe
size of the Inogen One G3.
Inogen One G4 offers long battery life of
uptosixhourswithanoptionaldoublebat-
tery,alargeLCDscreenandquietoperation.
ThecompanysaidtheInogenOneG4meets
specifications of the Department of Trans-
portationandtheFederalAviationAdminis-
tration to be used onboard aircraft.
Jillian Michaels to keynote
MindBody user conference
SanLuisObispo-basedMindBody,apro-
viderofcloud-basedbusinessmanagement
software for the wellness services industry,
hasannouncedthatfitnessexpertJillianMi-
chaels will serve as a keynote speaker at the
company’s annual user conference, BOLD,
to be held Oct. 5-6 at the Loews Hollywood
Hotel in Los Angeles.
Michaels will kick off the second day of
theconference,sharinglessonslearnedabout
howbesttomotivateandbuildstrongclient
relationships — a topic that is top of mind
forthehundredsofwellnesspractitionersex-
pected to attend.
Forinformationortoregister,gotowww.
boldmindbodyconference.com.
June 3-9, 2016 A report on business at the cutting edge Page 7A
see TECHNOLOGY on page 8A
Briefcase
Window power
NextEnergy’stranslucentsolarpanelsgenerateelectricity
ThefutureisalreadyhereatUCSantaBarbara
OvertimerulescouldhelpCaliforniafirmskeepemployees
By Alex Kacik
Staff Writer
Smallbusinessownershaverecentlybeenhitwithma-
jorchangestoemployeecompensationbuttherecouldbe
a silver lining for California companies.
The U.S. Department of Labor’s new overtime rules
will require most employers to pay overtime to work-
ers earning less than $47,476 per year. The threshold is
$23,660 per year until the law takes effect in December.
Many small business owners will likely opt to increase
salariesabovethatlevelratherthanreclassifyemployees,
said Trevor Large, a founding partner at Santa Barbara-
based Buynak, Fauver, Archbald & Spray.
“Theextramanagementtasks,recordkeepingandrisk
involvedinconvertingtononexemptemployeesfrequent-
lyoutweightheextramoneyitwouldtaketogiveexempt
employees a raise,” he told the Business Times.
Thestatewillcatchuptothefederalthresholdinabout
two years as California’s minimum wage goes up, Large
said.
However, the gap between California and the rest of
the country appears to be more or less permanently di-
minished, said Greg Wilbur of Anticouni & Associates.
“By raising the overtime exemption salary threshold
acrossthecountry,theDepartmentofLaborhasactually
lessened the competitive disadvantage businesses here
face,” Wilbur told the Business Times via email. “Under
the new rules, an exempt manager in California will rate
the same salary as one in West Virginia or Mississippi.”
Lookingatthebroaderpicture,Largeexpectsthemin-
imumwagehikestohaveabiggerimpactonemployers,
he said.
NEW SANTA CLARA WASTEWATER SUIT
Ventura County filed a civil lawsuit against Santa
Clara Waste Water Co. seeking reimbursement for work-
ers’ compensation benefits it paid to its firefighters who
wereinjuredintheNov.18,2014chemicalexplosionnear
Santa Paula.
The county claims that Santa Clara Waste Water and
its parent company Green Compass Environmental So-
lutions intentionally misled firefighters who responded
totheexplosionandfirethatbrokeoutatthecompany’s
plant at 815 Mission Rock Road. The company allegedly
toldthefirefightersthatthereweren’tdangerousorhaz-
ardous materials on the property, according to the com-
plaint filed on May 17.
The county of Ventura is asking for $500,000 in work-
ers’compensationsbenefitsforfourofitsemployeeswho
were injured during the disaster. The chemical spill in-
jured dozens of people and ruined about $1 million in
crops.
Santa Clara Waste Water CEO William Mitzel and
Assistant General Manager Marlene Faltemier, Green
Compass and several other defendants are also facing
criminal charges stemming from the spill. Charges in-
cludeconspiracytocommitacrimeandhandlinghazard-
ous waste, among others.
The Second District Court of Appeals has halted two
criminal cases while it considers a decision to recuse the
defendants’ attorneys. Ventura County Superior Court
Judge Kent Kellegrew ruled on May 2 that the firm Mu-
sick, Peeler & Garrett had a conflict of interest.
In the midst of the legal proceedings, Patriot Envi-
ronmental Services acquired Santa Clara Waste Water in
December.
PatriotpurchasedtheassetsofAnaheim-basedwaste-
water treatment company Green Compass, which has
three facilities in California. The sale of the Anaheim
propertyclosedinAprilbuttheothertwo,includingMis-
sion Rock Road, still await final regulatory approval.
The civil case court date is scheduled for Oct. 14.
BROKERAGES AIM TO SETTLE
Compass and Coldwell Banker will try to settle their
suit out of court, according to a recent court filing.
ColdwellBankersuedaformeremployeeforallegedly
stealingthecompany’stradesecretsafterheleftthecom-
pany for the rapidly growing real estate brokerage firm
Compass. The companies agreed to delay prosecution
pending mediation, according to a May 13 court order.
SincelaunchinginManhattan,Compasshasopened
offices in dozens of cities throughout the country and
lured top brokers and managers, to the chagrin of its
rivals.
IthiredformerColdwellmanagerJohnNisbettohead
its Montecito office at 1283 Coast Village Circle that
opened in February. Since the Montecito office opened,
Compass has hired 22 agents from other real estate bro-
kerages, the company announced on May 27. It did not
specify where the agents were previously employed.
ColdwellBankeraccusedNisbetofstealingconfiden-
tialdata,includingmarketdata,revenuereports,commis-
sionsplitsandcompensationagreementsofColdwellsales
associates,givingitsnewcompetitoranunfairadvantage,
accordingtothecomplaint.Thedatacontainsproprietary
“internal ranking metrics” that allow Compass to cherry-
pick its top agents, Coldwell Banker claims.
In a February hearing, Judge Thomas Anderle said
that the information that Coldwell Banker classifies as a
trade secret is readily attainable.
The next case management hearing is July 22.
• Contact Alex Kacik at akacik@pacbiztimes.com.
Law
philip joens
Technology

2. 8A Pacific Coast Business Times June 3-9, 2016
The Pacific Coast Business Times/
UCSB Economic Forecast Project rose 2.79
percentfortheweekendedMay27,echoing
similar gains in the national indices.
The week’s best performer, agribusi-
ness and real estate developer Limoneira,
jumped 12.1 percent after a short dip last
week. The Santa Paula company ended at
$16.60aheadofitsquarterlyearningsreport
next week.
Inphi, a semiconductor solutions pro-
vider with offices in Westlake Village, rose
10.6 percent to $31.11 and Camarillo semi-
conductor company Semtech gained 8.4
percent, ending at $23.01.
Resonant again had the biggest drop of
the week, ending down 3.4 percent. Share
pricesforthelate-stagedevelopmentcom-
pany out of Goleta fell to $3.97.
Goleta breast implant maker Sientra fell
for a second week. Shares shed 3 percent,
ending at $5.80.
Heritage Oaks Bancorp dropped 0.9
percent, ending just over $8.
Goleta-based Deckers Brands beat quar-
terlyrevenueestimatesbutstillpostedaloss
of73centspersharewhenthecompanyre-
ported fourth quarter and fiscal year 2016
earnings results May 26, as unseasonably
warmweatherateintoprofit
margins.
Deckers’ sales increased
11percentduringthequarter
from $340.6 million in 2015 to $378.6 million
in2016.Analystestimateswereforrevenueof
$362 million, according to S&P Capital IQ.
But earnings per share decreased from
4 cents per share in 2015 to a net loss of 73
cents per share during the same quarter in
2016.Duringthequarterthecompanyposted
alossof$23.7million,downfromnetincome
of $1.4 million.
Deckersfull-yearrevenuesalsoincreased
from $1.82 billion in 2015 to $1.88 billion in
2016. Earnings per share
dropped from $4.70 per
share in 2015 to $3.76 in
2016. Net income fell from
$161.8 million to $122.3 million.
The company blamed the decrease on
unseasonablywarmweatherduringJanuary,
FebruaryandMarch,whichhurtsalesofUgg
boots.
“Fiscal2016wasachallengingyearforthe
brand,” CEO Angel Martinez said in a quar-
terly earnings call May 26.
The company also announced Martinez
will retire May 31 and Deckers President
Dave Powers will take over as CEO. Martinez
will remain chairman of the board.
The company said in the earnings call
thatitexpectssalestoremainflatordecrease
about 3 percent in 2017 because of warm
weatherthatisexpectedagainduringtheup-
comingwinter.Salesareexpectedtodecrease
20 to 25 percent during the first quarter.
Deckers Brands earnings per share nose dive
•Apotentialwarningsignalforthehos-
pitality industry has been raised in New
York City. Analysts for Morningstar said
that“burgeoninghotel-roomsupply”could
increasethepossibilityofdefaultforsome
$3.68 billion in commercial mortgage-
backed securities.
• A better second-half awaits for the
economy, writes Scott Anderson of Bank
of the West.
Heexpectsmodestgrowthoverthe2.3
percent gain in GDP expected for the first
halfoftheyear.Modestgrowthinbusiness
investment and a jump in new home sales
will help.
• Forbes’ Global 2000 list of the world’s
largest public companies puts Amgen,
based in Thousand Oaks, at No. 132, up
from 161 last year.
Amongothernotablecompanies,Wells
Fargo jumps to No. 7 and Berkshire Ha-
thaway, the largest U.S. company, comes
in at No. 4. Industrial & Commercial
Bank of China is No. 1. see FIN BRIEFS on page 10A
June 3-9, 2016 A weekly report on personal finance and investing Page 9A
Biz Times index,
national indices
all show gains
Index Update
One-week One-month 52-week
change change change
Biz Times index . . . . 2.79%. . . . . 1.86%. . . . 6.98%
DJIA. . . . . . . . . . . . . . . . 2.13%. . . . . 0.56%. . . -0.76%
S&P 500. . . . . . . . . . . . 2.28%. . . . . 1.63%. . . -0.40%
Nasdaq. . . . . . . . . . . . . 3.44%. . . . . 3.31%. . . -2.69%
Russell 2000. . . . . . . . 3.43%. . . . . 1.73%. . . -7.71%
Note:Seepage11AforcompaniestrackedbytheBusiness
Times/UCSB stock index.
Portfolio watch
$FINANCIAL BRIEFS
TAKING STOCK
After lost decade, value
stocks making comeback
By Lu Wang
Bloomberg News
Hopes are high again for buying low.
Exchange-tradedfundsthattrackvalue
stocks,theonestradingcheapesttoearn-
ingsandbookvalue,havereceived$5.5bil-
lionoffreshcashin2016,datacompiledby
Bloombergshow.Theinflowsstandoutin
amarketwheremoneyisbeingwithdrawn
from practically everything else. Growth
stocks,enjoyingthelongestwinningstreak
overvalueinhistory,haveseenwithdraw-
als of $6.2 billion.
While trying to beat the market with
cheap shares has been a lost cause since
2006, the tactic may have found a cham-
pioninfinancialcompanies,agroupwhose
valuations slid to a 14-year low relative
to the rest of the market earlier this year.
Banksaregettinganextraboostfrompros-
pectstheFederalReserveisabouttoraise
interest rates, an action signaling faith in
theeconomythatoftenbooststheirprofits.
“We’re really at the very early innings
ofanewcycle,”saidDanMiller,whohelps
oversee$28.6billionasdirectorofequities
atGW&KInvestmentManagementinBos-
ton. “Value has done so poorly for so long
andit’sunder-ownedamonginvestors.All
we need is for investor interest to pick up
alittleandthatcouldbeenoughtosustain
the improvement.”
Using a formula created by Ned Davis
Research that tracks changes in the rela-
tiveperformancebetweenthetwostyles,
growthhasbeeninanuptrendversusvalue
since July 2006, a stretch of dominance
that outlasts virtually every other feature
in the American stock market. At pres-
ent,growth’sedgehasgoneonaboutthree
times what it normally has since 1932 and
is the longest in history.
Valueversusgrowthismorethanjustan
argumentformarkettheorists—aprefer-
enceforvaluesharescouldbeanindication
thatinvestorsarepreparingforanimprov-
ing economy, something the stocks have
historically needed to thrive. One reason
forgrowth’shegemonyoverthelastdecade
hasbeentheabilityofthosecompaniesto
appreciateevenwhengrossdomesticprod-
uct expands slowly.
Banks make up about 30 percent of
large-capvaluestocks,roughlythreetimes
thenextbiggestindustry,energy.Asmuch
as anything, it’s been their inability to sus-
tain rallies that has held the style back.
Financial companies remain 37 percent
belowtherecordhighstheyreachednine
years ago, by far the most of any S&P 500
industry.
After concern over a delayed interest-
rateincreaseandanoil-inducedcreditcrisis
that erased $700 billion from bank stocks
inaseven-monthslumpthroughFebruary,
the industry is making a comeback. The
SHUTTERSTOCK
see TAKING STOCK on page 10A
TECHNOLOGY
Continued from page 7A
NEXT ENERGY
Continued from page 7A
Unlike traditional solar panels, Next can tune
itspanelsanddecidewhattypesoflightitwantsto
allow into the cell.
Initially, Emmet said, the company is focusing
onmakingwindowsforcommercialusesbecause
commercial buildings tend to have more exterior
glass than homes.
“Every solar cell is also a window,” said co-
founder Corey Hoven. “Every solar cell has two
pieces of glass. (It’s a) very expensive part of the
thing, and if you lift it, most of the volume of the
solar cell is glass. So that’s a sunk cost that’s al-
ready paid for.”
When rays of light hit Next’s windows, electric
charges travel through the inks into wires where
the electricity is transferred to a building’s power
system.
“Somebody’s already buying a window,” Em-
met said. “Now they can have a window with this
feature.”
Hovenandco-founderArnoldTamayothought
of the concept as grad students at UCSB. In
2010, Hoven participated in UCSB’s Technology
Management Program and won its New Venture
Competition.
By 2013, the company came up with a concept
toprintitsinksontoflexiblethinplasticsheetsthat
could be applied to awnings or shingles.
Emmet said the company transitioned to win-
dowsaftertestingfounditssolarsheetscouldhave
a lifetime of about 30 years.
As the company heads toward production, it’s
raising money and talking with window suppli-
ers. According to filings with the Securities and
Exchange Commission, Next is in the middle of
raisingabout$7million.Emmetsaidthecompany
is also talking with large window suppliers who
areexcitedaboutthepotentialNext’stechnology
holds.
Inthesmalllab,ateamoffivescientistsworked
quietly against the cacophony of buzzing instru-
mentstomovethecompanyclosertoproduction.
Currently, Next solar panels convert about 10 per-
cent of light that hits them into electricity.
Dressed in a blue lab coat and blue rubber
gloves, Andres Garcia’s task is to make Next pan-
els convert more light into electricity.
Everything from the dye to a window’s design
can influence how much electricity is converted,
he said.
Emmet said about half the world’s energy use
comes from buildings. As he walked down a hall-
way between the lab and his office, he confided
thathereallyfeelshiscompanycouldbechanging
the world.
“It’s amazing,” Emmet said. “We could dra-
maticallyimpactthewaybuildingsfunctioninthe
world, reducing their carbon footprint.”
on campus. Stucky is, of course, famous
for creating QuickClot, which rapidly
stopsarterialbleedingwithoutcausingse-
vere burns to patients.
On May 19, six student-led compa-
niespitchedideasforwhatcouldbecome
the region’s next giant to come from the
TechnologyManagementProgram’sNew
VentureCompetition.Opal,whichintends
to design LEDs for small smartwatch dis-
playsand,therefore,createsmallersmart-
watches,didn’tevenplaceinthetopthree.
Oh, and let me say that, as a tech geek,
Next Energy Technologies’ solar window
is the coolest solar energy product on the
market.
With that in mind, the university held
its annual Emerging Tech Review May 27.
Companies — spun out of or working in
the UCSB Institute for Energy Efficiency
—updatedabout25otherentrepreneurs
on the state of some of the latest technol-
ogy that’s come out of UCSB.
Founded in 2008, the institute has a
budgetof$40million.DirectorJohnBow-
erstoldthecrowdtheschoolisworkingon
many cool projects.
One could help lagoons and other
sensitive areas along the coastline next
to the school. Funded by a $4.8 million
grant from the Environmental Protection
Agency, UCSB is studying the impacts of
chemicals through their life cycle from
manufacture to use and disposal.
Abouttwomonthsago,workstartedon
a project to create new silicon chips with
lasers that will create low cost, high effi-
ciency computers for data centers.
In a partnership with the University of
Virginia, the school is also developing a
type of very precise clock called an “op-
tical clock.” Bowers said the new clocks
will, hopefully, have chips that use a thou-
sandth of the power of current optical
clocks and become the standard clocks
used by GPS systems.
Speakers at the event included Jim
Fiske, founder of Gravity Power; Jim Nel-
son, CEO of Sunworks, formerly Solar 3D;
and Aurrion founder Alexander Fang.
Computer giant HP, which has six full-
timeemployeesbasedattheinstitute,was
represented at the event. Also there was
Steve DenBars of UCSB spinout Soraa
Laser.
“This is a chance to let them all talk
toeachotherintheenergyefficiencyarea
and link with students,” Bowers said.
The space for this column is too small
to tell you about all the cool things hap-
pening at UCSB. But, the next time you’re
out there, take a moment to check it out
yourself.
• Contact Philip Joens at pjoens@
pacbiztimes.com.
Andres Garcia’s job in the lab at Next Energy Technologies in Goleta is to
develop solar panels for windows that convert more light energy.
PHILIPJOENSPHOTO