This Harvard dropout and her brother launched a company to conserve liquids in factories
David and Annie Lu, siblings and co-founders of H20k Innovations
Photo courtesy David and Annie Lu
Annie Lu was a student at Harvard when Covid-19 brought the world to a screeching halt, including her own college experience.
“I remember in March of 2020 basically being kicked off campus and everything going virtual,” Lu, 22, told CNBC in a video interview in June. At the end of the spring semester in 2020, Lu’s sophomore year, she did not return to school.
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She hasn’t looked back since.
That’s because Lu, and her older brother David, 25, have since launched and are now growing their own company, H2Ok Innovations, which uses a combination of hardware and software to improve the efficiency of factories by reducing how much liquid they use.
“I can’t speak to what would have been, but what I can say is it was such an easy decision for me to make and it was so obvious,” Annie told CNBC. “The trade-off was virtually nothing.”
Leaving Harvard and becoming obsessed with improving factory efficiency with your older brother might seem like a surprising move.
But there is a deep family connection: Annie and David’s paternal grandfather started a factory in China that manufactured specialty fine chemicals, and their dad worked for the family’s chemical-manufacturing business. So did Annie and David’s uncles. And they were proud to do so. “As with every family business, everyone is involved in the family business,” Annie told CNBC.
David was born in Saskatoon, Canada, and at age 1 moved to the Bay Area, where Annie was born. Their parents are immigrants from China.
Annie Lu visiting her family’s factory in China when she was younger.
Photo courtesy Annie Lu
When Annie and David were young, their grandfather, who was deeply passionate about chemistry, taught them chemical reactions and how various pieces of industrial equipment worked. Also as kids, Annie and David would tour their family’s factories and learn about chemical factory parts, like the distillation towers. The idea of “lean manufacturing” was also a topic of conversation in the family.
“I remember in elementary and middle school spending summers touring factories, and having exposure to large scale industrial equipment, understanding how they work. We grew up in the sector,” Annie told CNBC. “That’s where our inspiration germinated from, I would say.”
Since officially launching their sibling enterprise in March 2021, H20k Innovations has raised $6.8 million from investors including Construct Capital, Flybridge Capital, Techstars, 1517 Fund and 2048 Ventures. The company is headquartered out of Greentown Labs in Boston, and is booking revenue. Annie and David were recognized as 2022 Forbes 30 Under 30 and in March, H20k Innovations was recognized at Unilever’s annual supplier summit and granted the “Start-up of the Year Award.”
Annie and David Lu at a Harvard Innovation Labs event, when they were still ideating.
Photo courtesy Annie and David Lu
The two started the company just as Covid-19 disrupted supply chains globally, bringing the importance of manufacturing into the spotlight.
“The pandemic exposing gaps within manufacturing and industrials … was an inspiration” for launching H20k, Annie said. “It was a perfect opportunity.”
From Techstars in Minnesota to setting up shop in Boston
In fall 2020, Annie and David moved to Minneapolis for the Techstars Farm to Fork program, which accepted them based on previous projects.
“Annie and I love hacking and building things together,” David told CNBC. “We work really well with each other. There are so many projects we have built in our upbringing when we were growing up.”
Annie and David Lu at the Farm to Form TechStars Accelerator.
Photo courtesy Annie and David Lu
They came to Techstars with the idea of developing a low-cost technology to identify contamination in natural waterways and drinking water. But as part of the program, Annie and David got access to 120 executive leaders in various parts of food tech, and they asked those executives what their biggest headaches were.
Eventually, they decided to focus on improving the efficiency of liquid use in manufacturing processes.
“Liquids and fluids are at the heart of it in production process in so many different sectors,” Annie said, including food and beverage, pharmaceuticals, semiconductor making and cooling commercial buildings and factories. “It is such a large white space, and an area where there exists a lot of gaps.”
By the end of Techstars, Annie and David had their vision for H2Ok Innovations set and started to execute.
They came up with the idea of using a combination of physical sensors and software to measure and optimize both the use and composition of liquids and fluids in manufacturing. Their process involves collecting that data and using their software to combine the liquids data with other factory and facilities data in what Annie calls a “very, very versatile” internet-of-things system.
Conventionally, data that is gathered in a factory stays on premises. “We’re basically unlocking previously untapped data streams,” Annie said.
Improving the efficient use of liquids in manufacturing processes reduces waste and lost product, which means the factories are also operating more sustainably.
In 2021, David joined Annie in Boston worked out of a space called Artisan’s Asylum for about six months and then moved into Greentown Labs.
Annie and David Lu with members of the H2Ok Innovations team at the Unilever Ben and Jerry’s facility.
Photo courtesy Annie and David Lu
In fall of 2021 and early 2022, Annie and David participated in the 100+ Accelerator program, a virtual accelerator program run by Unilever in partnership with AB InBev, the Coca Cola Co. and Colgate-Palmolive.
“The aim of the 100+ Accelerator program is to rapidly fuel the growth of startups developing sustainability solutions including reducing energy used in supply chains. Through the partnership, we work directly with entrepreneurs to refine and test their new technologies in our businesses, to put their solutions on an accelerated path to deliver a positive impact towards our sustainability goals,” Sandeep Desai, the Unilever ice cream chief product supply officer, told CNBC in a written statement.
“These startups operate across many fields including new packaging technologies, digital and geospatial solutions and new ways to upcycle product ingredients, that would otherwise be considered as waste,” Desai said.
As part of this partnership, Unilever tested the H2Ok Innovations solution at its Ben & Jerry’s facility in Waterbury, Vermont.
“At our Waterbury Ice Cream Sourcing Unit, our partnership has allowed for an 18% reduction in downtime during cleaning, which increases productivity and lowers costs in the supply chain. We have also saved 40% of a cleaning cycle’s water consumption by using the technology,” Desai said. Unilever is working to implement the H2Ok solution at other non-ice cream facilities in the U.S. and Brazil, Desai said.
In spring 2021, the siblings raised their first round of funding, and added to that during summer of 2022. H2Ok Innovations now has 17 total employees.
For investors, H2Ok’s value proposition is especially timely, as more manufacturing is coming back to the United States, and those facilities face increasingly strict efficiency standards.
“The U.S. is rising again as a manufacturing powerhouse and there is a compression of the normal technology lifecycle adoption curve in industrial companies and a push to be both innovative and more efficient given decades of intense, global competition,” Jeff Bussgang from Flybridge Capital told CNBC. “U.S. manufacturers have a strong climate and sustainability mandate, compelling them to be even more precise with their usage of liquids and energy.”
Plus, some investors see an inevitability to the sensor technology H2Ok Innovations is using.
“We found the H2Ok’s vision of replacing monolith-based water measurement with a swarm of sensors very compelling. Our thesis is that all measurements and data will be provided in real time and used to optimize operations of plants, data centers, etc.,” Alex Iskold from 2048 Ventures told CNBC. “That’s exactly what H2Ok is building.”
Annie and the H2Ok Innovations team at a customer facility, point up at their technology deployed in a factory.
Photo courtesy Annie Lu
The sibling bond runs deep
All of the investors who spoked to CNBC commented on how impressed they were with Annie and David, which is to be expected of investors doting on their portfolio companies, but still, the glowing accolades were notable and reflect the conviction the siblings share in building in the space their family has worked in for generations.
“They are exceptionally smart, visionary and courageous — the kind of founders investors dream to back,” Iskold told CNBC.
“We invested because they are incredible founders. Annie and David are relentless and incredibly smart, and this is the culture they have built out at H2Ok. They are the right and rare mixture of customer- and problem-oriented, and they have executed well to build a defensible technical solution that fits the customers’ needs,” Dayna Grayson from Construct Capital told CNBC.
“The founders are brilliant technologists and visionaries,” Bussgang from Flybridge Capital told CNBC.
Being siblings brings a level of inherent trust in that’s valuable to both Annie and David, who have been close to each other and the rest of their family their entire lives.
The H2Ok Innovations team at Greentown Labs in Boston, where they are currently headquartered.
Photo courtesy David and Annie Lu.
That trust is invaluable because running a business with employees, partners and customers can get stressful.
“There are hard conversations that need to be had,” Annie said. “We can have these hard conversations in a very, very comfortable way, and hold each other accountable and push each other to be better.”
“We know how to fight, we know how to have hard conversations. We’ve been fighting our whole lives,” David said.
Both Annie and David giggled at this thought. It’s something of a joke, they said, but it’s also serious. Getting through hard conversations is “crucial for the success of a business,” David said.
Their complimentary skill set is a great boon, too.
Annie is creative and an “especially out-of-the-box thinker,” said David. And David is excellent at recognizing patterns across disciplines and executing on technical developments, Annie said.
They also share a philosophy on how to interact with people. They acknowledge that they’re young and that listening to others is important.
“I think this aspect of authenticity, and coming into every single conversation with customers, to users, to mentors, and beyond with deep humility and empathy is so critical to who we are as a team, but particularly who we are as founders,” Annie said.
U.S. President Donald Trump announced on April 4 that he would again postpone enforcement of a law banning TikTok unless its Chinese owner ByteDance divests from the platform.
Vcg | Visual China Group | Getty Images
U.S. President Donald Trump told Fox News in an interview aired on Sunday that he has a group of “very wealthy people” ready to buy TikTok, whose identities he can reveal in about two weeks.
Trump added that the deal will probably need Beijing’s approval to move forward, but said “I think President Xi will probably do it,” in reference to China’s leader Xi Jinping.
The president made the off-the-cuff remarks while discussing the possibility of another pause of his “reciprocal” tariffs on Fox News’ “Sunday Morning Futures with Maria Bartiromo.”
Tiktok’s fate in the U.S. has been in doubt since the approval of a law in 2024 that sought to ban the platform unless its Chinese owner, ByteDance, divested from it. The legislation was driven by concerns that the Chinese government could manipulate content and access sensitive data from American users.
Earlier this month, Trump extended the deadline for ByteDance to divest from the platform’s U.S. business. It was his third extension since the Supreme Court upheld the TikTok law just a few days before Trump’s second presidential inauguration in January. The new deadline is Sept. 17.
The Protecting Americans from Foreign Adversary Controlled Applications Act, of PAFACA, had originally been set to take effect on Jan. 19, after which app store operators and internet service providers would be penalized for supporting TikTok.
TikTok went dark in the U.S. ahead of the original deadline, but was restored after Trump provided it with assurances on the extension.
Trump, who credited the app with boosting his support among young voters in the last presidential election, has maintained that he would like to see the platform stay afloat under new ownership.
Potential buyers that have voiced interest in the app include Trump insiders such as Oracle’s Larry Ellison to firms like AppLovin and Perplexity AI.
However, it’s unclear if ByteDance would be willing to sell the company. Any potential divestiture is likely to require approval from the Chinese government.
A deal that would have spun off TikTok’s U.S. operations and allowed ByteDance to retain a minority position had been in the works in April, but was derailed by the announcement of Donald Trump’s tariffs on China, Reuters reported that month.
The president previously floated a proposal for American stakeholders to buy the company and then sell a 50% stake to the U.S. government as part of a joint venture.
Experts have previously told CNBC that any potential deal could face legal challenges in the U.S., depending on whether it complies with PAFACA.
CEO of Tesla Motors Elon Musk waves after ringing the opening bell at the NASDAQ market in celebration of his company’s initial public offering in New York June 29, 2010.
Brendan McDermid | Reuters
At the time of Tesla’s IPO 15 years ago, the company had generated roughly $150 million in revenue in its lifetime. That came almost entirely from the Roadster, a two-seat electric sportscar that boasted a range of 236 miles on a single charge.
The Model S sedan was still in the lab, two years away from hitting the market.
“The Model S, which is planned to compete in the premium vehicle market, is intended to have a significantly broader customer base than the Tesla Roadster,” the company said in its IPO filing, ahead of its planned $226 million offering.
A bet on Tesla, which debuted on the Nasdaq on June 29, 2010, was a wager on CEO Elon Musk’s ability to develop a roster of mass-market electric cars and scale an automaker far away from the Detroit auto hub, focusing instead on Silicon Valley, home to much of the world’s top tech talent.
Musk didn’t start Tesla, but he invested early, served as chairman and took over as CEO in October 2008, after leading a board revolt against founding CEO and inventor Martin Eberhard early that year.
An investor who put $10,000 into Tesla’s stock at the time of the company’s IPO and held onto all those shares would now own a stake worth close to $3 million. A similar investment at the time in the S&P 500 would have resulted in holdings worth about $57,000.
Far removed from its days as an experimental clean-tech startup led by a member of the “PayPal mafia,” Tesla is now the eighth most-valuable publicly traded U.S. company, with a market cap of over $1 trillion after nearly hitting $100 billion in revenue last year.
The Roadster is largely in the history books, and the Model S is no longer of great importance to the company’s bottom line. Rather, it’s Tesla’s top-selling Model Y SUV and Model 3 sedan, along with sales of environmental regulatory credits, that helped define the company’s financial success over the past decade.
But for the 54-year-old Musk (his birthday was Saturday), now the world’s wealthiest person, that’s the past. He’s told investors that the reason to buy and own Tesla stock from here has almost nothing to do with selling cars to consumers.
“If somebody doesn’t believe Tesla’s going to solve autonomy, I think they should not be an investor in the company,” Musk said on an earnings call in April of last year. He added, “We will, and we are.”
Two months after that, Musk said his company’s Optimus humanoid robots that he hopes some day will perform like R2-D2 and C-3PO in Star Wars, could some day lift Tesla’s market cap to $25 trillion.
Musk, who last year characterized himself as “pathologically optimistic,” has said he expects thousands of Optimus robots to be working in Tesla factories by the end of 2025, and that the company will begin selling the robot next year.
As for autonomy, Tesla currently lags behind Alphabet’s Waymo, which is operating public robotaxi services in several U.S. markets, and Baidu’s Apollo Go in China. Tesla’s Robotaxi just launched a very limited pilot service in Austin, Texas, earlier this month, and said Friday it had completed its first driverless delivery of a new car to a customer.
While Tesla still has its share of fanatics and a largely bullish slate of analysts, Wall Street is skeptical of Musk’s futuristic promises or sees them as baked into the stock price. The stock is down about 20% this year, badly underperforming major U.S. indexes and trailing all of its megacap tech peers. Apple, down 19.7% for the year, is the only one close.
Earlier in June, Tesla’s vice president of Optimus robotics, Milan Kovac, said he’s leaving the company after a nine-year tenure, and Musk more recently fired Omead Afshar, the automaker’s vice president of manufacturing and operations.
Meanwhile, Tesla EV sales have been sluggish in 2025, with automotive revenue suffering a second straight year-over-year decline in the first quarter due to an aging lineup and bustling competition, especially from lower-cost Chinese manufacturers.
New Tesla sales in Europe fell for a fifth straight month in May, according to data from the European Automobile Manufacturers Association, or ACEA, and Tesla’s newest model, the Cybertruck, has failed to gain significant traction in the U.S. after a series of recalls.
Hovering over Tesla’s business is the unpredictability of Musk.
Long glorified for his business success — through PayPal, Tesla, SpaceX, brain tech startup Neuralink and artificial intelligence company xAI, among other pursuits — Musk asserted himself in the political realm last year, when he endorsed Donald Trump for president and subsequently injected nearly $300 million into his campaign and related Republican causes.
Tesla CEO Elon Musk holds a key gifted by U.S. President Donald Trump in the Oval Office of the White House on May 30, 2025 in Washington, DC.
Kevin Dietsch | Getty Images
Musk spent the first few months of 2025 spearheading President Trump’s Department of Government Efficiency (DOGE), slashing the size of the federal government and stripping resources from regulatory agencies, including those tasked with oversight of his companies.
But his pivot to politics came at a cost, at least in the short term.
Musk’s vocal and financial support of Trump, endorsement of Germany’s far-right AfD party and extended string of charged and divisive remarks and gestures, including on his social network X and in press appearances, has been correlated with declines in Tesla’s reputation, and a drop in his overall favorability, according to polling data.
“Unless Tesla can come up with a whole range of new products that will really excite consumers, and unless they can mitigate some of the antagonism caused by their leader, they will be seen as past their peak and will begin to go down,” David Haigh, CEO of research and consulting firm Brand Finance, said in January.
Brand Finance’s data showed that the value of Tesla’s brand fell by 26% in 2024, a second straight annual decline. That was before Musk’s time working in the second Trump administration.
Musk’s official tenure in Washington, D.C., ended earlier in June, just as his relationship with the president was souring. Shares of Tesla fell 14% on June 5, as President Trump threatened to pull government contracts for Musk‘s companies, escalating a war of words over the president’s spending bill.
Musk temporarily slowed his posting about politics on social media after that, and appeared to focus more on promoting his businesses. But this weekend he resumed attacking portions of the bill that would hamper solar and renewable energy companies, including Tesla.
Whether Musk is now focused enough to solve Tesla’s problems and, even if he is, whether that’s a big catalyst for the company, is very much up in the air.
Musk and Tesla didn’t respond to a request for comment.
Tesla investors have learned that volatility is a big part of the story, and has been since the company’s stock market debut. On more than 40 occasions in the past 15 years, Tesla’s stock has gained or lost at least 20% in a single month.
Here are the three best and worst months for the stock and what happened to cause these hefty moves:
The good months
Elon Musk attends a discussion session during the Cannes Lions International Festival Of Creativity in Cannes, France, June 19, 2024.
Marc Piasecki | Getty Images
May 2013
In Tesla’s best month on record, the stock jumped 81%. The company for the first time reported a quarterly profit, albeit a very narrow one. It didn’t mark a sudden turn to profitability, as Tesla continued to lose money until 2018. But sales of Model S cars topped estimates as did revenue from zero emission vehicle (ZEV) credits, which have long been a boon for the company and have sometimes been the difference between a quarter ending in the red or the black.
August 2020
Following a big dip in the early days of the Covid pandemic, Tesla’s stock began an historic rally, leading to an eightfold increase in the stock in 2020, by far its best year on record. Its single best month that year was August, when the share price jumped 74%. Model 3 sales were accelerating rapidly, but much of the momentum was tied to buzz that the company could soon enter the S&P 500, and a pandemic market boom, when retail investors poured into meme stocks, cryptocurrencies and FOMO (fear of missing out) assets. Tesla’s big announcement in August 2020 was a five-for-one stock split, with the share price having soared well past $1,000. Tesla would split its stock again in 2022.
November 2010
Tesla’s 62% rally in its fifth full month as a public company was as much a sign of early volatility as anything else. The next month, the company would lose almost a quarter of its value, wiping out most of those gains. Tesla’s cash position at the end of 2010 was precarious enough that the company warned it may need to raise more money in the future, particularly “if there are delays in the launch of the Model S.” On Nov. 9, 2010, Tesla reported a 31% drop in year-over-year revenue to $31.2 million and a net loss of $35 million. A week earlier, the company said Panasonic had invested $30 million in Tesla through a private placement.
The bad months
Elon Musk, during a news conference with President Donald Trump on May 30, 2025 inside the Oval Office at the White House in Washington.
Tom Brenner | The Washington Post | Getty Images
December 2022
Tesla’s steepest monthly slump on record was a 37% decline to wrap up 2022, which was the worst year for the Nasdaq since the 2008 financial crisis. The company faced a production halt at its Shanghai facility, which was dealing with a fresh onslaught of Covid cases. Musk had been selling Tesla stock in big chunks to fund his $44 billion acquisition of Twitter, which he later renamed X.
Musk said on Twitter Spaces on Dec. 22 that he wouldn’t be selling any stock for 18 to 24 months. In a debate with a Tesla shareholder, he pinned Tesla’s declining share price on Federal Reserve rate hikes, writing that “people will increasingly move their money out of stocks into cash, thus causing stocks to drop.” The distraction of the Twitter deal weighed on Tesla shares, and Musk also frustrated some shareholders by borrowing personnel from the Tesla Autopilot team to work on his social media company’s technology.
February 2025
What was supposed to be a honeymoon period for Tesla, thanks to Trump’s return to the White House, turned into a massive selloff, with the stock plummeting 28% in February. In its earnings report in late January, Tesla said automotive revenue sank 8% from a year earlier and the company reported a 23% drop in operating income. Tesla cited reduced average selling prices across its Model 3, Model Y, Model S and Model X lines as a major reason for the decline. Investors also worried about impending tariffs on goods and materials coming from Canada and Mexico, where some of its key suppliers are based. With Musk ramping up his political rhetoric, new vehicle registrations dropped in Europe, plummeting in Germany by around 60% in January from a year earlier.
January 2024
The beginning of 2024 was almost as bad for Tesla, with the stock tumbling 25% to open the year. The company reported revenue and profit for the fourth quarter that trailed estimates, partly because of steep price cuts around the world. Tesla warned that volume growth in 2024 “may be notably lower” than in 2023, and cautioned investors that it was “currently between two major growth waves.”
Elon Musk speaks onstage at Elon Musk Answers Your Questions! during SXSW at ACL Live on March 11, 2018 in Austin, Texas.
Diego Donamaria | Getty Images
There were countless other monumental moments for Tesla along the way and, had Musk gotten his wish in 2018, the IPO anniversary may have never taken place.
“Am considering taking Tesla private at $420. Funding secured,” Musk infamously tweeted in August of that year. Tesla’s stock trading was initially halted and shares were volatile for weeks. A take-private never occurred.
The SEC investigated and charged Musk with civil securities fraud as a result of the tweets. Tesla and Musk struck a revised settlement agreement in 2019 over those charges. The agreement forced Musk to temporarily relinquish his role as chairman of the Tesla board, a position that’s now held by Robyn Denholm.
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