Drew Baglino, the former senior vice president of powertrain and energy engineering at Tesla, has quietly founded a second startup in less than two years. The new venture, called Sadi Thermal Machines, is focused on heat pump technology, according to company filings and sources familiar with the matter. The startup was formed in June 2025 and shares a headquarters in Scotts Valley, California, with Baglino’s other company, Heron Power, which develops solid-state transformers.
A Second Act Rooted in Tesla’s Thermal Innovations
Baglino spent nearly two decades at Tesla, rising to become a key figure in the development of the company’s core energy technologies, including electric motors, batteries, and power electronics. He was instrumental in the creation of Tesla’s advanced heat pump system, known as the ‘octovalve,’ which first appeared in the Model Y. This system manages the temperature of the cabin, batteries, and motors in a compact, suitcase-sized package, and was considered a significant competitive advantage at its launch.
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The name of the new startup, Sadi Thermal Machines, is a clear nod to Nicolas Léonard Sadi Carnot, the pioneering French physicist whose work laid the foundation for modern thermodynamics, including the principles behind heat pumps and internal combustion engines. The choice of name signals a deep technical focus on thermal management and efficiency.
From Tesla’s Octovalve to the Home
During a Tesla earnings call in 2022, Baglino and CEO Elon Musk discussed the possibility of developing a heat pump for residential and commercial settings. Baglino noted that such a system would be ‘easier’ than automotive applications, which are ‘constrained on mass and volume and energy.’ Musk added that it was ‘a thing we will do,’ though no timeline was given. Tesla has yet to release a residential HVAC or water heating system, but Baglino’s comments on that call—’People should do it anyway’—now appear prescient.
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With Sadi Thermal Machines, Baglino appears to be acting on that statement. The startup is reportedly staffed by several Tesla alumni, according to LinkedIn profiles and a source familiar with the company. This team brings deep expertise in thermal management, heat pump design, and high-volume manufacturing, all of which are critical for bringing a residential heat pump to market.
Why This Matters for the Clean Energy Transition
Heat pumps are a cornerstone of the global push to decarbonize buildings. They are highly efficient, using electricity to transfer heat rather than generate it, and can provide both heating and cooling. The residential HVAC market is large and fragmented, and a well-designed, cost-effective heat pump could significantly accelerate adoption. Baglino’s track record at Tesla, where he helped scale production of complex energy systems, suggests he is well-positioned to tackle this challenge.
The startup’s connection to Heron Power, which focuses on solid-state transformers, also hints at a potential integration of advanced power electronics with thermal management systems. This could lead to more efficient and intelligent home energy systems that combine heating, cooling, and electrical management.
Conclusion
Drew Baglino’s quiet launch of Sadi Thermal Machines represents a significant development in the clean energy space. The startup leverages deep technical expertise from Tesla and a clear focus on heat pump technology, a critical component of building decarbonization. While details remain scarce, the combination of Baglino’s experience, a strong team of Tesla alumni, and a clear market need positions Sadi Thermal Machines as a company to watch in the coming years.
FAQs
Q1: What is Sadi Thermal Machines?
Sadi Thermal Machines is a newly formed startup founded by former Tesla executive Drew Baglino. It is focused on developing heat pump technology, likely for residential and commercial applications. The company was formed in June 2025 and is based in Scotts Valley, California.
Q2: Why is Drew Baglino’s background relevant to this startup?
Baglino spent nearly 20 years at Tesla, where he oversaw the development of the company’s core energy technologies, including the advanced heat pump system used in the Model Y. His experience in designing and scaling complex thermal management systems is directly applicable to creating efficient heat pumps for buildings.
Q3: Is this startup connected to Tesla’s plans for a residential heat pump?
While Tesla discussed developing a residential heat pump in 2022, the company has not released one. Baglino’s new startup appears to be an independent effort to bring such a product to market, utilizing the expertise he gained at Tesla. There is no known formal connection between Sadi Thermal Machines and Tesla.
