What I learned from working with utilities - from a startup perspective
The End of Business-as-Usual
We all know it and are part of it: The energy system is changing rapidly. Digitalization is advancing at incredible speed. Renewables, electrification of transportation and market deregulation are bringing enormous changes to the sector and are leading to the emergence of disruptive business models. We are seeing new players suddenly appear and gain huge traction. Technologies such as Big Data, AI or cloud computing now mature faster and faster, opening up massive possibilities for innovative, data-driven services. And the new generation of consumers - the digital natives – expect an “on-demand” user experience and are forcing utilities to become lifestyle providers. We are all part of the ongoing energy revolution.
Nowadays, utilities still use 80% of all IT spending on just maintaining the “as is,” to operate the status quo. Less than 20% of their efforts are used to innovate. But in reality, it’s the end of business-as-usual. Speed is the “new black”. It’s all about innovating at a faster pace. It’s all about flexibility. Adaptability. Agility. Business as usual is not an option anymore. Utilities understand this, but they need guidance on how to adjust.
The “New Kids on the Block” shake up the Establishment
Innovation is increasingly coming from the edge, from smaller tech companies or the startup community. They have modern technology, flat hierarchies, less bureaucracy and no legacy, combined with a lean startup mindset and - to some degree - a youthful cockiness. Often these companies can out-innovate established players and bigger organizations. At least, that is what I, as the CEO and Co-Founder of a utility SaaS company, like to believe.
Looking back over the last months and weeks, I have been astounded and thrilled by the enthusiasm, eagerness and engagement from many utilities, to get in touch and engage with us “New Kids”. Often energy companies are really “keen to dance with startups” and spend a considerable amount of effort and resources on making it happen. And it should not surprise anyone: We love dancing with utilities, too.
Dancing with the elephants
Having worked for tech startups and growth companies for more than 10 years, doing business with big organizations sometimes feels more like dancing with an elephant. Utilities naturally operate in a more stable environment and run at a slower pace. They cannot (and should not) just swing, turn around or rapidly change the direction of the entire organization. They cannot (and should not) just jump on the newest trends and hottest topics.
As a company we have found we like dancing with elephants. Even if it sometimes feels quite heavy and we have had our toes crushed several times. Here are some of the lessons we in Greenbird have learned.
Finding the hottest spot
The first thing is always to find the hottest spot or best dancefloor. As a startup, we are, by default, always short of cash. We cannot afford to visit each and every conference or exhibition. Nor can we jet set around the globe and knock at all the doors just to find out whether there might be an opportunity or not.
Luckily, many utilities have dedicated innovation departments and manage accelerator programs such as Free Electrons (http://www.freetheelectron.com/) where we as a growth company get a platform to engage with several innovative energy companies. For us, Free Electrons was the perfect spot to start dancing with utilities. The participating utilities in the program have more than 76 million customers in total from Europe, Middle East, Asia, Australia and the US.
Getting past the bouncer
Finding the hottest dancefloor is one thing but getting past the bouncer might be even harder.
The purchasing rules often can make it almost impossible to “get in”. Many utilities have policies that vendors must be pre-approved, required to show reference cases from the same region, need several millions or even billions in revenues for the last three years or must provide a 24/7 local support organization. Greenbird has been successful in business since 2010 and has strong economic foundations, but even we are just not able to fulfill all these requirements.
Luckily, again, the utilities’ innovation departments with their commitment to work with startups and the accelerator programs have been a door opener for us.
Being asked to dance
Elephants are big. Utilities are big. Even we have nearly 50 employees, but we are small. And there are many other small companies out there. And they all want to dance with utilities. We have to be attractive to be asked to dance. We have to be noticed.
In the crowded field of AI and Big Data analytics solutions for utilities, it has been crucial for us to stick out and to claim a clearly defined area. In our case, this is Data Integration. Utilities know about the latest research results: 80% of all efforts in developing new services are spent on accessing and preparing data. Helping them to spend this 80% on innovation instead is our mission. We unlock data from silos, we integrate machine and enterprise data, we clean and prepare data and make it accessible and usable.
We strongly believe our narrow focus on Data Integration makes us attractive as a dance partner. It is one of the reasons why Gartner recently selected us as a Cool Vendor in Application Architecture, Infrastructure and Integration.
Finding the right beat and leading the dance
It takes two to tango, it takes two to dance. We need the right music, the right beat and rhythm. We have to move in harmony, synchronized, with one partner leading.
Dancing with utilities can be a slow dance with only a few beats per minute. They typically need more time to get in motion, move at a slower pace and swing less. We as a startup are used to flat hierarchies, fast decisions and the agility to turn around and swing quickly.
We have been taught the slow dance. We have learned to plan with, and even more importantly, to budget for, longer sales cycles, extended sprints or more demanding decision processes. We have learned to lead even though we are smaller. Our capability to lead – with expert knowledge in Data Integration, our experience with Big Data and cloud computing – is why the utilities engage with us.
And we learned that a slow dance can even create a form of business intimacy. A partnership for success.
Not getting toes crushed
Last, but not least and maybe most important: As elephants are huge, heavy, sometimes unpredictable, scared or angry, we are always careful not to get our toes completely crushed during the dance.
And even though our feet hurt sometimes, and we occasionally find ourselves with blue toenails, we really enjoy dancing with them.
How innovative Tech Companies can help Utilities to accelerate the Digital Transformation.
Would you like to know more about my vision, ideas and what we are actively doing to accelerate the energy revolution?
Thorsten Heller | CEO