Help Needed - Strategy for cleantech venture

[akula]

Hi everybody! I have a venture called Save Green Australia. We operate in Sydney. Yesterday I was in a meeting with a solar panel installation business, they want my business to do marketing for them, and so I need advice on how to market solar panels. Let me tell you a bit about the product.

The product: For example, the customer can buy a $10k solar power system on credit (i.e. no upfront payment). Of the $10k, the government pays $5k as part of a rebate incentive offered to encourage renewable energy use. The system generates $1.5k worth of energy every year, which can be used up, or sold back into the grid. The government guarantees the purchase of energy from customer for 25 years. The panels instantly increase value of property by $10k. The customer never sees another energy bill, which is good because energy prices are rising every year.

It's a good product. Worth it..

The problem: How do I make Australia a solar powered nation? How do I put this product in millions of homes? What strategy should I use?

Thanks guys..really could use some help on this one..

[Encrypted]

I'd definitely take advantage of the government guarantee to buy back energy for 25 years to promote the product. Say something like, "what would you say if I offered to give you $37,500 in exchange for $5,000?" and then build off of that or something.
I mean, even if you don't use the energy for yourself, you can just hook it up to the grid and sell it for a profit.

I'd head to middle/upper class neighborhoods and do door-to-door marketing personally. There's a slim chance that they'll buy it right then and there, but if you give them some information on it, they can do their own research and get back to you.

[jasaunders]

Hey Danny, thanks for reaching out, hope all is well.

While I am certainly knowledgable of the environmental marketplace, solar and renewable energy isn't particularly my area, and of all geographies, I am least familiar with the Australian market

That being said, I think your best bet is going to be to target architects, specifiers and developers. It will be very difficult if you try to target consumers directly. Firstly, because you can reach many more people directly if you use a channel such as building specifiers. Secondly, because many consumers still don't "understand" solar and its payback, and it will be a harder sell.

I know Australia uses the Green Star rating system for buildings (mostly commercial I think). Green Star is managed by the Green Building Council Australia. This might be a good place to start in terms of networking and research and making contacts, since I am pretty sure the Green Star Rating System would award points to buildings for using renewable energy.

I'm not sure what other green building rating systems exist in Australia, there are probably others, but I believe targeting the building community as a whole will prove much more successful than going after individual households.

Hope this helps! Let me know if you have any questions.

- Josh

[crackah]

Yo Yo mate.

If they are getting 1.5k each year, tell them you will install the systems for free, in exchange for 5 years of rebates

you get a nice little interest component in it.

Not 100% sure on the product and if it will work. I would jump at that. Free Solar!

[BizGuy]

Danny,

First of all, congrats on landing this project, it sounds like it has huge potential and of course good for the environment!

I liked all three of the above comments from Encrypted, Jsaunders & Crackah, they were all great ideas.

I would like to add the possibility of partnering up with several of the other service companies out there that have already been 'inside' the house and developed a working relationship with the client. For example, if I was getting my air conditioning unit fixed or serviced and they asked me: Have you ever thought about Solar powering your house and pool? I'd say: Yes I have thought about this option for my pool. Then if those 'reps' or 'technicians' were trained, incentivized and equipped with the basic hand out brochure for "SOLAR Company ABC" and had a trackable link to "SOLARcompanyABC.com/offer1" as well as a dedicated referral tracking phone number, then i'm quite confident you could talk to the owners of these 'service' companies and offer a worthwhile referral fee. Its not a competing service just and added revenue stream and I'm not sure you would run into too many companies that turn down 'extra revenue' these days.

That being said, the list of home service companies are abundant. This way you have a small army of non-intrusive-suggestive-selling sales troops!

Keep us in the loop and let us know how things work out! Excited to hear more details so keep this thread updated if you would with all the tips & strategies you use.

Cheers,

Adam Toren

[rogercbryan]

Yo Yo mate.

If they are getting 1.5k each year, tell them you will install the systems for free, in exchange for 5 years of rebates

you get a nice little interest component in it.

Not 100% sure on the product and if it will work. I would jump at that. Free Solar!

This isn't a bad idea if you have access to capital to do so. I would go a step further though and say that you will install the panel so that they have free electricity for 25 years and then keep all the income they generate. As a home over in the US if someone came to me and said they could eliminate my electric bill for free I would be all over it.

I think if you were going to venture capital with a deal like this $10K up front for $37,500 lifetime return you would have a decent shot....

[rogercbryan]

Danny,

First of all, congrats on landing this project, it sounds like it has huge potential and of course good for the environment!

I liked all three of the above comments from Encrypted, Jsaunders & Crackah, they were all great ideas.

I would like to add the possibility of partnering up with several of the other service companies out there that have already been 'inside' the house and developed a working relationship with the client. For example, if I was getting my air conditioning unit fixed or serviced and they asked me: Have you ever thought about Solar powering your house and pool? I'd say: Yes I have thought about this option for my pool. Then if those 'reps' or 'technicians' were trained, incentivized and equipped with the basic hand out brochure for "SOLAR Company ABC" and had a trackable link to "SOLARcompanyABC.com/offer1" as well as a dedicated referral tracking phone number, then i'm quite confident you could talk to the owners of these 'service' companies and offer a worthwhile referral fee. Its not a competing service just and added revenue stream and I'm not sure you would run into too many companies that turn down 'extra revenue' these days.

That being said, the list of home service companies are abundant. This way you have a small army of non-intrusive-suggestive-selling sales troops!

Keep us in the loop and let us know how things work out! Excited to hear more details so keep this thread updated if you would with all the tips & strategies you use.

Cheers,

Adam Toren

I'm no longer a big supporter of partnerships as a first approach. I'm more interested in trying to go things alone and then only when I have control over the project I can look to bring in partners for minor roles and/or if the project has a large scale opportunity then looking for a larger partner when I have enough equity to still control the deal.

[rogercbryan]

Here is some hypothetical math as I know you've been involved in VC for over $1M before.

$1M = 100 Units
*I'm not sure about upkeep or other overhead so that would have to be equated

100 Units = $150K per year

If you could secure a 10 year note at 9% or lower you would have enough income to pay your note each year. You would basically be looking for the income from year 11-25 which overtime would be significant. If along the way you can sell a few of these items it would support your efforts as well. It all depends if you can support a project like this for 10 years. If this is going to be primary business then there are holes in what I'm saying... You may also be able to charge people a $1000 install fee in exchange for their free electricity for 25 years. This way you would at least have $100K in income over the duration of the install cycle.

Just throwing a few ideas out there... I like the opportunity! I just enrolled in an MBA Program at the San Fransisco Institute of Architecture in Sustainability and Green Building Design. I know this is the next age to come (industrial age - information age - green age)... getting in this now is the best bet for any entrepreneur. You'll have to let me know if there is ever an opportunity to bring this project to the US (before regulatory constraints and American Ignorance derails it of course)

[SCJeff]

This isn't a bad idea if you have access to capital to do so. I would go a step further though and say that you will install the panel so that they have free electricity for 25 years and then keep all the income they generate. As a home over in the US if someone came to me and said they could eliminate my electric bill for free I would be all over it.

I think if you were going to venture capital with a deal like this $10K up from for $37,500 lifetime return you would have a decent shot....

That is genius sir!

Like you said OP, the real problem is going to be marketing your solar powered system and getting it out there. Like stated before you could look into getting in contact with some contractors, architects, etc. Maybe have a deal worked where your package can be an additional option to a new home for a small fee, and then you receive the money for the excess energy being sold back into the grid.

The first thing I would honestly do though is install one of these on my own home, then close friends and family. I think word of mouth would be a great way to start getting a few of these out into the market. That is of course if you can get the money to do that.

If a co-worker or family member came up to me and said "I just spent $1000 for this new solar panel system and I'm guaranteed no power bill for 25 years" I would be shaking them to find out how I can do this too.

I think that might be the best bet starting out.


Jeff-

[crackah]

The government is changing the scheme, of yesterday it was cancelled.

Could be interesting and really change how it all works.

Also I agree with rogercbryan on partnerships somewhat. Its hard to make them work effectively. On one side, our it services side its not worked at all. On our community based program they are working great. We have been in HEAPS of newsletters, and heaps of refferals. Depends on the product maybe? Not sure.

[crackah]

The first thing I would honestly do though is install one of these on my own home, then close friends and family. I think word of mouth would be a great way to start getting a few of these out into the market. That is of course if you can get the money to do that.

Jeff-

Thats all good and great, WOM is amazing because its free, and it means your doing a good job. Our business is getting some great results but it doesn't build a big business imo. You need to advertise, market yourself and be clever in order to grow.

[Jhordell]

It was the Insulation rebate that got cancelled, not the Solar Energy one wasn't it ?

[jpmorgan13]

Hi everybody! I have a venture called Save Green Australia. We operate in Sydney. Yesterday I was in a meeting with a solar panel installation business, they want my business to do marketing for them, and so I need advice on how to market solar panels. Let me tell you a bit about the product.

The product: For example, the customer can buy a $10k solar power system on credit (i.e. no upfront payment). Of the $10k, the government pays $5k as part of a rebate incentive offered to encourage renewable energy use. The system generates $1.5k worth of energy every year, which can be used up, or sold back into the grid. The government guarantees the purchase of energy from customer for 25 years. The panels instantly increase value of property by $10k. The customer never sees another energy bill, which is good because energy prices are rising every year.

It's a good product. Worth it..

The problem: How do I make Australia a solar powered nation? How do I put this product in millions of homes? What strategy should I use?

Thanks guys..really could use some help on this one..

Having done zero research into how much it costs to buy/install solar panels I can't really comment if this is a good deal or not. I would like to know how the 10k price was arrived at?

-Is this the installed price to the consumer?
-Is this a one size fits all unit? Meaning a stock size...
-What is the going commission rate for a sales rep down under? 10%?
-Does 10k give you at least a 50% margin?

...if this is all good, then I would start where the biggest need is and where the biggest value is, wherever it is sunny all year round and people have high power costs...maybe Melbourne?

Because I don't believe there is enough margin for you to partner with local retailers and national distributors, I believe a direct sales strategy is in order...door to door, cold calls, and a big fucking billboard that tells people they will save 1500 per year with your solar system that pays for itself in under 3.5 years with the government rebate. Five commission only reps should be good to start. Set a devastatingly high goal with ridiculous growth plans to mimic what you've done in Melbourne. Maybe 10 more cities in year two running off the same model.

I don't know if you've studied Elon Musk, but he has a similar business in the US. SolarCity: Solar panels, solar leasing & financing for residential, commercial and government. $0 down solar lease—solar installation financing.

Might not be a bad model.

[akula]

It was the Insulation rebate that got cancelled, not the Solar Energy one wasn't it ?

errrhh..its complicated...
the insulation rebate is still available but there have been changes...same with solar
why, u want to claim smthn?