berkeley, berkeley class, business model, business model canvas, customer development, engineering, lean launchpad, lean startup, startup, steve blank

1. IoT + Energy Management
1
Zillow for Solar
Pivoted :Energy Storage
Service
TOTAL INTERVIEWS: 102
Shayaun Nejad
Business Dev
Sundar Subramanian
Energy
Abhishek Mishra
Consulting
Andre Askarinam
Energy & EECS
Billy Jan
Industrial Eng.
Scott Raskin
Mentor
BoltWatch

2. 2
Zillow for solar (Wk 1-3 & 30 Interviews)
EXISTING FREE COMPETITION.
“Landowners generally do not care about leasing land
unless 5x ROI.”
Sandipan Bhanot
Project Developer, Staten Solar
• Value Proposition: Platform
connecting landowners to
developers
• Cust Segments: Solar Project
Developers and Land Owners
(Farmers)

3. 3
Business Model Canvas – Zillow for Solar
No Product Market Fit saving 10 months
Landowners: do not care for developer and broker
mediation unless this service is for free.
Project Developers will not pay

4. 4
Energy Storage (Wk 4-6 & 26 Interviews)
“Grid scale energy storage is not viable.”
Matt Baker, Energy Trading, PG&E
“it’s too early due to storage system
costs.”
Jeff Eyet, Business Development,
GreenCharge
• Team expertise in Energy
• Store energy at low grid cost and supply at high
• Cust Segments: Commercial and Industrial facilities with high peak charges
• Value Proposition: Shave and shift Peak demand to reduce electricity costs

5. 5
Businss Model Canvas – Energy Storage
Economics does not work
Expensive Battery
High upfront cost for our startup
Storage capacity not sufficient for industrial

6. 6
BoltWatch
Ronan Bose
Consultant, Silver Spring
“It is difficult to manage electricity in large
facilities, and there are no dominant players.”
Jonathan
Farmer / Owner, Almond Processing Plant
“The farm is run by family and uses
$600,000/year in energy. We did not have energy
management department. In fact, we never
thought of energy management.”
• Address “Peak Charges” via Data Analytics + Monitoring
• Cust Segments: Commercial and Industrial Facilities with high peak
charges (15-25%)
• Value Proposition: Reduce peak electricity costs by (20-30%) + Energy
Management and Analytics
Week 7

7. Business Model Canvas
7

8. Energy
Storage
“New buildings and facilities integrate building management
software as part of design.”
Focus on SMB that do not have dedicated teams and those
that operate in inconsistent energy profile industries.
8

9. 9
Customer Archetype
“Mom & Pop” Facilities
+ ~ 10,000 sqft facility
+ Fewer than 100 employees
+ Inconsistent demand (eg., batch process plants)
+ No dedicated energy management team
+ Expensive electricity markets
+ Large energy bills in excess of $50,000 / month
+ No tangible strategy to reduce their electricity
cost
Week 9

10. Gateway
Device
Smart
Sensors
MVP: Hardware Week 10
10

11. MVP: Analytics
Software:
▫ Smartly analyze and report energy usage of appliances
▫ Can regulate appliance energy use without intrusion into machine operations.
▫ Find optimum set-points
Week 10
11

12. Appliance
MVP: Example Manufacturer Layout Week 10
12

13. Appliance
Monitor
Router
MVP: Example Manufacturer Configuration Week 10
13

14. Payment Flow & Revenue Model
BoltWatch
Finance/Accounts
$250 - $500/month
$500 one time
Send bills
Hardware installation
Small Industrials
▫ Performance based payment
▪ Sliding scale range from $250
- $500 per month
▪ Features and insights are
valuable
▫ Asset Sale
▪ $500 per hardware installed
▪ Low initial cost to increase
adoption
Per Customer LTV is $20,000 for asset +
Subscription for 60 month period
Revenue ModelPayment Flow
Week 11
14

15. Cost Flow
Software Development
4G Smart Plug $ 50 / cust. ($ 30 / unit, 50 units)
Router (4G LTE Router Industrial) $ 77 / cust. ($ 230 / unit, 10 units)
PaaS (AWS IOT) $ 5 / cust. ($ 5 / million msg.)
Cloud Computing (Amazon EC2 r4) $130 / cust. ($ 1569 / year)
Components
People (per project)
Marketing ($10K budget)
Direct
Sales
Estimate cost of one 10,000-sqft facility with 30-month amortization on components & software
(Assume acquire 20 customers in 30 months)
ios / Android Smartphone & Desktop $3,000
Online marketing $ 500
Salary $ 6,000
Travel + Award
$ 3,000
Total Cost $ 17,740 for 30 months
Cost per month= $ 591
Cost Acq Cost = $ 650
Week 11
Expand quickly to lower acquisition costs and Focus on Partnerships
“Napa wineries network still don’t get the product.” – Partner with Energy Consultants
“you must guarantee that product actually saves energy.
We will recommend your product but not directly sell it.”- Partner with Utilities
15

16. Final Business Model Canvas (46 Interviews) Week 12
16

17. 17
Week
1 2 3 4 5 6 7 8 9 10 11
We are team
3.4 Energy Partners!
Connect Farmer with Developer –
Zillow for Solar
Developer will not pay
Pivot 1
Battery Storage Management
Pivot 2
BoltWatch
Discover SMB
Customer segment
Focus on Mom-and Pop
Facility
Introduce plug-and-play,
non-intrusive hardware
MVP demo
Next step:
Build pilot project
Our 12-week journeyMorale
Low
High

18. 18
Our interests are different but for Anyone Going for It….
BoltWatch
http://www.boltwatch.us/
Good to know ….
Penetrate via Partnerships (Consulting & Utilities)
Competition from Low Energy storage costs (battery tech)
Market size appropriate for expanding existing business unit

19. Market Size
Annual Subscription Fee ( $ / year) $4,250.00
World # of manufacturing facilities 6,000,000
US # of manufacturing facilities 300,000
Small to Medium Size Facilities
(10 - 100 workers)
110,000
Potential Revenue Target $475M
19
Week 10

20. Appendix
20

21. Value Proposition Canvas
Gain Creators
Products &
Services
Pain Relievers
Gains
Pains
Customer
Jobs
● Peak demand management
● Saving $$ on electricity bills
● Dashboards for monitoring
● Inability to understand data
● Too much data
● Excel is cumbersome and low
tech
● Financial Targets
● Pay bills
● Energy use tracking
● Customized analytics
● Historical reporting
● Mobile /Cloud integration
● 24/7 Monitoring
Segment: SMB and factory
settings less than 10k sq ft and
100 employees
Value Proposition: Energy
Management through IoT
and Analytics
● Real time analytics
● Auto update local energy rates
● Recommendations via text, email,
phone
● Override thresholds
● Integrated metering - all meters
reported in one platform
Week 9
21

22. • Last fund round $5M for expanding
Internationally and AI enhancement
• Reach $5M total revenue EOY
• Have AI tool fully up and running
Jan 2020
• Finalize partner supply agreements and
MFG IP partnerships ($250K)
• Funding round #2 $1M for operations
• Partnership with utilities finalized for
subsidies
Jan 2019
• Analytics and AI algorithm development
$100K
• Hardware dev and test $30K
• Test all needed for pilot
implementation
Jan 2018
• Expand into other USA markets
• Industry roadshows and tradeshows
with case study whitepaper
• Develop licensing technology to sell for
royalties to BM sofwtare
June 2019
June 2018
June 2017
• Pilot project implemented and running
• Funding round #1 for $1M
• Generate more leads and customers
and add consultant partners
• Website and ad word campaign for
leads $5K to develop pilot
• Technical requirements and supplier
identified
• Finalized BOM and system design
3 Year Timeline
22

23. Interview Insights (Canvas Right Side)
23
Ravy Nalluri
Genetech
Everyone has a vastly different electricity situation (existing EMS, installed panels,
hardwired appliances, can’t turn off appliances, value different VP...) but all of
them want to save power - need a product to cater to all. Regulation of power is
not as important as monitoring.
SMB
Manufacturing
Facilities
4 people Agreed to send data from company (picture of panels and energy data) and
want to keep in touch regarding project
Tradeshow seems like a good way for customer orgination.
Glen Otinger
Thermofusion
Inc.
Focus on SMB that do not have dedicated teams and those that operate
in inconsistent energy profile industries.
“New buildings and facilities design pretty much integrates all these energy saving
automation and features as part of design.”
“Dibalog was the company that Thermofusion uses for last several years and they just
installed hardware and monitoring is for free. Tradeshow was where we found them”
Week 7-8

24. 24
Upfront Cost
Application Development
- ios / Android Smart Phone & Desktop $ 60,000 ($3000 per customer assuming 20 tot)
Estimate BOM of 10,000 sq-feet facility running 1 month ($262)
Fixed Cost (30 months amortization)
Hardware
- Smart Plug $ 50 ($ 30 / unit, estimate 50 units)
- Router (4G LTE Router Industrial) $ 77 ($ 230 / unit, estimate 10 units)
Variable Cost
Infrastructure
- PaaS (AWS IOT) $ 5 ($ 5 / million message for 650K messages)
- Cloud Computing (Amazon EC2 r4) $130 ($ 1569 / year)
Cost Flow
24

25. Interview Insights (Canvas Left Side)
25
Gopal Shanker
Consultant
Recolte Energy
Ramzi Brown
Engineer
Hawaii Energy
Energy consultants are a must-have partner
“We spoke to Verdegris two years ago but the product was just a theory, and the Napa
wineries network still don’t get the product.”
“Regarding partnerships with utilities and Hawaii Energy, you must guarantee that
product actually saves energy using case studies in order for public organizations to
recommend your product. We will recommend our product but not directly sell it. Plus,
relying on utilities for sales will give traction for your product.”
Working with public organizations to sell our product provides limited space
for growth and traction and is hard to convince them to do.
Week 11

26. Channel Diagram
Direct
Sales
Energy
Consultant
COGS
30%
Profit
30%
COGS
30%
EC’s Cut
15%
R&D
30%
R&D
30%
Disc
10%
Disc
10%
Profit
15%
Week 10
26

27. Activities
Generate leads through
value based selling
Develop cost competitive and
sophisticated hardware platform
Allow our platform to perform the
needed analytics and reporting
Become visible and improve
click through success
Resources
Customer Origination
Hardware Manufacture
Cloud Hosting
Marketing & Branding
Partners
Utilities, Energy
Consultants
Suppliers from China
source
Amazon Web Services
Costco for Business,
Industry tradeshows
Partnership Activities Week 11
27

28. Customer Relationship
Get:
1. Direct Pitch
2. Online Advertising
3. Tradeshow
Keep:
1. Provide Customer Analytics
2. Provide Hardware (Can’t
easily transition away)
Grow:
1. Predict energy usage
and pitch new energy
assets / services
(customer success)
28

29. Income Statement
Year 1 Year 2 Year 3
Units sold 50 110 180
Sales [hardware] $25,000 $55,000 $90,000
Sales [analytics] $0 $138,600 $138,600 30.00% [conversion rate from last year]
COGS $10,000 $22,000 $36,000 40.00% [percent of sales]
Gross Margin $15,000 $171,600 $192,600
R&D $5,000 $38,720 $45,720 20.00% [percent of sales]
SG&A $2,500 $5,500 $9,000 10.00% [percent of sales]
EBITDA $7,500 $127,380 $137,880
Tax $2,250 $38,214 $41,364 30.00% Tax rate
Net Income $5,250 $89,166 $96,516
Selling Price
Hardware $500 [one time]
Performance $350 [per month]
29

30. Business Model Canvas Progression

44. 44
Roadmap
Generate Leads through website/ ad words
To develop requirements
Seed Money
To develop analytics
algorithm
Partnerships
For promotion, analytics, and hardware
Pilot Implementation
From customer leads
Get more funds and revenue
To ensure continual growth and development