Sharing the Wealth (a Good People Update)
I don’t mean to be a tease about the whole change-of-direction thing. When I started telling you about it back at the beginning of May, I really thought I would get to the punchline in that first post. But once I got into writing about what we had been through, I realized that was a post on its own. It happened again when I started talking about the patents and how that could drive our pivot. But seriously, this time I’m getting right to it.
Our new direction is about enabling others and trying to bring as many folks to the table as we can to help deploy the Phoenix fan controller technology in the right way. Controlling the patents is empowering and we want to use that power to help others find new opportunities to improve their businesses. We think the Phoenix can be a great add-on product or even drive a whole new line of business for folks already serving the building energy efficiency space. It’s time to share the wealth. (Yes, we are offering you our green marker.)
Learning About the Building Efficiency Market
We’ve known from the beginning that the Phoenix can fulfill a lot of different needs. Our fan upgrade kits deliver great energy efficiency gains (data shows 29-53%). But they also addresses comfort and noise issues, hold temperature setpoints better, mix and condition the air, and reduce or eliminate noisy fan interruptions. The ability to cost-effectively roll them out one unit at a time, embedded intelligence that doesn’t require complex integration with existing control or management systems, and a quick and easy install that any HVAC or facilities tech can manage also provide a lot of flexibility on who the product can help. And we can do all of this with existing heaters and air conditioners without replacing their AC induction fan motors--no need to rip out existing equipment. It’s energy-efficient life-extension for existing heating and cooling systems.
While all of that is awesome, it leads to one of our biggest challenges. The building efficiency market is huge and growing, but incredibly complicated. Old buildings and old heating and cooling systems are everywhere and come in all shapes and sizes. And these old buildings are owned, used, managed, and maintained by all sorts of different people, sometimes one building has different owners, users, managers, and maintenance folks, all with different interests in the heating and cooling systems.
For example, apartment buildings and condominiums seems like they could be a great fit. A single building or complex might have 100s of units. But that means 100s of users, a separate group of active owners (building owners or condominium board), possible building management (sometimes outsourced to a separate company), and maintenance that may be handled internally, by one or more outside contractors, or some combination thereof.
And if you were to look at hotels, colleges, business parks, industrial parks, municipalities, etc., you would find similarly complex building ecosystems, each one of them different. Even when you look at single-family homes, you start to realize that the ways that different people purchase and maintain their furnaces and air conditioners don’t necessarily make it easy or obvious how to reach them with an energy efficiency upgrade opportunity. Not to mention that the existing ecosystems favor wasteful system replacements over upgrading existing equipment.
We honestly have no idea which of these markets are best suited to our product. From our efforts so far, we know that it can work in any of them, but our limited experience and lack of familiarity with the intricacies of each market hasn’t made pilot sales easy.
Resellers, Contractors, and Building Services Companies
But we have also learned that there are people who already know these markets and already have customers, marketing, and sales channels. There is a subset of these resellers, contractors, and building services companies who are genuinely interested in energy-efficiency and include that as part of the value they deliver their customers.
We have talked to quite a few and received early indications of interest. They seem to get the product pretty quickly. Our new task is to start reaching out with information about our product and the value it can deliver to these other service providers. We will be actively seeking resellers and strategic partners. The goal is to find people who are ready to go and jazzed about trying out a cool new product with a higher purpose.
We are also hoping that we can start collecting feedback for improving the product and really drilling down into the new designs and features that each of these unique markets might want to see. Now that we are the patent owners, we can also consider OEM or integrated product opportunities as well, though those are a little outside of our current focus.
We’ve worked up some initial information for resellers and partners. We are actively negotiating our first term sheet with a potential partner. And we will be launching a campaign to find more soon.