Tuesday, 23 June 2009

How much can AlertMe save you?

When I joined AlertMe a few months ago, it didn't take long for me to realise that the company's plans with regard to energy were truly impressive. One thing I couldn't help wondering, though, was how much money could a system like this really save me? Of course many people are motivated by the environment or energy security, but for most people it's pleasing to see a real cash saving from energy monitoring and management.

Recently, I found the answer to this question, and it came as a big surprise.

I've been monitoring my house's electricity consumption using technology that AlertMe will be launching later this year. I was able to see most of the big loads such as washing machine, tumble drier and fridge, but there were two mysterious loads: one that came on every hour like clockwork and used 2kW for about a minute, and another that came on less frequently (a few times a day) but used a lot more energy. By a process of elimination and experimentation I eventually found the culprits: an immersion heater (which we really don't need since the gas heated water is more than enough for our needs) and a small electric water heater in the out-building in our garden.

So, on 26th May, I turned off the first of these, and on the 27th, I turned off the second. The effect has been dramatic. The average electricity consumption of our house before the 26th was around 28kWh, or over £4 per day. After the 27th, average consumption has dropped to around 17kWh, or just £2.50 per day. This equates to a saving of about 40% or an annual saving of over £500! All from just turning off two water heaters that we don't need.

This may well be a fairly unusual case, but it makes the point that most people have no idea how much energy they're using or where the energy is going. As you can see from the picture, the immersion heater is huge, and hard to miss, but frankly I'd never really considered what it was or what it did, and it certainly didn't occur to me that it was costing me hundreds of pounds a year to run!

Do you know how much it costs you to run your washing machine or dishwasher? Or your lighting? And how do you make a decision about whether it's more important to stop leaving your TV on standby or to just buy a new one?

AlertMe's Smart Energy and Monitoring solution provides you with information which you can use to make real savings, and the wealth of new features we have planned for the coming months will make it even easier to understand and control your energy consumption.

Wednesday, 10 June 2009


What a wonderful word. It is great to able to spread the excellent news that AlertMe has succeeded in raising a big chunk of cash - £8m ($13m) - from the world’s top clean-tech investors, which sets us up for our next strong phase of commercial growth.

With all the recent crises of war, food, oil and finance it’s clear the next few years are going to be quite challenging for the world. And since investment tends to be a lead indicator for bad news, the last 9 months have been a tough time to be raising money. OK, that’s English understatement - if you remember, just a few months ago the headlines were full of talk about the possible collapse of the Western banking system, with banks defaulting almost daily. So it’s been tougher than tough.

But humans, for all our faults, have one redeeming quality which shines out in tough times – we rise to a challenge. And the biggest challenge facing all of us on this planet right now is that we’re living beyond our means when it comes to energy consumption – whether its concern about Putin turning-off the pipelines, or declining oil reserves, or climate change, we can’t continue with business as usual.

However, the great thing about challenging times is that they create opportunities for inventive solutions. It’s interesting that way back in 1916 Thomas Edison could forsee change:

“You see, we should make use of the forces of nature and should obtain all our power in this way. Sunshine is a form of energy. Wind and sea currents are manifestations of this energy. Do we make use of them? Oh no! We burn forests and coal, like tenants burning down our front door for heating. We live like wild settlers and not as though these resources belong to us. “

When our grandchildren look back in 100 years time, I believe they’ll mark sometime about now as the time that we finally faced-up to the big responsibility of being the dominant species on Earth. We’ve got someone in the White House who is showing leadership - and hopefully we’ll soon be able to say the same in the UK. The tides are changing, the winds of change are blowing … and although we can generate electricity from both, we’re going to need to get the consumption side of the equation under control to have a hope of true sustainability. So when our grandchildren ask what we personally did about it … well, I think that AlertMe Smart Energy can make a big difference.

We’re not the only player in town – many companies are looking at this space. Some are focussed on the “Smart Grid”, working to provide utilities with ways to get energy from the power stations to the meter outside the home. And some are, like us, saying “hey, don’t forget the consumer!” The fact that our platform has already had more than a year and a half of real-world testing by paying customers, and that we’ve shipped more than 15,000 ZigBee units, gives us something of a lead, but we’re going to have to keep moving really fast to keep ahead of our followers.

The huge raft of new features we’ve added for AlertMe 2.0 takes us a long way towards our goals – and the early feedback is that they are features that the world clearly wants. In our customer satisfaction surveys, and in our daily interactions with customers, the clear message is that consumers are adopting AlertMe as an integral part of their daily lives.

As I said, it’s been a “tough” time to be going out raising money. We went out to the market in July last year, and as we took our road show around the European and US venture capital market, the financial situation got worse and worse. Then Lehmann Brothers collapsed, and no-one wanted to do anything anymore, particularly anything involving consumers.

Well, almost.

Luckily inside the storm cloud of climate change there was a silver lining for us. There are some truly humungous Cleantech venture funds out there, keen to seize the massive opportunity that this energy revolution represents.

In August we started talking to the biggest of them all – Good Energies, a global fund who invest many hundreds of millions of dollars a year. Until now they’ve mainly invested in big supply-side renewable investments like Solar and Wind, but they were one of the first funds to realize that managing the demand side (i.e. consumption) is just as big an opportunity. They are fans of the statement that “the cheapest kilowatt-hour is the one you don’t have to generate in the first place”. So they geared-up their significant team and network to the task of doing “due diligence” on this whole new consumer-oriented energy-saving space – and understanding our role in it.

We took our road-show to Silicon Valley. I lived there for 6 years in the 1990’s, and I appreciate the straight-talking can-do attitude of Northern California. For several years I’ve been boring my English friends with the prediction that one day, when the Americans finally get around to paying attention to climate-change, then almost overnight they’ll step-up and take a leading role in solving it. I think we’re witnessing this change right now, and it’s great to see. The leading clean-tech investor in the Valley is VantagePoint, and the more time they spent looking at us, the more they liked us. Their decision to invest gives us a vital connection to this key part of the world. I was lucky-enough to spend some time recently at their annual “ResourcePoint” conference where we learned about the effects of the Obama stimulus package from leading lights in the US energy ecosystem.

Meanwhile, back in our home continent of Europe the leading consumer venture capital company is Index. They have nurtured massive consumer startup hits like Skype and LoveFilm and we wanted some of that magic, so we were delighted when they said they’d invest too. They are almost unique in understanding just how important it is (and how much focus it takes) to really engage effectively with consumers.

And finally – but perhaps I should have mentioned them first of all – we also have a Dutch Cleantech VC called SetVP on board. They were in fact the first investors to track us down last summer, and since then they have been unswervingly supportive. Like us, they understand that speed and agility are vital, and it’s no overstatement to say that without them this just wouldn’t have happened.

Originally we were looking to close this funding round in October. You’ll notice that it’s taken a bit longer than that, for understandable reasons. To keep us going at maximum speed through this period has taken strong support from our Angels and investors - and of course most importantly our customers, whose increasing numbers have helped drive our revenue upward even through these tough times.

Throughout it all, I had great faith that we’d succeed, even in a competitive space, even at a challenging time, because quality generally wins-out in the end. And speaking of quality, a phrase we have heard from every single investor we talked to is “you have a very high quality team”. And we do! Not just in terms of the specialist skills in the team, but also in the way everyone gets on, trusts each other to do their job, greets adversity with humour, and looks-out for each other. So huge thanks to everyone at Team AlertMe. Funding is always a bit of rollercoaster ride at startups, and the last few months have felt at times like the kind of rollercoaster you see in an Indiana Jones movie. But through all of this, our wonderful team has continued to focus single-mindedly on continuing to build AlertMe into a world-class player – delivering the major new AlertMe 2.0 service upgrade, closing deals, keeping our customers happy and generally getting us to the point where we can now rightly claim to be THE world’s leading Smart Home Energy company.

It seems that we’re very lucky to find ourselves at the centre of such an exciting and important space at just the right time. There’s a huge wave to ride and we find ourselves out in front of it, paddling hard. But as Thomas Jefferson said: “I'm a great believer in luck. And I find the harder I work, the more I have of it.”