While most of the people are not aware of the occurring climate change and scarce mineral resources, a small group of world engineers is working hard on building alternative ways of producing so-called clean energy. You might be surprised, but in recent years more and more companies, investors and developers are getting involved in projects connected with solar energy, and, so far, there has been an impressive move in the amount of power solar installers can produce – from 1 GW per year to 1 GW per month. Added by several existing unicorns dealing with solar electric systems, varied support from a group of billionaires led by Bill Gates, who announced the foundation of Breakthrough Energy Coalition, and numerous promising forecasts, concerning increasing manufacturing and installation of solar batteries, there is a huge perspective for distributed power generation.
Here is a new market niche down to give birth to the next unicorns – SaaS solutions for distributed power generation. Why? Turns out, most of the industries have already been fostered with specified solutions (like CRMs), helping them reduce costs connected with customer acquisition. However, while installation costs have gone down, customer acquisition costs covered by solar players are still relatively high. That is why solar developers are in great need of advanced tools (especially cloud solutions) that would help them match solar system building data with their customers’ demographic information for example.
Fortunately, there are some people already focused on the development of solar cloud applications, and, as usually, the US sets the trend. There are several working funding programs (by the Department of Energy’s SunShot Catalyst) plus solar-focused accelerators (like Powerhouse), incubating early stage solar software companies. Not to mention the growing VC activity in the sector: recently, Obvious Ventures invested $3.5 million into Sighten. So gradually, there is a SaaS distributed generation providers’ ecosystem appearing with its members, chasing a new opportunity within solar energy technologies. The thing is that most of these early stage companies still need to move from point solutions to complex ones.
Jake Saper from Techcrunch gives some expert advice on building a solar/DG software unicorn:
1. Focus on solving the revenue problem
It’s better to start with a top-line-focused solution that is very likely to demonstrate an obvious return on investment. In the case of the solar energy industry, it is great to solve the problem of expensive customer acquisition with an advanced software tool.
2. Build sticky, scalable software
Your product must become a non-substitute instrument, the one without which employees literally cannot get their job done. At the same time, the system should be scalable and relatively flexible for customers to configure it anytime according to their business model.
3. Layer the cake
As soon as your core product goes down well, start further expansion and try to solve other ‘pain points’. This way you are very likely to grow into a trusted tech provider, earning billions of dollars.
4. Expand to the incumbents
Do not stop on selling software to distributed generation players, go ahead and start cooperation with bigger utilities and independent power producers – rise up to the largest possible market size. Plus think of all possible market niches to fill within the solar energy industry.
Pay attention: the whole solar industry is growing fast today, which implies a number of favorable trends. So it’s high time to give it a try and seize the total potential market size. What is missing now is a so-called enterprise SaaS talent: solar energy software executives are very experienced in terms of renewable energy but no much success in scaling software element. For your information: a perfect solar software startup project team should consist of solar folks and SaaS folks. So start looking for a partner in another industry.
You may sign up our monthly newsletter to receive updates or news from our team.