Smart Joules: Making Energy Efficiency Simple

By far the cheapest form of both electricity and emissions reduction is energy efficiency. However, especially in emerging markets like India, the upfront cost and increased complexity of more energy efficient equipment deters many owners and operators. Today's start-up, Smart Joules changes the paradigm by making energy efficiency savings as simple as a cheque in the mail for building owners.

At its core, Smart Joules is a financing platform, converting the higher upfront cost of energy efficiency retrofits into a monthly opex, also known as Energy Efficiency-as-a-Service. In fact, they take 0 upfront payment but instead take a share of the electricity bill savings. This way, building owners have an easy decision-they can make savings from Day 1 with 0 down payment.

However, like many great start-ups, creating a simple experience for customers relies on deep complexity and understanding from the company. Smart Joules' leadership has decades of experience working on energy efficiency and buildings which allows them not just to finance the upfront cost but also use intelligence and data to continually monitor, correct and improve operations. Better equipment can provide about half the savings, but the real benefit often comes from how it is used. Smart Joules is continually innovating, investing in better IOT and AI technology to leapfrog existing BMS solutions. Buildings are very sensitive to occupancy, temperature, humidity, etc. and automating various controls and settings can further energy optimize for even greater savings over time.

Smart Joules holds a ton of lessons for other founders in the ClimateTech space, in addition to the need to simplify the end user experience. For example, they have actually simplified their own offering. They have identified the top 32 measures C&I building owners can take to make their buildings more efficient, and developed deep expertise in helping their initial clients (mid-sized hospitals) become more efficient overall. While they still take on many different projects, their core focus now is on Cooling-as-a-Service, as this is the largest energy consumer for most commercial buildings in India.

Ironically, narrowing their focus technologically has actually increased their addressable market, as they can replicate their work in any time of commercial (or industrial or multi-family residential). Cooling is expected to account for up to 45% of India's peak electricity demand in 2050, so curbing cooling consumption is critical for managing India's emissions and energy use overall.

They have also developed deep expertise in house. Many startups I meet want to be "asset-lite"/"light touch". However, the real value Smart Joules brings is in supporting their clients with ongoing operations and deep understanding of the client needs.

Another key lesson is to focus on delivering impact. To date, Smart Joules has spent effectively nothing on sales and marketing. By leveraging their deep expertise to work out the details, they can offer a simple and compelling value proposition (savings from Day 1) to property owners. Smart Joules was also willing to get their hands dirty and work with smaller clients, and big brands are typically averse to taking chances on startups (though now that they are established, brand names comes to them). In most industries (in their case starting with healthcare), word-of-mouth spreads quickly and repeat customers can create more business, if you focus on delivering value, rather than on trumpeting your own brand.

Smart Joules is a fantastic example of a start-up disrupting an existing industry by focusing on a relatively simple value proposition (the cost savings from energy efficiency more than pay for themselves) and building deep expertise to remove the complexity and deliver a simple solution (money in the bank account from Day 1) to customers. It will be fantastic to see them grow and have this business model inspire others.