Why we invested in vilisto

Non-residential buildings in the EU are in dire need of upgrades. They are required to make a contribution to the EU’s Fit-for-55 climate targets as well as remaining fit for purpose for tenants following the energy price hikes in 2022. 90% of non-residential buildings in the EU are energy efficiency rated “C” or worse – and ca. half were built before 1970, with resulting minimal building energy efficiency measures.??

A new EU-wide emissions trading scheme will include buildings for the first time, while an increasing number of corporates are now mandated to report on their carbon footprint and concrete action plans to reduce their CO2 emissions through the EU’s CSRD directive and its widening scope.??

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Despite this urgent pressure for action, non-residential building owners have been moving slowly on climate change. Why? 2 key challenges that we identified included?

1. A fragmented building-energy management landscape with a multitude of systems, operators and equipment makes building digitalisation and operational optimizations difficult to implement at scale and speed, especially with software-only approaches.??

1. The split incentive problem of who invests in energy savings and resulting carbon reductions (typically the building owner), and who benefits from them (typically the tenant through operational cost savings and carbon credits).?

Yet, the market is too large to ignore – the estimated TAM for non-residential buildings in Europe is at €44bn over the next 4 years.??

vilisto was founded in 2016 with the mission to develop a simple and fast-to-implement solution for making non-residential buildings more energy efficient. The key insight for vilisto was that not only is 70% of building energy consumption related to heating, but that over the course of a year, non-residential buildings are actually not in use 80% of the time. This creates large amounts of wasted heating energy for rooms that are not used.??

vilisto’s intelligent thermostat automatically controls room temperature in office buildings based on integrated sensors that detect motion, light and noise. Coupled with a self-learning algorithm that includes external data such as weather, vilisto heats rooms only when used and turns off the heating in evenings and weekends for example, leading to energy savings (and associated CO2-emission reductions) of up to 32%. In this way, vilisto introduces modern building comfort and services to (old) buildings that would otherwise be difficult to upgrade.?

What sets vilisto apart is that most building upgrade options - like full insulations and renovation projects - are costly, with long lead times and disruptive to the usage of the building. Pure software approaches to modern building management systems face complex implementation and integration effort, often with long lead times to achieve results. Most older buildings cannot easily connect with modern software stacks. Against this backdrop, vilisto’s product perfectly aligns with current market requirements for quick-win energy and CO2-emission reduction measures in buildings. The company has refined the product’s architecture and delivery so that customers experience a fast and seamless journey to realize value. Fast and relatively low-cost implementation, implemented within days by technicians that do not require deep technical know-how has proven a critical USP with customers. Once installed, the product functions automatically without further implementation effort, delivering instant results without disruption to the building’s usage. Several customers have already rolled out the solution across multiple buildings in their portfolios, confirming customer satisfaction and the commercial potential.???

But it is not only the solution that stands out, but the team behind it. Christoph, Lasse and Christian have built an impressive track-record of being both entrepreneurially nimble, constantly evolving and adapting their product, and at the same time thinking big and visionary about their market and showing strong commercial focus on winning and growing customers.?

vilisto has carved out a leading position in its focus segment of non-residential buildings – both large office campuses as well as public property portfolios. Addressing such large real-estate portfolios is both financially attractive and delivers environmental impact at scale. We are looking forward to working with the vilisto team on accelerating the roll-out of this must-have solution not only across Germany, but in an office or public building near you across Europe!?

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This article was written by SET Partner, Dr. Till Stenzel . Get more insights from SET Ventures, subscribe to our newsletter.