Domain Knowledge Wins: Larry Goldenhersh, CEO of Enviance (Part 7)

Sramana: How big do you think the market is?

Larry Goldenhersh: We did a bottom up analysis and we arrived at 1.4 billion dollars. From a top down look other companies have arrive at numbers ranging from 1 to 2 billion dollars.

Sramana: How much of that marketplace is online today?

Larry Goldenhersh: I think 20% of it is online. If you look at SAP, Enviance and others you will arrive at a number between 20% and 30%. A huge amount of work is still done in Excel.

Sramana: Are you able to win clients from SAP?

Larry Goldenhersh: Yes. We have invented the Enviance Integration Framework Library in 2005 which allows us to connect quickly to all sorts of enterprise software including SAP. The ecosystem in our space is occupied by first generation data processing systems that is used for operational purposes. The same data is highly relevant for environmental purposes. Rather than force customers to reinvent the wheel we just connected our system to the existing tier one systems.

Asset management systems are all over the place. If a pump is throwing off Co2 it tells the team that the pump is being inefficient and that someone should go fix it. That Co2 is also a greenhouse gas reporting requirement. Why collect that same data twice? It’s more efficient to just connect with the asset management system and use the data for environmental compliance.

We have all of this data in a central location. In the last couple of years we have started doing something new with this data. We have started looking at energy management. Environmental management is about collecting environmental data, comparing to allowable range, and doing something if it is out of range. A very substantial subset of environmental data is fuel data. When you are calculating the emissions from a boiler or heater you are really calculating the fuel throughput and putting that fuel through an emissions coefficient to get to emissions numbers.

It turns out that energy management requires the exact same functionality. You need distributed data collection, compare that data to an allowable range such as a rate or energy consumption limit, and when it is out of range you need a data triggered workflow to fix it so that it stays within range. Obviously the dashboards and reports help you understand how you are doing in energy reduction.

When you go to the energy space you will find there is a lot of hardware out there with almost no workflow that would make all that raw data actionable. We have added to our customer set without writing a single line of code or changing a single sales person. We have added energy management as an expertise that we do. We implemented one of the first actionable energy management systems at Travis AFB.

Sramana: What would you like to do with the company? It sounds like eventually SAP would like to acquire you.

Larry Goldenhersh: I could see a lot of reasons why SAP would like to acquire Enviance. We feel like we are uniquely well positioned to provide a legacy software/hardware company with the domain expertise to own the environmental compliance space. Our website and the people who visit it prove we have thought leadership in the space.

Over the past two years we have been building a business intelligence tool based on the data points we collect and the aggregation of data. Our tool will identify environmental factors in a company’s supply chain that increase cost and reduce their sustainability. We can size these factors in monetary terms. This tool may well be Enviance’s greatest contribution.

Sramana: This has been a great story. I look forward to following your continued success.

This segment is part 7 in the series : Domain Knowledge Wins: Larry Goldenhersh, CEO of Enviance
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