Scaling an Energy Management Venture: Martin Manniche, CEO of Greenwave Systems (Part 4)

Sramana Mitra: Whom did you raise that money from and based on what investment thesis?

Martin Manniche: We raised the money from a combination of strategic partners. These are partners who have invested in previous companies. Then of course, myself and my brother invested to show that we were serious about this. That first round was only insider investment. The B round was where we took external investment.

Sramana Mitra: In the $6 million, were there any outside investors?

Martin Manniche: There were manufacturing companies and other private investors who had invested in companies with me before. I normally call it an insider round. I want to make sure that there’s a substantial amount of motivation for a lot of the people who join me from Cisco and other companies. The employees also got meaningful ownership.

Sramana Mitra: What was the investment thesis?

Martin Manniche: It was invested based on a combination of a business plan tied to grants from Singapore that showed we could get government support.

Sramana Mitra: What is the business that you told the investors that you were going to build?

Martin Manniche: A horizontal managed services platform. The first vertical is energy management.

Sramana Mitra: After you raised the $6 million, what was the immediate next step?

Martin Manniche: Execute the foundation and find the customers. We found the customers fairly quickly, which was utilities around Europe. We went into trials to prove that what we thought we could do right, we had done right. It was a very good learning curve. We built a very good relationship with these utilities because we were seen as being very fast-moving, flexible, and it was a breath of fresh air for them.

I would say utilities in Europe are very different from utilities here because the market here is deregulated and fragmented. These guys needed innovation and differentiation. The company also started filing patents, which today is nearly all granted. A lot of this innovation, today, is very valuable for the company. We then saw that utilities, even though they have good intentions, don’t have a good relationship with customers. They are seen as a billing relationship. They never really had contact with their customer.

Just see how the telecommunications industry is now bundling, and it’s all about active marketing to limit churn and find ways. The utilities business went through some of the same challenges. As we grew the company, we saw that connectivity also needs to focus on the rest of the home. It’s not just energy management for heating and cooling systems, solar integration, and smart meter integration. It’s just as much about making sure that you are building a foundation that removes the complexities.

People don’t understand protocols. They just want devices. They want to put it in their homes. One thing that is in our DNA is I actually think we have a good team. The point is you need to make sure that you’re building technology that is not too intrusive. If you are focusing only on technologies, you are getting the geeks. It’s still not mass market. We are building the foundational platform that does not limit the use case but enables the use case. That’s what our Greenwave platform is all about.

This segment is part 4 in the series : Scaling an Energy Management Venture: Martin Manniche, CEO of Greenwave Systems
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