Why We Invested in 1Komma5°
As the world electrifies its homes to build a more sustainable, more economic, and more resilient energy system, Europe is seeing particularly spectacular growth.
Annual Installations (Europe)
Sources: (1) solarpowereurope.org, (2) European Heat Pump Association, (3) solarpowereurope.org, (4) IEA
The reasons for the strong growth in European markets are threefold:
- Increasingly ambitious environmental goals — in March the EU provisionally agreed to increase its 2030 renewables target from 32% to 42.5% of final energy consumption (roughly double the 22% actual renewables mix in 2019)
- The ongoing Ukraine crisis has prompted governments and consumers to prioritize energy security, seeking alternatives to Russian natural gas
- Residential energy prices are high and rising, bringing the payback on home electrification below 10 years in key markets
The unprecedented demand for home electrification is not a temporary spike, it is a permanent acceleration of a secular growth trend. The industry must quickly adapt to meet accelerating demand, change buying behavior, and overcome scale and complexity challenges.
Changing buying behavior
Historically solar was an accessory to the home that could be bought in isolation, like an appliance. For such a discrete purchase a consumer might respond to a browser ad, a mailer, or a door knock, and may choose based on the easiest zero-money-down financing. Home electrification impacts every major system of the home, and is purchased more like a kitchen remodel… consumers call friends/neighbors and search local forums for referrals, seeking a local provider with a reputation for great workmanship and high-quality equipment.
The scale challenge
There currently aren’t enough high-quality installers to meet the rapidly growing demand for home electrification. Small-scale local craftsmen have not had the capital, business practices, global supply relationships, or management expertise to scale their businesses.
The complexity challenge
Installing solar power, battery storage, EV charging, and heat pump technologies in a home is a complex multi-disciplinary project touching multiple home systems from the roof to the basement to the garage. In Europe these major home upgrades are purchased like a home renovation — through referrals to high-quality installers — and typically paid for in cash (in contrast to the financing-centric US market). As the systems become more complex, consumers want a single trusted provider to install high-quality equipment and have it work together seamlessly as a single integrated system.
1Komma5° is the solution to these challenges.
1Komma5° has innovated a unique platform that can rapidly scale and deliver a high-quality, globally sourced, locally installed, comprehensive home energy solution.
1Komma5°’s unique model begins by bringing together the highest-quality local solar, battery and heat pump installers into a single platform that can deliver a full home-electrification solution. These high-quality local installers join the 1komma5° platform so they can offer a full solution, accessing leading global equipment suppliers while maintaining the efficiency, regional density and personalized customer attention that have made them the leaders in their regions.
Additionally, 1Komma5°’s industry-leading Heartbeat product provides a holistic home energy management platform for consumers. Heartbeat’s hardware-agnostic architecture maximizes energy savings for consumers by optimizing the operation of the system depending on grid prices, incentives and market conditions. We believe Heartbeat has the potential to become the “command center” for home energy management.
This uniquely scalable business model has allowed 1Komma5° to become the fastest-growing home-electrification company in Europe and set it on a path to becoming a global industry leader.
We believe 1Komma5° is positioned to lead the European home-electrification industry in scale, operational excellence, profitability, and product vision.
G2 Venture Partners is thrilled to lead 1Komma5°’s €215M series B. This investment will enable expansion as well as continued development of the Heartbeat product. We are proud to back 1Komma5°’s exceptional founding team and visionary CEO Philipp Schröder whose experience at Sonnen and Tesla has positioned him to lead this industry to a bright future.
G2 Venture Partners backs exceptional teams using technology to transform traditional industries to build a more sustainable future. It is an honor to join the 1Komma5° team on their mission to deliver a cleaner, cheaper and more resilient energy future.
