Effy is at a crossroads. The French-based energy retrofit company is doing well, but it is tackling a much larger market than expected. That’s why I’m making a bet. The company has completed his €20 million funding round (approximately $22 million at current exchange rates) from Felix Capital. This is the company’s first external funding round.
“Our story begins 15 years ago. ‘We really believed in this market, so we got into it very early on.'”
Initially, Effy was not a tech startup. He works on energy renovations for public buildings, residences and industrial facilities. “We started with energy-intensive projects in an old-fashioned ‘brick and mortar’ business. However, this has allowed us to develop the company in a self-funded and profitable way,” he said Utzmann.
Soon after, the company began acquiring websites and services to help with energy retrofit projects. In 2011, the company acquired Calculeo, a tool that calculates how much government funding for energy retrofits is available. In 2015, Effy acquired Quelle énergie, a VC-backed startup. This allows you to calculate how much money you could save by isolating your roof or replacing your windows.
At the same time, Effy’s traffic began to grow rapidly. Search engine optimization increased his organic traffic. Effy has built a significant network of contractors and has begun redirecting homeowners to these partners.
In 2019, Effy chose to focus on small residential projects. Engie acquired her B2B business for an undisclosed amount. Effy has chosen to reinvest everything in product development and growth. In addition to organic traffic, the company spent some money on brand awareness ads (such as TV spots), Google and social media ads.
And it paid off as Effy attracted 18 million visitors to its website in 2022. Some people want to use Effy’s tools to see how much money they can save on their energy retrofit projects. Others go a step further and submit requests for construction work.
Effy then reaches out to these potential customers to understand their needs. To give you an idea of Effy’s size, last year the company reached out to 500,000 of his people and completed 100,000 energy retrofit projects. Effy has processed €800m worth of transactions on its platform.
own a relationship
Effy can improve the Service in several ways. In particular, the company’s marketplace is still lead generation products for energy retrofit contractors. If a potential client wants to move forward with a home project, we connect them with independent contractors.
These contractors will provide a quote. So there is some friction for the end customer. You need to compare quotes from multiple contractors and choose one.
Of course, Effy spends a lot of time curating the marketplace. Currently, 3,800 contractors are working with his Effy. The company has amassed 16,000 reviews of him, with an average rating of 4.8 stars for him.
Similarly, Effie can handle the paperwork to obtain subsidies for energy retrofits. The company cuts this administrative process and charges contractors a small fee for new potential clients.
Effy now wants to switch to a first-party marketplace model. The client interacts directly with her Effy and negotiates a quote with Effy. “Historically, we were almost 100% third-party business. Today it is his 90% of our business,” he says.
This opens up some new possibilities on the product front. First, there is a lot of optimization potential in terms of creating quotes, sourcing materials, and everything but the construction work itself. This way contractors can take on more work as Effy takes care of the rest.
Second, Effy can start offering funding options with partners. For small amounts, Effy can use “buy now, pay later” products. For larger amounts, Effy has an internal team that allows him to negotiate credit lines with Sofinco and Ceelem.
Indeed, energy retrofit projects can be expensive. However, customers often end up paying smaller bills when these projects are completed. Effy can even see the impact on your bill thanks to her smart meter.
“Let’s say you pay 2,000 euros a year, and starting tomorrow you’ll pay 1,000 euros a year. You can set aside 800 euros to pay back your investment. You’ll have less to save because you’ll have to pay back something.” But your home is also worth more money,” Uzman said.
In addition to this product roadmap, Effy’s business could grow rapidly thanks to the booming economy. Being in Ukraine had a big impact on energy bills.
At the same time, the European Union wants to fund projects that have a positive impact on climate change. Houses indirectly emit a large amount of carbon dioxide because they require a large amount of energy for heating and cooling. Many EU countries deploy generous subsidies to encourage energy retrofit projects.
Finally, Effy is currently only available in France. The company may expand to other European countries in the future, including Germany and Spain.
