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Effy, an energy refurbishment company that has operated on its own funds for the past 15 years, has raised $22 million

Effy is pondering her options. The French energy remodeling firm is successful, but it is attempting to serve a market that is far larger than it initially thought. Because of this, it is taking a risk. The startup has just finished a fundraising round with Felix Capital for €20 million (about $22 million at today’s exchange rate). The startup has just completed its first round of outside fundraising.

CEO and co-founder Frédéric Utzmann told me, “Our story begins 15 years ago.” “We tackled this market very early on because we genuinely believed in it.”

When it first launched, Effy wasn’t a tech company. The firm’s work included energy retrofitting for institutional, residential, and commercial structures. We got our feet wet with energy-intensive endeavors and a conventional business model. Utzmann remarked, “But that allowed us to expand the company independently and profitably.”

In short order after that, the business began buying up energy-related websites and services. The company purchased Calculeo in 2011, which is a subsidy calculator for energy efficiency upgrades. Effy purchased Quelle énergie in 2015, a VC-backed firm that determined how much money might be saved through various home improvements like roof insulation, window replacement, and more.

Simultaneously, Effy’s visitor numbers skyrocketed. Enhanced visibility in search engines increased the site’s natural traffic. Effy initiated a sizable network of contractors, referring homeowners to these associates.

For the year 2019, Effy has decided to specialize in private residences only. Its business-to-business operations were purchased by Engie for an unknown sum. Effy instead put all of its funds towards research, development, and expansion. The corporation also invested in paid brand awareness advertising (including television commercials, search engine marketing, and paid social media promotion).

And it paid off: in 2022, Effy’s websites had 18 million visitors. Some people are just interested in using Effy’s tools to calculate how much money they could save by implementing energy efficiency measures. Some people even take it a step further and ask for building work to be done on their property.

Effy follows up with those prospective buyers to learn more about their requirements. In a single year, Effy was able to reach out to half a million people and finish a hundred thousand energy rehabilitation projects. Effy’s platform processed €800,000,000 in transactions.

Taking charge of the partnership
Effy still has room to enhance its offerings in a number of areas. In particular, its primary function in the market is to generate leads for businesses that specialize in energy efficiency upgrades. Customers are put in touch with freelancers when they’re ready to move forward with their home improvement projects.

When these professionals offer estimates, it adds a layer of complexity for the consumer to make a final decision. They need to shop around for estimates from several professionals.

Naturally, Effy invests a great deal of effort in modifying its market. Effy now employs 3,800 independent contractors. 16,000 customers gave the company feedback, with an average rating of 4.8 stars.

Effy can also take care of the necessary documentation to secure funding for energy efficiency upgrades. The corporation retains a percentage of the administrative fees paid by contractors for bringing in new clients.

This has prompted Effy’s desire to transition to a first-party marketplace. During the quoting process, customers work directly with Effy. Utzmann said that the company has always relied heavily on business from outside sources (now accounting for 90% of total revenue).
It paves the way for new product developments. To begin, there is a great deal of room for improvement in every phase of the construction process other than the physical building itself. By relying on Effy, contractors can take on more work.

Second, Effy may be able to work with third parties to provide financing. Effy is able to use “buy now, pay later” products for low sums. Effy has a specialized in-house staff that can negotiate credit lines with Sofinco and Cetelem for larger sums of money.

Well, it’s true that energy efficiency upgrades can break the bank. Once these jobs are completed, however, clients usually find that their bills have decreased. If you have smart meters installed, Effy can even analyze how that affects your utility costs.

Let’s imagine your annual bill is €2,000, and as of tomorrow it will drop to €1,000. In order to recoup your financial commitments, you could put away €800. Since you owe money, your savings decrease, but your home’s value rises,” Utzmann explains.
Effy’s business may end up expanding significantly in response to the current market conditions and this product roadmap. Due to the weather in Ukraine, utility costs have risen dramatically.

Meanwhile, the EU is looking to fund initiatives that mitigate climate change. Because of the extensive energy needed to heat and cool them, residential structures are indirectly responsible for a large amount of greenhouse gas emissions. In order to encourage energy refurbishment projects, many EU governments are releasing sizable subsidies.

Finally, for the time being, Effy is exclusively sold in France. Following successful launches in Germany and Spain, the company may consider expanding into additional European countries.

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