Exploring new business models with Wondrwall
Energy transition Energy research Residential researchJon and Sandra explore Wondrwall’s approach to decarbonising homes through a combination of financing hardware and optimising energy demand with Wondrwall’s CEO and founder, Daniel Burton; and Mark Lufkin, Chief Product Officer and LCP Delta colleague Phillip Twiddy.
Episode transcript
[00:00:03.120] - Jon Slowe
Welcome to Talking New Energy, a podcast from LCP Delta. I'm Jon Slowe.
[00:00:09.120] - Sandra Trittin
And I'm Sandra Trittin. And together we are exploring how the energy transition is unfolding across Europe through conversations with guests from the leading edge of the transition.
[00:00:23.410] - Jon Slowe
Hi, Sandra.
[00:00:25.370] - Sandra Trittin
Hi, Jon. How are you?
[00:00:26.920] - Jon Slowe
Good. How are you doing? Where are you today?
[00:00:29.160] - Sandra Trittin
So, I'm sitting in my home office currently.
[00:00:33.790] - Jon Slowe
In Switzerland?
[00:00:35.320] - Sandra Trittin
Yes.
[00:00:37.650] - Jon Slowe
Well, Sandra, I'm interested in today's discussion because people often ask me what's holding back the energy transition. What can make it go faster? Is it technology holding it back, finance, regulation, policy? We hear a lot about that in our discussions. Customer propositions? Well, I think more and more, it's the right business model, or maybe to be more particular, a business model that can scale quickly.
[00:01:03.810] - Sandra Trittin
Yes, I think you're right. To add to that, I think it's the business model, but it's also the deployment on how to bring the solution out into the market, which goes closely together with the business model. As you were mentioning, the money is there, the regulation is more or less there where we need it.
[00:01:24.280] - Jon Slowe
Getting there. Yeah.
[00:01:25.550] - Sandra Trittin
Exactly. Technology. But I think now we, we need to get it done. We need to manage that change in real life. I think that's still a challenge that we are seeing.
[00:01:39.280] - Jon Slowe
Yeah. Speed of change.
[00:01:42.260] - Sandra Trittin
Exactly. But I think this also makes it especially more exciting to have guests like today from Wondrwall who bring different perspectives and different business models and also give, hopefully, some inspiration to some of our listeners focus on what is possible actually to deploy technology and get these new energy solutions in the world.
[00:02:09.450] - Jon Slowe
Well, let's go ahead and get inspired, shall we? Let's say hello to our guests. Hello to Daniel Burton and Mark Lufkin from Wondrwall. Hi, Daniel. Welcome to the podcast.
[00:02:21.710] - Daniel Burton
Hey, guys. Nice to meet you all. Looking forward to the discussions that we're going to have today. Really good to be on board.
[00:02:27.820] - Jon Slowe
And welcome, Mark.
[00:02:29.200] - Mark Lufkin
Yeah. Thanks for having us. Long-time listener, so excited to be part of the podcast.
[00:02:34.900] - Jon Slowe
Great. Listen to turn guest. Let's start as we usually do with a quick elevator pitch for Wondrwall for those of our listeners that haven't heard of Wondrwall yet. Daniel or Mark, would one of you like to give our listeners a quick intro to Wondrwall?
[00:02:49.820] - Daniel Burton
Yeah, no problem. Daniel Burton, the Chief Exec, and founder of Wondrwall. Well, going back to 2016, Wondrwall was set out to become a home automation business, really. That's where we started out as a company. But the whole vision around Wondrwall was to go the completely opposite way to where the market was going. The market was going to the connected home of the world, so connecting devices to the home. I sat there and was like, does it really make our life easier going to a mobile and turning a device on and off? The whole vision around Wondrwall right from the beginning was to give the home a brain and the intelligence for the home to control itself. What we did is we did a big deep dive into a lot of different types of technology, but one of them was autonomous vehicles. How does a car actually drive itself? What it does, it collects a lot of sensory data, uses deep learning to learn from that data, giving that car the ability to drive. We took that philosophy and we put it into a home. We built hardware, which was based around our light switch, which has 13 sensors in it.
[00:03:57.610] - Daniel Burton
So, changing your light switches in the home learns about how people live and behave, how the home performs, how it heats up, how it cools down, the thermal model, understanding what you're doing within the home. We use AI to learn from that data. We have about 20,000 data points a day. We learn from that data, and then the home autonomously controls itself. That's where we started out with a business. We launched that solution into the market in 2019, but then we realised a bigger opportunity in the market, obviously, decarbonisation. Our customers, which are real estate companies around the world, which actually they can't put gas in their homes past 2025 in the UK. We started building out a full energy solution back in 2019, which involved building heating technology, hot water, battery, solar, EV chargers, a complete integrated solution, but managed by our AI platform. so, these devices for us are pretty dumb, but it's our AI platform that's understanding everything from energy usage, energy pricing, all the solar generation, the weather, all this information feeding into the platform that intelligently controls all these other devices. That's where we are today. We obviously are doing a hell of a lot of work behind the scenes on grid optimisation, all the interesting things that we can talk about in this podcast.
[00:05:25.080] - Daniel Burton
But that just gives you a brief overview of what we do as a business.
[00:05:28.570] - Jon Slowe
That's great. Daniel What idea of scale, size, deployment in market, coming to market?
[00:05:38.370] - Daniel Burton
Yeah, so a bit of an understanding of the business. In November, we raised £100 million, which is by Infrared Capital, who back the business. We are in a transition period because what we realised quite quickly as a business is that we had to change our business models. Maybe this is a what we're going to in a bit more deeper conversations. But we changed our business models to be able to scale a rapid rate because there were issues around actually how much the kit cost, how do you deploy, all this thing. We sat down and we worked out a different funding solution to be able to scale this business. But we've got a lot of deployments in the field. We've learned a lot over the last five years from the data that we collect. We've learned a lot about how much energy savings the system can produce in different types of homes. So variants on insulation on different types of homes, whether there be retrofits, whether there be new builds, all the data that we collect actually gives us a real understanding of the technology and the energy savings that we can save the consumer.
[00:06:49.260] - Jon Slowe
Great. Well, yeah, let's dig into that shortly. Just want to introduce our third guest, Phillip Twiddy, colleague at LCP Delta. Hi, Phil.
[00:06:57.220] - Phillip Twiddy
Hi, Jon. Thanks for inviting me.
[00:06:59.500] - Jon Slowe
Phil, you've, you've looked at these... You've looked at Wondrwall, you've looked at other similar businesses. What stands out about Wondrwall's approach to this area?
[00:07:12.690] - Phillip Twiddy
I think the first thing that I find really interesting is that Wondrwall makes a home buyer's personal net zero journey easy and affordable. So, all of our homes have to go through this process. We've all got have more efficient homes that push out less carbon. And Wondrwall is forging a path that we can all follow, and they're leading that way and they've developed a consumer proposition which is attractive and a business model that's scalable, and that's wonderful for helping UK plc get to net zero. I think one thing I find particularly interesting is that although Wondrwall presents a very simple solution to the user, I'm particularly interested in, also interested in what's going on behind the scenes, how they're turning that incredible technology into ways that can help us to save money, live comfortably, and have things easy.
[00:08:22.990] - Sandra Trittin
Yeah, that sounds, I think as well, really exciting. Let's take that opportunity and dig a little bit into the technology first. Daniel and Mark, there are quite a few companies who are, let's say, a bit in your space, offering packaged solutions of storage, solar, charger, heating, doing also some optimisation within the home. What makes your solution special for your approach in that area?
[00:09:02.770] - Mark Lufkin
I suppose there's a couple of pieces. Part of it is what Daniel said originally. We're based on an intelligent platform which is gathering data, particularly about how the consumers use their homes, how that home is performing, and that data influences how we control the home. We're also vertically integrated, so it's a complete solution. It's not a question of getting different bits from different people with different apps, but rather having everything together in a single platform, in a single app, and making things work together. A very simple example We use motion sensors. We use those motion sensors for a security system. We use them to control the heating. We also use them to go and control other aspects, such as the lighting. They different data points are all integrated together into a single proposition, a single platform. I don't see that so much from anybody else. Obviously, the financial model that we've built off the back of it differentiates that. So that ability to reduce energy bills. So, when we started, Dan said it's about decarbonization, and that's true. But actually, our primary focus was always on reducing energy bills. We felt that the cost of the system...
[00:10:35.000] - Mark Lufkin
I was doing a talk yesterday, I was talking about heat pumps, and one of the big blockers to low carbon solutions is the cost of that solution, the cost to deploy and the cost to run. The cost of run being driven by the spot price, the difference between electricity and gas, and in the UK, electricity being four times more than gas. We took a very deliberate decision to focus on reducing the running costs for the consumer and getting those energy bills down. On a typical Wondrwall deployment, we're talking about reducing the energy bills by £1,500-£2,000. Similar sorts of numbers with euros, I think it's about a 10, 15% difference. But yeah, big numbers in terms of reducing those energy bills. That That allowed us to do some different clever things with the financial model.
[00:11:35.540] - Jon Slowe
I'm curious about the 13... Well, to two things. One is you're starting from home automation, which is different from a lot of the home energy management companies. You've started there and moved into energy. And the sign of that for me is your 13 sensors inside the light switch. So, some of the listeners might be thinking, Well, 13 sensors? I could think of motion, I can think of temperature. I don't know whether you want to tell us all 13, but to give us a feel of that. And yeah, how much of your proposition is home automation and how much is energy? Or is that the wrong way to think about it? Are they completely overlapping?
[00:12:17.730] - Daniel Burton
Well, they're a full HEM system now. We come from it from a home automation platform. We've got, obviously, the light switch, we've got heat, we've got humidity, we've got luminosity, we've got power sensors, we've motion sensors, all built into a light switch, but it's in every room. What we're learning is some real in-depth detail, not just on a home as in a home, but on each individual room. We're learning about how each room heats up, how it cools down. We're also learning about, actually, do you spend time in that room? Because fundamentally, back in the old days, well, you used to heat up a whole house, or then we went into heating up upstairs and downstairs. Well, Wondrwall will move on to actually heating the home based on occupancy. Actually, where are you spending time in the home? And rather than heating up a whole house, well, let's target temperature and heating based on where you're actually spending your time. Why are we heating up a spare room when you haven't been in it for the last 12 months? Why are we heating up a dining room when you only use it on a Saturday evening?
[00:13:23.880] - Daniel Burton
Collecting that, understanding each individual room, and understanding how you use your home. One of the things you'll find is that a bit similar to me is that I go home, I go in my kitchen, I make myself some food, I sit in my living room, I go to bed. I've probably got 14 rooms in my house. I've probably only used probably four of them on a regular basis. Actually, that's the knowledge and information that Wondrwall gives us to make sure that we're reducing the demand of electricity by heating up rooms rather than heating up houses.
[00:13:55.440] - Mark Lufkin
If I could just add something in there. The HEMs are the, the energy management is the main piece now. The home automation is almost a nice to have. It adds value to it. The way I see it is if you think back to how cars used to be 30 years ago, you used to wind up the windows, you had a cassette player or just a radio for the entertainment. There was no anti-lock braking on your cars. In the meantime, technology has changed cars, made them safer, more comfortable, more efficient. But if you look at a home, our homes really haven't moved in the same way. We haven't used technology in the same way to improve the comfort, the safety, the efficiency of our homes. So, Wondrwall really is about applying technology to making our homes safer, making our homes more secure, making them more comfortable, and especially making them more efficient in terms of energy bills and low carbon running energy consumption.
[00:15:04.420] - Jon Slowe
Some of that is cost-saving. Some of it is peace of mind as well, I guess, in terms of security or peace of mind that my home system is helping to reduce consumption, not for heating rooms that don't need heated. It sounds like there's a peace of mind proposition there as well as energy saving proposition.
[00:15:27.210] - Mark Lufkin
We asked one of our... Sorry, Dan. I was just going to give the example of one of the house bills. There's an article in the Times recently, and they went off and interviewed one of our customers. Interestingly, one of the things that they liked best was the ability to use their voice to go and control the home. They love the low bills, but they also love this. Their five-year-old kid could wander around the house controlling the home and turning lights on it often, things like that.
[00:15:57.650] - Jon Slowe
That's why that could be a challenge as well as a good thing.
[00:15:59.990] - Mark Lufkin
That is true.
[00:16:03.370] - Daniel Burton
Yeah. So, we put Alexa into every light switch as well. So, in every room, you've got voice control as well.
[00:16:07.800] - Sandra Trittin
And how does it look like? I mean, that sounds really exciting, right? Because, because I think once you have the energy insights, you also want to create action on it. Having the customer, let's say, adapting his energy usage, as you were saying, Daniel, if you're not using the different rooms, why should you heat them up? Do the clients have an app where you give recommendations, or you give the insights? How does it look like?
[00:16:42.420] - Mark Lufkin
We have an app, of course. But as Dan said at the beginning, really, the focus is on making this easy for the consumer. In an ideal scenario, they don't have to worry about it. They shouldn't be thinking about it. We take care of everything for them. Until recently, most people, most consumers, didn't know what kilowatt hours were. Probably if I go out and ask my friends, everybody knows how much it is to fill up their car and how much the cost of a litre of petrol is or a litre of diesel. But many people are not as aware at the same extent of how the energy system is and what it costs for a kilowatt hour of electricity or kilowatt hour of gas. Things like time of use, tariffs with a half-hourly billing for import and export is complicated. We take all of that complexity away, we hide it, and the consumer effectively lives in their home. It keeps them comfortable; it keeps them well without them even having to think about it. Of course, if they want to override it, they say, I'd like it to be a bit warmer in here or turn on the kids bedroom light or whatever it is, they have that ability to override, but primarily, Wondrwall is making those decisions for them optimising the home for them.
[00:18:01.190] - Mark Lufkin
I think moving forward, that's really important. As you talk about integrating with the grid and things like demand flexibility, that relying on human intervention was difficult. People are fallible. However, if you've got that predictability of what the system is going to do, that adds a lot of value from a grid perspective as well as a consumer perspective.
[00:18:30.860] - Phillip Twiddy
I think it simplifies the balance between cost and comfort as well, isn't it? With most traditional homes, you've got a very blunt tool to either save money or have comfort, and you don't have to have that with a more intelligent solution.
[00:18:45.850] - Mark Lufkin
Another way of looking at it, I suppose, is most energy tariffs today are a fixed price and you pay for your electricity. The complexity of managing the energy and getting that cost down lies with the energy retailer. With the Wondrwall system, we're making those decisions. The home is making those decisions. So it's pushing the... I suppose it's democratisation of energy, allowing the home user to benefit and make some of those adjustments, deciding when to use their energy, when to import it, when to export it, whether to use solar, whether to export the solar, demand flexibility. But again, hiding it from the user, but they're still benefiting rather than letting the retailer make all those decisions or the energy supplier.
[00:19:36.230] - Jon Slowe
Well, let's move on to the business model. I'd love to talk more about the tech. I'm a geek, but let's move on to the business model. You mentioned house builders, so the new build market, I can see, is an obvious part of the market. But yeah, tell us a bit about how you're getting, you’re controls, the optimisation, and the hardware into the market? What's the business model behind that?
[00:20:06.460] - Daniel Burton
We've always had house building clients as our key clients. We knew we had some great technology. We knew the savings; the technology was proven in the market. We knew the savings were consistent. We sat down and spoke with our clients and said, look, what is holding up the adoption of large-scale deployments of technology like the Wondrwall's solution. When you get down to the nitty-gritty and get down to actually the real truth, fundamentally, it's all about cost. If you look at a house builder installing a gas boiler, maybe they're paying around £5,000 to instal the gas boiler, where a net zero solution like Wondrwall is maybe £12,000, £13,000. It was all about bottom line. We sat there and we said, right, how can we work with you to create a solution where it benefits everybody along the value chain? Wondrwall will create a solution where what we said is, if we supply our Home Energy Management platform, the heating and the hot water, a similar cost to what they're paying for a gas boiler. The extra battery, solar, invertor, EV charger, in-roof mounting kit, if we free issue that to the house builder, what means is that that gives them the ability to build an EPCA-rated home with all this technology into their home, which makes it a desirable home, at the same cost of deploying a gas boiler.
[00:21:43.050] - Daniel Burton
One, it benefits the house builder. Then from a consumer's perspective, Mark, do you want to go into detail about the consumer-side and the savings and how we managed to get the solution to work from that side?
[00:21:54.230] - Mark Lufkin
Yeah, sure. I don't know how much detail to dig into it, but fundamentally, the system is maximising the use of solar generation, which is free. When we have insufficient solar, we're importing energy at off-peak tariffs to run the home, heat the home, heat the water. When we have surplus solar, we sell that back to grid at peak times to maximise the revenue stream. You throw all of those together and we're ending up with those £1,500-£2,000 savings. As Dan says, we've been doing this for five years now, so we know what savings we can generate from different house types, so we know it's very predictable. The model was, okay, let's share those savings with the homeowner. We'll keep half of the savings to run the service, pay for the kit, and the other half of the savings go back to the homeowner. They have a net monthly reduction in their outgoings, and the kit goes into the home for free. So effectively, what we're doing is giving the ability to deploy net zero homes at the same cost as gas-heated homes today, as Dan said. But also reducing the energy bills for the consumer.
[00:23:20.120] - Jon Slowe
So, the proposition for a consumer would be, I buy a house from the house builder. It's got Wondrwall technology kit intelligence in it. I say I save an amount of money and I pay a lease or annual fee to Wondrwall, but I'm saving much more than I'm paying.
[00:23:40.870] - Daniel Burton
Yeah. In essence, the energy savings are paying off that asset over a period of time. The consumer isn't really paying for that because the system, and what Wondrwall does is reducing that energy bill, but they're getting a reduction energy bill. But part of that energy savings is going off to pay the asset over a period of 10, 20 years, if you will. That benefits everybody along the supply chain, along the value chain, and make sure that this technology can scale at a rapid rate, get it into the market, and takes away a lot of the obstacles that people are facing at the moment.
[00:24:19.760] - Mark Lufkin
Yeah, that house doesn't cost any more to build than it does today as well. As you said, you're getting a better house, and you're getting a zero carbon house. It's zero carbon today. We can deploy zero carbon today. Those are not small benefits. The savings comes on top of that.
[00:24:39.690] - Sandra Trittin
Yeah. It almost sounds to be too good to be true, it's creating a wonder. So probably that's really great. But you were saying, Daniel, right? It's ready and up for scaling. What would you still see as the biggest hurdle to get going, to get this tremendous growth? Because normally now I would say, hey, it's clear we need to get that done. Let's run, right and start the deployment. Is there anything that is missing as a piece or something that is holding us back?
[00:25:25.760] - Daniel Burton
No, I think we've probably taken out the last of the blockers in front of us. The last of the blockers in front of us. Everybody loved the technology. The real issue always was cost. Now, taking that away, now we have a road ahead of us, which looks like a really interesting road. I'm never going to say scaling the business is ever going to be easy because it's going to come with its challenges. But lucky enough, the market is there, the opportunity is there, and it's the right thing to do. At the end of the day, everybody's going to be sat there, and some of these health builders can save tens of millions of pounds off their bottom line by doing the right thing and delivering efficient homes for their consumers. So we don't really have any blockers left apart from getting going and getting out there in the market.
[00:26:15.180] - Jon Slowe
Have you had any questions from house builders or challenges in the market around the concept of selling a house with a lease or repayment scheme? I don't know how you phrase it attached to it. So if I'm a customer, I'm buying a house, normally I just buy the house and everything's up to me. But now I'm buying the house and I'm paying a share of my savings to Wondrwall. Has that been a concern at all?
[00:26:41.840] - Daniel Burton
Not really a concern. It's just how you market it and making sure that it's very, very clear to both the housebuilder and the consumer about what we're actually doing. And the housebuilders are used to selling charges to consumers anyway because a few-
[00:26:57.290] - Jon Slowe
Ground rents and things like that.
[00:26:59.320] - Daniel Burton
Long-term leaseholds, ground rent, all that things. These are common things within the industry. All we're doing is we're taking something that's a common occurrence within the industry now and adding a variant to it. So, it's not as if it's brand new and it's ground-breaking. It's something that they've been doing for a long time.
[00:27:17.440] - Phillip Twiddy
I think it's becoming more normal for customers as well, isn't it? Because effectively, we lease our mobile phones, we lease our cars, et cetera. It's becoming much more normalised as well.
[00:27:29.210] - Daniel Burton
Exactly right. I lease my cars. Like I said, I lease my mobile phone. It's just second nature now, isn't it?
[00:27:37.520] - Sandra Trittin
Yeah, but I think there's one little detail, which is always the difference. On the leasing with the car, if the if the equipment doesn't work, the car can get away quite easily. The same with the phone, right? You could block the phone. Now, with a solar system or a heat pump being deployed, then it's a bit more difficult. But on the other side, I think it doesn't happen often, right? So, we are talking a small portion.
[00:28:04.480] - Daniel Burton
We did a lot of, obviously, consumer regulation work around this, and we obviously can't control people's heating and hot water. That's why we actually sell them right from the beginning. It's the battery, the invertor, the solar, and the EV that we can control. So, we've got control of them items, but them items are obviously not fundamental to running a home. And that's why we have to keep them separate, if you will. But say, for instance, if someone actually didn't want to pay for their system, we give them options around that. But also, for instance, if they did say, we don't want to pay for it, and we turn the system off, actually, when their energy bills goes through the roof and they realise that they're paying a lot. Why would they do that? They're going to be begging us to turn it back on. That's the budget.
[00:28:54.510] - Jon Slowe
It's the things that risk committees ask, don't they? And they can get stuck on in big corporates.
[00:29:00.120] - Phillip Twiddy
We had those discussions last year.
[00:29:03.240] - Daniel Burton
I think it also, as long as you're very clear on the benefits, and a lot of the work that we did on a business is to really show the consumers about what they're actually paying for and what they're actually getting for that. We actually completely redesigned our app from the ground up. We're launching a brand-new app which literally clearly demonstrates on a daily, hourly, weekly on a weekly basis, how much money you're paying to how much money the energy system is saving. I think it becomes a subconscious, subconscious thing. As long as you're proving to the consumer constantly that you're saving them money, and the money that they're paying is money, well, the pain is actually saving them money. Then it becomes a subconscious thing. Once you actually get trust in the client to say, right, we're doing this, but we're doing this the right thing, it becomes natural.
[00:29:59.210] - Jon Slowe
Well, I've got loads more things I'd like to discuss, but keeping an eye on the clock, time is getting the better of us as it always does. So, let's bring up the Talking New Energy crystal ball and set the dial this week to 2030, so six years away. And by 2030, Wondrwall's business is flying. You're scaling, you're having impact, you're growing left, right, and centre. Daniel and Mark, I'd like you to look back at those six successful years pull out one thing that was critical to that success, that drove that success. For Phil, maybe one thing in the market that enables this type of business model to fly. So, maybe Daniel, Mark, and Phil.
[00:30:49.920] - Daniel Burton
I think right from the beginning, my whole goal was never about money. My whole goal was, I always had this view of that if I left this Earth not having a positive impact on it, then I failed. So, that was always my goal right from the beginning. Wondrwall gives me that opportunity to really give something back and actually do something positive for this planet. But also, what's been pivotable is probably pivoting. We've pivoted in many different stages of our business to get where we are today. There's no doubt we're going to probably pivot again and pivot again. But that's just pivoting at the right time, making the right decisions, not really thinking. I probably think we've probably had a crystal the ball back in 2019 when we started building out a net zero solution before net zero ever become a thing. But we've made the right decisions at the right time. And fundamentally, in a business, it's all about the people. You have to bring the right people into business, and you have to give them the ability to go and do what they need to do.
[00:31:46.580] - Jon Slowe
Okay, so keep pivoting and keep hiring the right people.
[00:31:51.220] - Daniel Burton
Keep moving forward, and eventually you'll get to the place that you need to be. We've got a long, exciting journey. This is only the beginning of a really exciting journey for Wondrwall. We've got a lot of work to do. There's no doubt about that. We've got a lot of exciting work in the pipeline that we're going to be launching over the next three to four months. So, there's so much work that we've been doing in the business. So, we're looking forward to maybe in a year's time, having a recap on this conversation and saying where we've come from, from this year to next year.
[00:32:21.220] - Sandra Trittin
Would be great.
[00:32:22.720] - Jon Slowe
Mark, how about you? One thing that ends out looking back at your success.
[00:32:27.760] - Mark Lufkin
Actually, I'm going to pick up on similar to what Dan says, I think one of the things that's made us successful is that ability, I call it flexibility. So, things change, as you're growing a business, you put all these plans together, you've got this great idea of how it's going to go and go, and some detail, something is different to what you expected. It's that ability to adapt and believe. The fundamentals are there, but being able to adapt to those different changes, and particularly everything in the energy market, as you say, you talk about the energy transition. We're transitioning. We're not quite sure where we're going to get to in the end, but we've got a rough idea of where it's going to be. We've got the platform and the capability and the people to get to that point. I think we're actually in a fantastic position to influence where we we get to. But being able to adapt to all those changes, and as things change in the market, adapting our value proposition to support those market changes is what makes us successful. We've always been great at it, and I expect us to continue being great at it moving forward.
[00:33:50.470] - Jon Slowe
Thanks, Mark. Phil, on the wider sector, maybe less about Wondrwall or wider looking at the business models.
[00:33:56.790] - Phillip Twiddy
So, I think, I actually think there's going to be innovation that will have defined the success. Keeping ahead of the game, I think there are obviously market changes, energy market changes, there's housing market changes that are coming and being able to capture those opportunities but keep it simple and simple for the customer. I think that's what's going to have defined us in six years’ time and why Wondrwall been a success.
[00:34:30.940] - Jon Slowe
Customer-focused. Yeah. Well, Daniel and Mark, thanks so much for sharing your time and wishing you the best of luck and success in rolling this out and getting all that low carbon technology and that flexibility into homes that we desperately need. Phil, thanks for sharing your thoughts.
[00:34:51.540] - Phillip Twiddy
Thank you. Thank you.
[00:34:53.200] - Sandra Trittin
Yeah. Thank you so much to all of you.
[00:34:55.510] - Daniel Burton
Really appreciate your time, guys.
[00:34:57.260] - Mark Lufkin
Thank you, too.
[00:34:58.570] - Sandra Trittin
Jon, what What do you think now? What sticked in your mind or surprised you?
[00:35:06.380] - Jon Slowe
I think two things. One is the energy market is becoming a CapEx market, not an OpEx market. If you can finance the things we've been talking about in this podcast, then that's CapEx, that's capital expenditure. Then the OpEx, the ongoing running costs becomes really low. I think it's a really interesting example of how the energy retail space is starting to shift more and more in the very beginning of that but shifting from OpEx to CapEx or the emphasis from OpEx to CapEx. The second quite different thing, I think, is I love the light switch, the sensors, and the data. That home automation mindset I remember when Google bought Nest.
[00:35:47.620] - Daniel Burton
It's when I first started.
[00:35:48.770] - Jon Slowe
Yeah, a long time ago. Connected Home, smart home was the thing, and it was going to transform the energy sector, and then it went away. It's all been about home and energy management. But this blend of the two, I think, is really interesting.
[00:36:03.820] - Daniel Burton
Yeah, there's a benefit to the consumer because they can interact with the system, they can control the lights, they can control the heating, which gets them bought into the system. But then behind the scenes, we have the most comprehensive data set global in people's homes. Having that information to drive behaviours and things like that is great. That's the thing that as a business, sets us out from everybody else, really.
[00:36:25.040] - Jon Slowe
How about you, Sandra? What stood out for you?
[00:36:27.160] - Sandra Trittin
Yeah, probably building on that, right. I love data. I mean, also with my telecoms background, data is key, let's say. Also, for the smart home, I'm in that space also since more than 10 years. I'm building up with a few companies also strategies in that smart home space. What I really like is that we are getting more and more into automated optimisation. Because at the beginning, it was all about, I gather the data, I give the data to the consumer, and then it stops. The consumer might get an information, oh, you are heating your living room, but you're not in that room, but then nothing happens further, right? So, the consumer would need to take action. In some cases, they want to have the control and they want to take the action themselves It does, but there are other areas where it has to run automated. And this is what I see now and realise that we are getting more and more into that automated optimisation where it just happens in the background. And then the customer is just happy. This is consumer-centric product design because the consumer doesn't have to think about it. So, this is one point which I really like about the solution.
[00:37:42.690] - Sandra Trittin
And also in combining this building, management, construction topic together with the energy topic, because this interlinking helps quite a lot. The second point, also building on your OpEx to CapEx switch. What I still find interesting, if that case is so obvious, why don't we have more of these solutions out there? Coming back to the beginning of the podcast, we have the technology, there is the money. And luckily, Daniel and Mark, you got quite a big bunch of that. But for the scaling, it cannot be even enough, right? There can be just more and more.
[00:38:32.110] - Daniel Burton
We'll have to turn 100 million into a billion very quickly.
[00:38:37.110] - Sandra Trittin
I'm just thinking we have to move forward. If it's so obvious, we need to get it done. We need to make it happen.
[00:38:46.240] - Jon Slowe
I think it comes back to that customer proposition, Sandra, and creating one where everyone wins, everyone gets it, and it can fly off the shelves. The energy sector has not been great at that.
[00:38:57.670] - Sandra Trittin
No, and especially where it's easy. Easy to understand, right? Not much to think about it. Easy to understand, even for your grandma.
[00:39:05.470] - Jon Slowe
Well, let's leave it there for today. Thanks to everyone for listening. Hope you enjoyed the discussion and learning about Wondrwall and these type of business models and opportunities and look forward to welcoming you back next week. Thanks, and goodbye.
[00:39:24.780] - Sandra Trittin
Thanks for tuning in. We are excited to bring you captivating conversations from the leading edge of Europe's energy transitions. If you got suggestions for topics or guests for future episodes, please let us know.
[00:39:36.500] - Jon Slowe
If you're enjoying the podcast, then please do rate it and share it with colleagues. For show notes, transcripts, and more, please visit lcpdelta.com.