I authored a column on Cleantech.com this week, link is here; column is below.
The cleantech sector and its subsectors is now reaching a critical mass, in terms of investment momentum, public awareness and numbers of viable prospects. A number of segments, such as solar, are already in a land grab mode, where participants believe rapid client acquisition is the primary activity to ensure company success.
Similarities to the software/tech start up market?
- Founders: Like many software start ups, cleantech start ups are usually founded by strong engineering and academic individuals, who are not necessarily strong in market strategy and sales.
- Investor experience: While there are a handful of investors with deep domain expertise in specific technologies, many new investors do not have that same level of expertise. We have seen evidence of this with the rapid influx of capital into this nascent sector.
- Need for reference accounts: Creating demand in the market requires the identification of strategic accounts where successful referenceable pilot projects can be deployed.
- Go to market strategy: Demand fulfillment may be met via a direct sales force, or via indirect sales & deployment channels, dependant upon a number of factors, including the complexity of solution, the role of the technology in a business solution, and degree of access to markets & decision makers.
- Alliances and partnerships: when the technology and team are an integral part of a larger solution (such as engineering design & construction of a desalination plant, for example), the development of a partnership ecosystem is required, in order to integrate and deploy solutions across key sectors.
The environmental consulting and engineering & construction channel
Cleantech start ups may build their own sales forces to sell solutions, but most of the time their technology is just one part of an overall infrastructure or building/facility solution. Another sales approach is to build indirect sales & deployment channels.
I suggest the key to success for many cleantech start up companies is to effectively leverage the environmental consulting and engineering & construction channel (that is, the services firms that provide consulting, design, construction management and facility operations) to sell and deploy solutions, thereby accelerating cleantech adoption.
Here’s why:
- Solution requires a range of engineering expertise: Clean technologies in most cases will require specialized engineering that can be provided by the services team in the cleantech company, but will also require traditional engineering design & construction management expertise.
- Target customers already work with E&Cs: Target verticals that may adopt cleantech include process and discrete manufacturing, transportation, telecom, government, real estate and infrastructure. Companies in these verticals rely upon global E&C firms to build business cases, develop conceptual and detailed designs, manage construction operations, and in many cases, actually operate facilities as well; E&Cs are 'trusted advisors' for capital expenditure projects.
- E&Cs are already engaged with cleantech: E&Cs have vetted a number of clean technologies, especially in waste-to-energy, green building and wind and solar power. But projects, training, and alliances with cleantech vendors are scattered at this point, creating opportunities for new vendors to step in. Cleantech execs should familiarize themselves with key strategic initiatives at global E&Cs today in order to build an ecosystem of focused and trusted partners.
- E&Cs are actively seeking new technologies to leverage: Why? The desire to capture higher margin consulting projects (which could include cleantech due diligence consulting, for example) in what is traditionally a low margin business, as one reason. Driving more growth and market share in core markets of water, building design (including building information modeling, or "BIM'), IT (for ‘green’ supply chain management, for example) and energy development, is another reason. Their question is: can cleantech serve as a ‘catalyst’ for more E&C growth?
Sales strategies
What are some key takeaways for sales and growth strategies for cleantech companies?
- Business development and strategy should focus on building a partner ecosystem and driving sales from these channels, especially with larger engineering & construction firms. The business development team should have strong domain experience in core tech areas, but should also possess a very good background in developing a go to market strategy with a significant alliance/channel component, possess a good rolodex or set of relationships with a broad array of E&C business unit executives and certainly have a consultative sales approach.
- The alliance & partner development process will involve roadmap & technology discussions with key E&C practice leaders. Within most global engineering & environmental firms there are thought leaders (individuals and groups) that take the lead in developing and disseminating technology for new business opportunities within the company.
- Target key executives within E&Cs. The corporate strategy executive (in itself a relatively new role for the E&C industry) is chartered to leverage internal expertise and nurture emerging growth opportunities across the enterprise, and as such, is a natural ‘executive sponsor’ for a cleantech partner.
- Develop a network of investors and key advisors that have relationships both within E&Cs as well as at their target client accounts
Leveraging the E&C channel should facilitate more rapid growth and quicker profitability for cleantech companies. Keep in mind that the E&C industry can be conservative at times and is focused on the total engineering solution, of which cleantech plays a part. Your objective should be to communicate the value your technology (and expertise) provides to both the E&Cs and their target accounts.
No comments:
Post a Comment