Innovation Stories: Switchee
Switchee is a socially conscious technology innovator with a focus on delivering improved comfort, affordability, security and safety. The company has developed a portfolio of smart heating and energy solutions that help to empower landlords to provide exceptional homes for residents.
Founded in 2015 by four business school colleagues, the business has received three pots of funding: two from Innovate UK (the Energy Catalyst and the Emerging and Enabling Technologies funds), and more recently from BEIS’s Thermal Efficiency Innovation Fund. The funding has supported the business in developing its cutting-edge heating controlling devices and analytics for residential landlords.
We speak to co-founder and CEO, Adam Fudakowski, to learn what’s next for Switchee’s growing portfolio, and how the funding from BEIS and Innovate UK has enabled the business’ rapid growth.
Switchee is clearly a very socially conscious business looking to solve some of the current issues in the housing sector. Could you tell us a little more about its beginnings?
The origins of Switchee began four years ago when the co-founders (myself, Ian Napier, Russ Macmillan and Ed Warrick) met at business school. We all had an interest in developing smart home solutions, and it was clear there was a need for technology to address heating and fuel usage in residential properties.
We realised there were different pain-points for landlords and residents. While residents needed to be comfortable in their homes and in control of their bills, landlords needed data-based insights into their properties in order to identify any heat retention, damp or mould issues that might present themselves.
Our idea was a smart, internet connected thermostat – one integrated solution that could help residents consume less energy and provide landlords with insights to make homes more energy efficient.
The first step was to develop the product, but as a start-up we needed funding to get the idea off the ground. We worked with Innovate UK and received £50,000 to develop our initial product in 2015. It took nine months to develop as we consulted with senior housing professionals, housing associations and local authorities to get the product fit-for-purpose and delivering results. We wanted to be able to provide a solution that would hit the mark for those managing large and complex housing portfolios.
The final product is a platform that creates a personalised and efficient heating profile for each individual property, which benefits both landlord and resident.
Since launch, Switchee has seen rapid adoption by some of the largest landlords in the UK, with the first commercial rollouts in Peabody and Flagship starting in 2017. Over 45 housing associations and local authorities have now ordered more than 5,000 thermostats. A lot of the partners we worked with to trial the product are now our customers.
We’ve received great feedback from residents, and research has shown that Switchee has reduced household bills by up to 18%. Likewise, landlords have really been enjoying the benefits, particularly the early warnings it provides to support more effective preventative maintenance. In fact, we’ve calculated that it only takes 2.5 years on average for landlords to see a return on their investment.
Sounds like Switchee was a great success from the start, why did you decide to work with BEIS to access additional funding?
We knew that we could develop Switchee further and offer more benefits for residents and landlords. Our goal is to provide a broad set of property management solutions for landlords, eventually selling to private sector landlords with more than 10,000 homes.
To make that a reality we needed funding to enable further product development, research, testing and trials. We knew of BEIS through a few fellow entrepreneurs, as well as through our conversations with Innovate UK, and had been signed up to their mailing list. So when we looked into the Thermal Efficiency Innovation funding stream, we knew this could work really well for us.
The application took around two to three weeks to complete, and while that could seem a little time intensive to some, it definitely reflected the grant amount. We received £500,000 to help us take Switchee to the next level with a new generation of products. Without that funding, we wouldn’t have been able to drive our R&D at the same pace or attract the same level of talent to our business.
What’s next for Switchee now you’re developing more products? Will BEIS continue to be a support for the business?
Our purpose doesn’t change – we still want to help landlords in providing exceptional homes for their residents, enabling them to access data and analytics to ensure their tenants are comfortable and safe.
No one else in the market is able to meet the needs of landlords like Switchee can, but we want to work with other industry players and providers. The more we can interact with these other innovators and businesses, the more we can refine our product to really address the issues in hand. BEIS is able to support us with that, having them as a backer of the business has opened us up to new networks that would have been difficult to access otherwise.
Applying for funding from BEIS was a great move for us, it was a simple process and an open, collaborative conversation rather than just forms to complete. If another start-up in a similar position to where we were wanted advice, I’d tell them that working with BEIS is a no brainer. The time and effort you put into the application is absolutely worth it.
The funding we have received has been instrumental – it's really allowed us to transform our product from the early prototype phase to the current version that's now rolled out in thousands of homes. Without the funding, we definitely wouldn’t be where we are today. The future looks great for Switchee.
Switchee will be exhibiting as part of the Innovation Zone at Futurebuild 2019. Visitors to the Innovation Zone can learn more about the company and similar innovators, as well as how they can benefit from the funding and support on offer from BEIS, Innovate UK and the wider innovation family.