Dash Energy

Marketplace software to help SMBs compare energy options

The idea

At Dash Energy, we built a marketplace tool to connect small and medium-sized businesses (SMBs) with providers of lower cost energy and renewable energy options. Big companies have consultants and white-glove energy services to help them manage their energy needs. Residential customers had slick online tools. SMBs had almost nothing. We wanted to fill that gap. Most SMBs didn't have the time to build out optimized energy programs but often that means leaving hundreds or thousands of dollars of savings on the table by simply changing utility rates or their supplier. On our platform, SMBs get transparency around the various pricing and rate structures, and we help them assess their energy profile to determine the optimal structures based on their unique operations.

We chose Texas as our entry market because it’s the largest deregulated energy market, with many energy suppliers and a lot of customer choice, which also creates complexity. SMBs would often use brokers when they wanted to navigate energy choices, so we focused on working through brokers -- it would take a lot more marketing effort to directly acquire customers otherwise. We built tools to help brokers streamline their workflows and automate their process to issue an RFP (“request for proposal” -- a document outlining the pricing, terms, and services the supplier can offer) on behalf of SMBs, and automate the comparison of these options. We save brokers time from manually analyzing the options themselves, so they can focus more on sales.

Competitors / Substitutes

There wasn’t a clear “300-pound gorilla” in the market that was widely adopted, but there was a mix of other software platforms that supported brokers in various ways. One of these was Broker Exchange Online, which was aiming to be the equivalent of a full Microsoft Office suite for energy brokers. The most similar competitor was Enerex. They positioned themselves as a full back-office suite for both brokers and energy suppliers, whereas we were more broker-forward. 

Dash had a structural advantage from other startups in that we spun out of an internal venture program at Schneider Electric, a heavyweight multinational energy company. That gave us access to unique supplier relationships and internal tools that we believed could allow us to get better rates from suppliers, provide unique value to SMBs, and move more strategically than other startups. 

Amount raised

We raised ~$1.4 million in seed funding from Schneider Electric. A bridge round was raised after I left.

Duration

The incubation began October 2019, we officially started in March 2020 and the company closed in March 2023 (Schneider Electric acquired the technology) 

Team size

We grew from four people at launch to thirteen at our peak.

What went well

Culture: We hired incredibly well on all fronts, but particularly the engineering team. Great personalities, super talented, I still keep in touch with a lot of them. We had a fun, collaborative culture, sharing side projects like building computers and gardening (we launched during COVID). Also, we were pretty good at remote-first culture.

Technical groundwork: We were doing some pretty interesting work with OCR (Optical Character Recognition). Even what AI and ChatGPT can do now with extracting information from non-standard formats is not great. OCR is messy, and consistency is hard. The fact that back then we were trying to apply machine learning on top of OCR feels like we were seeing where things were headed and is pretty validating.

Market insight: The market is underserved and a lot of small business owners are missing out on savings because the whole energy management space is such a confusing patchwork of tools and info. It is not a billion-dollar opportunity, but there’s definitely still something compelling there. In hindsight, a more durable opportunity may be in bundling energy with other essential services like internet service provision and security. Some of the brokers we worked with did that, and offered more comprehensive energy management as well (think solar, rebate programs, etc.).

Conditioning the market: Traditionally, the industry focused on PPFD, or photosynthetic photon flux density, which measures the amount of light hitting the plant at any given moment. With Candidus, we shifted their attention to DLI, or daily light integral, which measures the average light they are getting. DLI is the most important variable that influences plant growth and quality and we were able to train the market to use our language.

Challenges and what you'd do differently

Hiring for scale too early: One of the stipulations for funding was bringing on an experienced CEO to accelerate our path to revenue. However, there was a misalignment between the founding team and the board about the skills most needed from this new CEO. The board and interim CEO -- feeling we had achieved product-market fit based on three months of strong customer interviews and a pretty solid pilot -- believed we were ready for GTM leadership and sales experience. However, the founding team believed we need more skills to help navigate the organization through earlier stage exploration and potentially pivot the organization should some bets not pay off, particularly because we had not sold the product yet. There was also time pressure on finding a CEO after several candidates declined the role. The board chose to hire for scale rather than for building out a product. Unfortunately, the CEO shared the same optimism for our nascent product and in my opinion hired marketing staff too quickly, before we had fully hired the engineering team. This led to a rapid increase in our burn rate but more importantly led to stress as we had an idle team waiting on a product yet to be built and yet to be marketable. 

Licensing distraction:  One idea that excited us initially was to license an SDK (Software Development Kit -- a collection of tools developers use to build applications for a specific platform) from a healthcare company that the incoming CEO was advising. You can take these giant, legal jargon-heavy documents from different healthcare providers and use OCR technology to scrape data from them and structure it into a format that’s easy to compare. We saw a strong parallel with what we were trying to do: take utility bills, extract key data quickly, and structure the options for SMBs. That kind of fast, automated data ingestion was actually one of the first pieces of IP we had been working on (before companies like Arcadia had fully fleshed out their technology). We ended up spending two to three months trying to make it work, only to hit a dead end over licensing terms, and it massively set us back at a critical time when it was just me and our CTO with no engineering team. Looking back, it was a bad idea to focus on this deal: 1) we gave up our IP, 2) we would have been dependent on another company that was also a startup, which could be a risk if they shut down, 3) we prioritized the tech vs. confirming people wanted the product.

Internal tension on timelines:  It was challenging to get the business team comfortable with the idea that an early-stage startup team will miss deadlines sometimes (especially as a first-time PM working with a new engineering team on a complex, abstract product).  For the GTM team, who were focused on talking to customers and building the brand, any incremental week to build meant an additional week they could not sell. It was hard for me to reset reasonable expectations -- that we had to choose between hiring more people, cutting scope or moving the deadline.

Interview above with Nathan Shuler, formerly co-founder and Head of Product at Dash Energy. After Dash Energy, Nathan worked as a senior product manager at ClimateAI, leading the development of new products in agriculture, food and beverage and climate risk management based on proprietary AI-enhanced climate modeling. He currently supports early-stage Climate Tech ventures by joining as fractional design, product, and technical support.