Article
Nexus Pro
11
min read
James Dice

The Lens: SkySpark Arc, Facilio+Belimo, and WTF is Efforce

January 6, 2021

Hey friends!

Welcome to The Lens, a (new) monthly recurring series where I unpack the strategy behind the news in as few bullet points as possible.

Enjoy!

1. SkyFoundry Releases New Arc App

What happened?

  • As announced in SkyFoundry Insider No. 37, SkySpark now has a built-in work order / task management system that’s fully integrated with the analytics.
  • SkySpark’s UI includes a bunch of end-user applications for different analytics purposes (FDD, charting meter data, charting system data, displaying KPIs, etc). This is a new app called Arc.

Why?

  • Analytics overlays like SkySpark need a human-in-the-loop to get stuff done. Until this was released, there wasn’t a great way to track and manage the actions of those humans. The old ways¹ of tracking tasks were quite clunky.
  • This cleans up those human-dependent processes and makes it easier for teams to get stuff done. I see it as a great way to get building operators and technicians logging into the platform and engaged in the process. And since it’s integrated with the other apps, they have the option to dive deeper into the nerdier apps but don’t need to.

The context

  • Broadly speaking, this capability matches what SkyFoundry competitors offer.² The difference with SkySpark, as with its other apps, is that this is customizable to the almost exact needs of end-users but requires a SkySpark expert to do that customization for you.
  • Speaking of those experts, if you’re a SkySpark reseller, you can now inch closer to a true software company, as now the software isn’t as dependent on your services team to drive results for your customers.
  • Engaging building owner stakeholders in energy management and O&M processes is—IMHO—a big weakness for most analytics software vendors. For SkyFoundry, this starts to make up for a place where up-and-coming startups were gaining ground.³

2. Facilio and Belimo collaboration

What happened?

Why?

  • As we’ve discussed a bunch over the last year, the traditional BAS tech stack and business model gets in the way of using data to run buildings better.
  • The synergy between Facilio (an overlay software startup) and Belimo (an established actuator and valve OEM) is in how they are both innovating in ways that are chipping away at different parts of the traditional BAS stack, making them great compliments for getting around the bullsh*t obstacles presented by BAS industry.
  • For Belimo, it’s a value-add and potential sales catalyst for their smart devices:
  • Their valves and actuators come with intelligence built-in, which they consider a digital twin of that small piece of the HVAC system. The twin knows when something is wrong and produces valuable data.
  • This pairs nicely with an overlay that can use that valuable information in engaging the building operator or service provider that is maintaining those devices and makes life easier for them. The modern BAS doesn’t do either of those things.
  • For Facilio, it’s the same but just from higher up in the stack:
  • The number of installed Belimo devices is massive. For owners of large portfolios with lots of those devices, Facilio can provide an overlay that helps monitor, manage, and even control all of them. If they’re IP-connected, this integration can occur directly, without the BAS.
  • They can create workflows, supervisory control sequences, and more that will solve for Belimo-specific use cases to take advantage of the added local intelligence.

The context

As Rob Huntington said recently on LinkedIn:

“the sun is setting on BMS as we know it and change is coming through Building Operating Systems and Packaged Equipment Control which when delivered together will eliminate the need for field fitted BMS control all together!”

Look for more and more of this trend of bypassing the traditional BAS…

  • And as I’ve said in the past, as more and more intelligence is added locally “at the edge”, the portfolio-wide overlay software becomes MORE important, not less.
  • Device OEMs recognize this, as they need to pair up with the software that aggregates ALL connected devices (not just theirs) into a common user interface for the building owner.

3. Steve Wozniak’s new startup Efforce makes a big f*cking splash

What happened?

  • Steve Wozniak started his second company, 45 years after co-founding Apple with Steve Jobs
  • According to their whitepaper, Efforce is securitizing future energy savings from energy efficiency projects and creating a marketplace for them as a digital asset.⁴ Although you can’t buy that digital asset everywhere (like the US), initial trading showed quite high demand: in December the initial token offering hit a market cap of $950 million in 13 minutes – 10x the offering price.
  • The Efforce business model is described as follows:
  • First, the ESCO registers an energy efficiency project on the Efforce marketplace—including evaluating the investment need, calculating the anticipated return, and creating an EPC that details the savings and the duration of the returns the building owner will keep and the returns that investors will get. The project is then “validated by Efforce”.
  • Efforce then lists the project for “crowd contribution” where participants may buy into the project using fractional or whole WOZX cryptocurrency tokens. The contractor is then paid to do the work when the project is fully funded.
  • After it’s complete, Efforce “measures energy savings on these projects through smart meters attached to the blockchain”.  👀 👀 The savings data are then loaded to each investor’s profile as an energy credit for use or sale by the investor.

Why?

  • Once you get past the buzzwords (blockchain⁵, crypto, crowdfunding, etc), all the hype is hinging upon unlocking the energy efficiency sector’s true potential.
  • The thesis is that the energy performance contracting (EPC) model can be unleased much more broadly, finally extending beyond large, public sector buildings. Think: small buildings, which make up most of our building fleet and have largely been untouched by energy services companies (ESCOs) doing deeper energy retrofits.
  • The win-win-win: The building owner gets the building improvements at no cost, keeps some of the savings, and decreases their GHG emissions. The ESCO has an easier sale and doesn’t need to go to a bank for financing. The investor can put their money to work in a way that mitigates climate change. (Almost forgot: and Efforce as the platform takes a cut).

The context

  • Before you say “what the hell does the Woz know about energy efficiency?”, as I did, know that Efforce’s core team runs an Italian ESCO, so they probably do know a thing or two.
  • I see this as a way to cut out big banks and investment funds from the EPC process. Those guys often need a borrower with certain credit-worthiness (e.g. a municipality) and a minimum size contract (at least $250k) to lend money for energy projects.⁶
  • After I read everything I could find on the Efforce process, I remain extremely skeptical for two reasons:
  • The contract—When I call a Lyft or an Uber, I agree to a standard set of terms & conditions, just like you do. They’re all the same, and we’re fine with that. With EPCs, I’ve never seen a standard agreement/contract and I’ll believe it when I see it.
  • The measurement & verification (M&V)—the notion of “smart meters being attached to the blockchain” and measuring savings is nontrivial at best and hand-wavy bullsh*t at worst. Energy savings can’t be measured—they are the absence of energy consumed—meaning there is some complicated math that (1) they’re glossing over and (2) all parties need to agree on, or else sh*t will get ugly quick.

That’s all for The Lens this month! Thanks for reading,

—James

P.S. Three questions for ya:

  • Where am I wrong?
  • What news should I turn The Lens on next month?

Footnotes:

¹ I’ve seen teams use SkySpark’s old Notes app, export to spreadsheets and word documents, enter tasks manually into a CMMS or commissioning software, build their own task management system, or integrate SkySpark with the building owner’s CMMS directly.

² BuildingIQ was probably the first to include this capability after they acquired NorthWrite and then incorporated their work order system into the platform. Others have followed.

³ Bractlet and Aquicore come to mind here for energy management, with their Simulation and Projects offerings, respectively. For O&M processes, startups like Facilio and Thoughtwire have prioritized task management and engaging building O&M teams in ALL of their workflows (not just HVAC/metering analytics). Then they’re adding analytics from there.

⁴ Please note that I’m always in learning mode… but especially on this one. I understand performance contracting deeply, but crypto… not so much. And obviously none of this is investment advice.

⁵ The role of blockchain technology is to make sure each kWh reported as saved is real and not double-counted.

⁶ The bankers also often don’t care about actual energy savings, so the savings guarantees are often big fluffballs.

Upgrade to Nexus Pro to continue reading

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Hey friends!

Welcome to The Lens, a (new) monthly recurring series where I unpack the strategy behind the news in as few bullet points as possible.

Enjoy!

1. SkyFoundry Releases New Arc App

What happened?

  • As announced in SkyFoundry Insider No. 37, SkySpark now has a built-in work order / task management system that’s fully integrated with the analytics.
  • SkySpark’s UI includes a bunch of end-user applications for different analytics purposes (FDD, charting meter data, charting system data, displaying KPIs, etc). This is a new app called Arc.

Why?

  • Analytics overlays like SkySpark need a human-in-the-loop to get stuff done. Until this was released, there wasn’t a great way to track and manage the actions of those humans. The old ways¹ of tracking tasks were quite clunky.
  • This cleans up those human-dependent processes and makes it easier for teams to get stuff done. I see it as a great way to get building operators and technicians logging into the platform and engaged in the process. And since it’s integrated with the other apps, they have the option to dive deeper into the nerdier apps but don’t need to.

The context

  • Broadly speaking, this capability matches what SkyFoundry competitors offer.² The difference with SkySpark, as with its other apps, is that this is customizable to the almost exact needs of end-users but requires a SkySpark expert to do that customization for you.
  • Speaking of those experts, if you’re a SkySpark reseller, you can now inch closer to a true software company, as now the software isn’t as dependent on your services team to drive results for your customers.
  • Engaging building owner stakeholders in energy management and O&M processes is—IMHO—a big weakness for most analytics software vendors. For SkyFoundry, this starts to make up for a place where up-and-coming startups were gaining ground.³

2. Facilio and Belimo collaboration

What happened?

Why?

  • As we’ve discussed a bunch over the last year, the traditional BAS tech stack and business model gets in the way of using data to run buildings better.
  • The synergy between Facilio (an overlay software startup) and Belimo (an established actuator and valve OEM) is in how they are both innovating in ways that are chipping away at different parts of the traditional BAS stack, making them great compliments for getting around the bullsh*t obstacles presented by BAS industry.
  • For Belimo, it’s a value-add and potential sales catalyst for their smart devices:
  • Their valves and actuators come with intelligence built-in, which they consider a digital twin of that small piece of the HVAC system. The twin knows when something is wrong and produces valuable data.
  • This pairs nicely with an overlay that can use that valuable information in engaging the building operator or service provider that is maintaining those devices and makes life easier for them. The modern BAS doesn’t do either of those things.
  • For Facilio, it’s the same but just from higher up in the stack:
  • The number of installed Belimo devices is massive. For owners of large portfolios with lots of those devices, Facilio can provide an overlay that helps monitor, manage, and even control all of them. If they’re IP-connected, this integration can occur directly, without the BAS.
  • They can create workflows, supervisory control sequences, and more that will solve for Belimo-specific use cases to take advantage of the added local intelligence.

The context

As Rob Huntington said recently on LinkedIn:

“the sun is setting on BMS as we know it and change is coming through Building Operating Systems and Packaged Equipment Control which when delivered together will eliminate the need for field fitted BMS control all together!”

Look for more and more of this trend of bypassing the traditional BAS…

  • And as I’ve said in the past, as more and more intelligence is added locally “at the edge”, the portfolio-wide overlay software becomes MORE important, not less.
  • Device OEMs recognize this, as they need to pair up with the software that aggregates ALL connected devices (not just theirs) into a common user interface for the building owner.

3. Steve Wozniak’s new startup Efforce makes a big f*cking splash

What happened?

  • Steve Wozniak started his second company, 45 years after co-founding Apple with Steve Jobs
  • According to their whitepaper, Efforce is securitizing future energy savings from energy efficiency projects and creating a marketplace for them as a digital asset.⁴ Although you can’t buy that digital asset everywhere (like the US), initial trading showed quite high demand: in December the initial token offering hit a market cap of $950 million in 13 minutes – 10x the offering price.
  • The Efforce business model is described as follows:
  • First, the ESCO registers an energy efficiency project on the Efforce marketplace—including evaluating the investment need, calculating the anticipated return, and creating an EPC that details the savings and the duration of the returns the building owner will keep and the returns that investors will get. The project is then “validated by Efforce”.
  • Efforce then lists the project for “crowd contribution” where participants may buy into the project using fractional or whole WOZX cryptocurrency tokens. The contractor is then paid to do the work when the project is fully funded.
  • After it’s complete, Efforce “measures energy savings on these projects through smart meters attached to the blockchain”.  👀 👀 The savings data are then loaded to each investor’s profile as an energy credit for use or sale by the investor.

Why?

  • Once you get past the buzzwords (blockchain⁵, crypto, crowdfunding, etc), all the hype is hinging upon unlocking the energy efficiency sector’s true potential.
  • The thesis is that the energy performance contracting (EPC) model can be unleased much more broadly, finally extending beyond large, public sector buildings. Think: small buildings, which make up most of our building fleet and have largely been untouched by energy services companies (ESCOs) doing deeper energy retrofits.
  • The win-win-win: The building owner gets the building improvements at no cost, keeps some of the savings, and decreases their GHG emissions. The ESCO has an easier sale and doesn’t need to go to a bank for financing. The investor can put their money to work in a way that mitigates climate change. (Almost forgot: and Efforce as the platform takes a cut).

The context

  • Before you say “what the hell does the Woz know about energy efficiency?”, as I did, know that Efforce’s core team runs an Italian ESCO, so they probably do know a thing or two.
  • I see this as a way to cut out big banks and investment funds from the EPC process. Those guys often need a borrower with certain credit-worthiness (e.g. a municipality) and a minimum size contract (at least $250k) to lend money for energy projects.⁶
  • After I read everything I could find on the Efforce process, I remain extremely skeptical for two reasons:
  • The contract—When I call a Lyft or an Uber, I agree to a standard set of terms & conditions, just like you do. They’re all the same, and we’re fine with that. With EPCs, I’ve never seen a standard agreement/contract and I’ll believe it when I see it.
  • The measurement & verification (M&V)—the notion of “smart meters being attached to the blockchain” and measuring savings is nontrivial at best and hand-wavy bullsh*t at worst. Energy savings can’t be measured—they are the absence of energy consumed—meaning there is some complicated math that (1) they’re glossing over and (2) all parties need to agree on, or else sh*t will get ugly quick.

That’s all for The Lens this month! Thanks for reading,

—James

P.S. Three questions for ya:

  • Where am I wrong?
  • What news should I turn The Lens on next month?

Footnotes:

¹ I’ve seen teams use SkySpark’s old Notes app, export to spreadsheets and word documents, enter tasks manually into a CMMS or commissioning software, build their own task management system, or integrate SkySpark with the building owner’s CMMS directly.

² BuildingIQ was probably the first to include this capability after they acquired NorthWrite and then incorporated their work order system into the platform. Others have followed.

³ Bractlet and Aquicore come to mind here for energy management, with their Simulation and Projects offerings, respectively. For O&M processes, startups like Facilio and Thoughtwire have prioritized task management and engaging building O&M teams in ALL of their workflows (not just HVAC/metering analytics). Then they’re adding analytics from there.

⁴ Please note that I’m always in learning mode… but especially on this one. I understand performance contracting deeply, but crypto… not so much. And obviously none of this is investment advice.

⁵ The role of blockchain technology is to make sure each kWh reported as saved is real and not double-counted.

⁶ The bankers also often don’t care about actual energy savings, so the savings guarantees are often big fluffballs.

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