Otovo has signed up its first 3,000 service customers in Germany, Norway, Spain and Sweden as it debuts its offering of remote monitoring and diagnostics, accelerated response time, and discounted service work on batteries, inverters and solar panels.
Most customers have signed up for 12 months service paid upfront resulting in a EUR 115 annual average revenue per user, representing EUR 350,000 in annual recurring revenue.
***
Recurring revenue with attractive margins
The product is priced at €9 per month for customers signing up for 12 months, and €12 per month for those preferring a monthly commitment and billing. The 3,000 first customers have signed up in order to keep service levels high after their initial warranties have expired or have joined Otovo after being offered the product in relation to the discontinuation of Zolar, a German competitor.
Otovo also opened the product up to the German, Spanish, Norwegian and Swedish general homeowning public this week, meaning the service subscription is accessible also for customers who have bought installations through competing installer companies.
– For the solar and battery installation businesses across Europe, service and maintenance has been an overlooked and poorly treated customer need. In general this industry overpromises on day one and underdelivers for twenty years when it comes to helping customers get full value from their systems, says Andreas Thorsheim, Otovo CEO.
– We are now addressing this problem with two good products: OTOVO LEASING, where customers pay a monthly fee to have a fully functioning system up and running at all times at zero upfront cost; and OTOVO CARE, the new service subscription where solar system owners can get monitoring, maintenance and help for a small monthly payment.
Otovo is so far averaging 56 euros in direct customer acquisition cost for these first customers.
The service customers represent a recurring revenue stream with attractive margin. Otovo can leverage the company’s existing operations centers and installer network already in place in multiple locations in Europe.
– For Otovo, the addition of a recurring revenue product on top of already existing installation-based revenue streams represents an important driver to grow the topline, says Andreas Thorsheim, Otovo CEO.
***
EUR 1 billion market opportunity
When homeowners install a solar system, battery storage, or a wallbox, they are not just putting hardware on their roof or in their garage. They have invested in decades of energy independence, lower electricity bills, and a cleaner future. Solar and battery technologies typically save European homeowners thousands of euros per year. Otovo’s view is that such an investment deserves to be looked after day after day, even as original warranties expire, equipment makers’ guarantees reach their age limit, or suppliers go out of business.
In Europe more than 15 million homes have been outfitted with solar panels in the last 20 years. Because of the volatility in the markets over the years, for as much as a third of these systems the original installer company is no longer operational. This leaves systems “orphaned” and under-supported.
— The service market is a billion euro per year opportunity across Europe. We believe Otovo has a big role to play as millions of homeowners find they have nobody to call when their systems have downtime, and people are losing out on the value of their systems because of this, says Thorsheim.
Since 2016, Otovo has installed tens of thousands of solar systems in 13 European countries and knows how important it is for system owners to have someone by their side when they wonder if something is wrong, whether it can be repaired, and who can reliably support them.
Otovo aims to grow its service product by offering it to customers getting new installations from Otovo itself and through its installer ecosystem; to its existing customer base (30,000+) and the Otovo installer corps’ customers (300,000+), and through customer acquisition to “orphan” system owners.
The Otovo service product launched across four European countries this week is aligned with the offer given through Otovo USA. There are significant overlaps related to brand, product design, required software development and the infrastructure needed to provide this product in the European and US markets.
***
For further queries, please contact:
Andreas Thorsheim, Chief Executive Officer
Phone: +47 93 06 51 78
***
About Otovo: For homeowners, Otovo is the easiest way to get solar panels on the roof, and batteries in the home. Otovo is a marketplace that organizes hundreds of local, high quality and qualified energy installers. The company uses its proprietary technology to analyze the potential of any home and finds the best price and installer for customers based on an automatic bidding process between available installers.
Follow us on investor.otovo.com for reports, financial calendar, contact details and more.