Armed with an idea born out of his decades of experience as the managing director at one of the biggest energy companies in Europe, Neil O’Hara launched Energy-Scanner, an online platform that helps SMEs scan for energy prices and get a better deal
A handful of energy companies have come to dominate the market in the UK, supplying close to 95 per cent of all gas and electricity across the nation. Known as the “big six”, these companies leave little room for newcomers in the market.
With supply-side energy management off the table, small and medium businesses are left to take on demand-side strategies to maintain lower energy bills. According to Neil O’Hara, transparent energy contracts tailored for SME customers is the best way to counter inefficiencies in the market. O’Hara launched Energy-Scanner last month while heading up two other multinational companies. He speaks to GrowthBusiness on the launch phase of his start-up.
What does your business do?
Energy-Scanner is an online platform where small businesses (SMEs) are able to compare the very latest energy tariffs in the market from a large range of energy companies and switch in less than five minutes. Our technology means SMEs can make a decision on their energy needs, checking an unbiased list of relevant energy contracts which are specific to their business, and switch. And if SMEs are already on the best deal, we will let them know and we can send regular updates so they can switch if and when they want to.
Where did the idea for your business come from?
The idea of Energy-Scanner was first born during my time at British Energy, when I thought that there needed to be a better and easier way for SMEs to be able to confidently check the market and enter into an energy contract that’s right for them. However, achieving this reality is complex because energy companies provide a price that’s specific for each SME, which is quite different to domestic energy contracts. We needed to develop the technology to solve this. Last year we formed an exclusive partnership with a technology provider that has developed the only reliable and accurate pricing and switching engine in the UK.
How did you know there was a market for it?
I have worked in the energy sector for a long time, so I knew the opportunity existed. But that experience was backed up by recent calls by the CMA and Ofgem, who both argue that SMEs could save hundreds of millions a year in costs by switching energy contracts. This has been backed up by our initial customers, who’ve saved an average of £2000 a year on their energy contracts.
How did you raise funding, and why?
I pitched the idea to an experienced private investor, who shared my absolute enthusiasm for the concept.
Describe your business model in brief
Using innovative technology, and based on our customer’s address, we scan the market for the latest prices offered to that business’ location, list them and let SMEs switch online. There’s no need to wait for an email or phone call back to run through your details again and complete more checks.
We have contracts with all the energy suppliers who provide pricing and contracts through our service. And our brand ethos is transparency. So we’re upfront about the fact energy companies pay us a small fee for providing the technology; in fact we list our fee on our site. We’re completely unique because the same small fee applies to each and every supplier – from the big 6 to the smaller niche suppliers – so our customers are assured we’re 100 per cent impartial.
What was your first big milestone and when did you cross it?
We worked hard to secure a number of energy suppliers during the development stages of Energy-Scanner. To date, we have three of the six big UK suppliers signed up to the site with a further seven smaller organisations on-board. Seeing these names sign on the dotted line was definitely a turning point for us as a business. We look forward to nurturing these relationships as well as provide the very best service to the SME community.
What advice would you give to other entrepreneurs?
It can be challenging to start a new business, so you need to be brave. And most importantly, seek out and embrace constructive feedback, and be absolutely clear about what differentiates you from all the others.
Where do you want to be in five years’ time?
Clearly, we would like as many businesses as possible signed up and using the service. We believe that Energy-Scanner’s platform is a critical offering to SMEs, enabling them to find the best possible energy deals that will cut their overhead costs, and allow them to switch providers if necessary. We will continue to offer SMEs a transparent service to ensure they receive the best deal possible to help make energy bills a little less complicated.