Undetected water leaks have been the bane of property owners for years. Not finding and treating them quickly enough can lead to substantial damages and a fall in property value. Here Craig Foster, founder of HomeServe Labs says why he decided to tackle the problem.
What are the details of the company, when was it founded and why?
HomeServe Labs is a smart home technology developer that designs products and services which make consumer’s lives easier. HomeServe Labs was born out of HomeServe, the UK’s leading home assistance provider, which has been delivering maintenance and repair services to consumers around the country for over 20 years.
The team invented a new type of smart home leak detection alarm, LeakBot, that solves one of the biggest problems in the home insurance industry – undetected water leaks leading to substantial damage and expensive claims. The alarm measures air and water temperatures in the home and alerts you if the air temperature drops for a prolonged period of time, which is what usually happens if there’s a leak. HomeServe Labs is now a separate entity focused on scaling the LeakBot business and it now counts Aviva, RSA, Legal & General, Covéa Insurance and Neos as strategic partners.
Talk about the company’s growth trajectory, from being founded to establishing revenue, to covering costs, to moving into profit.
HomeServe Labs began life in 2014 when myself and HomeServe’s CEO Martin Bennett attended a course on corporate innovation at London Business School. While HomeServe’s core business as a home assistance company was doing very well, we knew there were new opportunities emerging around us which were not yet being explored.
We wanted to create innovative business models to find new solutions to real problems. It was during our time at London Business School that the idea of focusing the business on the future really hit home for us.
How important is an inspirational figurehead to a scale-up company and how did your leadership style get the most out of your staff?
In 2014, I was given the responsibility of setting up a new team who were housed in “The Shed”, a separate creative space to make sure the team were both physically and mentally separated from the day-to-day business.
In the early days, we ran a portfolio of projects, from smart thermostat partnerships to new apps for Landlords. We used a lean start-up approach, running quick cheap experiments to test business model hypotheses. The remit I gave the team was very broad, figuring out how technology could be used to shape home assistance services in the future.
The main reason behind the company’s success today is its entrepreneurial start-up culture, always striving to offer our staff the flexibility to pursue and bring their own ideas to the table. As a result of this philosophy, our team keeps an open mind in looking for new solutions to old problems. We make the best use of new tools at our disposal, ultimately to create new revenue opportunities others haven’t yet thought of.
The team you have around you is key and needs to be of a similar mindset to keep pushing for progress and not accept the status quo. We never rest on the laurels of past successes and our partners and stakeholders respond very well to this hungry and creative mentality.
What specific advice would you give to scale-up companies looking to build their company to exit?
Identify what value you offer customers, not what product: The music industry is a great example of how being too focused on the product you sell can lead to complacency and being disrupted by a newer product. In this case, the value that record labels provided to customers was the songs and albums that they loved listening to, not the format of an LP, cassette, CD or even MP3.
Now people use Spotify and other streaming services because it gives them what they want – a great music experience. HomeServe used to define itself as being in the business of selling home emergency insurance policies, but then redefined itself as being in the business of providing effortless home assistance. This paradigm shift paved the way for the team in HomeServe Labs.
Never rest on your laurels, always look to adapt: Too often, businesses take existing customer behaviour for granted and assume their competitors will not change. It is also easy to underestimate potentially disruptive new technologies and believe that their adoption will be slow. The most innovative companies are good at sensing where the winds of change are blowing and have a high degree of focus on shaping the technologies and changes in customer behaviour that will define the future of their industry.
By surrounding yourself with a diverse team and creating a culture where they are happy to challenge each other’s assumptions, you’ll likely stand your business in good stead to compete in highly competitive modern business environments.
Find out more: Leakbot