Start-up Business to Challenge Energy Retailers

Since its inception, cloud computing has enabled many business ideas to flourish. Outsourcing technical infrastructure means firms in their infancy can keep initial capital costs low.

The most recent evidence of this is Melbourne based start-up BidEnergy.

The company launched 18 months ago, and BidEnergy co-founder Anthony Du Preez has said cloud computing allows concepts like this one to get off the ground.

Du Preez says this is key for many start-ups:

‘My mindset in launching a number of businesses is very much around the lean start-up concept — not over-spending on infrastructure from day one and try to have that infrastructure really scale with your business revenue.’

In fact, as this is Du Preez’s latest venture, he believes being able to use cloud based services reduced his upfront costs by 90%.

As Du Preez told The Australian last week:

‘From an infrastruce perspective, we have gone from a few hundred dollars a month to a few thousand dollars a month so it is an opex [operating expenditure] cost base rather than any sort of capex [capital expenditure] around infrastructure.’

Du Preez was a co-founder of Adslot. Adslot Limited [ASX:ADJ] now trades as a public company after being purchased by Webfirm. Adslot is now a global company.

However, as an entrepreneur Du Preez sees a need in the market and tries to fill it, perhaps even before the market has cottoned on.

And by taking advantage of cloud computing, BidEnergy will make it easier for medium to large businesses looking for energy suppliers.

The idea is simple. Power companies should compete for medium to large business contracts, rather than customers having to contact them individually.

Think of it like a reverse auction.

Here’s how it works.

A firm provides their particulars to BidEnergy detailing their energy usage. Then, BidEnergy’s algorithms compute the analysis and this data is available to partner power companies. From here, the energy retailers bid for the business by offering their lowest possible price.

Read the rest of this article at Money Morning