the outsider ekWateur goes public

“We are no more energy companies than Amazon is a bookseller. We are above all digital traders ”, explains Julien Tchernia, co-founder of the energy supplier ekWateur, alongside Jonathan Martelli. Thanks to its strong technological positioning, coupled with the affirmed choice not to produce energy, the start-up created in 2015, wants to overshadow the behemoths of the sector that are Engie (12 million customers), Total Direct Energie ( 5 million) or the Italian Eni (1.2 million).

To achieve this, ekWateur was listed on Euronext on Monday, May 10. Objective: to raise enough new money to reach one million meters by 2025, against nearly 300,000 today. In details, the electricity and gas supplier launched a capital increase in the amount of 38.3 million euros, which could be increased to 44 million euros. The indicative price range is between 7.57 and 10.23 euros per share. And the operation that begins today will close on May 24.

In France, the energy market opened up to competition in 2007. Since that date, all consumers therefore have the possibility of choosing their electricity or gas supplier. Individuals can thus subscribe to EDF’s regulated sales tariff (TRV) for electricity, with prices set by the public authorities, or to market offers, at free prices, marketed by both the incumbent operator and by around forty competitors (such as Engie, Total, GreenYellow, Planète Oui, E.Leclerc energies, Plüm energies, Enercoop, to name a few).

Gradual market deconcentration

While the French market remains relatively concentrated today, with 93% of the market share held by the top three players, a breach has nevertheless been opened. At the end of 2020, the energy regulator (CRE) estimated that EDF was losing nearly 100,000 customers per month at the regulated tariff.

“Of the 33 million residential customers in France, nearly 10 million have gone to alternative suppliers. In volume [c’est à dire en kilowatt-heure, ndlr], this loss also represents nearly 30%. On the professional market, EDF has lost 30% of customers and 50% of the volume of electricity sold, ”notes Jacques Percebois, professor emeritus at the University of Montpellier and founder of the research center in energy economics and law. .

For the two ekWateur co-founders, this “ market deconcentration ” represented ” a great opportunity ”. « Market shares are taken now and not in four years ”, assured Julien Tchernia during a press conference, organized on the occasion of the IPO.

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To succeed, the young shoot, member for the second consecutive year of French Tech 120 (ranking which lists the most successful and promising French start-ups), thinks it has several assets. First, its technological platform which allows it to industrialize its offer and optimize its costs. Then, its brand positioning, characterized by its commitment to the energy transition and a fair price.

Free’s broken price model not imitable

“Imagining being able to cut prices like Free did on the telecoms market is unthinkable for reasons of market structure [la partie fourniture ne représente que 12% de la facture d’électricité, ndlr] », Says Julien Tchernia. “We have therefore made the choice not to act on the price, but on the brand and to put digital at the service of our customers”, he continues.

“The originality of ekWateur is that it has an indexed price on the wholesale market and not on TRVs. It is also playing the tailor-made card, with green electricity and green gas and many services around energy efficiency and self-consumption ”, watch Jacques Percebois.

In addition, not producing electricity directly ensures that it does not have conflicts of interest between various internal activities, such as selling its own energy and offering customers energy savings, for example. Guarantee of credibility in the eyes of consumers.

To grow its community while limiting marketing spending, greentech has also opted for an offbeat tone and does not hesitate to qualify its gas offer as ” Fuck “, in reference to its anaerobic digestion offer, made from cow dung and organic waste.

Winning the Customer Race

However, in order to establish itself among the largest, the race for the number of customers is essential and ekWateur must make itself known more. The company plans to devote 60% of its capital increase to acquiring new customers through marketing and communication expenses.

“The incoming model is the Direct Energie model [racheté depuis par Total, ndlr] : we don’t earn a lot of money at the start, but we gain customers and then we enhance the customer portfolio. Value is the customer portfolio. The objective is therefore to have as many customers as possible, ”comments Jacques Percebois.

In this race, ekWateur is counting on group purchases thanks to partnerships forged with brands known to the general public. The company has thus become closer to Macif, MGEN and UFC Que Choisir. The latter have suggested to their customers to change supplier in favor of ekWateur. ” This allows us to gain a large number of customers at once ”, explain the co-founders. In exchange, ekWateur offers a favorable rate to these new customers over a given period and therefore benefits from a lower gross margin than with its traditional customers.

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Services to improve profitability

The alternative supplier is thus betting on hypergrowth, with an almost doubling of the number of meters between the end of 2018 (168,460) and today (294,902), and relays the objective of longer-term profitability. At the end of 2020, its losses thus widened to 9.3 million euros, against 4.1 million a year earlier. However, thanks to the development of services, around demand response and self-consumption in particular (the sale of which is more profitable), the start-up intends to increase its ratio of gross margin to its turnover to 15% in 2025, compared to 6.6% today.

At the same time, it aims for a turnover of 400 million euros, against nearly 87 million at the end of 2020, ” if the price of electricity remains the same ”, specify its founders. To quadruple this amount, ekWateur is counting on organic growth but also external growth with a view to market consolidation where “ The biggest [fournisseurs, ndlr] will no longer be interested in small players ”, explains Jonathan Martelli. She will register ” in an opportunistic approach “, he specifies.

The potential threat of the Gafa

Will the small supplier succeed in becoming big? According to Jacques Percebois, in addition to the execution of his strategy, the future growth of ekWateur will also depend on several external factors. The energy specialist lists the evolution of electricity demand, the elimination or not of regulated sales tariffs for individuals, but also the evolution of EDF, ” which can rebound and recover market share ”. « It will depend above all on the reform which is underway ”, he believes while the discussions between the government and the European Commission drag on around the Hercules reorganization project.

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Last point of vigilance: the potential arrival of the tech giants in this market.

“The number of entrants is not going to increase eternally, after a while it will freeze, but the potential entrants are the Gafa”, warns the economist. ” Amazon like Google have obtained the status of electricity supplier in the United States to be able to sell the green electricity they produce to their various establishments … From the moment they invest in renewable energy (and do not settle for to buy it from producers) we can imagine that they will soon be marketing their surpluses … or even launching into large-scale supply ”, he adds.

And needless to say, these are very good digital marketers.

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