xWatts, the SaaS that offers cloud-based energy optimisation, has secured $1.8 million in pre-seed funding. Led by European VC Antler, the round included participation from Cambridge Enterprise, Parkwalk Advisors, R42 Group, and numerous angel investors. The funding will support xWatts as it grows its team and improves an offer that has already seen clients reduce energy use by as much as 40%.
TFN asked xWatts co-founder, Alexander Allen about the startup story, the difference it makes, and the vision for an energy-saving future.
From Cambridge to energy innovators
xWatts co-founders, Allen and Yigit Akar, both come from technical backgrounds, Allen explained. “We both studied at the University of Cambridge, where we researched energy optimisation and IoT technologies,” he told us. After working for leading global renewables and energy providers in both engineering and management roles, they went through Antler’s venture creation programme, and developed the ideas that led to xWatts.
“At Antler we validated our problem area by conducting extensive research and interviews,” Allen said. “The same problem statement was echoed throughout. Commercial buildings have many systems existing in silos, and a lack of data availability and automation, leading to poor optimisation.”
How xWatts maximises energy efficiency
The strength of xWatts is that it connects the dots between the different uses of energy within a building or facility to optimise energy use. In some cases, they have seen costs and emissions reduced by 40%, having an obvious impact not just on the building’s environmental impact, but also the user’s profits.
When energy efficiency has been a major drive for organisations for decades, such savings may seem surprising, but xWatts takes those previous efforts further. “xWatts leverages a combination of Machine Learning, physics-based modelling and advanced mathematical optimisation to identify opportunities for energy savings,” Allen explained.
Connecting directly to building management systems or IoT gateways, xWatts constantly monitors the building’s energy use, then optimises it against other factors like the environmental conditions, occupancy, and energy market data.
“The platform replaces manual optimisation with predictive control and automation to continuously improve the building’s energy efficiency and flexibility,” Allen said.
And the platform has been developed as the climate crisis becomes more and more urgent. The latest UN recommendations suggest that European countries need to reduce carbon emissions by more than 45% by 2030 if we are to avoid irreversible global temperature increases.
Antler Partner, Jed Rose, commented on the importance of timing. “Sometimes a founding team is in the right place at the right time to deliver commercial growth alongside long-term positive impact,” he said. “We know that they have what it takes to transform one of the world’s largest industries and bring a positive impact to improving both workplace energy efficiency and reducing global emissions,” he added.
Ambitious plans to conquer Europe and climate change
The xWatts platform offers two modules. The commercial module, aimed at buildings like offices, universities, hospitals, and the industrial module, for facilities such as factories or manufacturing. Both have met with success.
Since being launched last year, xWatts has secured commercial and industrial clients in the UK and Turkey, and helped them see the practical benefits of energy efficiency, Allen said, “to date our commercial projects have realised energy reductions of up to 40% and our industrial projects have realised profitability increases of over 15%.”
With a solid base, they are looking to grow their team and expand their offer. This investment will power xWatts to make key strategic hires to their product, engineering, and business development team as they expand into new markets.
The company aims to be working with all of Europe’s largest energy providers by 2030. They are starting by openly inviting any commercial or industrial facility with even the most demanding ESG targets to contact them. “Given that energy bills increase inline with the size of the facility, our primary focus is on large-scale facilities where we can demonstrate the most impact in energy costs and carbon emissions,” Allen said.
It means that xWatts may be playing a major part in the battle against climate change. “Now more than ever, commercial and industrial businesses need to focus on improving their energy management,” Allen said. “The operations of buildings account for 30% of global final energy consumption and 26% of global energy-related emissions.”
Based on xWatts initial successes, the energy management solutions it offers have the potential of making a major contribution to meeting the UN’s 45% reduction target. But Allen notes it’s a big challenge, “meeting net-zero targets and building energy efficiency compliance requirements, poses a daunting challenge for businesses already facing an unprecedented rise in energy costs,” he said. “With reductions of up to 40%, xWatts is positioned to significantly reduce carbon emissions through making buildings more efficient.”
