Innovative ideas, hard work and persistence – these are the steps a business prepared to compete for funding from the European Union would have to overcome. Speaking at the webinar “Micro business in Ukraine: European experience”, SolarGaps founder and director Yevhen Erik told the story of his company.
Smart blinds instead of solar panels
The Ukrainian company SolarGaps manufactures smart blinds powered by a solar battery.
“We began solving a problem of quite global proportions for a small company. We decided to reduce electricity consumption by cities, and decided to do it gradually, innovatively and find money for that,” Yevhen Erik, SolarGaps founder and director, says.
According to information by The Guardian, 37% of electricity in the world is spent on air conditioning today. This is more than it is spent on heating. The reduction of electricity consumption by improving energy performance of buildings would have helped the world reduce the global warming impact.
However, cities have no room for solar panels, which usually occupy a lot of space. That was the starting point for this company, and therefore, their idea was to mount panels on windows and vertical surfaces.
“Making our cities with zero emission, and perhaps even buildings could generate more than they consume. Our proposal features innovative blinds, where every slat represents a solar panel generating electricity and following the angle of the sun. They follow the sun like sunflowers, and maximize the volume of energy we can collect,” Yevhen says.
These blinds are much lighter than a solar panel; they can be mounted without professional help, and for that, one does not need an own house with the roof, where solar panels are usually installed.
First of all, the company assessed the potential market. It is very big. Presently, the main dealers are European companies (Italy, Spain, France). This product is fully manufactured in Ukraine, from panels themselves to software.
The payback period of solar panels is calculated depending on the place where they are going to be installed. For example, installation of these panels on a 400-square meter hotel in Murcia, Spain would cost 159 thousand euros, and the annual savings would amount to 65 thousand euros. In other words, this investment will pay itself back in less than three years.
“In most countries, our solution pays itself back in 3-4 years. In Ukraine, the tariff is presently very low, and therefore, it would take some 10 years. However, our solution helps save on air conditioning, and therefore, it pays itself back faster than a regular solar panel,” the businessman says.
What was the path of your company to success?
Some four years ago, our company went to several accelerators. The first of them was IoT Hub. Then were accelerators in the Silicon Valley. They helped us learn how other countries create similar products.
“We did not start to build an organic business, but made the company on Kickstarter. In other words, we borrowed money on an international platform. It did cost us a bit, but this way, we gained a large number of users all over the world,” Yevhen says.
Later on, the company applied for a grant and received funding from the European Bank for Reconstruction and Development.
“It was Climate Voucher Program. I know that there are many programs like that, aimed to reduce СО2 emissions. The participation in this program allowed us to make prototypes and find the way to our first trade fairs,” the company’s director recalls.
But the company did not stop there, and applied for a grant under European Horizon 2020, the EU’s largest framework program of funding science and innovations, eventually receiving a million euros from the EU.
“This program is still available. It can provide a grant of up to three million dollars,” the CEO says. “The funding is phased. We fulfill a plan, and report on the moneys spent. This way, we scale production, develop a new version of our product, procure certificates, and the like.”
According to Yevhen, they could not even foretell a path like that, because the Horizon 2020 project is a competition for money featuring 200 participating European companies. In other words, the chance to succeed there wasn’t bigger than 3%. But the idea won, and therefore, SolarGaps became the second Ukrainian company to receive funding under this project.
The selection was stringent. The company’s representatives made two trips to Brussels to show the European Commission how their solutions work and how they plan to scale. On top of that, the company developed its business plan to make sure that they do not compete with the existing European companies but become their partners.
“But if a company is working on some global idea, now is the best time to think about how to describe it and perhaps to apply for this instrument,” Yevhen says.
How did they win a million?
“An innovation alone is not a product,” Yevhen says. “You need to have a clear plan and clear cases which you want to implement.”
In fact, quite a lot of representatives from Ukraine apply for Horizon 2020 program. However, they fail to win. As a winner, Yevhen suggests a few life hacks.
The first thing is this: if you were turned down, that does not mean you have to stop.
“We were turned down four times. Only after two interviews in Brussels did we receive a positive decision. If we wanted to stop, we would have done it after the second unsuccessful attempt. Instead, we rethought the idea from a В2С to a В2В model. At first, we presented the idea of supplying our blinds from Ukraine all over the world. They weren’t impressed by this concept. They were interested in creating a product, but even more so, they wanted to know how we would be able to establish contact with a large number of organizations in architecture and construction which could use our solution,” he says.
You also have to look for partners who can help. To make sure that their application is properly structured, they sought assistance from a specialized company which oversaw the project at all stages.
How does your business live during the pandemic?
Because of the coronavirus disease, the company had to reduce expenses, change plans and look for other grantors. The majority of their distributors operate in countries the most affected by the Covid-19. Therefore, market expansion plans are not possible for the time being. Visiting a number of European trade fairs to present their company is presently out of the question, too.
“We have no other choice but to live through it and continue to work,” Yevhen says. “If we make it through that, and we must do it, the next 3-4 years will be very interesting for green energy. Today, people want to be more independent, and solar power may play an important role in that. For you need to have not only buckwheat but also an independent source of power supply, and perhaps for some it is even more important.”
By Anastasia Dziubak