Even at university, I was motivated how social and economic value can be reconciled, and also how an economy with human face can be operated in a globalized world. I targeted to contribute to a sustainable economic and social model by creating well-functioning structures and systems.
Prior to the establishment of Solarbnb, I was working as a business consultant for a long time. I have learned that what is truly important for a long-term success is credibility, reliability and to able to create win-win situations. I was always motivated to build: whether it’s a team, a project, or a client problem. And this idea is only one step away from starting an own company. As the CEO of Solarbnb, in addition to make the company successful, I am also responsible for building our organization and culture, which is a great responsibility and means a lot to me.
The term ‘securitization of sunshine’ was drafted by my friend, Gergő Lakatos during a financial presentation in Taiwan. That was the root idea. We know each other with Gergő since 2011. We were working together in a professional student organization at Corvinus University. We started thinking of how would it be possible to get to the so called ‘solar bond market’. For this even more distant purpose, we have identified the necessary steps. First of all, we need a strong solar energy sector that involves a wide range of people, therefore we must first take root in the Hungarian retail market. We digged into the Hungarian market and the concept of an online marketplace for solar PV investments crystallized. Later I helped an acquaintance of mine in choosing the best solar system for, which contributed greatly to the validation and elaboration of the details. Our assumptions have been confirmed, as I have found a very fragmented solar installer market with more than 300 players, inefficient and different processes, incomparable and offers. It wasn’t difficult to realize that in a booming market, this was a big problem for many customers. And there came state subsidies, MFB loans, and so on. By then, we had to “just” come up with the concrete solution, and then we founded Solarbnb.
The operation of our platform follows the logic of the well-known marketplace sites – Booking.com / NetWaiter / Amazon / Airbnb – with the difference that Solarbnb provides a gap-filling service on the dynamically evolving solar energy market. We started from the customer’s problem, together with creating value for the installer companies as well.
From a customer’s perspective, if we go to the platform, we only need to enter the data needed for installation once in a user-friendly interface, and the pre-screened solar panel installer companies are competing for the project. On our online marketplace, offers can be compared; and an independent Solarbnb team would assist the customer in the evaluation if required. All steps, starting from the request for proposal to the conclusion of the contract take place on the marketplace. The usage of the platform is free for customers.
Through the platform – without any sales and marketing expenses – they only meet serious interested parties who has filled out a fully completed request for proposal. They do not have to comply their own brochures, emails or phone calls to submit an offer, they only have to fill out the proposal form on the platform. Solarbnb ‘s platform is free for them, there are no fixed costs, they only have to pay a commission after successful projects. We believe that we could become the number one sales channel for reliable, quality-oriented installer companies in the next period.
Regardless the profile of the company, to be successful, it is essential to be on a growing market, a viable business model and an excellent value proposition for clients, – in our case for customers and installers. I think we meet all these criterion. But that’s not enough. Commitment, long-term strategy and outstanding execution capability are also needed. Implementing the strategy consists of quite small steps that we need to be able to choose and effectuate well. At this point, the issue of human resources comes into play. I am proud to have a team of founders and partners, who have a proven track record on their field. We are not a startup that consists of youngsters who have just graduated.
I am convinced that building a company means building business and organization at the same time; equal attention needs to be paid for both. However, as a new player, the business ‘goes ahead’ and the organization needs to pursue our market performance. In our daily work, it requires flexible, transparent operation and excellent communication.
We are ahead of the decade of solar energy all over the world and in Hungary as well. Based on the National Energy and Climate Plan adopted in January 2020, Hungary intends to increase the share of renewable energy sources in gross energy consumption to at least 20% by 2030. The key element of the “greening” strategy is the expansion of solar capacity. The government’s objective is to create household-level energy independence, so the declared goal is that by 2030 at least 200,000 households would have roof-mounted solar PV systems. This itself is a HUF 230 billion market. But we shouldn’t think of this 200,000 households as an upper limit, as more than 2 million residential houses in Hungary today are suitable for installing a solar system. Thanks to the increasingly cheaper and sophisticated technology and government support programs, solar investment becomes available and it pays off to more and more families. Time has come to let them find the optimal system!
The platform has been established from own resources and from the initial investment of our lead investor, Drukka – Intellitext. Our automated service is being launched this year We are raising HUF 30-50 million in our crowdfunding campaign to fine-tune, further develop the online platform and also to introduce new features. We intend to incorporate new functionalities into our service, such as the review system, the performance monitoring function, the loan scheme, and the mobile application.
The first year is about achieving fast growth in the Hungarian retail market, but we also want to take root in the corporate sector. In three years’ time, according to our strategy, our service will be available in multiple international markets: in addition to the Central and Eastern European and Southern European regions, we also see significant potential in expansion to the Far East. Within five years, the solar bond market will also be working.
The solar bond market is based on the idea that we can have expectations for a solar system’s future performance based on production data in the past. Future production can be regarded as an expected cash flow, which can also be traded, as different actors (solar system owners, investors) may have different expectations about the expected performance (production) and its monetary value. The intention to trade is also driven by the different time preferences and liquidity needs of participants. As we see that solar energy’s dominance is just a matter of time, we can talk about a huge, still dormant market.
In practice, this means that if we install a solar system on our house, we will have a system of HUF 2.5 million that will generate income for us (electricity) for at least 30 years. Even without an interest-free loan and government support, the return on investment and payback time is very high, but our money is still sitting in the solar panels. There are many who would need the income generated by the solar system earlier, while others would be willing to invest – even because it is not possible to install solar panels on their house – and as a perpetuity, buy the future income of others ’solar systems. An additional spice to the matter is that the expectations of the volume of electricity produced by each system and its monetary value also differs actor-by-actor. The availability of production data and such a trading also helps to find the best manufacturers and installer companies. We believe that the solar bond market will function as a green investment platform where small investors can also benefit from solar investments. Thus we can also increase the environmental and financial awareness of society.
While solar energy means democratization on the energy market, crowdfunding plays the same role on the capital market. This is an important reason why this method of capital raising is attractive for us. Crowdfunding also helps increase our visibility.
Everyone who invests in Solarbnb, acquires share in a dynamic, future-oriented company offering a unique, well-scalable service in a dynamically growing market. Our dedicated team of founders and partners plays a key role in achieving our goals. Our business plans have been validated by Drukka and Intellitext, and we are honored that they have already placed their confidence to us. We welcome everyone as an investor who cares about a sustainable and transparent economy and would like to participate in creating the European center of solar energy and has intention to take his part in building a prosperous Hungarian company that can also become successful and profitable on the international market.