By: Lloyed Lobo
It is not everyday that you come across businesses that support social good as a part of their business model, particularly in the energy space. This week I had the privilege of meeting Carolyn Martin, Founder and CEO of Sponsor Energy, a new energy retailer in Alberta that not only offers competitive rates without locking customers into contracts, but most importantly, donates 50% of their profits on each customer’s monthly electricity usage to local charities.
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With 50 charities such as Alberta Cancer Foundation, Calgary Food Bank and Make-A-Wish onboard, Sponsor Energy is on a great start to its mission of generating $5 million in 5 years for 50 charities while providing a low-cost, reliable electricity service for households and small businesses across Alberta. Here’s more from my conversation with Carloyn.
How did you come up with the idea for your startup? Was there an “ah-ha” moment?
We wanted to create a new business that could harness the power of everyday consumption and contribute to the betterment of society. Based on my background, electricity was a logical starting point since people have to pay their power bills every month anyway. Why not use this power for good?
The idea had been brewing for a while, but 2012 was when the pieces really came together. In terms of an “a-ha” moment, it was more of an “OK now is the time to pull the trigger” moment when Mayor Nenshi challenged us to do 3 things for Calgary.
What has been the biggest challenge so far?
Overcoming skepticism. When people first hear of Sponsor Energy, they start looking for some sort of catch. We need to make the average Alberta household aware that Sponsor Energy is a viable, low-cost choice and switching to us from their current provider could not only save them money on their electricity bills, but also support local charities.
Another challenge is that we have to pay a deposit to the Alberta Electricity System Operator (AESO) and the local power distribution companies (equivalent to about 2 months on each customer’s power bill). This ties up a large portion of our capital.
Are there any key individuals outside of your organization that have been of great help to your startup?
Nick Clark of Utilitynet helped us with our business plan, regulatory hurdles, licensing, etc. The charities that took a chance with us early on, including Neighbourlink, Calgary Food Bank and MEOW, have been instrumental in our success. As well, many of the charities that have helped us get the message out to their supporters – like Calgary Drop-in Centre.
What’s new with your startup that we can share?
We have reached our goal of partnering with 50 charities and have launched services to Albertans last fall. We’ll be adding natural gas offering to the mix this year, with the same charitable split.
Personally, do you think it is more difficult to raise capital or find the right talent?
Oh the ultimate chicken and egg conundrum – in both cases it is about passion. The right talent will gravitate to a company that they can believe in and feel passionate about and the right investor will also seek that passion in any team they are considering investing in.
What has contributed to your success to this point?
Since Sponsor Energy is all about giving back to the community, developing and formalizing relationships with charities was critical – even before we officially launched our services. This has been very helpful in developing traction in the market.
My advice to new entrepreneurs – do something that matters!
What made you choose to go down the path of entrepreneurship?
Got the bug early and have not been able to shake it! Being an entrepreneur has its challenges, but if you really want to do something transformative, it is easier to do it from outside the shackles of someone else’s company.
What are your thoughts on Calgary’s startup community?
The Calgary startup community is an extraordinarily smart and confident group. I think it would really help startups if there was a tangible toolkit of Alberta-specific templates for every conceivable agreement and circumstance – non-disclosure agreements, MOUs, shareholder agreements, cash flow and budgeting spreadsheets, invoices, media lists, Board of Directors agreements, incorporation documents, trademark applications, share certificates – all in one spot.
What’s your ask right now? What do you and your startup need?
Any household or small business can now switch from their current provider and support a local charity by signing up on sponsorenergy.com. Email me if you have any questions at firstname.lastname@example.org.
Lloyed Lobo covers Calgary’s tech startup community. He is a Partner at Boast Capital and the VP of Community Evangelism at Startup Calgary.
This interview was originally published by Startup Calgary, a non-profit organization focused on cultivating the tech startup community in Calgary. For more information, visit startupcalgary.ca.
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