When he knocked on doors to introduce his year-old business, Chloros Solutions director Peter Goh learnt that the opening line ‘Hi, I’m from a green technology firm …’ was simply not the way to gain an audience with the average Singaporean homeowner. ‘But once you say ‘Hi auntie, we can help you shave 20-40 per cent of your electricity bills every month!’ suddenly, they’re a lot more interested. So that’s the value proposition we offer,’ Mr Goh says.
The start-up markets itself as a one-stop hub for households and businesses looking for green solutions or better energy management. But its aim, for now, is to build Chloros into a household name among home-owners looking to save energy and costs.
Though it’s an easy assumption to make about founders of green businesses, 26-year-old Mr Goh says that he was not an environmentalist to begin with, but an aspiring businessman.
‘Since I was young, I’ve never really thought of getting an office job. Business is just something that I’ve been doing on and off,’ says Mr Goh, recalling how, as a student, he and his friends were the first to organise an inter-junior college party – a considerably profitable venture.
But an elective module on global environment issues which he took in his last semester in the National University of Singapore (NUS) piqued his interest. Then the World’s Greenest Homes documentary on TV sparked off the idea that has since become Chloros.
Mr Goh and his co-founders Melvin Chen and Rebekah Lin, both 26, decided that Chloros could fill a current gap in the market – to help make the average home more green. ‘I thought, if I were a homeowner in Singapore and wanted to go green, I wouldn’t know where to start,’ Mr Goh says. ‘And if I did, I would have to seek out 10 to 15 different suppliers to replace the different appliances in my house.’
Not one to warn of global warming doom or preach about the need to save the environment, Mr Goh does take a moment to place Chloros in the larger scheme of things.
‘There is a lot of money being pumped into green tech by the government into R&D, solar energy, but if you think about it, that’s mostly about increasing energy supply,’ he says. Chloros lies on the ‘negative watts’ end of the scale by bringing energy-saving products and ideas to the end-users and lowering energy demand.
The three co-founders incorporated the company late last October, but took on part-time jobs for two months to regain an 8-to-5 routine after the less structured days of post-graduation life.
Things moved speedily thereafter. ‘We started doing a lot of supplier tie-downs; applied for the Spring Singapore grant in December; had an interview in January; received our first tranche of the grant in March,’ Mr Goh says.
Spring’s Young Entrepreneurs Scheme for Start-ups gives support of up to $50,000 – matching $4 for every $1 that the entrepreneurs themselves raise. This meant that the three co-founders needed to first pump $12,500 into the business between the three of them.
For Mr Goh, raising capital quite literally meant giving up what he had. ‘It was quite bad, I actually had to go pawn some of my belongings,’ he says.
These possessions were of sentimental value too, so he paid a higher interest to ensure that they would not be sold off, thus wiping out most of his take-home pay of less than $700 (as stipulated under Spring’s grant conditions) for several months.
Another condition was that the grant would be disbursed in two tranches, the first upon acceptance and the second only when they met the target of completing 50 projects and creating five avenues to raise brand awareness in a year.
Mr Goh says that these targets got them fired up: ‘We said, ‘Let’s do it as fast as we can!’ They completed 50 projects in two-and-a-half months – less than a quarter of the target time.
Consultancy charges were waived for some, though that did not equal zero profits. ‘Our model is such that we have two arms of making money – one through consultancy and the other through contracting,’ he says.
The consultancy charge covers Chloros’ home-visit to conduct the energy management audit, which provides a detailed breakdown of how much each electrical home appliance costs the owner to use each month. This report then forms the basis on which Chloros recommends lifestyle changes as well as appliance replacements or other green solutions.
‘Say we recommend that you change the aircon. We are able to source and procure and install the aircon for you, sometimes at cheaper rates because we work directly with wholesalers,’ Mr Goh says. This benefits the homeowner, and gives Chloros its other revenue stream.
Mr Goh’s main preoccupation now is scalability: ‘We need to reach a position whereby people look for us, not we look for people. And since we already have the first mover’s advantage in the residential market, we really need to capitalise on that.’
So though the co-founders initially targeted landed properties, they soon realised that while margins per project were higher, they risked missing out on the mass market.
Chloros is thus working with non-profit body ECO Singapore to conduct training on energy management and raise awareness of green solutions among HDB homeowners. There are also tentative plans to work with the MCSTs (management corporation strata titles) of condominiums, and with the concierge service at Sentosa Cove.
Indeed, the past couple of months have seen projects slow to a stream of two to three a month, as the team builds up and stress-tests its business model and audit system to prepare to scale-up.
Of its 70 projects to date, about 10 were with corporate customers – shops, bars and restaurants. It has just concluded a study for Lemnis Lighting on the returns for carparks to change to LED lighting, and is also working with Nanyang Junior College on a project to reduce heat in classrooms.
With Mr Goh focusing on business development and Mr Chen on the technical and engineering aspects (Ms Lin, who works in private equity, is less active in the business), Chloros has already hired another person full-time with two others working on a project basis.
Just two weeks after moving into Chloros’ first office at Orchard Plaza, Mr Goh says that he can see how dedicated office space, as opposed to a home office, has ‘really accelerated progress and growth’.
Working from home was ‘very economical’ but less productive, as the office has eased communication and aided focus greatly, he says.
This is important to Chloros’ service delivery. ‘We didn’t build this company around products and technology, but people and services,’ Mr Goh says. ‘Tech becomes obsolete quickly, but good service and a company built around people can take you a longer distance.’
The days can be long and unpredictable, but Mr Goh is glad that Chloros has made it past the one-year mark.
‘I’m very happy and proud to tell people we’re entrepreneurs. We don’t feel tired. When you’re doing something you like to do, you just don’t,’ he says.
