Electric Cars - A Current Reality:
A Green Entrepreneur Case-Study.
The following is an interview held between John Keohane - the MD of
Verde Autos in Cork, and Mike Collins of
The Coaching Partnership in September, 2009.
Mike Collins: "How about a little business background?"
John Keohane: "Verde Autos was founded in July 2007. Our first year and a half was based on the development of our commercial range - which was launched in April, 2009.
Before that launch, we brought a variety of products on the market - including electric scooters, and an off-road range which we supply to the National Parks, Stud farms.
Scooters ended up being in the top 10 brand."
MC: "How do you design and develop your products?"
JK: "With the scooters and the off-road range - the products are OEM vehicles rebadged. For the commercial range, we actually developed it ourselves. I have engineers based in China working on them full-time.
So, the commercial range is only on sale in Ireland and are Verde vehicles."
MC: "What is your own background previously?"
JK: "I came from a financial markets background - I was working with Bank of Ireland on the money markets side. However, I couldn't see myself forever there - but it was a great view into the financial world and how funding works for business. I really wanted to do something for myself - my own business.
I was always interested in various technologies. A few years ago, I was working in California and I came across a company called ZAP - who make electric vehicles. They had affordable vehicles - but some of them just were not practical. And I thought I could do better with vehicle design."
MC: "So, you were looking at technology that was attractive to you - but for a market that wasn't really established. Isn't that a little risky? Why not walk away and come back when the market is better established?"
JK: "Well, by 2007 there was a lot more talk of electric vehicles coming on stream, and the green agenda was being pushed hard. I felt that if electric vehicles were to take off, then I needed to be in there at the very start. So, I was after a first-mover advantage when we started in 2007.
I knew it would take time - 2 years down the line in 2009, the infrastructure still has to take off. But I believe that a couple of years from now it will take off rapidly, and I want to be here when it does."
MC: "When do you think that point will come in the future - the take-off point?"
JK: "Well, the financial side needs to settle down, consumer confidence needs to come back and I think the focus will come back to the green agenda again.
Also, incentives are really necessary to get people buying electric. People want to stick with the tried and tested and so need these incentives.
Finally, with infrastructure - charging points need to come in. They are visible and tell people that Electric has arrived. It would also be great to see a scrappage scheme and other incentives such as legal use of bus lanes for EVs.
So, if the legislation can come on board quite soon, I can see things turning around in 2010 - but maybe more certainly in 2011. That will probably be the first serious year with all the incentives in place."
MC: "What market are you specifically aiming at with your all-electric vehicles?"
JK: "Specifically at the commercial market. End users who have a defined daily route. Businesses who know the business they do in a day. So if we know that, then "range anxiety" can be eliminated. They know that the typical 100KM range per charge of an electric vehicle will cover the daily business.
To these people the bottom line is what is attractive - and established brand is not as important."
MC: "How would a business engage with your company?"
JK: "They could deal with us directly or with one of our dealers (in Cork that is City View Wheels). First, we have a look at their requirements and make sure it's a good fit. We may not be able to replace a whole fleet, but we may be able to replace some vehicles who are working within specific mileage limitations.
We then go through the costing models and present the cost-savings that would happen should you go to Electric where we recommend. The green benefits are an aside at the moment - cost-savings are the reason why 99% of our customers will go electric."
MC: "So - it seems that you are in this game to get profitable in 2011."
JK: "We will actually be profitable this year despite the current economic climate so I am hoping that by 2011 our turnover will be significantly up along with profit expectations."
MC: "Are you active in any other countries at the moment?"
JK: "Yes, we have a scooter dealer set up in Paris at the moment - they started in July. I think Paris is an ideal market for electric scooters so we expect them to do well."
MC: "Where are the attractive countries to do "electric vehicle business" in at the moment?"
JK: "The UK - and London in particular with the incentives around it's congestion charges.
In London, with Electric vehicles you get the 8 pound daily charge waived, free parking as well as an infrastructure for charging your vehicle. And this includes commercial vehicles.
In Ireland, the ESB has guaranteed charging points by the end of this year - but that's really only the start of the infrastructure needed."
MC: "What other "green areas" would you consider investing in if you had the money?"
JK: "Green energy is the big thing. This is a great growth area. The prices for wind generation and solar PV are coming down all the time. The payback seems to be there. I think that Solar PV is the way forward - especially for micro-generation. The cost is down - and in another 2 or 3 years it should be down to the right level. Wind has it's limitations - site size and investment included."
MC: "What's your take on using angel investors, VC's etc. for green company funding at the moment?"
JK: "There is a bit of an appetite - again, a lot of people are very cautious at the moment. I definitely think that Angel investors are the biggest opportunity in the country at the moment."
MC: "How do you recommend a business person gets access to angel investors?"
JK: "Networking is the best thing to do. And there are events to get involved in. Online there is seemypitch.com. Also, there's no harm in writing to business figures them to get a meeting."
MC: "Looking back, what would you have differently from the time you started the company?"
JK: "There are a lot of lessons - putting too much focus into avenues where there were dead-ends. It was about focus and prioritisation. Focus on a narrow market."
MC: "What sort of mentoring support would you advise?"
JK: "I got mentoring in the first year with The Cork Enterprise board, they arranged helpful meetings and ran a course: "Grow Your Business". It was a great opportunity to meet others in business who were going through similar challenges. It's great when others can see the obvious issues and tell you."
MC: "Say 8 or 10 years from now, what is the vision for your business?"
JK: "I'd like to be looking at a business that is pushing out at least 400 - 500 commercial units a year in the Irish market. Supplying the councils and government bodies. I'd like to see a lot of green urban fleets around the country. I'd also like to think that at least 10% of the national fleet would be electric and that we'd be a big player in that."
MC: "John, thank you very much for your time."
