ZYPHO
Shower water heat recovery device that helps you save up to 30% on shower water heating energy.
- Location
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Porto,
Portugal
Categories: Energy Non-Digital B2B
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Investment
sought: - €750,003
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Equity
offered: - 25.39%
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Investment
amount: - €752,334
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Valuation
(pre-money): - €2,204,060
Idea
Introduction
With ZYPHO installed beneath the shower tray or bath plughole, it can reuse up to 30% of the wasted energy in every shower.
By using a heat exchanger and without mixing clean and dirty water, Zypho extracts wasted energy to preheat the cold water that travels to the shower’s mixing valve.
Therefore, a smaller amount of hot water is required to achieve a comfortable shower temperature.
As a completely passive technology, Zypho is a simple and safe ways to save money and reduce energy consumption, recovering wasted heat energy with each and every shower.
Neither your shower temperature nor your shower time has to change, and once installed, Zypho is invisible.
Intended impact
As growing populations put a strain on our energy resources, we need not only to find renewable sources of energy, we must also use, and reuse energy more efficiently.
Under the 2012 Energy Efficiency Directive, all EU countries are required to use energy more efficiently at all stages of the energy chain, from production to final consumption.
It’s not only homes that can use Zypho. Gyms, hospitals, hotels and other businesses and buildings with high shower usage can use Zypho to slash their carbon footprint, energy usage, and energy bills.
We estimate that daily showers for a household of three people use around 5,000 Kwh of energy. Zypho could help save around 30% of this – the equivalent of 12 x 9-watt compact light bulbs running for an entire year.
Zypho products aim to reduce hot water energy consumption in residential and leisure buildings, which is in-line with governmental regulations encouraging the use of equipment that promotes energy efficiency.
Substantial accomplishments to date
With 10,000 units sold since we launched, Zypho is internationally patented and holds the mandatory certifications of performance and quality in the most important markets.
2017
• Substantial focus on marketing to high volume potential markets such as the UK and Holland, while preparing the future approach to new markets such as Central Europe and Scandinavia.
• Milestone of 9,000+ units sold and €1 million in cumulative volume sales.
2015-2016
• Business consolidation and expansion into new geo-markets.
• Acquired new high-profile customers.
• New product development under the same concept to respond to market opportunities.
• Obtained international certifications (Sakervatten, SE | Watermark, AUS ).
2012
• Seed Investment from EDP Ventures & Change Partners.
• Initial distribution agreements and sales. Product qualification in each target geo-market by observing the technical specifications of each market.
• International quality and performance certifications process (Kiwa, WRAS, SAP, Belgaqua, CSTB).
Monetisation strategy
Zypho is a patented product with a competitive sale price.
We have two main revenue streams, one generated through partnerships in strategic markets, and the other from direct sales from specific projects that require a stronger R&D involvement. Once completed, these projects create new growth opportunities, either directly or via partnerships.
Zypho is entirely produced under our direct responsibility so that we may assure complete quality output and strong cost control. This tight control strengthens our partners trust in our ability to deliver and encourages them to commit marketing efforts to driving sales growth.
Use of proceeds
Zypho is fully-operational both in terms of production and sales, so the investment will be used to optimise our activity and maximise opportunities in key markets – the UK and the Benelux Union.
Your investment will help us to achieve the following objectives:
• Strengthen partnerships.
• Invest in marketing to raise product/technology awareness.
• Reinforce our sales teams in each market.
• Reinforce our R&D team and develop new products to satisfy strategic markets with high growth potential.
• Master key market regulations on energy efficiency.
Market
Target market
The business operates in the construction sector – of new residential and leisure buildings – as well as in retrofitting. Our primary market consists of companies looking for equipment to help them gain mandatory Energy Performance Certificates, and sanitary equipment manufacturers willing to integrate Zypho into their products.
Our secondary market consists of private and public organisations looking for energy efficient systems to reduce energy consumption and greenhouse gas emissions at residential and social projects.
Zypho is a cost-effective way to achieve Energy Efficiency Certification and to upgrade a property to reach Passive House (ultra-low energy building) or Nearly Zero-Energy Building (NZEB) status.
Typical customers are companies that build residential and leisure properties, modular homes and off-site projects; European sanitary equipment OEM companies willing to add Zypho to their catalogues, and project companies producing Passive Houses or NZEBs.
Characteristics of target market
The potential size of the addressable market for Zypho is directly linked to new residential construction.
The European construction market has a projected yearly growth of 6% until 2020, according to Euroconstruct.org, while the global industry is forecast to grow at a CAGR of 4.2% from 2018 to 2023.
In the UK alone, the current government aims to build 300k homes per year – compared to the 217k homes that were built in 2017– which need to be affordable and energy efficient.
And in the EU, the 2012 Energy Efficiency Directive requires all new buildings to be nearly zero-energy buildings (NZEB) by 2020 and countries such as Germany and Holland are offering tax incentives to encourage technologies to help them meet these goals. The offsite construction sector has an important role to play in the future of construction industry as well as addressing UK (and EU) housing shortages, and Zypho is easily integrated in pre-fabricated structures like bathroom-pods, holiday homes and modular construction.
Marketing strategy
Large scale promotion of Zypho and Shower Waste Water Heat Recovery technology is required. We will work with our local partners to enhance the awareness to the product and technology, demonstrating its competitive edge against other energy efficiency solutions.
By raising awareness to the advantages of reusing otherwise wasted energy, we hope to help change consumer behaviour and drive demand for the product.
With a distribution strategy based on partners that can ensure volume on a short medium term, our customers are identified within three vectors:
• Wholesalers of sanitary equipment;
• Providers of energy efficiency solutions;
• OEMs of sanitary equipment and companies who incorporate Zypho in their products.
Competition strategy
Due to its cost and benefit, we believe the competitive landscape is extremely advantageous for Zypho. Widespread awareness of such technology will hopefully turn it into a commodity for future shower installations.
Direct competitors already exist and are likely to grow in number. However, Zypho has many advantages: an extremely competitive price/efficiency ratio, and universal installation and certification, which makes it able to be implemented globally.
Some direct competitors offer products that are more efficient than Zypho, but are sold at a higher price. However, some of these products are compatible with only a single shower system, which we believe limits their suitability for generic construction projects.
Considering the entrance of new players, the Zypho team has become expert in its business. We are now three years ahead of the process for mandatory quality and performance certifications.