Named after the eight minutes and 19 seconds it takes for light to travel from the sun to the Earth, Eight19 emerged from the white hot foundries that are Cambridge University's research laboratories with the help of well funded and focused government project looking to engineer a world lead in advanced photovoltaics (PV).

Its third generation solar cells are based on printed plastic, making it flexible, robust and lightweight, all delivered with relatively low fabrication costs due to the high-speed manufacturing process, which from next year will happen in Cambridge where Eight19 plans to build Europe's largest roll-to-roll printing facility for plastic electronics.

However, as CEO, Simon Bransfield-Garth points out, rather unusually for a Cambridge: "The commercial bit of the company is up and running before the technical bit."

Eight19’s initial focus is off-grid energy for developing world countries that can be used for lighting or charging electrical devices such as mobile phones. It recently launched a £200k revolving fund to provide working capital for a product roll out in Africa.

The high-tech roll-to-roll plastic electronics will come later, for now, this is the story of a company that makes renewable energy the low cost energy option.

THE PROBLEM

1.6 billion people, over one fifth of the world's population, lack access to electricity via a grid and pay high prices for kerosene to serve basic needs such as lighting. A kerosene lamp costs about 1000 times as much to run as an equivalently powered light plugged into the mains.

Kerosene is also hazardous, a major fire threat and potentially toxic. So, the world's poorest people are paying the highest costs for basic needs. Solar lights are a solution but many people find it hard to save up the initial cost of the units, even if the payback time is measured in months.

THE SOLUTION

By combining solar and mobile phone technology, Eight19 is bringing electricity, using the power of the sun, to off-grid communities thereby by passing the need for a grid connection.

By offering solar power as a service, without high purchase costs, these users can now access clean electricity for less than their current spend on kerosene. The IndiGo solar electricity system is inexpensive to buy and allows users to light their homes and charge mobile phones as a service, paid for using scratchcards.

THE INSPIRATION

Two main sparks lit the fire that became Eight19. The first was three academic founders from the University of Cambridge Cavendish Laboratory, Professor Sir Richard Friend, Professor Henning Sirringhaus and Professor Neil Greenham.

Sir Richard's previous work led to Cambridge Display Technology, which sold for $285m, and Plastic Logic a company that has raised almost $1bn and which he co-founded with Prof Sirringhaus. His research group has demonstrated materials that can be used in a range of semiconductor devices including photovoltaic cells, light-emitting diodes and field-effect transistors.

The second element was the Advanced Photovoltaic Research Accelerator (APRA), launched in 2007 by the Department of Energy and Climate Change (DECC) in an effort to promote UK breakthroughs in advanced, low-cost solar photovoltaic technology.

Following a tough selection process managed by the Carbon Trust, three research areas were chosen, one of which was roll-to-roll processing of organic polymer-based PV.

A partnership between the Carbon Trust, Cambridge University and The Technology Partnership (TTP) formed in August 2008 and following a successful R&D phase, Eight19 was spun out in September 2010.

THE BUSINESS MODEL

As Bransfield-Garth said, it’s the financial bit before the technical bit: For now, Eight19’s focus is on providing off-grid electricity through the IndiGo system, which actually uses conventional solar cells. The fast printing solar cells based on the Cavendish Laboratory work won’t happen before the end of next year, so for now the company is focused on IndiGo.

IndiGo gets users to pay for on a weekly basis using scratchcards costing $1 per week, similar to payment plans for mobile phone. The cost of the system is recovered from the revenues generated from the scratch cards. The customer wins because the $1 per week spend displaces an existing spend of $2 per week on kerosene and at the same time the service is profitable for Eight19.

The hot spots for these markets are focused in Africa and India according to Bransfield-Garth: "Of the 1.4bn to 1.6bn people off-grid, one billion of them are in sub-Saharan Africa or India."

How it will commercialise the roll-to-roll printed solar cells is another matter for another day (and another startup story) as the technology is still at least two years from being production ready.

THE OPPORTUNITY

Surprisingly, the potential in off-grid mobile charging alone is huge – or substantial, whatever your view of a $50bn annual opportunity is. “People often ask ‘off-grid is the starting point, but what are the long term markets?’,” says Bransfield-Garth. “Our view is off-grid is a very large market in its own right.”

Indeed it is, but it’s a fair question when you have Cavendish inspired roll-to-roll solar cell printing up your sleeve, but as we’ve established, IndiGo is where the revenues are currently being sought. 

Currently 1.6bn people lack access to grid electricity and the World Bank predicts this number will still be 1.3bn in 2030. “Kerosene for lighting is a $38bn a year market,” says Bransfield-Garth, “it’s very substantial.”

But there’s more. “With 5 billion plus mobile phone users, 600m are phone owners with no electricity,” he says.”Eighty per cent of net new subscribers – people who have never previously owned a mobile phone – have no electricity because pretty much everyone with electricity already has a phone.”

That’s not all. “It’s very unusual for paying for someone to charge up your mobile phone in the West,” says Bransfield-Garth, “but $15bn is the amount people are paying to put electricity in their phones, so together that’s a $50bn market opportunity, which is substantial.”

THE FUNDING

Eight19's emergence from APRA came with a solid £4.5m investment from the Carbon Trust and specialty chemicals company, Rhodia as well as TTP Ltd and the University of Cambridge. Eight19 will be undertaking a further funding round in 2012 of between £5m and £10m according to Business Green.

THE COMPETITION

The solar lamps market is well established but Eight19's unique approach allows users to purchase a small system and progressively upgrade to more extensive power over time to add devices such as a radio, TV or sewing machine. Eight19 has patented technology and a broad partner network that enables the company to access rural customers.

THE TEAM

The team has broad experience in a wide range of industries from mobile phones to electronics and software design and cryptography. These came together to arrive at the idea of pay-as-you-go solar.

Simon Bransfield-Garth, CEO: Bransfield-Garth has 25 years experience helping build rapid growth, technology-based businesses in the semiconductor, automotive and mobile phones sectors. His career includes seven years at Symbian, the phone OS maker, where he was a member of the leadership team and VP global marketing. Bransfield-Garth was founder of Myriad Solutions Ltd and was previously a Fellow at Cambridge University, where he gained a BA and Ph.D in Engineering.

John Bradshaw, CFO: A Chartered Accountant with more than 15 years’ experience as a CFO with VC backed and listed companies. Following 11 years with Arthur Andersen in Cambridge and Turin, he joined Gyrus Group as CFO prior to listing it on the London Stock Exchange.

Kieran Reynolds, COO: Reynolds has 10 years experience in the development of plastic electronic devices and was with Plastic Logic for six years before joining APRA. He holds a M.Sci in Chemical Physics from the University of Bristol and a Ph.D in Physics from the University of Cambridge.

Michael Niggemann, CTO: Michael has nine years experience in development, investigation and scale-up of organic solar cells and modules and was latterly heading the organic photovoltaics activity at the Fraunhofer Institute for Solar Energy Systems (ISE) in Freiburg, Germany. He holds a Doctorate in Natural Sciences from the Faculty of Applied Sciences at the Albert-Ludwigs-University of Freiburg, Germany.

THE EXIT STRATEGY

There are many possible options, say Eight19, which adds that the idea is to continue to grow and provide service to new customers and so create value for both shareholders and potential acquirers.

 

Posted by cbm_startup on Thu 26/01/12 @ 17:46