Building Automation and Services Management | PropTech Startup Ideas

Sourav Paul

This Real Estate Tech startup idea from YoStartups is to develop a Plug and Play system for Building Automation and Services Management. The startup would develop and install a set of modular hardware in the buildings and integrate these with the systems such as electrical, air conditioning etc. An application would be used to detect these hardwares and create a digital model of the building on a mobile device, to manage the building systems. Overall, the aim is to make building management easy to implement, thus extending it to even residential buildings and saving energy.

Market Definition For Building Automation and Services Management

As per the International Energy Agency, the global building sector is responsible for 30% of the energy consumption and 40% of the direct and indirect CO2 emissions. This continues to rise at 1% every year.

In India alone, it is estimated that by 2030 the aggregate floor area in residential buildings will increase four times. The energy consumption in residential buildings is predicted to rise by more than four times by 2030. However, as per the Global Alliance for Buildings and Construction, the energy use in buildings needs to reduce by 30% by 2030 to be on track to meet global climate ambitions outlined in the Paris Agreement.

Building Automation has been implemented extensively in commercial buildings, and as per engineering estimate, the resulting total energy savings are from 5% to 15% of a building’s annual energy consumption. Automation has not been used much though in residential buildings, other than the ultra-luxury sector, mainly due to the unavailability of cost-effective solutions. Most automation systems today depend on on-site programming, which forms a significant barrier in adopting automation in semi-luxury and budget housing.

Competitor Analysis For Building Automation and Services Management

PassiveLogic is a company that uses artificial intelligence driven controls and brings the power of big-data to buildings, providing every customer with their own building management in a mobile device Enlighted is a company that provides management of electrical and air conditioning with a high sensor density. Comfy is a firm that creates intelligent software systems for office buildings. It offers an occupant-facing mobile app that allows individuals to control the temperature of their work area. The data collected enables facilities managers to analyse how individuals interact with their environments.

 75F is a startup that addresses various aspects of air conditioning systems from dynamic airflow balancing to indoor air quality management and outside air optimisation.

Pain Point and Target Audience For Building Automation and Services Management

The target customers for this business are residential owners and commercial building owners/ managers. Residential owners acknowledge that there are no easy-to-use solutions for managing services in residential apartments. Existing houses find it difficult to find solutions that can transform the manually operated systems to an application-based management system.

Commercial building owners depend on programming expertise to customise the automation/ management system in their buildings. Most systems require dedicated spaces for installation and are not mobile. Programming these systems required expertise, and although there are many vendors in the market, the end user/ facility manager often lack the engineering know-how to make changes as per need.

Value Proposition For Building Automation and Services Management

The value proposition is to develop a set of hardware sensors and controllers, and software application for building services controls that would eliminate the need for programming for commissioning the building facility operations. The hardware sensors would be installed as part of the building electrical, plumbing and air conditioning systems. The building can be modelled in the software application by taking a set of photographs of the building floor. The controls are added on to the model to create a digital replica of the building. The software application then helps to automate and control the building services from a mobile device. This plug-and-play system eliminates the need for customised programming that is used currently for building automation. As a result, the cost of building automation reduces, while ease-of-use increases.

Business Model For  Building Automation and Services Management

The company should focus on both commercial building owners and residential owners.

In case of commercial building owners and residential owners, it would be a good idea to focus first on buildings in the pipeline. The firm should initially tie up with real estate developers to include the above technology in future constructions. Over time, an Ingredient Branding model needs to be adopted, highlighting ease-of-use and energy savings as values to the consumers.

The firm should also target to implement the concept in existing residential buildings, many of which do not have any automation of services. There is a huge market for implementation of app-based automation in such buildings, and ease of integration of the technology with the existing system is the key to tap into this market

Way to market For Building Automation and Services Management

The firm will have to develop sensors and controllers for different sizes of building services. The way to promote this concept is by business-to-business marketing. The startup should focus at first on managing basic parameters of particular building service, demonstrating its benefits and then enhance the features. Modularity of the system and having sensors/ controllers of a wide capacity range is the key to attract a large user base. The data collected from the systems will help in further learning and also further support the firm to modify their systems.

Milestones for this PropTech Business Idea

The startup should focus on developing the sensors/ controllers and the application, conduct trials and then launch a basic version. While residential apartments are the more comfortable option to start with, commercial buildings offer more readiness to adopt newer technology. By the end of a year, the startup should target to expand to major real estate hubs in a country, with a range of products varying in size and capacity.

Investment Needed for Prototyping this PropTech Business Idea

The initial significant costs are hardware and application development and testing costs, and marketing/ networking cost. The startup should target to raise around $200-250 thousand for developing and testing the concept. Angel investors or incubators such as IDEA Lab, Brigade REAP, Pi Labs, MetaProp NYC, provide both the seed money and domain-specific guidance.

Team Capability For Building Automation and Services Management

The core team would be comprised of Building Automation and AI/ IoT engineers who will work on the blueprints and then build a prototype. A strong understanding of sensors and IoT systems is a must.

Investors/ Expert on Building Automation and Services Management

The total investments in Real Estate startups have increased almost 40 times in the last 13 years. The total amount of investments in the first half 2018 is twice the amount of the investments during the same period in 2017. In 2018, Smart City and IoT raised around $15 million in investments.

Energy efficiency, although a highly acknowledged global need, will become a motivation of every person only when the individual user can control the systems that impact energy he/ she uses. Residents, therefore, need solutions that are user-friendly, customisable without the dependency on engineering expertise and efficient at achieving the overall goals.

Additionally, building automation needs to move on from being a set of stand-alone systems to being part of a more extensive network that can use data to make living and working spaces more energy efficient. Only then will such spaces be able to integrate into the overall concept of smart cities.

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