On Wednesday, April 8th Cultivate918 teamed up with TCC & i2E to put on a reverse pitch night in the energy sector. Here’s what that means: leaders in the energy industry described pain points in their everyday work life and provided insight on what they believed was fertile ground to innovate. The audience was comprised of energy professionals, regular Cultivate918 participants and those who were in the position to build something if a business idea presented itself. That’s a generalization of course and I’m sure there were audience members who had other motives than those but the ones I described are who I personally encountered the most.
The night began with some beers and introductions (always a wise choice) and a panel of six energy professionals were lead in a guided discussion by Cultivate918 moderator Dustin Curzon. The behind the scenes information that the audience wasn’t aware of is that Dustin and Cultivate918 Executive Director, Elizabeth Ellison had been talking to the panelists separately about areas where they saw the most room for innovation. This gave them a sort of “guide” of what to ask and first up was a discussion about data.
Pain Point #1: Data
Someone at the event reminded me of that term “data rich and knowledge poor” and it seems the energy industry is experiencing this issue in spades. All the panelists expressed that data management was a source of headaches for them. They explained that more efficient real time data would be most helpful, particularly in an economy like we have today. The panelists gave some really good examples of areas where data extrapolation or lack of being able to see and interpret all that data in one spot is a pain point.
As a participant it seemed the people around me acknowledged that this was an area they could help innovate but they had concerns of how they would actually sell it. Some of them gave examples that in their experience the people who experience data as a pain point the most don’t always have purchasing power. They further relayed concerns of whether or not it would lose it’s value proposition if the economy got better (would they care anymore about saving $30K here and there? It is the energy industry after all). I think our group came away thinking that if you were to innovate data for energy you need an insider pretty high up within the industry to be helping you sell it.
Next topic for discussion was how mobile affects the energy industry. The panelists described anything from how the millennial employees depend upon mobile to mobile apps they use in the field. I didn’t hear much of follow-up on that topic from the attendees, if you were there and you did, please share.
Pain Point #2: Paper
The discussion moved on to good ‘ol fashion paper. Michael Scott would be pleased. It seems paper, snail mail, faxing and the like is alive and well in this industry. An example panelist Chad Cagle, GM of Midstates Petroleum, gave was that processing contractor invoices takes an unnecessarily long time because of paper approval process. By the time the energy company receives the invoice there’s a big time lapse. That number can disrupt cash flow management as the energy company now has to pay for something that they had budgeted to pay for months ago. As Cagle put it, “You want to keep your accruals and invoice processing tight so cash in the door matches cash going out the door.”
The group I was sitting with thought that there were already a number of tech companies that already solve the paper problem pretty efficiently and for a few thousand dollars could integrate those platforms with the energy companies existing software using an API. They also thought that at the end of the day if you have someone who doesn’t want to use technology they just won’t and gave the resistance of the healthcare industry as an example.
Pain Point #3: Reputation
I’m not sure where it was in the course of the discussion but there seemed to be some areas to innovate around reputation management of energy companies. The reputation of the energy company is especially important for people who work in land right of way and title. Those are the people who reach out to landowners and arrange the lease of well sites. If a company has a bad reputation of not paying on time or has been portrayed in the media as being bad (think BP oil spill) then the landowners are hesitant or resistant to work with companies.
Startup Weekend: Energy Edition!
Reverse pitch night was the precursor to the upcoming Startup Weekend May 1st. It was meant to seed ideas for startups that you put together that weekend. One of the pitfalls many entrepreneurs and startups fall into is coming up with solutions that look for a problem as opposed to solving a problem that actually exists. Now you’ve heard some of the problems that these energy executives would pay money for if you created a solution. Go forth and do great things. Hopefully I’ll see you on May 1st! You can buy tickets to participate by clicking on the link below!