Blog Post No. 191
Modern Living: Home Appliance Subscriptions & Less Waste in Real Estate – Jon Holden
Jon Holden is a visionary clean technology founder with a diverse entrepreneurial journey dedicated to making a positive impact on the environment.
from cultivating exotic seafood on land to energy storage solutions, Jon’s diverse background culminated in Iterum, a pioneering company disrupting the hardware industry with energy-efficient, connected appliances on a subscription basis.
To connect with this expert, email firstname.lastname@example.org .
In this engaging podcast, we delve into the world of clean technology and sustainability with Jon Holden, who shares his vision of transitioning from ownership of home appliances to access, emphasizing the importance of a circular economy and the subscription-based approach as a means to promote sustainability.
Through Iterum, Jon offers landlords and property portfolio managers the opportunity to access high-performing, energy-efficient appliances while eliminating the hassles of ownership and maintenance.
Jon also discusses the potential for IoT (Internet of Things) connectivity to optimize the lifespan of these assets, reduce waste, and create a more sustainable future. His insights into the future of clean technology and its potential to transform the real estate industry make this podcast a must-listen for anyone interested in sustainability and innovation.
Join us as we explore Jon Holden’s journey and discover how Iterum is making waves in the real estate and clean tech sectors. Together, we’ll gain valuable insights into the power of sustainable practices and subscription-based models to drive positive change for both businesses and the planet.
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Farnaz Fazaipour 0:34
Hello, and welcome to London property, the home of super prime, I am your host Farnaz Fazaipour. And today we’re in conversation with Jon Holden, whose journey has brought him to bringing some sustainability to the real estate market. Welcome to the show. Thank you. Jon, let’s start with how your journey did get you to this point of addressing some issues of sustainability in real estate.
Jon Holden 1:00
So I would describe myself as a clean technology founder. And what clean tech founders do is look for innovations in business models and technologies that provide positive impact for the climate of the planet, but also make money in a profitable as well. So I’ve started quite a number of ventures in the clean tech space before this. So it started in growing exotic seafood on land, to molten salt energy storage, to evey charging solutions and digital twins with industrial synergies to quite a range and eclectic mix in the clean tech space. But I really decided I had to have a day job at the same time as doing those ventures. So I had a day job as a data scientist and statistician. And I really made the decision to do this properly and to have impact both profitability and impact on the planet at scale, I need to do this full time. So that’s when I joined a startup incubator with Zinc and Zinc VC that specialises in impactful startups. And I did the programme with Zinc, around three, six months, at the end of that they took the decision to invest in Iterium, which is the business I’ve started. And they’ve made that investment at the start of the year. We’ve been growing the business since then.
Farnaz Fazaipour 2:10
And what is the opportunity or the vision that you had, that led you to starting this business?
Jon Holden 2:20
So at Iterium, our vision is to disrupt the way people access hardware, and also the way that industries within hardware operate. So the future will be access over ownership. And we already see this happening in quite a few different industries. So at Iterium our vision is to see, subscription economy and as a service model represent the ultimate business model to aid this transition from a linear to a circular economy. And it’s better for the business, it’s better for the planet. And it’s better for end users using these these products.
Farnaz Fazaipour 2:54
And in particular, what made you decide to go after hardware to do with housing?
Jon Holden 3:00
So in in the Home Hardware space, people are using these products for a lot longer lifespan. And they’re often really operating in this more linear model where they’re using these products, they’re purchasing these products, they’re using them, and then they’re getting rid of them. There’s a lot of planned obsolescence from the manufacturers, they’re planning for these things to break after certain amount of time. And they’re not shifting towards this planned kind of permanence where people can repair, reuse, and recycle these products to different tiers of customers. So the Home Hardware space seemed like had a lot of opportunities for other service and subscription operators to work in and really disrupt in that in that area.
Farnaz Fazaipour 3:44
And how are you proposing to disrupt the space?
Jon Holden 3:47
We’re starting within the home within Home Hardware, and we’re offering landlords and property portfolio managers access to energy efficient, connected high performing appliances and as an appliance as a service offering. So they get all all that for a monthly fee with a full service wraparound under our innovative leasing service and product.
Farnaz Fazaipour 4:10
At this early stage, who are your target market? And how do you see that evolving?
Jon Holden 4:16
So when we first launched, we were targeting very much private landlords kind of operative HMOs a couple of properties within their portfolio that kind of operate as landlords for existing housing stock. And we got some really good early traction in this space. Landlords really saw the benefit to them, removing the hassle of ownership or reduced cost and the service that we were giving to them. But as a start up, it’s really important to like know where to focus on and where to spend your time and energy focusing on. So we pivoted to focus much more on the builder and development side of the property market. So people operating in build to rent in the UK. Also in purpose built student accommodation, later life living and co-Living. So our value proposition of removing the hassle and cost of ownership, and also enabling them to access the data on the usage of their assets Once deployed, and showing how it can increase tenant satisfaction, really resonated with those customer segments. And also for us, it was very useful because we could see scale to that approach, and increase profitability. Those operators also get a lot of benefit from the tax efficiencies of operating leases. And they can scale that across their portfolio and really reach the kind of impact on ESG targets, and circularity targets that they need to achieve this bigger corporations.
Farnaz Fazaipour 5:39
And the hassle factor, just to go back to this point, the hassle factor that you’re taking away from a property management perspective, can you talk to us a little bit more about that?
Jon Holden 5:48
Yeah, so when when they own their assets when they purchase their assets, appliances within within the household. Obviously, that when something breaks or goes wrong, the tenant often has contacts them first. So often, what we see is the tenant contacting those landlords or property operators, and then them having to organise the warranty with the manufacturer, if there is a warranty, or try and source maintenance and repair through third party or go through their extended warranties, this can often lead to weeks of delay, weeks of downtime, lots of calls back and forth between the tenant and the landlord, causing a lot of headache and hassle. That landlord when they could be doing, you know better things with their time, and the tenant is getting increasingly frustrated. So we’re our services kind of removing that we own the assets, we’re leasing them to the operator, anything that goes wrong, the tenant will contact us, we loop in the landlord of the operator, but that hassle is really removed from them. And the tenant gets a better satisfaction of living in that in those units that we serve.
Farnaz Fazaipour 6:53
So not only are people leasing their white goods from you, so they’re washing machines, dishwashers, fridge, freezers, fridge freezers, so all the white goods that you have in your house, they can lease from you. But then you will also manage them for for them. So you don’t need to then worry about those.
Jon Holden 7:12
Yeah, so our service comes with a full service wraparound, so all the kind of headache and hassle is taken away from the operator and landlord we, we take care of all the servicing that those assets. And the tenant will contact us directly with looping the landlord and operators. So they’re aware for us to take care of the replace, repair and replace. So we have a very high SLA a service level agreement with with the landlords and operators that we replace and repair within 72 hours. Often a lot of times before that the links into a lot with are these assets being connected IoT connectivity, which means Internet of Things. So these devices are talking and feeding data back to us to talk to predictive maintenance, those assets telling us kind of their usage, any issues that are coming from them. So we can really streamline those operations and hopefully lead to decrease downtime for the tenants. If anything does go wrong.
Farnaz Fazaipour 8:13
There comes your clean tech with expertise, right, you’re gonna get everything to talk GCU being as efficient as you possibly can and costing less than in as a result of it. So what do you think has to change from a manufacturing and a distribution perspective, to have a more sustainable future for white goods.
Jon Holden 8:36
So I think these manufacturers really to embrace the as a service and subscription economy, we see it making around 20-25% of other kind of very established hardware markets. 15-20 years ago, everyone wanted to own their car. And now we see big portion of that sector, people being very happy to rent or lease their car to see it’s more cost effective, more sustainable, they can upgrade more easily. They really value that access over ownership piece. And what manufacturer what we’re our big vision here is to demonstrate to manufacturers that a reoccurring revenue model is possible within this space. And it’s not only possible but there’s far increased asset returns than just making and then selling. So what we’re proving is that reoccurring revenue model exists and is profitable. And then from that, as mentioned before, they are designing for permanence over designing for obsolescence. So they’re designing things to be modular, more repairable, more circular. And they’re designing these things to be assets that are deployed to produce recurring revenues, as opposed to just being used for five or six years then going into landfill. So we really want to demonstrate that to the manufacturers in this sector. It’s kind of lagging behind other sectors. But we see He respects manufacturers that these are really important strategic priorities for them to get involved in this. And we think as a startup, we’re fast and agile enough to demonstrate that to them and work in partnership with them.
Farnaz Fazaipour 10:15
And are you seeing any any changes in the sector, even if they’re small?
Jon Holden 10:19
Yeah. So there’s, there’s kind of established bricks and mortar businesses in the UK that have been doing appliances and our rental model for 50 plus years. These often target kind of subprime customers, so people that can’t afford to purchase their appliances. And we’re trying to flip that to say that the customers we’re trying to target, you can afford the, you can have access to higher performing embedded devices through this as a service model. So more energy efficient, more water efficient, connected devices, that lasts longer. And our bigger vision here is to have these appliances lasting longer, and as to look after, and increase the health of those assets, and then redeploy them to multiple customers. So they’re getting deployed for one, one customer, we redeploy those to another customer, and then another customer, and then showing that the recurring revenue potential from these assets is much larger, and they can serve and bring benefits to multiple customers across our lifespan. And we’re really seeing that not only certain manufacturers across the world, so Electrolux and trialling this and Singapore, Bosch trialling it in Denmark, but they’re all kind of outside of their own balance sheet. So they’re doing it through a different operator, and they’re trialling it out, they’re starting to play in this market. So we see there’ll be opportunity here within the UK, as a separate entity to those manufacturers. And to partner with those. What we’re also seeing as well as changes in legislation. So in the EU, there’s the right to repair legislation, this is a big kind of package of legal measures that mean that manufacturers have to kind of enable their products to be repairable, to kind of share the knowledge of that repairability with the rest of the world, but also to make parts available to this big push and kind of big governments to make things more circular. And to prove that things can’t just go on in this linear way where things are made used and then thrown into landfill. So it’s this big kind of shift going on across governments and industries, led by consumers as well. They they’re demanding these kind of products and services.
Farnaz Fazaipour 12:38
That’s a really big point, right? Because people have the choice to buy or not to buy. So if you don’t actually do things the way that people like to see their future, then you’re going to end up losing them as customers. So this is a very important part of this whole package. And I guess from a manufacturer’s perspective, if you’re for lack of a better way of explaining it staying in touch with that equipment, then you know how it’s being used, how it’s being maintained, then it’s much easier for you to deploy it in a secondary place until it reaches the end of its life, it comes back to you and then you’re the best position to recycle it. Yeah.
Jon Holden 13:18
So I think the so to speak about IoT for a second. So IoT means Internet of Things. And that’s the ability for all kind of products to talk, send their data back to a system and be able to understand the usage of those assets. So a lot of these kind of white good manufacturers have enabled their devices to be IoT enabled, a lot of the time they’ve not found a really strong business case for that. So, you know, you might own a fridge or an oven that’s got IoT enabled capabilities. But a lot of people won’t be using that in the home to turn their oven on before they get home or to check what’s in their fridge, that consumers aren’t using it enough to kind of show the return of investment from the manufacturer is deploying this. But what we’re trying to share is that there is a really important use case for the IoT and AI enabled capabilities, which is to show not only the impact on more energy efficient devices on showing usage of energy and water, but also in checking the health of these assets Once deployed, when should we maintain them? How to optimise the kind of lifespan of those so they can last longer? be repairable optimise what parts are needed when but also, as you say, to redeploy those in an optimal way. So you know, one tear of Customer Access up that appliance and then they’re told the optimal time for them to upgrade for their use case, that appliance comes off. The data has already told us what maintenance is needed to that and it gets redeployed to another customer who gets that at a very cost effective price, because we might have already kind of made our margins Have it and then it gets redeployed again. So the lifespan is increased. And then at the end of that, the data is telling us which parts can be reused and fed back into the kind of supply chain and potentially fix the devices. And which ones need to be are fully end of life and how best to dispose of those because we understand what their their components within those are. So it’s kind of demonstrating this is why we’re really excited about this model is because it really demonstrates that true circular model. So it’s a true incarnation of a circular model and economy. So that’s why we’re really keen to demonstrate how this has commercial potential at scale. And then we can look to expand to the hardware within the home, which is kind of our Hawaii division in that space.
Farnaz Fazaipour 15:50
And a good vision to because 40% of the waste, I think created comes from real estate. So that’s a really big number. And the other thing is going back to what you were saying about consumers using these technologies, more will push the manufacturers to make it something that is easier to use, and more widely use. I think you’re seeing a lot of this in the short term holiday business, because a lot of people are remotely managing and remotely accessing and, you know, all the all the appliances, you know, if a guest leaves, for example, even in hospitality, you seeing this, if the guests leave, then you know they’ve gone because the sensor says no one’s moving in the room, then you can turn the air conditioning unit down a bit, you know, so all in all, not only is it helping the hardware live longer, but it’s also reducing the waste from the energy that is running for nobody in some of these cases.
Jon Holden 16:50
It also optimises, like you say, optimises, the property management role and can really kind of lead to a lot more increased profitability, but also that tenant experience, that things aren’t broken when they come in.
Farnaz Fazaipour 17:04
Well, you’re onto a good, good idea, and we’re glad to be speaking to you about it. And certainly I look forward to helping you gain some traction in this field. Thank you very much for coming.
Jon Holden 17:17
Thank you for having me. Thank you.
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