Green issues have become a hot topic in recent years and, as such, a number of environmentally friendly business start-ups have appeared, with varying degrees of success. Climatecars is one of the more successful examples due to their innovative use of hybrid technology to provide a taxi service.

Green issues have become a hot topic in recent years and, as such, a number of environmentally friendly business start-ups have appeared, with varying degrees of success. Climatecars is one of the more successful examples due to their innovative use of hybrid technology to provide a taxi service.

Nicko Williamson started Climatecars when he was just 22, writing his business plan during his final year of University. Now 27, his company has been profitable for two years and is growing steadily. The idea for the business started when he was driving home from university. He travelled past an LPG conversion garage called Green Fuels when the idea hit him. “I thought why not try and make taxis green? The idea developed from here and I settled on hybrids with a view to adding pure electric cars in the future,” he says.

Climatecars uses a fleet of Toyota Prius hybrid cars that use both petrol and electricity as power sources and are widely considered as one of the cleanest cars available. The service aims for a 99 percent on-time target offer and complimentary carbon-neutral bottled water and magazines, and its drivers are uniformed.


Starting up

As soon as Nicko started working on Climatecars he encountered a number of issues – he had never had a “proper” job before, let alone any experience of running a business, he knew nothing about running a taxi company, he didn’t have the funds he would need and was up against considerable competition in London.

Nicko’s first move was to get a job at a taxi company to learn how the business worked before leaving in order to raise funds for his own start-up. He investigated Carbon Trust loans, but found that they were unsuitable and Climatecars couldn’t pursue the option. He eventually raised £150,000 from friends and family after investing £50,000 of his own money. A year later, he found further investment of £300,000 from angel investors.

As for competition – not just coming from taxi firms but also from London’s public transport infrastructure – he saw a gap in the market, arguing that the well-established taxi firms are set in their ways and that taxi services could be modernised.

Green issues

Nicko has always had an interest in green issues, having started learning about the environment at a young age. He says: “Green issues are not a fad. We can see the effects of climate change already and although there are sceptics out there, a sufficient number of companies are showing commitment to mitigating their impact on the environment.”

He argues that consumers are more actively seeking out environmentally friendly alternatives but are still wary of new options. Pricing is just as important as green credentials to customers, particularly in the current economic environment. Climatecars ensure that they stay competitive by pricing journeys based on distance rather than time.

He is strongly in favour of businesses turning to green options: “There are real reasons for companies to choose green options, the most fundamental of which are cost. Many greener ways of running businesses can result in cost savings.” 

Marketing

When it came to marketing Climatecars, Nicko found the best method was to send out press releases. As it is an innovative business, and with green issues being a popular topic in the media, the company received a lot of free publicity as journalists were willing to write about the company.

Nicko used a network of contacts to find clients across London – Climatecars’ client base primarily consists of corporate accounts, including Unilever and Virgin. He has also embraced digital media, saying: “We used social media and started a Facebook page to begin with, now we use Twitter and are planning a lot more online marketing activity for 2011-12.”

Competition

Since starting as one of the first taxi companies to utilise hybrid technology, Nicko says: “A number of “non-green” competitors have jumped on the bandwagon and added Toyota Prius to their fleets.” The company has seen a positive impact from the increased use of green vehicles by competitors, as large companies increasingly expect environmentally friendly options to be available and not all taxi companies provide this option.

Future plans

In the future Nicko hopes that Climatecars will switch from hybrid cars to electric vehicles, but will not say when, remarking “without giving away our strategy for the next year, all I will say is watch this space”. He is also planning for other new ventures, although he is unwilling to give away details.

Success

In Nicko’s opinion, the most important thing entrepreneurs must do is to work hard. “I personally still work 12 hour days and worked much longer hours and weekends for the first two years when the company was smaller and we had fewer resources,” he says. He also points to providing an excellent service and keeping a close eye on your financial situation as ways to help your business thrive.

Nicko would advise budding entrepreneurs to find people that complement your skills to work with. “If you are a great sales and marketing person then find a good numbers person to run this side of the business.” He also favours market research, saying that business owners to research competitors and customers as extensively as possible, and to raise as much capital as possible: “Assume the business is going to burn through at least double the amount of cash you project and protect against this by raising more money than you need.”