BBOXX are a business with an exciting mission: to electrify 20 million people by 2020. That means providing people in some of the most inaccessible areas in the world with the power to charge mobile phones, turn on lights at night, or watch TV using solar power. And they are doing all of this from Chiswick. We're at the Light Box on Power Road - yes, it's a great address for a solar energy business - to talk to Chris Baker-Brian, the CTO and founder.
BBOXX designs, manufactures, distributes and finances plug and play solar systems. The charity project which eventually became BBOXX was founded in 2008 by three engineering students at Imperial to provide off-grid solar solutions to businesses and communities in the developing world. In March 2010, spurred on by the extent of appetite and need for alternative forms of energy, they decided to turn BBOXX into a for-profit venture. The team were also tired of raising money from friends and families.
The need for a scale-up
Given BBOXX's involvement in all the process - from manufacturing to distribution - it's not surprising that the business has had to grow fast. They’ve gone from 20 to 150 people in the last 18 months. Chris explains that the hive of activity in the operations and engineering office in the Light Box building in Chiswick is only one part of it. There is another room for strategy and finance which can house anywhere between four and fifteen people.
We have the UK business which is round about 30 people. There are about 15 people based in Southern China, Guangzhou, who are part of the supply team.
BBOXX need to be where their investors, customers and suppliers are; they are also based in Rwanda, Kenya, Uganda and China: “We have the UK business which is round about 30 people. There are about 15 people based in Southern China, Guangzhou, who are part of the supply team. They’ve made about 50,000 units over the 3 to 4 years with a variety of different manufacturers. Engineering is held here, all the IP is here, but we work in China because of their ability to scale.” In Kenya, Uganda and Rwanda, they have three retail operations, including training centres and logistics bases.
They employ about 100 full-time staff in Africa as well as near to 250 part-time sales agents. BBOXX products are also sold in other parts of the world; they have partners in places as far and wide as Columbia and the Philippines who use their own retail channels.
Financing the scale-up
Such a rapid scale-up has required financing in various ways. From 2012 to 2014, the first fifteen employees took some form of stock options or equity in return for a reduced salary which was typically vested over a few years. It was a sensible way to take on and incentivise staff when you couldn’t pay them vast amounts. Chris enthuses "It’s a great way of getting people - the more senior and strategic people who are here to stay - when you can’t pay them the market rate. Some of the guys now have equity worth 50 to 100, 000 dollars."
The BBOXX business model is partly financed by debt; their products are sold on a three-year training plan. The man in the village pays 10 to 20 dollars a month which would have been spent on candles, kerosene or their existing energy source. This debt investment comes from players in the off-grid energy field.
Raising finance gets faster. Series B took 6 months. The debt investments we’re doing now take three months.
The operations side is funded through equity. They were first approached in October 2013 by Khosla Impact, an American firm which typically invests in businesses similar to BBOXX working in the developing world, whether that's in healthcare, banking, education or water provision. They ended up investing just under two million dollars. Series B started last summer and was completed at the beginning of this year with investment from Bamboo Finance. As Chris explains, the process wasn't straightforward:
"We first approached them in 2012, so it was a long-term process of building up trust, sharing what we were doing, and contacting them on a regular basis. Things don’t happen quickly - you have to build that relationship. It took us nine months to complete the deal with Khosla. Raising finance gets faster. Series B took 6 months. The debt investments we’re doing now take three months. It gets faster as you build your systems and know what they’re looking for."
Managing the scale-up
Managing the scale-up, whether abroad or in the UK, has been one of BBOXX's biggest challenges. According to Chris, 'growing 5 separate businesses at the same pace and keeping everyone coordinated' has, unsurprisingly, proved demanding.
Starting businesses in developing countries can be daunting but the BBOXX team were keen to act fast and use existing organisations like UKTI: "When we first started the business, we scaled out of Rwanda very quickly to exporting out to 40 different countries. It shows the scale of the market in which we’re in. UKTI were useful in a couple of areas; my colleague Ashley went to India with them and that helped gained links and potential market partners. We did one in Turkey and in Ghana. They’ve been useful facilitating and setting up these links."
Managing the scale-up
Local partners have been vital; BBOXX often end up buying out partners and investing money and staff. It means they can use existing expertise and being based near their customers is key to the business strategy. Members of the team in China and Africa also have equity in BBOXX.
Growing the business to match demand has necessitated expansion in the UK. They moved into Workspace in 2013 in to a small office as there were only six or seven engineers. In their new, bigger office in the same building, there are normally 17 or 18 people. Five people are soon joining the team so they may look to move to a bigger space in September.
The office is open-plan and spacious while the atmosphere is energetic and ambitious. Pride of place, is their 3D printer which is used to print sample light bulbs, miniature versions of casing, and Chris admits ''Mario Cart figurines". There's also an area to play XBox at lunchtime. They may be a business looking raise a Series C funding next year and aiming to provide 20 million people with electricity by 2020, but they're still a startup.
Find out more about BBOXX