Energy

Energy Efficiency Services Market Scan and Acquisition Target Indexing

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Problem:

A leading HVAC systems manufacturer was interested in building its presence in the Energy Efficiency Services (EES) market to generate services revenues and additional product pull-through.  The client believed the EES market offered a strong growth opportunity, and was prepared to pursue one or more acquisitions to enter the market, but leadership needed to validate the size of the U.S. market opportunity. The Client wanted a better understanding of the market landscape in order to determine what type of acquisition target it should pursue. To this end, the client asked Beacon to rapidly validate the EES North America Market size, characterize the competitive landscape, and identify a force-ranked list of potential acquisition targets.

 

Approach:

At project kickoff, Beacon worked closely with the client to clearly define the strategic footprint the client was seeking to acquire, and developed a set of key criteria by which potential acquisition targets could be evaluated. First, Beacon conducted a two-week rapid market scan and opportunity validation. Insights collected during Phase I helped refine the client's understanding of the requirements for success in the market, which allowed Beacon and client to collaboratively refine and weight each variable in the criteria set. In Phase II, Beacon shifted research focus to identifying and profiling companies that fit the client's target footprint. Beacon identified and profiled ~40 potential acquisition targets that met client criteria at high level, scored these companies in an Excel-based indexing tool, then conducted a deeper dive into the top scoring companies.  The final phase of work focused on developing of a set of recommendations for the client based on Beacon's assessment of the potential options. Over these seven weeks, Beacon interviewed over 150 market participants, including financial and industry analysts, regulators, customers, OEMs, and service providers. We engaged with the client's core team on a weekly basis to brief our progress.

 

Results:

Beacon's assessment identified a small top tier of Energy Services Companies (ESCOs) and highlighted a clear favorite. Later that year, the client acted on the study's recommendation and completed a significant acquisition of an Energy Services Company. The acquisition positioned the client to grow its services footprint rapidly in key regions and exceed its North American growth objectives.

Renewable Energy Adjacent Market Analysis & Opportunity Assessment

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Problem:

A long-time Beacon client identified renewable energy as an attractive adjacency for the company. The client team identified four market segments it believed could provide the best near-term market entry points: Energy Management (Micro-grids/Smart-grids), Solar, Wind,  and Biomass.  Our client asked Beacon to assess the potential synergies between its capabilities and customer need, and investment in each segment and to force-rank addressable opportunities in order of attractiveness. Beacon's objective was to help the client focus scarce business resources on the most attractive entry points to shape and win new customer markets.  Additionally, Beacon identified and profiled specific near-term opportunities for the client to pursue in each market segment.

 

Approach:

Beacon's opportunity assessment included a four-week scan to identify potential federal customers within each segment, followed by a deep-dive into top-tier customers to assess addressable opportunities.

Phase I and II - The client briefed Beacon on the specific functional capabilities it believed it could leverage in micro-grid, biomass, wind, and solar industries.  The client was able to set parameters on the types of opportunities it wanted to pursue in terms of size, scope, and timing, and discuss hypotheses regarding its go-to-market strategy.  Phase I continued with an exhaustive review of all publicly available, open-source information with the collision of opinion from the analyst community, including investment analysts, industry-watchers, journalists, and academics.  Secondary research included a thorough analysis of Stimulus Package funding streams to identify which federal agencies were receiving allocated ARRA dollars.  Beacon then conducted a deeper dive into the most attractive potential federal agency customers to identify and profiled specific client-addressable opportunities.  Over an eight-week engagement Beacon interviewed >170 market participants, including analysts, industry organizations, regulators, customers, and competitors to assess and force-rank potential client opportunities.  All research was conducted in "blind" fashion in order to collect unbiased market feedback and opinion.  Beacon engaged with the client's core team on a weekly basis to brief its progress and provide the client an opportunity to focus or redirect Beacon activities based on information uncovered.

Phase III - Beacon assessed client capabilities and objectives against market characteristics to force- rank the attractiveness and viability of each potential adjacent market opportunity and generated recommended market entry strategies and tactics for the client.

 

Results:

Beacon identified two of the potential market segments as most attractive based on opportunity size, growth potential, competitive landscape, and strong synergies between customer needs and the client's core capabilities.  Additionally, Beacon's assessment concluded that the client would likely need to explore partnership or acquisition to build a reputation as an energy solutions provider or systems integrator.  These findings led to a second project in which Beacon identified and force-ranked potential client partners.