A startup that’s friendly to both the environment and your wallet is two steps away from a $1 million prize.
Renewable-energy company Looop Inc., which says it can slash household electricity costs to a third of what customers pay now, advanced to the final rounds of Startup World Cup 2020 in Tokyo on Thursday.
Looop won the Tokyo preliminary round, allowing it to proceed to the semifinals, and perhaps the finals, which will be held in San Francisco in May. The winner gets a $1 million investment prize.
The fourth Startup World Cup, hosted by Silicon Valley venture capital Pegasus Tech Ventures Inc., gives entrants a chance to network with investors and CEOs around the world, raise funds and boost their international profile.
Looop placed first on a shortlist of 10 ventures selected from the 105 companies that applied to take part in this year’s contest.
Looop President Soichiro Nakamura said his company’s resolve to “create a new business that breaks from dependence on the government’s feed-in tariff program,” which obliges utilities to buy electricity generated by renewables at fixed rates, probably resulted in its victory.
Founded in 2011, Tokyo-based Looop provides a wide range of services, from setting up solar power plants to retailing electricity. Its core business is supplying electricity based on renewable sources.
Because renewable power sources do not entail material costs, once the company pays off the initial setup expense for the plants, “the cost (clients pay) will go down to ¥12 per kWh” at Looop versus ¥32.4 per kWh at Tokyo Electric Power Company Holdings Inc., Nakamura said.
The cheap rate — roughly a third of Tepco’s rate — comprises ¥10 in transmission fees and a ¥2 maintenance fee.
Looop’s launch was inspired by a volunteer experience in the aftermath of the March 2011 tsunami and triple core meltdown at the Fukushima No. 1 power plant.
“I decided to commit myself to spread renewable energy all over Japan,” Nakamura said.
Looop had attracted about 186,000 power customers as of the end of October, logging ¥54 billion in fiscal 2018 sales — a dazzling figure for a startup.
Although the feed-in tariff program was meant to give utilities an incentive to participate in spreading renewable energy, for Looop it accounted for only ¥1 billion of its ¥54 billion in sales.
The Startup World Cup aims to foster entrepreneurship, innovation and startup ecosystems around the world. Last year’s champion was the Vietnamese startup Abivin, which provides logistics route optimization software powered by artificial intelligence.
About 60 regional preliminaries are being held as part of the Startup World Cup, including in Tokyo.
At the Tokyo competition, a panel of eight judges hailing from local venture capital firms, incubators and the technology industry screened the contestants.
Each gave a short presentation about its business in English, followed by questions from the judges. Spectators were invited to assess the startups via tweets containing the hashtag for the event and the name of the company that impressed them the most. The number of times the hashtag appeared on Twitter was factored into their scores.
Anis Uzzaman, general partner and CEO of Pegasus Tech Ventures, was confident Looop would prevail as world champion.
“It is one of the few ventures in the world that deal with people’s basic needs,” he said.