While I studied mechanical engineering at the École de technologie supérieure in Montreal, I indulged my passion for design. As part of a student competition, I worked on a team to design and build a Formula SAE race car. That’s how I met and became friends with my two business partners—us three “motorheads” worked long hours designing and building our vehicle.
After graduation, I spent two years at Pratt & Whitney, a leading global aerospace manufacturer, writing discrepancy reports about jet engines. I quickly realized I was never going to have the freedom to do the kind of design work that excited me. In 2006, Benoit Lacroix, Dany Fouquet and I decided to act on our passions and founded Effenco, a Quebec-based company specializing in electric hybrid technology to reduce fuel costs and emissions for heavy work vehicles. I knew I could trust my business partners because they were just as passionate about design as I was and would work equally hard.
Today, we have customers in Canada, the United States and Europe. As more governments around the world move out of the climate change “awareness” phase and start setting targets and making action plans to reduce greenhouse gases (GHGs), the opportunities for our company and other cleantech companies in the energy efficiency sector will only grow.
Trucks that “work”
Effenco provides solutions to help improve the energy efficiency of heavy vocational trucks, the least efficient segment in the transportation sector. Vocational trucks include municipal garbage trucks, terminal tractors, concrete mixers, school buses and “bucket” trucks used by utility companies. The hydraulics and other systems in these vehicles are usually powered by the truck’s engine. But the engine is sized to move the truck, not to power that equipment. With our technology, we combined a stop/start function with an energy storage system. Every time the vehicle stops, the engine shuts down and the stored energy electrifies all the onboard equipment.
Since we were growing, we needed a line of credit. EDC was there to guarantee this line of credit which allowed us to grow even more.
One of the keys to Effenco’s success was finding the right customers early on. There are a lot of opportunities in the energy efficiency sector and it can be tempting for a new company to run after too many rabbits at the same time. Finding a first-adopter customer that was serious was key for us.
We were fortunate to successfully apply for funding from Sustainable Technology Development Canada. As part of the program, we put together a consortium of private capital with different members of the industry. Through the consortium, we met waste collection operators, some of which were globally positioned, signing them as a customer was our first bridge to servicing the company’s fleet across North America. We also started attending cleantech fairs that specialized in vehicles. Most of these fairs are in the U.S. and that was how we met people from the City of New York and brought them on as a customer for their waste collection fleet.
Another important step for us was becoming involved with Écotech Québec, an industry association for Quebec-based cleantech companies. Through Écotech, we connected with a Paris-based waste collection company, called Derichebourg, that wanted to partner with an innovative Canadian company. That provided us with an opening to bid successfully on a contract in Paris. Now, we have a foothold in Europe where many countries and local governments are keen to address the issue of climate change and reducing GHG emissions. We feel confident about our prospects in Europe because of the tailwind that regional governments are serious about taking action and will be open to new technologies to help them achieve those goals.
Understand your advantage
A key reason Effenco has been successful is because we’re able to demonstrate gains in energy efficiency with reliable data. A popular saying among all the employees of our company is, “Without data, you’re just another person with an opinion.” Data is the key because it’s the proof you know what you’re talking about. You can’t argue with the truth.
Our expertise lies in understanding the inefficiencies of heavy-duty vehicles. Only when you understand and can measure those inefficiencies are you able to offer solutions to reduce them. After all, what gets measured gets done.
Over the last three years, we’ve seen a big shift in governments and large corporations taking action on reducing GHG emissions. This has created a lot of opportunities for Canadian cleantech small- and medium-sized enterprises (SMEs). The federal and provincial governments understand that SMEs are the driving force in cleantech innovation and there’s a large number of government grants and accelerator programs available to them.
Obtaining financing is the most difficult challenge most SMEs face, especially in the beginning. Facing that challenge in the early stages of our company taught me the importance of putting together a solid business plan. Our business plan changed over time as we refined our concept and realigned the company based on feedback from the market and potential investors. In those early days, it was frustrating to have so little funding, but it taught us the importance of making sure that our ideas and concepts were refined. If we’d been fully funded six or seven years ago, we may not have moved in the direction we did.
At the same time, that flexibility and speed to market is an important edge that start-ups and small companies have over large companies. When you have to change something, it’s important to accept it in order to evolve and move quickly. This is especially true in a new market, like ours, that’s evolving quickly. We need to catch the wave, otherwise it’s going to pass us by.
Building a passionate team
I often say to my employees that if you do what you love, you’ll never work a day in your life. That’s been true for me and it’s what we look for when recruiting new talent to our team. Our business requires engineers and technical specialists in the area of Internet of Things (IoT). Unemployment in these areas here in Quebec is extremely low, making competition extremely fierce. We also can’t pay the same salaries that specialists might earn at big tech companies like Amazon. We meet these challenges in a couple of ways:
- Our workplace is a cool, friendly and relaxed environment. We have our own brewery in the garage where our head engineer is the master brewer. It’s a great way to bring employees together to brainstorm.
- When recruiting, I like to go back to where I started and scout people from student engineering competitions. I know that the people on those teams are motivated because they’re passionate about what they do.
The passion of our employees and their belief in our mission to help companies and governments reduce their GHG emissions has brought Effenco where it is today. Passion can also be a two-way street with your customers. We have succeeded because we found customers who are serious about reducing their emissions and putting plans in place to achieve them. There’s plenty of opportunity around the world for Canadian cleantech companies to find those customers and help them meet their goals through measurable data-driven results.
How EDC helped
EDC was essential for Effenco. There is no doubt about it. When they jumped in, the company had too much risk for a traditional bank. Since we were growing, we needed a line of credit. They were there to guarantee this line of credit which allowed us to grow even more.