More than 90% of Nigerian households use firewood, charcoal and kerosene as their prime means of cooking, despite the health hazards and their negative environmental impact. Powerstove Energy has developed a low-cost, smokeless cooking stove which also produces its own electricity. The company, launched in 2018, recently received investment from GreenTec Capital Partners. Founder Okey Esse (42) answers our questions.
1. Give us your elevator pitch.
Powerstove Energy has designed and manufactures an innovative smokeless cooking stove. We also produce biomass pellets from non-recyclable paper, wood and agricultural by-products, which are used to fuel the stove. The Powerstove precision airflow system injects the right amount of oxygen to enable the complete combustion of the pellets. The stove is able to produce 50 watts of continuous power, providing enough energy to charge phones and lights. Surplus electricity is stored in an attached lithium-ion battery allowing users to charge additional devices via USB.
Powerstove pays stove users in US dollars for cooking with our environmentally-friendly product. We have IoT technology built into the cookstove that tracks and quantifies the carbon credits generated. We then sell these credits in the global market, enabling customers who cook an average of four hours a day to receive $90 per annum once we’ve deducted a 30% transaction fee.
2. How did you finance your startup?
Like most other startups, our early financing came from the founders’ funds. Then last year we received funding from an angel investor as well as grant competitions.
3. If you were given $1 million to invest in your company now, where would it go?
Our short- and medium-term target is to take advantage of the low-hanging-fruit markets in Lagos and Kano states. We will invest the $1 million in working capital, equipment and machines, and market expansion.
4. What risks does your business face?
Electricity supply has been our greatest challenge. All our manufacturing equipment use three-phase power, meaning three live power wires are connected at the same time to the machine and if for whatever reason one power wire doesn’t have electricity, the machine is doomed to fail. To avoid this happening, we rely on a three-phase generator to avoid damaging the machine and equipment with inconsistent electricity supply from utility companies. This also ensures production continues and targets are met.
Access to funding and managing unskilled workers are other challenges.
5. So far, what has proven to be the most successful form of marketing?
Below-the-line marketing has proven successful. We deal with customers who want to see how products work before they purchase.
6. Describe your most exciting entrepreneurial moment.
We started Powerstove in an environment where many people don’t trust locally-developed technology. However, today Powerstove is a force in the clean cook stove industry because of our tenacity, perseverance and creativity. Every week we receive requests for distribution and franchising partnerships from across Africa.
7. Tell us about your biggest mistake.
I regret trusting new staff members’ abilities only to later discover they can’t deliver on the tasks and responsibilities assigned to them. These days all staff first have to undergo a probation period before they are appointed full time.