GE Current: Transforming the way we use energy through digital innovation
Corporate Startup of the Week
The practice of using smart technology to make energy consumption more efficient has become quite popular in recent years and it’s not hard to see why.
Energy-efficient buildings can help corporations achieve significant savings, leave a reduced carbon footprint, and comply with changing environmental legislation. Aside from all that, it’s the socially responsible thing to do.
GE Current is helping corporations accomplish these goals by acting as a digital engine that combines the power of LED technology, networked sensors and specialized software to make industrial buildings and even entire cities more energy efficient and productive.
Plus, the things they can do with smart technology is the stuff Star Trek episodes are made of!
Let’s take a closer look at how GE Current first got started.
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Keeping up in the digital era
Incorporated in 1889, GE is no stranger to radical industrial changes, having successfully adapted and thrived despite the arrival of numerous disruptive technologies including cars, T.V.’s, refrigerators, the internet, and most recently, mobile phones.
Fast forward to the changes that are shaping today’s economy e.g. increased digitalization and reliance on software, and the challenge is proving to be much greater.
In essence, they’ve been working to change their value proposition from products to services and brand themselves as a “Digital Industrial Company”.
GE Current was launched as part of this effort.
A billion-dollar startup
Current was launched as a startup integrating GE’s existing Solar, LED, electric vehicle and energy storage businesses under one roof.
Instead of selling a bunch of separate energy products, Current simplifies things by combining various smart devices and connecting them using the Predix software. Predix is a cloud-based platform that provides analytics to help clients understand how their resources are spent and how they can use them more efficiently.
The goal is to offer their target audience (e.g. hospitals, automotive plants, banks, universities, retail stores, and even cities), a one-stop energy service provider that tailors its energy solutions to meet the needs of each client.
An initial investment of $1bn was made by GE in 2015 (the year that Current was launched), with an expected return of $5bn by 2020. And with customers like Walgreens, JPMorgan Chase, Home Depot, Hilton and the City of San Diego, who wouldn’t be optimistic?
It’s all about innovation
Current, powered by GE is a great example of how startups can help corporations change up their business model, test new strategies and tackle new markets.
In this case, for example, GE was having trouble competing in industries that it traditionally dominated, due to all the rapid technological advances. Despite efforts to adapt and create new products, they seemed to be making little progress.
Launching Current enabled GE to integrate several technologies and create a new and more holistic value proposition, attracting a whole new set of clients. It also helped them reach the goal of becoming a digital industrial company by shifting the focus from traditional products to digital services.
GE Current’s broad range approach (e.g. Solar, LED, electric vehicle, energy storage and software that brings it all together) also helped GE learn more about “partnering with” rather than “selling to” customers. By doing this, they were able to more easily promote long-term client relationships and upsell innovative technologies.
What’s next for Current?
Earlier this year, GE announced that it had finalized the sale of its billion-dollar startup to a New York private equity firm known as American Industrial Partners (AIP).
As described by Maryrose Sylvester, President & CEO of Current:
“American Industrial Partners is an excellent fit for our people and technology. Current has an important role to play in this emerging industry, and we look forward to working with our customers to continue building the future of digital lighting innovation.”
Today, the startup is known as “GE Current, a Daintree company” and it focuses mostly on LED lighting and fixtures.
Despite having been sold, Current helped GE reshape its traditional business model, rebrand itself and reach a whole new set of clients. In fact, the lessons learned from this venture could very well end up being a vital stepping stone to GE’s long term presence in the market for many generations to come.