All posts by kjungnitsch

Yeloha- Meet the Airbnb of Solar Power

In the past few years, we having been moving towards a sharing economy- a place where IT allows people and companies to distribute and share goods and services that are in excess capacity (Hamari et al, 2015). Multisided market platforms like Airbnb and Uber have led this trend, creating quickly growing businesses that have other parties provide the product or service and are disrupting existing industries. One industry that has not yet been affected by this growing movement is the energy industry-until now. Enter Yeloha, an Israeli startup that is looking to shake up the US energy market.

Yeloha, has been described as being “like Airbnb, but for solar power.” The company hopes to rapidly expand thanks to a peer-to-peer model. Yeloha’s business model relies on two groups of customers, Yeloha ‘hosts’ and ‘partners’. Hosts are people who have suitable roofs and can apply to have Yeloha install solar panels free-of-charge and who will receive one-third of the energy output free. Partners are customers who would like to benefit from solar energy but do not have a suitable premises to do so and thus can buy energy from Yeloha hosts. Those who opt for long-term contracts can benefit from greater discounts. Yehola is entering the market when at a time where its business model makes a lot of sense. A recent poll revealed that 79% of Americans want the US to develop more solar power. Last year, the US generated a whopping 4.093 billion kWh, however only 7% came from renewable energy and only pitiful 0.4% came from solar. The company is looking to change that and launched its invite-only programme in the solar power-friendly state of Massachusetts just last month, backed by millions of Dollars in venture capital funding.

Yeloha’s business model addresses some of the major issues that hinder the expansion of solar power by reducing these barriers and transaction costs for the customer. One of the biggest barriers is the upfront cost of installing solar panels. By offering them free-of-charge along with free energy, the company hopes to attract a large number of interested customers who would otherwise unwilling or unable to do so themselves. These incentives should help the company quickly grow a large network of hosts by not having to purchase property to hosts solar panels but have customers host them instead. This model has allowed businesses in the sharing economy to grow at astronomical rates. For those who are unable to host solar panels but would like a way to reduce their energy bill or be more environmentally conscious, they can simply buy energy from nearby hosts.

Yehola’s business model, although promising, will have to overcome some potential hurdles, particularly legal ones. Other sharing economy platforms like Airbnb and Uber have recently run into lawsuits, which have cost the firms enormous sums of money as well as negative PR. Some observers are sceptic on the legal arrangements of Yehola’s planned solar installations on apartment buildings and rented premises. Others have noted that it only makes sense in markets where electricity from the grid is very expensive like Hawaii. Nevertheless, the market conditions and timing seem to be in the company’s favour to disrupt an industry that has remained unchanged for too long. 


Chernova, Y. (2015) “Peer-to-Peer Solar Network Yeloha Gets $3.5 Million to Launch in U.S.”, April 8, Wall Street Journal, (online) available at:

Hamari, J., Sjöklint, M., & Ukkonen, A. (2015) The Sharing Economy: Why People Participate in Collaborative Consumption”. Journal of the Association for Information Science and Technology

Whitford, D. (2015) “Here Comes the Airbnb of the Solar Industry”, April 7, Inc., (online) available at:

BrewDog Beer’s £25m crowdfunding appeal- Brand Community building at its finest

Earlier this week, Scottish craft beer brewery BrewDog announced that it would be returning with a new equity crowdfunding campaign to raise a stunning £25 million- shunning traditional financing methods and banks in the process. Dubbed “Equity for Punks”, BrewDog said it would be offering shares at £47.50 each with a minimum investment of £95, entitling investors to an lifetime discount on BrewDog beers and bars as well as the opportunity to attend the annual AGM (Annual General Meeting). Earlier in 2013, the company successfully raised £4 million from a similar crowdfunding bid from customers. BrewDog co-founder James Watt said that “Equity for Punks puts the people who really care about our beer in control and keeps the passion and integrity in people’s beer glasses.”

BrewDog’s latest bid is a brilliant move from a customer relations perspective. Although the primary aim is to raise the necessary cash to fund new projects and growth, the campaign is essentially bringing like-minded people together to create a dedicated brand community and allowing them to invest and be a part of the company’s future. The group of existing and potential investors embody what a brand community is: ‘a specialized, non-geographically bound community, based on a structured set of social relations among admirers of a brand’ (Muniz and Guinn, 2001). The already 14,500 strong community of shareholders share the company’s vision and associate themselves with the brand’s anti-establishment identity and culture.

The new equity crowdfunding campaign will allow the company to realise their ambitious future plans such as building a new brewery as well as a craft beer-themed hotel. However, the value from the dedicated group of investors who have an equity stake in the company will be just as great as the funds looking to be raised who can provide important suggestions and feedback for the brand’s future strategy. The ‘brand community’ of investors will also act as passionate brand advocates and it is in their interest to promote BrewDog and its values as their return on investment is dependent on the success of the brand.

From a consumer’s perspective, a close look at the numbers show that they must be realistic about their goals of their investment, as BrewDog has no near future plans to go public, and that it is hard to determine the true value of the brand. However, for many dedicated fans the lifetime discount and their legendary punk AGM that features some high-profile rock bands may be enough to entice them. As one BrewDog lover noted to the Financial Times, it is “more of a beer club than an investment… The AGM lasts about 30 minutes, followed by a six-hour beer festival.”

BrewDog’s latest equity crowdfunding bid by appealing to their most dedicated customers to bring together a passionate community of BrewDog beer lovers is a brilliant strategy to build a closer relationship with its customers and among them as well- a move that, if successful, is likely to be imitated by other brands.


Thompson, B. (2015) ‘BrewDog launches record £25m crowdfunding appeal’, April 22, Financial Times

Muniz, A. and Guinn, T. (2001) ‘Brand Community’, Journal of Consumer Research, Vol 27, No. 4, pp. 412-432

Decision Quality Measures in Recommendation Agents Research

In the digital age of consumption, the internet has been a platform that has greatly enhanced the choices available to consumers. Despite the internet’s potential to enhance consumer utility, this vast increase in choice can potentially overwhelm customers and lead to worse choices (Lurie 2004). A growing trend has been the use of recommendation systems by online retailers and content providers. These systems seek to predict the rating or preference that potential consumers would give an item and suggest products or content based off those. In the world of e-retail, Amazon’s recommendation system is widely recognised as the industry leader, which helps consumers through item-to-item collaborative filtering, suggesting items based on previous purchases or views by other consumers with potentially similar interests or preferences.

The decision quality of electronic recommendation systems also serves as an indicator of service quality (Zeithaml et al, 2002), however, little academic research has been done in this field. The 2011 paper by Askoy et al ‘Decision Quality Measures in Recommendation Agents Research takes a closer look at the decision quality of such systems. The paper examines empirically examines the relationship of different measures that have been used to date in recommendation agent literature. In the paper, they distinguish between preference-dependent measures (PDM), which require knowledge of the different decision maker preferences as well as the attribute values of alternatives that are available; preference independent measures (PIM), that do not require any knowledge of individual decision maker preferences but do require product attribute values, and subjective measures (SM), which depend neither on the knowledge of consumer preferences nor attribute values (Askoy et al 2011: 111). Through a simulated experiment, participants were assigned to conditions simulated by a recommendation agent for a database of 32 cellphones, which were each defined by different attributes (price, weight, talk time and stand-by time). This allowed the experiment to simulate a wide range of recommendation agents currently offered by online retailers to their customers.

Results which compared PDM and PIM results verified that there are considerable gains from knowing consumer preferences that are gathered by recommendation agents. Furthermore, PIM measure prove to a way of assessing decision quality when decisions are unknown. These results suggest that setting up mechanisms to compare product attribute values may be highly beneficial to online retailers even if recommendation agents are not in use.

Electronic recommendation systems help customers sort through the ever-increasing array of choices and alternatives and make better and more informed choices. Similar to real salespeople, electronic agents can serve dual roles of being both providers as well as collectors of information. The paper serves as an initial step in assessing the decision quality as a metric for gauging the impact of marketing activities and to help marketing practitioners have a better understanding of the effectiveness of such electronic recommendation agents. This is certainly an area that will be a growing area of interest as companies aim to better their own recommendation systems to increase sales and increase utility and satisfaction of customers.

Askoy, L., Coil, B., Lurie, N. (2011) “Decision Quality Measures in Recommendation Agents Research”, Journal of Interactive Marketing, vol. 25, pp 110-122

Lurie, Nicholas H. (2004), “Decision Making in Information-Rich Environments: The Role of Information Structure,” Journal of Consumer Research, 30, March, 473–86.

Zeithaml, Valarie A., Parsu Parasuraman, and Arvind Malhotra (2002), “Service Quality Delivery through Web Sites: A Critical Review of Extant Knowledge,” Journal of the Academy of Marketing Science, 30, 4, 362–75.