Harness The Power of Purpose — Scaling up Energy Efficiency
How can buildings perform to their maximum potential? Why efficiency hasn’t scaled yet? How to harness the power of your purpose in the world?
Charles Blaschke IV is on a mission to reduce the world’s energy consumption by 20% with energy efficiency — using technology, engineering, and finance. He launched Taka solutions in 2012, with the aim to address the waste of energy in the region caused by the poor and unhealthy construction of buildings in the UAE.
Taka solutions offers a very innovative business model, reducing the waste of energy in existing buildings while getting paid a portion of the savings. So they only get paid if the owner saved money and they’re helping our planet in the process!
Vuk Zlatarov: To kick off, I’m going to start with a scenario where you’re coming into the office, turning on the switch lights — they’re not turning on; sitting by your desktop turning on the computer, computer is not turning on. You’re like, damn, I need to go back home. Then you go down, try to start your car, but the car is not starting. There’s no energy. Do you think that people are taking energy for granted?
Charles Blaschke IV: A hundred percent. I think people don’t realize what it takes to have the energy infrastructure and energy on demand like we have, the reliability. You know, I think the last, let’s say 100 years, it’s just been there and it’s not so simple to get those electrons everywhere they need to be at all times so reliably.
Vuk Zlatarov: Definitely. We’re so used to it. I mean, at the moment, imagine the amount of energy that is used to produce this podcast, lights, cameras, microphones. And we don’t realize that actually, you know, we are really taking it for granted.
Charles Blaschke IV: Yeah. Everything in the world is ran off the electricity, the energy. I mean, think of the infrastructure behind all of this as well. The cooling to cool this building, right? The fresh air and the exhaust that comes into the space that gives us air to breathe in a very harsh climate, all the computers, the data centers, everything that runs everything relies on that energy and that electricity.
Vuk Zlatarov: Crazy. And with the growing population, the problem of supplying enough energy for current lifestyles will be actually the biggest problem that we’re facing, right?
Charles Blaschke IV: Yeah. So there’s the growing population and the demand. So even with a set population, let’s say we stayed at 7 billion or whatever at now. If you look at countries that are, let’s say coming out of poverty or developing that, you know, historically consumed zero energy, think of Africa, think of India, think of China. And now as those populations move to cities or increase their lifestyle and their demands, the energy grows much more per capita than it does even just with regular population growth. So, yeah, it’s very unsustainable. I think the forecast is if we go as business as usual right now, by 2040, we’re going to double the amount of electricity and energy we need, which is impossible.
If everyone lived the way we live in Dubai and the US — kind of the super developed countries, we would need seven Earths to supply us with that much resources, which we don’t really have.
Vuk Zlatarov: So to put the problem into a context. What are the consequences of that? We don’t have seven planets, so where do we go? What do we do?
Charles Blaschke IV: We burn through our own planet seven times faster than we thought we would, or we should or could. So that means ultimate destruction of the Earth. EVs and cars and stuff are good in general, but you’re just shifting the energy mix. So now everybody needs more electricity to plug in their cars. So where do you get that electricity if it was already kind of at capacity? It takes it away from other sources, the gasoline let’s say. But that just adds to the mix of energy needs and demands is changing every day.
Vuk Zlatarov: So just rebalanced, but actually the same amount of energy is required. This is actually supported by numbers.
Charles Blaschke IV: Yeah, definitely. I mean, if you think about it, so the big push for renewable supply, so solar, wind, geothermal, these types of things, you know, gives clean energy to the grid. Then you can charge your car, let’s say, or your home or your battery with energy or electricity, that’s actually clean as opposed to the traditional coal or the gasoline or the oil or the diesel. So there is a benefit, but then we need more cleaner new energy, which is why the supply side is a big part of the equation as well.
Vuk Zlatarov: It’s unbelievable. And so what I was shocked about when I was doing my research, is that buildings are consuming more energy than what cars, trains, planes, space, shuttles, and everything else combined.
Charles Blaschke IV: Yeah. I guess it depends on where you are and kind of how you measure it. But yeah, if you look at electricity consumption or energy consumption or carbon output — which I think is kind of the ultimate denominator these days, is carbon. Cause then it takes into consideration the source of the fuel, right? So clean, renewable energy is less carbon intensive than let’s say coal plant. But yeah, buildings, homes, schools, malls, hospitals, that we all live, work, and play every day… As humans, we spend 93% of our time indoors. Think about that, 93% of our time.
Vuk Zlatarov: How much time we spend in on cars?
Charles Blaschke IV: I guess like, yeah, 1%, 2%.
Vuk Zlatarov: And everyone is putting a lot more focus on how much cars are actually affecting the planet, right?
Charles Blaschke IV: Yeah. So buildings, if you look in the US, there’s a lot of good data there. Buildings are responsible for anywhere between 30% and 50% of the electricity consumption. Therefore 30%, 50% of kind of the carbon output. If you look at a country like the UAE or the Middle East with very extreme climate, especially hot or extremely cold, it is upwards of 60, 70, 80%. It goes to these buildings and basically for us to be comfortable, right.
If you think about it, kind of like you were saying a hundred years ago, what was the population? Not only was the population one seventh of what it is. If we’re saying it was a billion versus seven, we didn’t have AC everywhere. We didn’t have heat everywhere. We didn’t have electricity on demand. We didn’t have hot water at a perfect temperature. So as humans, we’re also very conditioned now to need a perfect space, right? We’re in Dubai. I don’t know, it’s 35 degrees outside sunny and it’s perfect, 22.5 degrees with 50% relative humidity, that’s energy, massive amounts of energy. So it’s also that we are creatures of comfort and now we expect and demand that at a flip of a switch.
Vuk Zlatarov: So you figured out that the problem does exist. It seems to me like you got hooked to solving that problem maybe too much that is driving you crazy. You founded Taka solutions. Tell us a bit more about Taka solutions. What do you guys do?
Charles Blaschke IV: So I’m a mechanical engineer. I actually started school or in high school computer science, but then ironically, switched to mechanical engineering because I wanted to find an alternative engine for cars that was more sustainable. But then for some reason I went into buildings, which I never really knew much about or liked. And I was designing buildings, building systems, MEP systems, energy systems in the buildings for new construction and actually had started a technology startup in Abu Dhabi doing digital twins. This is way before our time in 2010 and my friend and roommate and then co-founder at the time Chris Burkhardt and I were, we’d always have like business ideas. And we had a notebook of business names and logos, and we’d come home every night and kind of brainstorm about this. And what happened is we realized that the buildings, I think the numbers roughly 50 million buildings exist today. We’re building new buildings every day. But in 50 years, 90% of the building stock are the ones that are already here today. So we’re going to add only 10% more. And those 50 million buildings are really poor at energy performance, reliability, air quality, technology.
Where everything in this world has kind of been transformed by technology and smartphones and cars and apps and everything we do all day, every day, delivering food to our house, delivering more materialistic goods to our house faster and cheaper that we don’t really need. You know, you can think of every tech startup, that’s been funded. There hasn’t been the same technological advances in buildings and in homes. And that’s caused them to really perform poorly. And what we realized is you can basically save 50% of the energy in a building relatively easily and in doing so, make it a better building and save a lot of money, a lot of carbon.
And so this idea came when we were writing this chapter for the image green building council, there’s a book for building owners, how to save energy and carbon in building easily. And we were astonished with the numbers. We were writing a chapter and doing the calculations and it said, look, you could save all this energy and all this money by doing this relatively simple thing. And so Chris kind of being in economics and finance said — okay, if that’s the case, why don’t we just pay for it ourselves and get paid from the savings? Cause then we can just go install it. The owner doesn’t have to pay anything. They take no risks, they don’t have to know anything. We’re the experts. And we just put this in and then they get a better building, and they get a bunch of money and we can have people invest in that.
Vuk Zlatarov: Sounds too good to be true.
Charles Blaschke IV: Yeah. And it works. We thought we invented it. We thought we were the smartest people in the world that, paid from savings, the owner doesn’t have to pay. And from the beginning, we always wanted to offer this finance model because our goal is impact. Scale impact to make a difference in the world. And so, as we started to explore, we realized, well, buildings do consume way too much energy. And if they can save, let’s say 50% of the energy. That’s 20% of the world’s energy and carbon saved very easily. With like easy technologies, easy equipment that exists today with financial models that make good sense, three, four, five years simple payback. And we didn’t want someone’s budget or capital stand in the way of us making that impact and scaling that. And so that’s why from the beginning, we always wanted to use the finance model where we would come and say, look, we’ll pay for it. No risk let us do it, we are the experts, offload that liability. And as we started to extrapolate, you know, from one building to Dubai, to the UAE, to the world, we realized, well, using this model that, you know, like you said, it’s too good to be true. It’s a no brainer. We could reduce the country’s energy by 30%, the owners wouldn’t have to put in a penny. The government wouldn’t have to put in a penny, let’s say in this case, we would never have to build another power plant ever again. And everyone’s buildings would be better and healthier. And that was the big why, like people say, what do you do? How do you do it? But for us, it was about why, because we want to make impact. And we basically kind of quit our jobs within the next couple of weeks and jumped in.
Vuk Zlatarov: But at the time that the market was, were there anyone else doing it or was it open, how saturated the market of energy efficiency was?
Charles Blaschke IV: Well let’s say there was, well, there was one other person EMS, Khaled Bushnaq. Great guy, had been doing it for about a decade at that point. But that was about it. Nobody else was even talking about it, thinking about, doing it. And if you fast forward today, there’s still kind of nobody doing it.
But in the meantime, yeah, we kind of started, we were definitely a first mover. We kind of made the market. We’re the first ones out. We are the only ones that really finance. We had the biggest team. We grew fast, we’ve built our own technology. We had all the projects, we found a partner to fund the project, we set up a basically kind of a private equity type structure with a fund and then operating company where we deliver the projects, the fund funds, it, which we manage that gets paid from the savings. And then about, you know, let’s say between 2014 and today 25 companies kind of started and rushed in. And I think there’s only two of us left. Let’s say three. You know, cause a lot of equipment manufacturers kind of do this on the side as part of their business, but yeah, independent engineering based vendor energy efficiency providers, especially ones that finance, we’re kind of the only ones still, still the biggest. And yeah, we’re saving a ton of energy, a ton of carbon. We’ve deployed a lot of clean impact ESG capital that makes a return for investors and makes buildings better and more reliable and better for customers. And COVID has only made that better.
Vuk Zlatarov: So yeah, we can talk about that as well. What COVID brought in, how did you guys survive last year and how did that impact your business, but you guys put together technology, engineering and finance.
Charles Blaschke IV: Exactly. Yep. The three pillars.
Vuk Zlatarov: Which are kind of a perfect combination for what you’re describing. You provide them the technology to reduce the energy spending. You provide the engineering to orchestrate all that to happen and you engineer it, plus you finance it for them. So they’re not paying for anything.
Charles Blaschke IV: Yup. They just pay a share of the savings we generate. It’s all performance-based.
Vuk Zlatarov: So risk free.
Charles Blaschke IV: It’s pretty much risk-free. I mean, honestly the biggest risk is if we are to go into a building and let’s say break it, but obviously there’s insurance that could happen with anything, there’s insurance around that. But yeah, if we don’t save, they don’t pay and whatever we prove that we save, we just bill them for a percentage of that over a period of time. And when we’re done, we leave everything there and they get all the savings and have a better building.
Vuk Zlatarov: But what was in the way of such an exciting opportunity, not only for you guys, there’s 30 other companies who started, why did they shut down? You started to Taka solutions when?
Charles Blaschke IV: 2012.
Vuk Zlatarov: So eight years ago. It’s a perfect product, perfect market fit. Okay, maybe that’s arguable. We can talk about that. What’s like, what’s in the way of scaling that kind of service through the roof literally?
Charles Blaschke IV: That is, if you look at the UAE, that’s the billion dollar question, which is the kind of the market size that everyone’s asked through the years. If you throw in Saudi, you know, we talk about a hundred billion dollar question and you talk about the world, It’s kind of a $5 trillion question. Why has an energy efficiency, in particularly financed, shared savings energy efficiency scaled? If you bring it back down to Taka and let’s say UAE and Dubai you know, people asked through the years, it’s too good to be true. We say, no, it’s not, look we’ll show you. So we make money.
Vuk Zlatarov: It sounds like if I’m a building owner, if you approach and offer me, okay I want to save you three million over the next month or a year or two years, and you pay me back even 500,000 or a hundred thousand, doesn’t matter. Like, you saved me three. So it’s a no brainer.
Charles Blaschke IV: And you get the equipment, and you get the expert engineers, and you get all the new technology.
Vuk Zlatarov: Absolutely no brainer.
Charles Blaschke IV: And no budget. Like you don’t have to have a budget. It’s off balance sheet. You know, so, even from like a legal accounting standpoint, it’s off balance sheet. So you know, it doesn’t affect your debts and your loans.
Vuk Zlatarov: So are people saying yes, like when you’re…
Charles Blaschke IV: Well, no. I mean, like I said, we got out there before everybody, we’ve worked really hard. So that’s the question. Why do we survive and do good? And why doesn’t everybody say yes? And we’ll show them, look, we make money, here, here, here, here. And in the services, in the energy audit and the technology and the project management and the commissioning and operations maintenance and the monitoring and the finance. And it’s not a trick. We aren’t screwing the customers.
Vuk Zlatarov: It sounds like that — you tell them I’m going to come in and I’m going to do everything for free. I want to save your money and then you just pay me out of savings. It sounds like, okay, where’s the trick here?
Charles Blaschke IV: There isn’t. You know, I guess I wish there was maybe, maybe that would be better. But no, and even if we were making a ton of money, the customer…
Vuk Zlatarov: Still you’re saving.
Charles Blaschke IV: Exactly. They’re getting their equipment, they’re getting the engineering, they’re getting the savings.
Vuk Zlatarov: So what’s in the way?
Charles Blaschke IV: What’s in the way? So after all these years, and I kind of came to this conclusion a few years ago and — the headline is: people don’t care. They just don’t care. If they cared, they’d do it. And, you know, that sounds very simplistic. And obviously expands out to many factors and root causes of why they don’t care. Why they don’t care — because it’s a transient population in general. So the people we’re dealing with are saying, well, I’m only going to be here a couple years, so I’m not actually going to get the benefit of this. So I don’t care. The building owners and managers are temporary, you know, we might sell this building next year. Oh, I’m just the property management. My contract ends in a year. So why am I going to deal with this? I’m not being told I need to do it. I think I’m doing it already. So I’m not going to do this. So yeah, they just don’t care enough to do it, ultimately is the issue. And so how do you make people care? There’s a lot of ways to do it, but yeah, back to the question what’s failed or why hasn’t the market developed. I mean, it’s probably 1/10th of what we had planned, and everyone had planned, because if you look at those 30 companies that came in, if there’s only, let’s just, let’s be nice and say, there’s five of us left. That’s like 25 that have went out of business and left. That’s massive losses for the investors, for the people that lost their jobs. And ultimately holding back the country from becoming more efficient and more competitive.
Vuk Zlatarov: And that’s country’s agenda.
Charles Blaschke IV: That is the top of the agenda, Cop 21 happened like a year after we started, everyone signed up in Paris, sustainability, energy savings, the whole thing. It just doesn’t trickle down. And, you know, I think people don’t, just don’t care enough to do it and then to act, sadly.
Vuk Zlatarov: All these companies came into the industry and then went out, were they funded?
Charles Blaschke IV: Oh Yes.
Vuk Zlatarov: VC money, popular VC money these days?
Charles Blaschke IV: Not VC. It’s a bit more infrastructural, like not even PE cause it’s not quite so big, but yeah, a lot of the times it’s a branch or division of a larger company that wants to enter the market, so they’ll invest in the team and, you know, they’ll pump a lot of money in there and they lost it all and they shut it down.
Vuk Zlatarov: So the solution isn’t just throwing money at the problem.
Charles Blaschke IV: Well, that can help. I think that nobody’s really brought big money to the problem. A company NG Smart for power, who’s kind of our twin. This went in parallel with us, kind of started around the same time as us, same kind of DNA. It has big money as well, but nobody’s brought the VC mindset, the startup mindset to truly fund a company and grow it and capture customers quickly. And then worry about profitability later. If that had happened, I can tell you right now, if that happened to us right now, we could take over this market. Cause it’s still, it’s a clean slate. Nothing’s really happening. I mean, we have 30 invested contracts in our portfolio, but you know, the original Dubai goals were 30,000 buildings retrofitted by 2030.
Vuk Zlatarov: 30,000 retrofitted until 2030, where we at today?
Charles Blaschke IV: A hundred.
Vuk Zlatarov: Hundred buildings.
Charles Blaschke IV: Yeah. Maybe a thousand, depending on how you define a building. I mean, what’s a building, is a house a building? So yeah, we define a building as 30,000 square meters. So if you think of a, JLT building, kind of a Marina sized building that’s 30,000 square meters. So yeah, we’ve done, you know, kind of 30 of those. I mean, I think it’d be hard to count another 70.
Vuk Zlatarov: Interesting. So what’s your agenda now going forward?
Charles Blaschke IV: It goes back to those kind of those first principles. People want to save, they need to save, they need technology in their building. The building industry is just known that it’s so innovative, and so far behind in terms of technology that these relatively simple technologies, that’s a big word, but it could be lights. It could be an analytics software, could be new chillers. All you need to do is kind of put that in. People ask, well, what do you do to save? It’s like, guys, I’m not going to lie, it’s easy. You haven’t changed your chillers, your AC system for 20 years. We’re just going to put in new ones. It is like, if someone had a 30 year old car and someone said, well, how do you make it more fuel efficient? Well, I just put in a new engine, that’s it, it’s not rocket science. It’s not brain surgery, you know. The hardware, the equipment, and there’s a big scalable software play here. Because if you think about it, the first thing that you can do is optimize using data. And that’s why we built the software platform that we did. So continue to scale impact. We want to help people save. We want to finance it. We want to be the experts. We want to offload that risk and liability to us as the experts.
We want to put that hardware and software and engineering into the building to help them save. And that’s the goal — to scale our impact. That’s what we’ve always wanted to do.
Vuk Zlatarov: I’m not familiar with the industry that much just know the basics, but I am interested in understanding what each industry is bringing as an opportunity for a new business or growth or startup. In energy efficiency, are there any hot spots, you know, parts of the industry where we should put focus on or where the biggest opportunities are lying?
Charles Blaschke IV: Yes. Well, I go back to even globally, even in markets, more mature markets like the US and Europe is still kind of untapped. So if you look at the US now, Joe Biden’s now elected, one of his top agendas is, it’s one of his pillars is climate. And one of the top parts of climate is building efficiency. And so he’s came out and said in four years in his presidency, 4 million buildings need to be retrofitted.
Vuk Zlatarov: Wow. In US alone. 4 million.
Charles Blaschke IV: 4 million.
Vuk Zlatarov: You should move to US.
Charles Blaschke IV: It’s not just a big opportunity. It’s a once in a mankind opportunity brewing right now in the US that is either going to make or break us as humanity for climate change. And it’s going to start there and, you know, I’m relatively happy and proud that they’re actually stepping up and doing something and being leaders like we should be. And yeah, to say as a brewing opportunity is an understatement, and that’s happening in Europe and other places as well. Saudi is big and there’s big impact opportunities in Saudi.
Vuk Zlatarov: You mentioned something along the lines that you are expecting, still not sure what the solution will be, but like the next Google and Amazon, so the world will be in the energy efficiency.
Charles Blaschke IV: A hundred percent. I think Tesla and Elon Musk, you know, I’ve always been a big follower of him for a number of reasons, because mainly because he’s an entrepreneur that solves real world problems, not delivers food and junk to your house faster and cheaper. I don’t think the world needs any of that. He puts real money and expertise to solve real problems. And Tesla now is kind of a clean tech climate tech startup, and he’s the richest man on earth, a climate tech entrepreneur. And so I think as we move away from these nice to have materialistic software plays and the money and the resources actually going into things to solve real-world problems like energy efficiency. And he does solar as well. Obviously, he’s doing the batteries, he’s doing all this stuff.
The next wave is going to be climate tech and clean tech and prop tech as well, I think it as a third tier entrepreneurs, because it’s just untapped and it’s so big, it affects every single person and every single business in the world. It’s just about, what’s the model that needs to be done and scaled. And back to your question, I think putting that kind of VC model and that marketing model to scale an industry like this is, it’s unbounded.
Vuk Zlatarov: We need to make it more sexy.
Charles Blaschke IV: Need to make it more sexy. And that’s where the analytics and technology and dashboards come in.
Vuk Zlatarov: That you are investing in heavily, right?
Charles Blaschke IV: Yeah. We do it for ourselves to kind of operate our business better. We digitized it, using it in all of our projects and we offer to our customers, but it really needs to be part and channeled through a bigger touchpoint. So think of Apple. Imagine if Apple came to you and was like, we can save all your energy in your home and we’re going to do it through our Apple and iPad. Or Google, you know, like one of these guys, they have like Facebook, Tesla, they have it, they have the customers, they can do it. They have the reach, they have the money. They have the technology, they have like the interface, but it would be a shame if it was one of them, it should be somebody that, you know, is a clean tech entrepreneur that comes from scratch and brings the right model and the right funding. I mean, this one’s about funding. Imagine what WeWork did, you know, they did that for the $12 trillion a year real estate industry that’s so old and backwards with Elba Softbank, obviously, and a lot of capital, but look what they did. They are the only real known name in commercial real estate in the world. So who’s going to do that for building energy efficiency and technology and savings?
Vuk Zlatarov: So if anyone wants to get familiar with the topic, learn more, what are some of the resources that you can point them towards, you’re listening to a lot of podcasts and you read about that.
Charles Blaschke IV: Energy efficiency in particular, it’s kind of been this sleeping giant in the background that doesn’t get a lot of attention. And that’s why it has a scale globally. You kind of ask where the opportunities are. Historically, it’s been very big public projects that are focused on government buildings, municipalities, schools, hospitals. And so I guess kind of back to that question and kind of where to learn, this whole small to medium sized buildings have never been touched, they’ve never been addressed. And that’s kind of been like the Pandora’s box everyone’s been trying to crack. And again, it’s a software solution that’s going to do that. And so to hear kind of where, how to learn more about it, there is the Energy Gang Podcast. I mentioned that earlier, very US centric, very, you know, it’s not so much efficiency. Again, efficiency always plays like 10th fiddle to solar and wind and batteries and EVs. But there’s a lot of great resources. IEA, International Energy Agency has really great stuff on energy efficiency and ESCOS in particular. And I guess me, I’m always here. Like, obviously I want to, I feel like I made the market, but I’ve been there to support the UN. We’ve been asked to speak at the UN and in Switzerland about entrepreneurship and clean tech and the UN sustainable goals, IFC, UNEP, all these kind of things and done a lot of panels presentations through the years to educate people and the market, that’s what it boils down to.
People just need to understand that they can make the impact and efficiency is called the first fuel because it’s the first place where everyone can make an impact.
Vuk Zlatarov: So I love the idea and the industry. I’m getting hooked. I’m going to keep an eye on it. I hope that we managed to at least educate some audience out there and at least push them a little bit to explore more because definitely, you know, while everyone is rushing towards fintech and trying to come up with some new thing, obviously the market is huge. There are other sexy industries. There are these, as you call them sleeping giants that are hiding great opportunities that can be captured. So guys, keep an eye on this and follow Charles. So if you want to follow Charles, you can find him on LinkedIn. We’re going to leave his details in the description. And let’s see, we can talk again in a year or so, and see, did you move a bit.
Charles Blaschke IV: And there has been progress, I guess it’s not all negative. I think sometimes like, it hasn’t lived up to our expectations and what I personally want and the world needs, but there is progress. If you look at, especially in countries like Denmark, even the US there’s what’s called energy decoupling. Because we’ve made strides in energy efficiency where GDP growth, population growth is going up, energy is going down. So it used to be a one-to-one, the more you wanted to grow and create growth in GDP, you needed more energy. So now it’s decoupled. So there is some progress. The last couple of years has been a bit sad on the macro efficiency front. COVID obviously has given like an insight into what can happen if people actually are a bit more responsible and we focus on it. I think it was said there was 19% drop in energy consumption in office buildings. It could be more. If they were better equipped, it would have been like 70%. Empty office buildings should consume almost zero, but 19% drop is big. It is big. So now it kind of shifted to homes and residential. So the net effects we don’t know yet, but there is progress, but it can be much, much, much more.
Vuk Zlatarov: Yeah. And I think that maybe Taka solutions was ahead of the time, at least for this region. And that very often separates, you know, companies that explode in a couple of years from companies who struggle, struggle, struggle, but then eventually explode. And I think that you guys went through a very steep learning curve over the years, that you are ready to capture the amazing road that is definitely coming. It’s just a matter of time, you know, and for you to position as a thought leader in this industry is an amazing you know, positioning and an opportunity.
Charles Blaschke IV: Yeah, agreed. We’ve got a lot of scars and sleepless nights to prove it. And now we’re just ready. If you look at, let’s say it took us eight years to get where we are, obviously we’re in a much stronger foundation and platform to take advantage of the next wave, which is going to be even bigger. So as long as we apply it to the future, it’s worth it.
Vuk Zlatarov: So let’s switch gears a bit. We’ll talk more about you now. Your story, which is beyond this amazing roller coaster ride. And I think everyone can learn a lot from your life episodes, what you’ve been through to build the company, to start the company in the first place. You’ve been starting businesses even before, but Taka solutions was probably is the biggest one that you started, the most serious one obviously. And before you started Taka solutions, you were working for a consultancy, right? Now someone is listening, and they have an idea how they can save energy — how do they quit and how they go for it? Like, how did you decided to go for it?
Charles Blaschke IV: Yeah. Great question. So I’ve been asked this a lot and I’ve kind of presented it at university around entrepreneurship and startups in different regards. So I’ve actually been able to actually think about it, put it down, present it, discuss it, and continuously improve on the answer. So I guess, when I came out here, it was 14 years ago. I was at a large American architecture and engineering firm. And then I went to a German one, and then we started a tech company in Abu Dhabi. So like each of those steps was kind of a, like you said, a buildup to the big one where it was like me alone doing it from scratch. Like, I think that the experience I had at iTech was the name of the company where I was at like a founding employee with my two friends that started it. But I wasn’t there like finding the funding, finding the partner, taking this risks, putting all your salary and equity. But I was there enough, and I was in involved in it enough to like, that was an invaluable experience. Like had it not been for that, Taka would’ve failed within like six months, for sure. But so how, like how to do it, if someone’s thinking about taking the leap.
The why needs to be so damn strong. Like, why are you doing it? Why do you want to do it? Why does the company exist? And forget about the who, the what, the how, the when — it has to be so strong that you’re ready and willing to basically give up your life and everything you know about your life for at least five years. I wouldn’t tell anyone to plan on anything less than five years.
Vuk Zlatarov: What do you mean? Those guys are making millions, in a year, startups raising hundreds of millions.
Charles Blaschke IV: This is true.
Vuk Zlatarov: Can’t they make millions in a year.
Charles Blaschke IV: I don’t know the statistics, but I’m guessing the ones that we read about that get the millions of funding, probably not millions in their pocket, but in the funding where you know their salary, and everything’s tied up in equity. They may never get that money anyways. And it might fail, but I bet the ones that we see, and I know people say it’s like the one in the million, but I bet it’s less than one in a million, the ones we actually hear about. So yeah, the one in, let’s say 5 million, I don’t want to say has an easy ride, but has something that’s so good that the world wants it and needs it. And it’s like clawing for it. And then therefore they get the funding, they get the team around them. So they don’t have to shoulder all the burden. And I think that’s like the tipping point.
Vuk Zlatarov: And most likely it’s not the first thing they did in their life.
Charles Blaschke IV: Exactly. So for all of us normal people, the why has to be so strong, so you have to be ready and willing, you know, I don’t think people can comprehend what it can actually take and what it does take. Yeah, okay, you can say you work more stressful or you sleep less your friends or family, but like, you have to like actually be ready to give up your entire life. So you can think of it in like in a really extreme case. Like if you were going to go to war and you said, I believe in going to war for whatever reason, I’m leaving my family, I’m leaving all my comforts. I’m taking a big risk. I might die. I’m going to be in pain every day. I’m not going to see anybody. I’m not going to enjoy anything, but I’m going to be gone for three years and then I’m going to come back. Like, if someone could think of it in that mindset, that’s exactly what it is.
Vuk Zlatarov: Were you aware of that when you decided to go for it? Or did you thought you were going to make millions in one year?
Charles Blaschke IV: No, you know, it’s funny. We never thought we were going to make millions and it was never the goal.
Vuk Zlatarov: And my intention is not to make this about millions!
Charles Blaschke IV: You know, strangely enough, we just believed in it so much and we liked the concept so much. Like we sat back, and we said, look, there’s a group of us, co-founders, and seed investors that we could put our collective experience to better use solving this big problem in existing buildings, than building more bad buildings the world doesn’t need. So that was kind of our why like, wow, it’s like, cool, it’s tangible. It’s exciting. And I think it’s the combination of those three pillars, technology, engineering, finance. That for me, is like the fuel that’s that never goes away because I had done engineering and it was kind of okay. It was cool, but kind of boring. I had done pure technology before. I was like, but applied to what? Like it’s technology for technologies, useless, finance. So when you bring the three together, you can actually bundle it into something that’s really impactful and exciting. And so I think that’s what’s kind of kept me going structurally, but yeah, I don’t know that we knew, we definitely didn’t know. I mean, we were ready and willing like myself and Chris and then some of the other employees, like we worked way too much, and we just do, it’s our nature, I guess. Which I’m not advising. I don’t think that’s smart. I think in hindsight, you can work a lot smarter than harder, but again, that comes with experience, like you said, it’s not your first time, where you have an ecosystem, where you have the co-founders, you have the investors, you have the advisors, you know, and I think when we started, definitely, like you said in this market, we were way too early.
Even today I’d say we’re too early. And back then there was no VCs, no such thing. There were no VCs. So we would kind of go to pitch events kind of that didn’t really exist. And especially for our industry, it’s like, Oh, you don’t have an app? You don’t do e-commerce? You’re in a startup, we don’t want to talk to you. And even today I think it’s like that here. So yeah, I think having the right ecosystem around you, but you have to just be ready to grind and just never stop grinding. And again, kind of a reflection after so long is know when to quit too. Like that’s different for everybody. If someone hasn’t been through it, or doesn’t have a lot of grit or can’t put up with a lot then you know, they might quit early, which maybe is for the better, but those of us that are too stupid and put our heads down and just try to work through it. Like we might not see that, or we might be too proud, but I think having someone there to like recognize, or have like a metric to understand and see in real time, Oh, I said if this didn’t happen, we’re going to quit or like sell it or whatever it is, merge it or move on to the next thing. And I’ve known people who’ve done that and probably better off for it.
Vuk Zlatarov: There is a book written by Ben Horowitz. It’s called The Hard thing about hard things, how to build a business when there is no easy answers, it sounds like Taka solutions. What was the hardest thing about hardest things over the previous eight, nine years?
Charles Blaschke IV: Oh God, there’s so many. Everything, everything I think it’s, you know, I’ve been through a few experiences with like scaling, like really high growth in demand. And it’s really exciting. Just projects coming in, work, new stuff, exciting new people, hiring new people, just like the vibe, it happened basically in all the companies here before Taka, and that’s really exciting. And I guess if you’re somewhere in between that and just like in your face at failed, you can’t really recognize it. And I think the hardest thing for me is like to see that we have something so perfect, so impactful that aligns with the government, that aligned with the world, that aligns with businesses, that aligns with everything. It’s like a quadruple bottom line on steroids. And it just, and we also brought like a very engineering, a very quality approach to it. And it just still didn’t take off like it should have. And we’re saying, yeah, we’re saving like millions and millions of millions, but at least make it so it’s not so hard. Like it shouldn’t have been so hard to get kind of where we are. Look, if we were doing something that has been done before or it wasn’t that great, or we’re trying to sell something to somebody, I get it, that’s fine. But you would think with what we were doing, it would be a bit easier to cross that critical mass, where we can really scale, really get there, really make big impact, really make people happy, really satisfied customers, really deploy, you know, ESG and clean impact capital and really transform the world and buildings and the energy and climate change problem that everyone talks about, but isn’t doing anything and we have the solution right here.
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Vuk Zlatarov: What are some of the things that you would do differently along the way to, you know, improve, or change?
Charles Blaschke IV: So I guess kind of back to the question, the advice to someone that wanted to start — I always say start with at least three, if not four co-founders that have very different backgrounds and experience, because one, you can shoulder the burden of work in general. You have different perspectives and experience, and it’s probably going to help you collectively scale and grow faster. I think that’s really important and less budget, right? If you’re all co-founders, you don’t have to have the cash, so you can go longer and further on less money or with no money potentially, and test it. And I think also kind of along those lines, don’t quit your day job until like you’re really needed at the company. So until you’re bursting at the seams, don’t jump in. And then I think for us one of the things we would have done different is kind of look more at like macro market trends and recognize like things are moving or not moving or why they’re moving and react. Again, I think it goes back to the stubbornness of us as the co-founders and kind of the management team is like, we believe in it so much, we were blissfully ignorant to maybe the realities of the market. And we just kept forging ahead. And where, I don’t know, again, would we have pivoted where we have changed, would have, you know, in hindsight can tell exactly what we do like operationally, but I think it’s more about what’s the lesson learned to apply into the future for continuous improvement. And I think it’s understanding the true market dynamics and that, you know, you aren’t in control of a lot of this. You know, rising market you’re going to rise, falling market, you’re going to fall no matter how good or bad you are. And there have been a lot of headwinds and roadblocks in this market that we never would overcome. And we’ve tried and we’ve done, I’d say, damn good considering the circumstances you know, why are we still here where everyone else failed. Is it because we’re just stupider? Is it because we’re hard to working? Is it because we got out there earlier? Is it because we found ways to, you know, continuously improve, and navigate and pivot? I think it’s all of the above and we have a strong local partner that’s been supportive of us and wants to change the future of the UAE for better with sustainable green investment. So, you know, I think it was a combination of all of those. But on the flip side, if we didn’t work so hard, we wouldn’t have the knowledge and experience to apply to the future either.
Vuk Zlatarov: There is no diploma that can compensate it. Absolutely no diploma. But do you know what? I think that the public is aware only of success stories of Elon Musk in his late forties, or, you know, Jeff Bezos now when he’s, you know, in his fifties or whatever, or all of the startups out here in the Middle East that raised significant rounds of funds, but nobody’s really aware of the years that were leading to that point. And for example, the fact that you managed this to survive same years is a big success because you survived, you learned a lot and you’re ready to tackle the years that are coming, you know, much stronger. And, you know, at one point I recently talked to one founder and he will be coming on the show in a couple of episodes. And all of a sudden, he got all of the attention of the world because he raised funds. And I asked him, so how did you do this? What happened? He said, man, I didn’t do anything differently. Just happened. And now I have all the attention of the world. Everyone is calling him, he’s going to be, you know first page of the magazine, everyone is calling him to podcast, including me, like he said, nothing changed. I’m doing the same thing. So things in entrepreneurial journey — just one morning things change, one good move, one deal. And all of a sudden, you’re in the front page of a magazine.
Vuk Zlatarov: And I think that’s what’s cooking, you know, for anyone out there, if you think about entrepreneurship and making that leap and starting something on your own, you bet that you’re going to be hooked on it at least for that feeling of winning, or of a potential win that can happen. And that’s something that cannot be compensated with anything else.
Charles Blaschke IV: So true. Yeah, these extreme ups and downs, but it only takes a couple extreme ups that keeps you going. My dad always says about golf. He’s like, it’s the worst sport ever. You’re just angry. You’re hitting the ball everywhere, but it’s like that literally two shots around that are amazing, then it keeps you coming back. And I think that’s true. I mean, we’ve had amazing ups and we’ve done amazing things. And one in particular similar to that is in 2016, we won it is called the venture competition.
It’s called The Venture. And it’s a global search for the world’s most impactful social enterprises. And we won the region, and we represented the region on a global scale for what we were doing. Like as a company that’s changing the world for better. And things like that, you’re like, Oh, wow. All this work, like someone recognized it and we get to do something fun and exciting and is helpful. And it was probably the best thing looking back, outside of obviously winning a contract and finding our partners and saving and stuff like that. And making our software is probably the most exciting and best thing that ever happened to us. And with that came a lot of free press. So all of a sudden, we’re all over the press from media, interviews, and then it’s like, yeah, wow. Yeah, no, yeah, you’re right. Nothing changed. Just people are listening now.
Vuk Zlatarov: So what we need to hack is how to get the attention before some significant events happen in your business life or a career. So should you invest then in PR and promote yourself and be loud, maybe that’s what you should do or something else. You know, you can be grinding all day long and working hard 24/7 for years, but not telling anyone about it. So not being loud about the problem that you’re solving, nobody’s going to be aware of it. Maybe if you’re lucky you’re going to solve a problem for someone really important. And then they’ll be like, wow, have you heard about these guys? But if that doesn’t happen, most likely, you’re going to end up just, you know, working your ass off and not being recognized for it.
Charles Blaschke IV: Yeah, Sadly.
Vuk Zlatarov: This is like the game.
Charles Blaschke IV: I guess this is life. Yeah.
Vuk Zlatarov: So you are familiar with Ray Dalio. He wrote this book called Principles. And he’s talking about his life and work principles. I’ve been asking this question to previous couple of guests as well. I’m curious to know more about your principles in life and in business. Principles that you, you know, developed over the years and that helped you, you know, stay on track, or make some decisions in your life that you think are most important for you.
Charles Blaschke IV: I have, some years ago I did a lot of reflection. I’d never been into like emotions and psychology, but I took a break and started learning about it and really appreciate and respected it and kind of started writing stuff down. So I don’t have a great answer, but I think certain things keep popping up that I realize. And it’s kind of centered around continuous improvement. And obviously like I’m an efficiency guy in buildings from an engineering perspective, but I think they kind of go hand in hand, like finding better ways to do things and learning from what you’ve done, either good or bad to continuously improve into the future. So it was kind of like this compounding interest effect where if you get 1% better every day at the end of the year, it’s, you know, whatever, it’s not 365. And so whether that’s applied to business or business process, or you personally really think about what’s happened and happening and why, and then how to make that better and then apply it and apply it in real time. I think this like very quick thing of efficiency and continuous improvements is super important. I do in my personal email, I still have it. I have a saying, it’s hard work conquers all. So sometimes I look at it and I do believe in that, but then I think, well, maybe that’s like the, is it kryptonite or superman needs kryptonite to survive, right. Maybe that’s like the flip side, like the yin and yang, like, Oh, that’s the reason maybe like some things haven’t happened cause I’m too focused on hard work through it, instead of that, smarter, not harder. I think, you know, those kinds of are recurring themes that keep coming back. And then in the end, like people are just people, you can only do so much. So whether it’s you and what you can produce or impact in the world or in a business or the relationships you make, right. Like company is usually just as people.
The lasting thread through everything is — companies go up and down, friends go up and down, but in the end, it’s kind of what you build and what you do with that that’s really important.
Vuk Zlatarov: Charles that went into this whole journey 10 years ago, and Charles today — what’s the difference?
Charles Blaschke IV: Other than aging 30 years in those 10 years you know, I’d say I’m hardened in a way to the world, to business, obviously more experienced. That’s fine. I think when you do, you know, 30 years’ worth of experience crammed in kind of 10 years, I hope you get like the double, extra-large MBA without the diploma. I’m less naive, I’m less happy. I’m less fun. I’m less energetic, I’m in worse shape. So those are kind of the negatives, I guess. And I’ve noticed that, and people have noticed that it’s really worn on me in a lot of ways, mentally, physically, emotionally. And you know, I messed up as well. I can’t say like my wife and my girlfriend, wife at the time, she always told me like, you’re bad. Like you’re bad. Like, can I help? And like, she was there to help obviously. And so were a lot of other people and people noticed it and like, I cut out a lot of people in my life, not because I wanted to, but I was focused. And it goes back to the why, I was so focused and intent because I cared so much about what we were doing and the company obviously, financial security is kind of, it’s always never been high on the list, but when you have staff and the customers and everything else, investors. So I was so focused and sadly I saw this the other day. I don’t know if I told you before, I used to keep track, like, I’ve always been like big into exercise and fitness and just, just activities, outdoor adventure stuff. And so I had this spreadsheet from like back 15, 20 years ago of all the runs and cycling and everything I had done. And I’d put like the date, the time, the stats, and notes, it was really cool. And I just started putting, getting back into shape about six months ago. And I use Strava now. It’s like an online thing and automatically does it. I was like, you know, I want all my old stuff in one place. So I started inputting it and I input everything. And I swear to God, like the week I started Taka was the last entry I had for eight years. And I was like, there’s a gap in my life literally of exercise. And that’s who I was. And I think that balance also helps through those hardest times, you need to have an activity, you need to turn your brain off. You need to exercise, which would then help with sleep. And I think you get in this vicious cycle where you don’t exercise or you don’t turn off and then you drink more caffeine to get through it because you’re tired, then you feel like shit. So then you drink a little and then you don’t sleep well. And like, now that you can do that for a week, a month, a year, a few years, eight years, I don’t know is healthy. So, you know, that’s I guess another word of advice to people, don’t lose yourself too much, but also still be yourself, like through all of it. Like you’re going to run into people, shady people, and things, and you can go down dark path, but for what? Like, you don’t need to. You know, take the higher ground. And yeah, I think one cycle a week over those eight years, I’d be a very different person, very different person today.
Vuk Zlatarov: But something kept you going all these years and that’s passion and that’s belief. And that’s what I can see in you. And I don’t think that without that, you can make it. Like you need to put in hard work. You need to be prepared to, you know, to get sweaty and bloody and to get into a battle. But at the end, you know, why are you doing it and at one point when you look back, everything will make sense.
Charles Blaschke IV: Let’s hope so. Or you’re just stupid. You don’t know when to give up. No, I know. I agree. And that’s what I think if people don’t realize, like you have to be ready and willing, let’s say to give up your salary at least half your salary for three years, you know, some people think it is a few months until I raise money. I think you just plan on that and give up your whole life. And if you aren’t, don’t even start, it’s not good for you. It’s not good for anybody. You have to be ready and willing to do it. And I don’t think most people are.
Vuk Zlatarov: So my last question, as The Change Officer, if there’s one thing that you could change in the world what would that be?
Charles Blaschke IV: Change one thing in the world, I’ve got two answers. One is human nature and we aren’t going to solve it. But if people weren’t lazy and stupid… I wish people wouldn’t be lazy and stupid. And it sounds like really bad. And there’s a lot more to it. Cause it relates to efficiency and continuous improvement where if people weren’t lazy and stupid, a lot of things would be better obviously. So I’m going to throw that one out and you can cut that if you want. But I guess kind of more related to efficiency and the whole thing, and me as a person, is everyone has the power to make the change that can save the world, it sounds dramatic. Like, look, we didn’t start Taka because we’re like a tree hugging hippie save the planet organization per se. We started because we see that with very basic engineering and skills and stuff we have today, we can do way better in buildings, which happen to kind of save the planet. So it was more from like a technical and a business approach to help people. But what I’ve realized in the end is like, why do we consume energy? Because us humans need it. How can we save energy, us humans use less. And that’s in everyone’s hands. So whether it’s an app, like we have apps for fitness, we have apps for everything, but does anyone have apps to know how much energy they consume and how to save it and how much they’ve saved? So I’m not saying that everyone needs to run out and do that. I’m not saying everyone needs to run out and put in smart thermostats and good lights and buy efficient homes and only work in like the most efficient buildings and stuff. But I think if people could understand that they actually have the ability to make that change because efficiency, unlike solar and renewable, and a lot of this other stuff is really literally in people’s hands. They can do it, your thermostat, you know, just be a little bit smarter, be a little, you know, there’s so many different things. And if everyone did that little bit from the ground up and, or like demanded that from others, like their building owners, the schools they work in or go to, you know, the office, they work, the schools they go to, all those will start to save and then the technology’s there to do it, the finances there to do it, the engineers there to do it. And obviously the regulation, the policy and the need is there. The world would transform in no time. And I think that’s what’s really coming. I think there’s this hidden tidal wave of grassroots plus like from the top with policy to where, you know, I think efficiency finally, finally efficiency is going to have its day. And when that happens, we’re going to see really incredible things happen. Really incredible things.
Vuk Zlatarov: Thanks for coming Charles. I really enjoyed our conversation. Second one, first episode for everyone out there, we already did the episode once, but then the audio was broken. So we had to do it again. I enjoy our conversation, every second of it. Guys, I hope that we inspired you, that Charles share with you some insights that you might not be aware about before and that this is going to push you, or motivate you to explore this whole area a bit more. There’s a lot of opportunities out there. And I think that whole market is still pretty untapped. And instead of chasing all of these popular areas, I think that we can put some efforts on the side to explore areas like this.