Munich Startup: What does your startup do? What problem do you solve?
Marc Schubert, Ecoturn: To further encourage the switch to environmentally friendly drive systems, e-car owners have been offered additional bonuses since the beginning of this year. The annual greenhouse gas premium of a few hundred euros provides an additional financial incentive to switch to environmentally friendly drive systems. It doesn't matter whether the vehicle is purchased or leased. As long as the owner is listed on the vehicle registration document, these annually creditable CO2 quotas can be sold, for example, to oil companies, which can then avoid punitive tariffs.
Theoretically, electric car drivers could also apply for the GHG quota themselves from the Federal Environment Agency. However, since an oil company has a large demand to meet, in practice they only purchase large quota quantities instead of picking each flower individually. And that's where our platform comes in. Elektrovorteil.de comes into play. With it, we handle the entire process, from applying for CO2 certificates to paying the premiums.
The process for applicants is simple: All they have to do is upload their vehicle registration document to the website. From there, Ecoturn handles everything else. During the administrative processes, we use artificial intelligence to review and structure the entries – all while adhering to the highest data security standards, of course. Using the service is free of charge for the vehicle owner.
Ecoturn relies on clever processes and maximum automation
Munich Startup: But that's been around for a long time!
Marc Schubert: Sales commissions of 25 to 30 percent are currently common in the industry. This made me curious to see how much effort it would take to retain a quarter of the sales price. It turned out that the processes in GHG quota trading are largely analog and inefficient. However, if you cleverly streamline the processes and maximize automation, you immediately unlock enormous savings potential.
Therefore, a core element of our solution is automatic text recognition, which extracts all the information required for application and certification from the vehicle registration document. The algorithm can flexibly handle any errors and, for example, detects whether the vehicle registration document has been uploaded incompletely, or whether the wrong document is present, if the vehicle is not a purely electric vehicle (such as a hybrid). In such cases, the formal verification is automatically rejected, and the customer is notified of any corrections.
In this way, Ecoturn manages to differentiate itself from other providers and convince consumers with a sales commission for the GHG quota of only 15 percent.
Munich Startup: What is your founding story?
Marc Schubert: I worked in the automotive industry for many years and first became aware of the topic during a user survey for a car manufacturer's digital project. We surveyed electric car drivers about their preferences. One of these e-mobility enthusiasts told me in the fall of 2021 that there would soon be an annual e-car bonus. And as co-author and editor of the specialist publication "Machine Learning, Real Problems - Practical Solutions, Potentials and Limits of Artificial Intelligence," I was already intimately familiar with the possibilities of artificial intelligence and deep learning. When new emissions control laws were passed, it became clear to us that a radical change was imminent in the industry: many new participants, more quota fulfillment via third parties, and a need for digital solutions. This is what motivated us to develop our rewards platform.
“Our challenges lie mainly on the government side”
Munich Startup: What have been your biggest challenges so far?
Marc Schubert: Our challenges lie primarily on the agency side. We often notice that the staff at the Federal Environment Agency are dedicated but hopelessly overworked. This is evidently because, with insufficient staffing capacity, practically every application has to be processed manually. The pooling service providers' use of artificial intelligence is interspersed with manual list processing at the agency. We have not yet encountered any meaningful process automation. On the contrary: we find an inadequate software situation at the UBA, which unnecessarily complicates many things on both sides. Even the storage space for uploads is so limited that we have to have all scanned documents downscaled to a grainier image format beforehand.
We fully understand that at the end of 2021, no one imagined that the GHG quota would become such a hit at the beginning of this year. It's entirely understandable that a federal agency hasn't yet gone all out with the resources available, but is instead waiting to see how the public responds. Likewise, at the end of January, people still believed they were experiencing an initial rush that would likely subside. But if this rush continues month after month, even grows, and the backlog can no longer be reduced, then it's time for a change of process.
“Customers have been so upset about this”
It's high time to significantly advance the automation and digitalization of these processes. The flood of submissions isn't going to abate anytime soon. However, the completed certification of the quotas is a mandatory prerequisite for their marketing. Only once we receive a certified quota bundle back from the authorities can we trade them. Payment is linked to this, in turn. Customers have been up in arms about this. Dozens of emails came in daily from dissatisfied customers, who understandably complained about the long waiting times.
So we had to do a lot of explaining why exactly it was stuck at which point in the process. At the same time, we tried to convey a sense of security. After all, unlike other funding sources, the payment is guaranteed; there's no maximum quota or anything like that that could suddenly be exhausted. We expanded the personal user profile so that every single process step can be visualized. This creates clarity and transparency. We also took a proactive approach to communication. Simply to convey: "We haven't forgotten you!"
“The shift from B2C to B2B is in the nature of things”
Munich Startup: What are your next steps?
Marc Schubert: The GHG quota represents a useful addition to the business models of, for example, car dealerships, insurance companies, fleet operators, municipal utilities, charging point operators, or backend operators. The shift from B2C to B2B is therefore in the nature of things. For this reason, Ecoturn, for example, offers a cooperation model for the automotive trade, whereby the automotive company can apply for the bonus on behalf of the customer. The right to the GHG quota can be transferred as often as desired. The refund of the bonus then runs in exactly the opposite direction. This creates entirely new and exciting business areas.
For us, it's now all about establishing more corporate partnerships. With our software, developed specifically for this industry, processes can be fully digitized and fully automated. Because user-friendliness is paramount. Only when the process is absolutely effortless, convenient, and straightforward will it be accepted by customer service employees. The effort involved should be no more than the click of a button, so the process can be seamlessly integrated into everyday work.
Munich Startup: How have you experienced Munich as a startup location so far?
Marc Schubert: Before the coronavirus pandemic, I spent six months intensively engaging with the Munich startup scene. For example, I participated in various discussion forums and tried to make contacts. Participation in the UnternehmerTUM It was wonderfully unbureaucratic; there's a really cool energy there. I really liked the "Maker Space."
Ecoturn sees too little support for startups in Munich
While I don't have any comparisons to other cities, my expectations were definitely not met. For example, some time ago we were considering an open space for a vertical farming concept and were looking for a reasonably central location. But if anything was offered to us, it was far out of town, with no public traffic, and at a price per square meter that was anything but affordable. I think Munich has a lot of potential. Unfortunately, there's far too little funding to leverage it. I've completely missed startup facilities in central locations, in particular, or maybe I just haven't been able to find them?
Munich Startup: Quick exit or long breath?
Marc Schubert: The whole thing is far too much fun for me to hope for a quick exit. Of course, we want to be profitable in the long term and generate further profits. The legal situation has created a framework of eight years for the GHG quota, which I think is a fairly manageable period. Time will tell which direction the business models will take up to 2030. In any case, we are seeing firsthand how the "greenhouse gas quota" e-mobility funding instrument is having a direct impact. We are receiving many inquiries from potential customers who are now interested in purchasing an electric vehicle, partly because of the annual e-bonus. Experiencing the transport transition and thus also the energy transition first hand definitely gives us a pleasant feeling. Ecoturn receives a lot of positive feedback from happy and satisfied customers, which is a great motivation for us.
