British smart home systems installer BOXT accelerates expansion plans to become the leader in the UK domestic heating market after raising £20 million in a fresh round of funding.
The latest round was led by Brookfield, one of the largest global investors in infrastructure. Brookfield has also invested in residential infrastructure specialists Thermondo in Germany and Enercare in Canada and the U.S.
With its sights set on improving heating efficiency and installing smart home solutions to anyone in the country, whatever their post code, BOXT will use the cash injection to spur UK growth, whilst also supporting the government’s pledge to cut UK emissions by 80% by 2050.
The fundraising follows an initial investment from engineering giant Bosch.
Born out of a belief that the heating industry wasn’t fair on consumers, founders Mel Butler, Andy Kerr and Keith Jones launched BOXT in 2017, developing a unique digital platform to simplify and democratise the process for homeowners.
In less than four years the Leeds headquartered technology company, which offers consumers an uber-style service for fitting boilers, electric vehicle chargers and air conditioning with accompanying smart home devices such as thermostats, smoke alarms, cameras and speakers has successfully disrupted the home heating installation market, becoming Britain’s second largest boiler installer, providing services to over 100,000 households nationwide.
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Removing the need for an on-site visit to quote, BOXT passes on the cost savings made through streamlining processes. Its intuitive online service and trusted army of engineers mean customers can obtain competitive fixed prices and installation within 24 hours.
Unveiling a home cover for existing customers in 2020, a boiler repair solution in 2021, along with smart home packages via its partnership with Google, the business is on course to grow its customer base to over 300,000 households by 2025.
This latest investment round will also allow the business to continue to develop its globally leading technology platform and provide innovative, affordable and reliable home heating solutions.
Growing to over 70 employees since its inception in 2017, BOXT, which has offices in London and Leeds aims to double its workforce in the next 18 months. The digital heating disruptor has amassed a network of over 3,000 engineers, with a view to increasing this to 6,000 by 2023 to meet customer demand.
“The company has continually delivered double digit growth since 2017” said BOXT founder and CEO, Andy Kerr.
‘’Bucking the trend of the traditional UK heating industry, we’ve achieved over 50% underlying sales growth despite the challenging economic circumstances throughout the COVID 19 pandemic ’’
“We’ve invested significantly in technology that creates a smooth customer journey, reducing waste and additional journeys for both customers and engineers.
“Nurturing partnerships with Bosch, Google, EDF and Halfords have also strengthened our proposition and momentum in the UK, whilst ensuring the business is at the forefront of innovation.”
In a bid to lower UK carbon emissions, government advisors have called for low carbon heating to replace gas in all new homes built after 2025. A BEIS survey found half of respondents had never heard of renewable heat.
The UK is aiming to phase out gas boilers and replace them with low-carbon technologies, such as heat pumps and electric boilers, in order to reach net-zero levels of CO₂ by 2050,
BOXT is committed to supporting the new technologies, infrastructure and education needed to help households and businesses overcome barriers to low carbon choices.
“Our vision is to be part of the solution to the carbon questions being asked of our industry, supporting our customers – especially the most vulnerable as the UK transitions its heating and energy supply to a more climate friendly future.” continues Andy Kerr.
“Two thirds of the homes we will live in by 2050 have already been built, so we need to ensure that any new heating and power solutions can fit into existing homes in a more energy efficient and cost-effective way.
“We are pledging to become a net zero carbon business by 2045, reducing our overall carbon emissions by 45% by 2035.
“The latest round of funding will enable us to continue to expand and provide our energy efficient and optimisation products like Google Nest as well as fuel saving technologies to our customers such as electric vehicle charging as well as hydrogen powered boilers and heat pumps.
“We are delighted to have Brookfield as our partner, as one of the largest energy and infrastructure investors in the world. We know they will bring a wealth of knowledge into the business and together, we see an incredibly ambitious future of growth for BOXT.”
The European Residential Boiler Market size was valued over USD $5 billion in 2017 and annual installation is anticipated to exceed 6 Million Units by 2024, according to Global Market Insights, with the UK residential boiler market anticipated to grow over 2% by 2024.
The Global residential boiler market size was also valued at $8.1 billion in 2019, and is expected to reach $12.3 billion by 2027, registering a CAGR of 5.8% from 2020 to 2027 (Allied Market Research).
Brookfield Managing Partner, Sikander Rashid said, “The U.K. home heating market is expected to experience accelerating change over the next few decades in response to progress in technology and regulation”
“Having rapidly gained the trust of thousands of consumers, we believe BOXT is well positioned to continue to grow its market share, given the attractiveness of the online offer combined with the scalable and flexible business model.”
DC Advisory have acted on behalf of BOXT as their corporate finance advisors with Pinsent Masons acting as legal advisors. Squire Patton Boggs have acted as the BOXT founders’ legal advisors.
Brookfield’s advisory team included LEK as commercial advisors, EY as Software and IT advisors with Farrer & CO acting as their legal advisors. KPMG have advised on Financing & Accounting, with Grant Thornton acting as tax advisors and Marsh completing the team as their insurance advisors.
With fixed priced costs and reliable, trusted army of engineers the business has achieved almost 10,000 5* reviews on TrustPilot, ushering them to the top spots in the gas installation, boiler supplier and heating installation industry on the review site.