The SundayBusinessPost November3,2019

Deloitte Fast 50


All grown up at 20 Ireland’s premier tech awards, theDeloitte Fast 50, are 20years old—and the endof adolescence marks the sector’s real importance to the economy,writes Jason Walsh

From a dot on the horizon to the dot-comboom, and fromboom to bust and back again, the Deloitte Fast 50 has tracked the waxing and waning fortunes of the Irish technology sector since 1999.  Richard Howard, partner at Deloitte, can date the explosion in Irish tech. “If you go back 20 years, we had telecoms deregulation in Ireland, so you had com- panies like Esat Digifone,” he said. Esat didn’t just represent the appearance of compe- tition in the Irish telecoms sector, it meant there was a non-incumbent player out there who didn’t do every- thing in-house. It also acted as an incubator inmore di- rect ways.  “You had companies coming out of it, often founded by people who had worked for it, provid- ing software in the mobile Deloitte brought the Fast 50 awards to Ireland just a few years after the company was launched onto the global stage, thus recognising the importance of the technol- ogy sector in the Celtic Tiger economy of the late 1990s — the early days of a better nation. It wasn’t all to be plain sailing, of course, for Ireland or for the information and communications technolo- gy sector.  “There was already a significant tech sector back then, and it was just before the dot-comboom—which was followed by a bust, of course,” said Howard, lead partner for the firm’s technology, media and tele- communications, as well as energy groups. The awards, based on a purely quantitative mea- surement, do more than just promote Irish tech firms. In a sense, they track the importance of the sector to the Irish economy and the growth of the players in it as theymove from start-up to, hopefully, global player. “There are some that span the full-time frame. First Derivatives, for example, has been there for 18 of the 20 years,” said Howard. Typically, though, the nature of the companies has changed as technology and society have evolved. There is little sign today, for instance, of web develop- ment companies. “We did have indig- enous companies pro- viding web development services, but they tended to drop away as the market changed,” said Howard.   Trends come and go, but innovationmarches area,” Howard said.  Charting a course inchoppy waters

Typically, the natureof the companies haschanged as technology andsociety haveevolved

Powerfulpartnership Duncan O’Toole, co-founder, Electricity Exchange; Karen Frawley, partner, Deloitte; and Paddy Finn, co-founder, Electricity Exchange ElectricityExchange, this year’s overall Deloitte Fast 50winner, has seen electrifying growthdue to its novel power grid technology that generates revenue, notwatts,writes JasonWalsh

ever forward, seemingly.  “What was web develop- ment in 2001 is nowmaybe data analytics companies, and the question now is: is that going to be in-house [like web development] or baked into the process?”  So, will the data compa- nies appearing, and suc- ceeding, today be around two decades hence? Or will they be bought out and absorbed in-house? It’s an open question, but in the meantime the Deloitte Fast 50 will continue to crunch the numbers and see where the Irish tech sector is really growing. Howard said Ireland today is represented by tech busi- nesses focusing on the busi- ness-to-business market, business-to-consumer and also infrastructure. In short, it runs the gamut.   “We do have a successful business-to-consumer sec- tor but perhaps people don’t always see it because it’s not like Amazon; typically, it’s commissionaire type things. Hostelword, for example” he said.  Over the two decades, though, the trend has typi- cally been for software and services —and they come in a continuous stream, said Howard. “What you find every year is new companies ap- pearing: ones who were op- erating under the radar. The one area where we [as a na- tion] probably haven’t had a lot of success is hardware because that needs a lot of cap-ex and other things to start up,” he said.

L imerick-based E l e c t r i c i t y Exchange is a smart-grid technology and servicescompa- nywhichavoids the need to build new power stations and grid infrastruc- ture. Instead it helps to un- lock the existing capabilities of electricity consumers in a processthatcanprovidemore electricity to the grid than many major power stations generate.  “Effectively, we operate like a power station as far as the grid is concerned,” said Dr Paddy Finn, Electricity Exchange co-founder and managing director.  “We aggregate electricity consumers to build ‘virtual power plants’, and we can currently deliver up to 126 megawatts of capacity.”  In contrast, Ardnacrusha power plant in Co Clare was one of the world’s largest civil engineering projects when it was built and has an 86-megawatt generating capacity.  Deloitte said Electricity Exchange achieved a growth rate of 1,442per cent over the last fouryears. ElectricityEx- change’s growth has not just been in revenue terms: the company has grown in ca- pacity too.  “Last year we ourselves were at 86 megawatts, now it’s 126,” saidFinn. “That’s an additional40megawattsbeing delivered to the power grid without the need for any ad- ditional infrastructure. We’re the power station that keeps growing.”  Ratherthanproducepower, ElectricityExchangeprovides demand response technolo- gies todeliverelectricityfrom commercial and industrial electricity consumers to the grid. “We use commercial and industrial customers tomake power available to the grid [so] that electricity is deliv- eredwithout pouringasingle ounceofconcrete,orbuilding a single new pylon,” he said.  Finn said the approach Electricity Exchange took resulted in a newway of ad- dressing demand on the grid.  “If there’s a peak on the

also gives us an international advantageastechnologylead- ers, said Finn.  He is quick to point to Eir- Grid as a forward-thinking organisation, and one that is globally recognised as an exemplar in the use of inno- vative technology to enable world-leading levels of re- newable generation.  “Ireland is a number of years ahead of othermarkets aroundtheworldwiththein- tegration of innovative tech- nologies like this,” Finn said. “The traditional route was to build more power plants, change the nature of the plants,builtnewtransmission networks, and so on. Here, EirGrid has been at the fore ofdoingthingsdifferently,and whenwego toothermarkets, they all, without fail, look at Ireland and EirGrid as exem- plars,” he said.  What is essential tounder- stand, he said, is that Ireland has had to adapt faster than mosttothechallengesofdeal- ing with power demand and renewables. “Asaweakly-interconnect- edislandweareatadisadvan- tage togeographicallydiverse countriesoncontinentalpow- er systems,” Finn said. “TheproblemsIrelandfaces at 40per cent renewables are the kind that other countries won’t face until they are 70 to 80 per cent renewable, so we have to be creative in our strategies,” he said.  The company is now using the expertise it developed at home to move into inter- national markets, including AustraliaandtheMiddleEast. In the end, Finn said, what getspeople’sattention ishow cost-effective Electricity Ex- change’s technology is.  “Famously, Teslahas a bat- teryprojectinSouthAustralia. That project cost in the order of $50million. “With our technology we could deliver the same ser- vice for less than $1 million and deliver the value back to consumers instead of battery manufacturers,” he said. This is all simply because at the core of Electricity Ex- change sits a technology for shuttingoffloads that already exist, thusnonewinfrastruc- ture is required. 

Duncan O’Toole and Paddy Finn, co-founders, Electricity Exchange and David Shanahan, partner, Deloitte

stations to generate, it pays us [for capacity] andwe pass themajorityof that backonto the customer,” Finn said. “Any one of our customers would be individually insig- nificant onthegrid, butwhen we aggregate them, they be- come part of a meaningful quantity — and, in the blink of an eye, we canuse themto helpheal the power system,” he said. Thisfundamentallychanges the relationship the compa- ny’s clients havewith power, said Finn.  “It turns electricity users intoactivepower systempar- ticipants that generate reve- nue in the same way that a power station does,” he said. International expansion  Like almost all companies in the Fast 50, Electricity Ex- changehasaneyeonoverseas markets. Being a weakly intercon- nected islandwithambitious renewableenergytargetspos- es a significant engineering challenge for Ireland, but it

grid,whenpeoplecomehome fromwork, for instance, tra- ditionallyEirGridwould turn on more power stations. In- stead, when EirGrid call for more power from us, we au- tomaticallyreduce thepower our customers are using. The power they were using can then be redirected to other consumers likeyouandme.”  Allofthishappensfromthe company’s 24/7 operations centre in Limerick — and it canhappeninunderasecond.  “Instead of turning on tur- bines,wesendremotesignals to our customers’ equipment to reduce their power con- sumption. The end result is the same as a power station producingmore power,” said Finn.  “We’vedevelopedtechnol- ogies that allow us to be in- crediblyquick:wecandeliver enough electricity to power 35,000homes ina fractionof the time that it takes you to blink your eye,” he said.  An energy company coming out top ina technologyaward is a clear sign of a changing world. Electricity Exchange looks and acts very much like a

‘disruptive’ start-up despite being an established energy company.  Connection to the grid Central to the firm’s work is IoTAS, its in-house-devel- oped platform which is able to help in healing issues on the national grid in less than 150milliseconds. Asmorerenewablesenter the mix, too, a fast response is more essential than ever to ensure that the grid is able to compensate for these less stable sources of power.  IoTAS also ensures that thecompany’s customersare not inconvenienced when it comes toparticipating: it only reducespowerthatcustomers make available to be turned down.  Founded in2013, the com- pany began with an engi- neering-centric approach to business.  “At that stage it was my- self, [co-founder] Duncan [O’Toole] and three employ- ees in a three metre by three metreoffice,” saidFinn. “Our

first 18 months were devel- opment focused; instead of hiring salespeople, we hired engineers and developed our systems.  “The approach paid off, and early clients included the likes of Boston Scientific, PepsiCo and Keelings Salads who sharedour vision for the future of the power system.  “We entered the market with them in 2014 [and] ev- eryyear since thenwe’vehad over100percentgrowth,year after year after year.” Finn said it is not simply a case of thinking like a tech- nology company so much as actually being one.  “As soon as we entered the market, we knew that in or- der to stay relevant we had to innovate.So,inordertostayat thetopofourgameasapower companywehadtobecomea technologycompany,”hesaid.  Unlike many technology companies,though,Electricity Exchange has a concrete im- pact on the physicalworldby reducing theneedtogenerate more electricity from fossil fuels.  “The same way the elec- tricity market pays power

Richard Howard, partner at Deloitte

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