I had the pleasure to interview Kevin Dick. Kevin is passionate about developing innovative green building, energy and waste programs with an eye toward user experience design and human behavior. Kevin currently focuses his work on energy efficiency programs for low and moderate income consumers, which account for about 40% of energy users in Illinois. As a Director at the Midwest-based nonprofit Delta Institute, Kevin founded Lumin, a free mobile notification service that helps low and moderate income residents manage their energy bills.
Thank you so much for doing this with us! Can you tell us a story about what brought you to this specific career path?
I have a passion for finding solutions to sustainability problems that are rooted in human behavior. In my experience, people are motivated to act in society’s best interest, but identifying the right choice and reducing the friction to act on that choice can be challenging. This challenge is especially pronounced with low and moderate income populations. Instead of convincing people to change their behavior, I believe we need to make acting sustainably undeniably easy to make lasting change.
What is the mission of your company? What problems are you aiming to solve?
Lumin’s mission is to give consumers control over their energy bills. Lumin does this by helping low and moderate income customers easily pay their utility bills, access subsidies when they have trouble paying their bill before they get into arrears, and get connected to programs that help lower their bill. Making bill payment easier for struggling customers also engages them in efficiency programs, which are designed to lower energy use. Utilities account for one-third of greenhouse gas emissions, and reducing electricity use is one of the most cost-effective ways to mitigate climate change.
Can you tell us about the initiatives that your company is taking to tackle climate change? Can you give an example for each?
Lumin takes a targeted approach to assist low and moderate income electricity customers as electricity accounts for a large portion of greenhouse gases in the US. Using a human centered design approach to design our software, we work to improve the lives of low and moderate income electricity users while combating climate change by reducing energy consumption.
For low and moderate income customers, especially those that do not use banks, paying utility bills is a challenge. Utilities are required to serve all customers, and often for low-income customers struggling to pay their bill, this requires that the utility providing in-person intake centers to offer payment assistance, or partnering with payday lenders to offer this service. Based on prior user research, we believe that improving this process would increase opportunities for customers to use programs to reduce their bill, and be able to understand their bill more frequently and make changes to conserve energy.
What was the most difficult thing you faced when you first started your company/organization? Can you share how you overcame that. This might give insight to founders who face a similar situation.
Working with low-income customers is a challenge, and there are many issues with trying to design programs that are targeted toward them. To overcome this challenge, we developed direct partnerships with organizations to solve each individual barrier — trust, design and development, communications, and delivering the value proposition to each unique stakeholder.
We worked with the local electric utility, Commonwealth Edison, and the foundation, Illinois Science and Energy Innovation Foundation, both located in Illinois to take advantage of their new smart grid initiatives. We worked with a nonprofit, Faith In Place, to reach vulnerable populations through a trusted messenger to do user research. We worked with the design and innovation firm IDEO to develop concepts and interventions, test them, and iterate to higher fidelity to develop the Lumin user experience. Finally, we reached out to utility program stakeholders to build connections to allow customers to more easily take advantage of the subsidized programs available to them.
Many people want to start a company to tackle environmental issues, but they face challenges when it comes to raising enough money to actually make it happen. Can you share how were you able to raise the funding necessary to start your organization? Do you have any advice?
Starting a business is a challenge regardless of whether it has a social mission or not. Social ventures have to follow the same business rules as traditional businesses. Many entrepreneurs think that having a social value proposition is strong enough to gain interest and raise funds for a business. However, a social value proposition isn’t a reason alone to invest in a business for most savvy investors.
I want to emphasize to other entrepreneurs that if they want to get the funds they need, they must stick with business basics. They need to focus on the value proposition, so that the reason to invest in evident. Show how your idea is beneficial in the form of a story and people will fund it. There are plenty of social and environmental problems that also have solutions with good business models. Focus on delivering these solutions. Build a painkiller, not a vitamin. If the main features of your product or service don’t solve a pain point for your customer, you may not have enough of a business to get beyond a seed phase.
For low-income energy customers, the value proposition is simple — convenience. But they can’t pay for the service, so we had to find a value proposition that worked for who was going to pay for the service. For utilities, we are demonstrating that the smart grid has direct customer value, we are showing a viable way to connect with low-income customers to develop deeper trust relationships, and we are showing that working this way saves money by eliminating customer service costs. For subsidy program administrators, we are providing a lower cost of acquisition, saving money and time to spend program dollars that are allocated to this issue. This helps make the case that the product is worth investing in.
Lumin received its first large grant because of our strong story and value proposition that clearly stated “through a human centered design approach, Lumin aims to solve a very difficult social and environmental problem.” Our story and value proposition resonated with all of the stakeholders involved. Developing relationships and communicating a clear story has been the most important aspect of fundraising for Lumin, and I suspect it will work well for other entrepreneurs. Focus on this, and funding opportunities will become available to you.
Do you think entrepreneurs/businesses can do a better job than governments to solve the climate change and global warming issues? Please explain why or why not.
Entrepreneurs are more nimble than government, but without government policies and financing, often issues such as Lumin are not possible to execute. I believe we need both, as government policy created the impetus for Lumin to make sense as a business. For example, in Illinois, the Energy Infrastructure Modernization Act allowed utilities to charge customers to upgrade the electricity grid with smart meters. This gave us access to daily data and seed funding. Further action by the State of Illinois created the Future Energy Jobs Act, which allocated more funding specifically for low-income energy efficiency programs. This provides Lumin with runway to prove its value proposition. We need both.
What are some practical things that both people and governments can do help you address the climate change and global warming problem?
Together, people and governments can 1) reduce barriers and friction that inhibit action, 2) create incentives designed to increase program uptake, and 3) educate the public that it is important to address climate change and to set goals to do so. I believe this is happening at local levels, but national leadership is still wanting.
We are often battling against inertia and human nature. It is much easier to lead by example than to try to force action, and it seems that there are always ways to get around punitive policies. Policies that encourage the uptake and development of clean energy technologies and make them easier and cheaper to use are preferable to penalties that attempt to demonize existing technologies and consumption. Consumers will shift their behavior if they have the motivation and ability, and you give them a trigger to act.
Education is also important, but programs should be designed in such a way that they are well tested and coming from trusted sources. A lot of climate change education is often directed at people who are already committed to changing behavior. Getting large numbers of people to take action requires a shift in focus to solve their pain points. Talk about comfort and convenience, instead of dollar savings. Focus on performance and reliability, instead of carbon footprint. Taking these approaches can have the same effect with much larger uptake.
Humans are terrible at planning for long term effects and tend to act on short term interests. For climate change action to work, we need to provide opportunities to meet both needs. Our continued focus on messaging the urgency of the problem may be hurting our ability to scale solutions, as it diverts the focus away from solving the problem and trying get opposing viewpoints to move. Climate change solutions such as massive energy efficiency and renewable energy programs, regenerative agriculture, and clean energy transportation have benefits for everyone that go beyond their climate change mitigation. We should be focused on delivering those benefits.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story about that?
There are many people that have helped me get to where I am, but for Lumin in particular, Andrew Burroughs has been one of the most influential. Andrew serves as Innovation Director at Healthy Minds Innovations and a Board member at Delta Institute, a Chicago-based nonprofit that collaborates with communities to solve complex environmental challenges across the Midwest. Formerly at IDEO, Andrew was influential in Lumin’s early product development, and has been a sounding board for advice, a connector, and a cheerleader for the product and approach since the very beginning. Andrew’s contributions are immeasurable, but his breadth and depth of experience in design and the connections he brings along have been invaluable to Lumin’s continued development.
What are your “5 Things I Wish Someone Told Me Before I Started” and why. (Please share a story or example for each.)
1. You will have trouble articulating what is obvious to you.
Social and environmental problems are complex and are decades in the making, which makes them difficult for lay people to understand. Lumin is hampered by tackling a problem that indirectly helps everyone while directly helping low-income customers. Indirectly, Lumin saves money for utilities by decreasing the carrying cost of low-income customers, which lowers bills for everyone. Lumin helps climate change by engaging a challenging population that is behind on energy efficiency upgrades. It makes low-income customers lives easier, which reduces the social cost of helping struggling consumers. This is simple enough, but in order to see the full value proposition, one needs to understand how utilities are paid and incentivized, how low-income customers experience bill payment, and how taxpayers and ratepayers socialize these costs. Most consumer products don’t have this problem, as the value proposition to the customer and the user are the same. Telling the Lumin story in an elevator speech can be maddening depending on the audience.
2. Talk to your intended audience.
People want to help solve social problems, but they often do so without listening to the people they’re trying to help. I’ve met with many people who have a distorted understanding of the life of a person struggling to survive, and seem to approach these social problems with a “do what I tell you to” solution. Real behavior change requires intrinsic motivation. A lot, though not all, of our social programs are designed to provide a separate track for the poor and struggling as if they are separate from the community in which those who are better off live. I’m constantly amazed by solutions that are developed without ever talking to their intended target audience. Developing simple solutions requires eliminating a lot of the structure that we have put in place as a bandaid for the problem. This is a hard change to make when existing programs are already in place.
3. Progress is slow and in fits and starts, and help is often not direct.
There are many partners who will help you along the way, but none of them will build your product or service for you. Many times they will distract you from doing so. Some initiatives move your business forward, but are not immediately productive. The important thing is to embrace these initiatives as time well spent for the whole business, and not let them feel like they are distractions. There are many times I would rather spend money and time on developing the product further, but I’m instead meeting a need of the business that won’t be relevant until we are scaled. All of these requests for time add up to time not spent on the core product, but they open doors for future development, so they are almost always worthwhile. You get better at telling the difference between what is worthwhile and learning to say no, but early on you take every meeting.
4. You are your own pit crew.
No one knows your product or service, or has the passion for it as much as you do — by a long shot. So you’re going to be doing all of the heavy lifting for a very long time. You will be writing draft legal documents, fundraising, sales, product development, and getting your own coffee. At some point you will need to pivot and start giving up all of this to focus on the mission and vision of the business, but this doesn’t happen overnight. And it may never happen if the business doesn’t scale.
5. Changing assumptions about the population you are trying to serve requires a lot of education and listening.
Lumin is trying to work with a challenging population, low and moderate income customers of utilities, that gets a lot of attention. Unfortunately, it is also looked at as a vulnerable population that requires a lot of oversight and direct assistance. Low-income people have unique challenges, but they do not generally require educated and wealthy individuals to live their lives for them. They need solutions that are designed to solve their unique problems, not one-size-fits-all solutions designed first for engaged and educated populations and then expected to serve the entire population. These populations are also very diverse, and solutions need to take this into account. A low-income senior in a rural area has different needs than a low-income working mother in an urban area. Solutions developed for the ease of program administrators will miss opportunities to engage by not designing for the population they are trying to serve.
You are a person of great influence and doing some great things for the world! If you could inspire a movement that would bring a great amount of good to the world, what would that be? You never know what your idea can trigger. 🙂
I advocate a human centered design approach to product and service development for environmental and social movements. A large amount of work in the environmental and social fields focus on more deeply understanding problems, or involve trying to influence people to care about large complicated problems instead of developing solutions to them. Designing simple solutions, however, is time consuming and expensive, as it requires dealing with barriers that make it difficult for users to act or existing interests that don’t want the current system to change. To make this shift, we need to move resources to programs and policies that eliminate barriers and develop simple solutions and stop focusing on programs designed to influence people. Marketing and communications approaches to social problems work much better when the solution is easy to pick up. Too much of our effort is focused on gaining control, fighting competing interests, or trying to sell people on a sub-par solution because we didn’t spend enough effort developing a better one.
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This was so inspiring. Thank you so much for joining us!