Munich Startup: What does your startup do? What problem do you solve?
Marc Schubert, Ecoturn: To further promote the switch to environmentally friendly propulsion systems, electric car owners have been getting additional bonuses since the beginning of this year. Through the annual greenhouse gas premium of a few hundred euros, they receive an additional financial incentive to switch to environmentally friendly propulsion systems. It doesn’t matter whether the vehicle is purchased or leased. As long as you are registered as the owner in the vehicle registration document, you can sell these annually creditable CO2 quotas, for example to mineral oil companies, which can use them to avoid penalty tariffs.
In theory, electric car drivers could also apply for the GHG quota themselves at the Federal Environment Agency. However, since a mineral oil company has a large demand to cover, in practice they only accept large quota quantities rather than picking each individual one. And that’s exactly where our platform Elekrovorteil.de comes in. We take care of the complete processing from applying for the CO2 certificates to paying out the premium.
The process for applicants is simple: you just need to upload your vehicle registration document on the website. From there, Ecoturn handles everything else. During the administrative processes, we check and structure the entries using artificial intelligence – all of course while adhering to the highest data security standards. The service is free of charge for the vehicle owner.
Ecoturn relies on clever processes and maximum automation
Munich Startup: But that already exists!
Marc Schubert: Currently, revenue shares of 25 to 30 percent are standard in the industry. That made me curious about what kind of work justifies retaining a quarter of the sales amount. It turned out that the processes for GHG quota trading are largely analog and inefficient. But if you streamline the processes cleverly and rely on maximum automation, enormous savings potential emerges immediately.
Therefore, a core element of our solution is automatic text recognition, which reads all the information required for application and certification from the vehicle registration document. The algorithm can flexibly handle uncertainties and recognizes, for example, if it’s not a pure electric vehicle, such as a hybrid, whether the vehicle registration document was only partially uploaded, or if it’s the wrong document. In such cases, the formal review is automatically flagged and the customer receives a notification to correct it.
This allows Ecoturn to stand out 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 became aware of this topic during a user survey for a digital project of an automobile manufacturer. We asked electric car drivers about their preferences. One of these e-mobility enthusiasts told me in autumn 2021 that there would soon be an annual e-car bonus. And as co-author and editor of the technical publication “Machine Learning, Real Problems – Practical Solutions, Potentials and Limits of Artificial Intelligence,” I was already intensively familiar with the possibilities of artificial intelligence and deep learning. When new emission control laws were passed, it became clear to us that upheaval was coming in the industry: many new participants, more quota fulfillment through third parties, demand for digital solutions. Out of this motivation, we developed our premium platform.
“Our challenges are mainly on the government side”
Munich Startup: What have been your biggest challenges so far?
Marc Schubert: Our challenges are mainly on the government side. We often notice that the employees of the Federal Environment Agency are committed but hopelessly overwhelmed. Apparently because with too few personnel, practically every application has to be processed by hand. The work of pooling service providers with artificial intelligence meets manual list processing at the agency. We haven’t encountered any meaningful process automation yet. On the contrary: we find an inadequate software situation at the BfG that unnecessarily complicates things for both sides. The storage space for uploads is even so tight that we have to convert all scanned documents to a grainier image format beforehand.
We have great understanding that at the end of 2021, no one imagined that the GHG quota would become such a hit with the beginning of this year. That a federal agency with the resources provided didn’t go all out right away but first wanted to see how the public would accept it is completely understandable. Just as it’s understandable that in late January they still thought they were in an initial rush that would probably die down. But if this rush continues month after month, even grows, and the backlog can’t be worked through anymore, then it’s time for a process change.
“Customers came to us in droves”
It’s high time to significantly advance the automation and digitalization of these processes. The flood of submissions won’t abate anytime soon. However, completed certification of the quotas is a mandatory prerequisite for their marketing. Only when we receive a certified quota bundle back from the authorities can it be traded. The payout is tied to that. That’s why customers came to us in droves. We received dozens of emails daily from frustrated customers who understandably complained about the long wait times.
So we had to do a lot of education work explaining exactly where in the process things are stalling. At the same time, we tried to convey a sense of security. Because after all, unlike other funding programs, the payment is guaranteed – there’s no maximum quota or anything like that which could suddenly be exhausted. We expanded the personal user profile so that each individual process step can be visualized. This creates clarity and transparency. We also proactively engaged in communication. Simply to let people know: “We haven’t forgotten about 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 sensible addition to the business model 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. Therefore, Ecoturn offers, for example, a cooperation model for the automotive trade in which the automotive business can apply for the premium on behalf of the customer. Because the rights to the GHG quota can be transferred as often as desired. The refund of the premium then runs in exactly the opposite direction. This creates exciting new business opportunities.
For us, it’s now about concluding more corporate partnerships. With our software specially developed for this industry, the processes can run fully digitalized and fully automated. Because user-friendliness is key. Only if the process is absolutely effortless, convenient, and uncomplicated will it be accepted by the employee in service. The effort shouldn’t be more than a button press so the process can flow seamlessly into the daily work routine.
Munich Startup: How have you experienced the Munich startup ecosystem so far?
Marc Schubert: Before Corona, I spent six months intensively engaging with the startup scene in Munich. For example, I participated in various discussion forums and tried to make contacts that way. Participation in UnternehmerTUM was wonderfully unbureaucratic, there’s a really cool energy there. I really enjoyed the “Maker Space.”
Ecoturn sees too little support for startups in Munich
I don’t have a comparison to other cities, but my expectations definitely weren’t met. For example, we thought about an open space for a vertical farming concept some time ago and looked for a reasonably central location for it. But if anything was offered to us, it was only far outside the city without foot traffic and at anything but a reasonable per-square-meter price. I think Munich has real potential. Unfortunately, there are far too few subsidies to tap into it. I completely missed startup facilities in central locations – though maybe I just didn’t know where to look?
Munich Startup: Quick exit or playing the long game?
Marc Schubert: This whole thing is 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 an 8-year framework for the GHG quota – I think that’s a nicely manageable timeframe. What directions the business models will develop by 2030 remains to be seen. In any case, we’re witnessing firsthand how the e-mobility support instrument “greenhouse gas quota” is having a direct impact. We receive many inquiries from potential customers who now want to purchase an e-vehicle in part due to the annual e-premium. Witnessing the traffic transition and thus the energy transition up close definitely gives us a pleasant feeling. Ecoturn receives a lot of positive feedback from happy and satisfied customers – we draw a lot of motivation from that.
