And it’s a nice reminder. After all, customers of the group buying service — similar to Groupon — can tap into deals that make the switch from their current electricity or gas provider more appealing.
As we reported in February, the company could save customers $100 per year or more, according to a quick test we ran on the website comparing the price of energy through PECO.
The service provides deals to customers by allowing them to purchase energy from wholesalers in groups, which can earn them a better deal then if they went it alone.
The company has marketed 18 offers so far, and 95 percent have brought the highest discount for its user base. The company’s footprint currently covers all of Pennsylvania, and it will soon be moving into New Jersey and parts of New York state. The company was recently awarded licenses as brokers of energy in those states, which gives it permission to sell energy with its group buying model.
As it enters new markets through the summer, it will ramp up efforts to raise a Series A round of venture capital funding.
John Raisch, Co-founder and Chief Product and Marketing Officer says that the company is still running lean in Paoli, with 5 full-time employees and an investment from angel investors and the company’s Co-founder and President Kevin Johnson, a serial entrepreneur.
“We’re making good progress, we have a sustainable flow of funding, and we plan to really take this to the next level,” Raisch says. “By the fourth quarter, we should be in about 80 percent of all the deregulated states in the U.S.”
Across the country, 15 states have deregulated electricity utilities and 19 have deregulated natural gas, allowing customers to choose which energy provider they pay for. All in all, there’s a market of 50 million new residential customers in energy market, Raisch says.
If things go as planned, company executives are looking at other monthly bill categories, like mobile phone plans, internet service and insurance plans. The company is honing in on non-discretionary spending, which, according to U.S. Bureau of Labor Statistics, accounts for 37 percent of spending in households.
“Our focus is to be the only group buying company that helps customers save money on things they buy every month,” he says.
But Raisch says that AlphaBuyer is differentiating itself. “At the end of the day, those businesses are incentivizing people to spend money. They’re not helping to save money,” he says.