Written by Jacqueline Leung
City MOGULS: Founder Profiles Series
Stories of strength, growth, and resilience. A spotlight series featuring founders and leaders from across Canada and the US whose stories and experiences will inspire a new generation of entrepreneurs.
A conversation with Stuart Lombard, CEO and Founder of ecobee, a technology company transforming the smart home.
Type “smart home” into Google today and you’ll get a slew of results. You’ll find everything from light bulbs to heaters to security cameras sold by some of the biggest brands in the world, including IKEA and Google.
Type “smart home” into Google 13 years ago and you may have displayed one result. Maybe.
The story of ecobee starts in 2007. The company was started by Stuart Lombard, a former VC partner who found himself making several intentional lifestyle changes to reduce his environmental impact. He outfitted his house with a solar roof, started driving a Toyota Prius, and programmed his own thermostat to save energy while away on vacation, all while thinking how expensive it was to go green.
Lombard ventured on a path over the next decade to help people reduce their environmental impact in practical ways.
Today, ecobee is an industry leader and innovator in home technology that helps consumers save money and conserve energy. It was the first in the world to introduce an internet-connected thermostat back in 2009. Since then, ecobee customers across North America have saved enough energy to take all the homes in Las Vegas off the grid for a year!
It’s not easy being first
It’ll be hard to find a home these days that doesn’t consist of at least one smart home device; the Amazon Echo comes to mind as a common one. But the concept of a smart home wasn’t common until recently, so it’s no surprise that Lombard wasn’t exactly met with open arms when he started pitching ecobee to investors.
“Who gives a crap about thermostats?”
Lombard remembers a lot of rejection and a lot of VCs looking at him with pity. “[One VC] told me ‘life is short, do something else,’” the CEO remembers.
But Lombard didn’t do something else.
“We knew that the business was good because we were able to double our revenue every year,” Lombard said. “There were clearly consumers who wanted this kind of tech.”
Ecobee has since raised over $150M from investors like Amazon and BDC.
But in addition to having to convince investors to back an unfamiliar idea, Lombard was starting a business in a Canadian market that was known for adopting new technology at a slower pace, especially in comparison to its American neighbours.
Lombard advises entrepreneurs who are building something new to focus on customer-led innovation and to spend a lot of time and sales and marketing efforts in the US.
“We always set out to serve the North American market,” Lombard said. “Canada is a great place to build a business, but the speed and flow of communication in the US is really important to learn. [Entrepreneurs should] spend a lot of time in the US because you really have to win in the US if you win at all.”
When your competitors include Google
Since ecobee is consistently ranked a top thermostat amongst smart home competitors, you may not realize that Google and Honeywell are a couple of ecobee’s biggest competitors.
“Some people say having a strong competitor pushes you to be a better company,” Lombard said with a laugh.
So, how do you become a better company than one of the best in the world?
“Obsessively focus on customer satisfaction,” Lombard said. “We used to read comments then put suggestions into our products. Not all customer feedback is as important as others, but if you set a really high bar for customer experience, you’ll win with word of mouth.”
One of ecobee’s core differentiators versus both Google and Honeywell is a feature built from research of customer complaints. When ecobee found that customers were unsatisfied with how their heating and cooling systems left hot and cold spots in their homes, the company created wireless room sensors that measure temperature and occupancy to make it comfortable in the rooms people actually use.
Bottom line, if it’s a market worth having, there will be competitors.
Creating opportunities out of setbacks
Growing up, Lombard’s dad taught him to be self-sufficient; that a person should be able to make anything they need.
“It was hard to be a teenager who just wants to hang with friends and not make something we could just buy at Canadian Tire,” Lombard remembers.
But Lombard’s dad was insistent, and when Lombard was 12, the father son duo built a foldable canoe that still works today.
That canoe would be the first of many things that Lombard would go on to create.
After graduating from Queen’s University, Lombard didn’t know what he wanted to do so eventually started a job with CAE Electronics in Montreal.
“I was really fortunate in that I had the worst boss ever,” Lombard remembers. “If I had a good boss, I may have stayed in that job and never started a company. As I was walking out the door, a colleague said ‘you should really check out this internet thing. I think it’s going to be big.’”
Lombard went on to start and sell two internet companies before joining JLA Ventures as a Partner and later starting ecobee.
“What you perceive to be a setback can be an opportunity,” said Lombard.
For students looking to start a business straight out of school, Lombard says ‘go for it!’
“I had this idea that when I was older I’d know something, but if you’re ready to work hard and can open up a book, start!” Lombard said that resilience and grittiness helped him build a 13-year-old company, “but it’s about the right level. You need enough to push through the challenges, but not so much that you’re willing to live with pain over a long period of time.”
When asked how he and his team stay motivated during tough times, the Founder admits that sometimes he dances around in funny suits.
Also, “we’re on a mission to help people live better. We are a mission-based business that’s having a real impact.”