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Why Bloom Energy's Business Model is so successful?

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Bloom Energy’s Company Overview


Bloom Energy is a leading provider of breakthrough solid oxide fuel cell technology generating clean, highly-efficient on-site power from multiple fuel sources. Founded in 2001, the company is headquartered in San Jose, California. Bloom Energy's energy servers, known as "Bloom Boxes", are compact, modular, and can be tailored to any electric power requirement. They are designed to provide uninterrupted, 24/7, reliable, and resilient power while reducing greenhouse gas emissions. The company serves a wide range of industries including data centers, manufacturing, retail, healthcare, and education, among others.

Bloom Energy's business model is centered around the production and distribution of its energy servers. The company designs, manufactures, sells, and installs its systems to commercial, industrial, and utility customers through direct sales force and leasing partners. The company also provides services such as system installation, ongoing maintenance, monitoring, and repairs. This integrated approach allows Bloom Energy to provide a comprehensive energy solution to its customers, ensuring high levels of customer satisfaction and loyalty.

The revenue model of Bloom Energy is multi-faceted. The company generates the majority of its revenues through the sale and installation of its energy servers. Additionally, Bloom Energy earns revenue through long-term service agreements, where they provide ongoing maintenance and system monitoring services for a recurring fee. The company also gains revenue through its leasing program, where customers lease the energy servers over a fixed period. This diversified revenue stream ensures a steady flow of income and allows the company to invest in continuous research and development, further enhancing its product offerings.

https://www.bloomenergy.com/

Headquater: Sunnyvale, California, US

Foundations date: 2001

Company Type: Private

Sector: Energy & Utilities

Category: Energy

Digital Maturity: Digirati


Bloom Energy’s Related Competitors



Bloom Energy’s Business Model Canvas


Bloom Energy’s Key Partners
  • FuturaGene also a subsidiary of SLC Agricola extended and expanded a collaboration and license agreement with Monsanto (2007)
  • The two companies agreed to establish a joint venture (JV)
  • to develop and commercialize biotech crops in Brazil (2008)
  • Large retailers such as Wal-Mart
  • Coca-Cola
  • Staples and more recently X2 Resources are using Bloom Energy servers
  • Intel
  • Apple
  • Google
  • EBay
  • Wal-Mart
  • Coca-Cola
  • Microsoft
  • Disney
  • FedEx
  • Staples
  • AT&T
  • Target and Bank of America
  • The Bloom Server has been adopted by several major corporations
  • Including Wal-Mart
  • EBay
  • Staples
  • AT&T
  • Google and FedEx
  • Alibaba
  • Cargill
  • Dupont
  • Capital One
  • Sales partnerships with GE Energy and Bank of America
Bloom Energy’s Key Activities
  • Product management
  • Operations
  • Design
  • Development
  • Hybrid power generation
  • Electrical power generation
  • Optimization
  • Maintenance
  • Customer Support
  • Clean energy projects
  • Waste-to-energy
  • Commercial sales
  • Procurement
  • Manufacturing
  • Supply Chain
  • Customer Service
  • Field Service
  • Contracts Management
  • Legal
  • IT
Bloom Energy’s Key Resources
  • Extract Use
  • Oxide-based solid electrolyte
  • Bloom Energy process
  • Fuel cell received the Popular Mechanics Breakthrough Award in 2002
  • Bloom Energy was listed first among America's 25 Most Promising Companies by Forbes magazine
  • Bloom Energy Server can withstand high temperatures
  • Bloom Energy has received $400 million of VC funding
  • Bloom Energy operates with a high-powered board
  • Former U.S. Secretary of State Colin Powell and former Secretary of Commerce William Daley serve as directors
  • Bloom Boxes produce 60% less CO2 than a typical coal fired power plant
  • A single cell generates approximately 1 volt of electricity
  • Bloom Energy manufactured Solid Oxide Fuel Cells use all ceramic components as opposed to liquid electrolytes found in typical fuel cells
Bloom Energy’s Value Propositions
  • Bloom Energy changes the way the world generates and consumes energy
  • Bloom Energy servers produce power 24x7 with lower emissions and can reduce your carbon footprint by 50% or more when compared to the grid
  • It offers customers a single point of contact for their energy needs and deliver services more cost-effectively
  • A clean and distributed electricity generation system built on solid oxide fuel Cell technology
  • Bloom Energy Servers provide a highly reliable means of producing electricity that generates fewer greenhouse gas emissions
  • Reliable and resilient energy at a predictable and competitive cost
  • Cleaner and more reliable decentralized power generation that also reduces grid constraints and the financial and energy costs traditionally associated with large power losses during long-distance transmission over electric grid lines
Bloom Energy’s Customer Relationships
  • "Always-on"
  • Constant monitoring to ensure all of its systems are meeting the demanding performance standards that its customers expect
  • Jobs creation
  • Design and manufacturing technology advancements
  • High Performance and quality
  • Enterprise Software Sales (Traditional)
  • Long term contracts
  • Mass consumption
  • Partnerships
  • Wholesale and Retail channels
  • Consulting approach
  • Carbon-neutral
Bloom Energy’s Customer Segments
  • Fortune 500 and other large corporate customers
  • Small businesses
  • Educational institutions
  • Municipalities
  • Government agencies
  • Healthcare organizations
Bloom Energy’s Channels
  • Sales reps
  • Global footprint of direct sales offices and dedicated regional channel partners
  • Website
  • Blog
  • White Papers
  • High-profile marketing and branding activities
  • Social media
Bloom Energy’s Cost Structure
  • Development
  • Production
  • Manufacturing
  • Distribution
  • Operations
  • Facilities
  • Engineers
  • Economists
  • Patent attorneys
  • Component procurement
  • Local industry / outsourcerers
  • Legal
  • Economies of scale
  • Lower maintenance costs
  • Licensing and royalty fees
  • Marketing
  • Taxes
Bloom Energy’s Revenue Streams
  • Sale of Bloom Energy Servers
  • Long-term power purchase agreements
  • Project financing
  • Service contracts
  • Fuel cell installations
  • Lease and PPAs

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Bloom Energy’s Revenue Model


Bloom Energy makes money by combining different business models. Below, you will find the list of the different monetization strategies identified for this company:

  • Energy
  • Lease
  • Signature for rent model
  • Rent instead of buy
  • Direct selling
  • Knowledge and time
  • Corporate innovation
  • Sustainability-focused
  • Technology trends
  • Performance-based contracting
  • Product innovation
  • Solution provider
  • Data warehouses
Analytics


Market Overview
  • Patterns
  • Sectors
  • Categories
  • Companies
  • Right click on the nodes to explore

Bloom Energy’s Case Study


Bloom Energy's CASE STUDY

Introduction

In the fast-evolving energy sector, one company stands out for its unique approach and resilient business model: Bloom Energy. Founded in 2001 and headquartered in San Jose, California, Bloom Energy has redefined how businesses can achieve sustainable, reliable, and cost-effective power solutions. Their pioneering solid oxide fuel cell technology sets them apart in a crowded marketplace, enabling them to deliver cleaner energy with unmatched efficiency. In this blog post, we delve into several compelling case studies that portray Bloom Energy's impact across different sectors, highlighting why they are a game-changer in the energy domain.

Breaking the Mold: Bloom Energy's Distinctive Technology

Bloom Energy's flagship product, known colloquially as the "Bloom Box," represents a revolution in energy technology. Unlike conventional power systems, Bloom Boxes use solid oxide fuel cells to convert fuel directly into electricity through an electrochemical process, bypassing the combustion step. This unique approach not only reduces greenhouse gas emissions by around 60% compared to conventional power plants (Bloom Energy, 2023), but it also enhances efficiency and reliability. A single Bloom Box can generate approximately 200 kW of power, which is sufficient to power a small office building or data center. This modularity allows companies to tailor energy solutions precisely to their needs, making Bloom Energy an attractive partner for large corporations and public sector entities alike. So, why has this technology gained traction so quickly, and who are the beneficiaries?

Case Study: Walmart - Embracing Sustainability Through Bloom Energy

As part of its commitment to sustainability, Walmart has adopted Bloom Energy servers across several of its stores. Faced with the challenge of reducing its carbon footprint while ensuring reliable power supply, Walmart found Bloom Energy Servers as a fitting solution. In 2018, Walmart installed Bloom Energy fuel cells at 20 of its locations in California, providing a combined capacity of 5MW. This installation helped Walmart reduce its CO2 emissions by 47% per MWh of electricity generated (Harvard Business Review, 2018). More than just environmental benefits, the Bloom Boxes provided Walmart with greater energy reliability, enhancing operational efficiency and minimizing downtime. "Our customers depend on us to provide essential goods, and in return, we depend on Bloom Energy to ensure our stores are powered sustainably and reliably," said Jennifer Lohse, Walmart’s VP of Sustainability (Harvard Business Review, 2019). Walmart’s case illustrates the significant impact that Bloom Energy can have on large retail operations.

Case Study: Stanford University - Redefining Campus Energy

Another remarkable instance of Bloom Energy’s success is Stanford University's sustainable energy initiative. Stanford has long been a pioneer in sustainability, aiming to achieve carbon neutrality by 2030. To this end, they incorporated Bloom Energy Servers into their energy strategy to power critical campus operations. In 2015, Stanford deployed 4.2MW of Bloom Energy fuel cells across the campus. This installation provided the university with uninterrupted, clean, and reliable power, reducing the carbon footprint significantly. According to the Stanford Office of Sustainability, the Bloom Boxes have cut down campus carbon emissions by 30% and provide a reliable energy source that supports their academic mission (Stanford Office of Sustainability, 2022). “We chose Bloom Energy for its unparalleled efficiency and ability to deliver a continuous power supply, thereby enabling us to meet our sustainability goals without compromising on performance,” stated Joseph Stagner, Executive Director of Sustainability at Stanford.

Case Study: AT&T - Powering Communication Infrastructure

Telecommunications require consistent and resilient power. AT&T, recognized the potential of Bloom Energy to meet its critical infrastructure needs. Since 2011, AT&T has partnered with Bloom Energy to install fuel cells at 28 sites, powering their data centers and support facilities with clean energy. By 2020, AT&T had installed over 17 MW of Bloom Energy Servers, which have generated more than 207 million kWh of electricity and reduced CO2 emissions by approximately 178,000 metric tons (AT&T Sustainability Report, 2021). This initiative aligns with AT&T's overarching objective to be carbon neutral across its global operations by 2035. "The reliability and sustainability that Bloom Energy provides are core to maintaining the seamless communication services that our customers rely on," said Scott Mair, President of AT&T Operations.

The Multifaceted Revenue Model

Bloom Energy’s revenue model is a testament to their strategic foresight. The core revenue stream comes from the sale and installation of Bloom Boxes. However, they also have diversified income through long-term service agreements for ongoing maintenance and system monitoring, providing a recurring revenue flow. Additionally, the company has a leasing program for customers who prefer to lease the energy servers over a fixed period rather than an outright purchase. This diversified revenue stream has enabled Bloom Energy to continuously invest in R&D, ensuring that their technology remains cutting-edge. According to a market analysis, Bloom Energy allocates roughly 12% of its annual revenue to research and development (Energy Research Partnership, 2022). This investment underscores their commitment to innovation and staying ahead of industry trends.

Conclusion

Bloom Energy represents a paradigm shift in the energy sector, providing a sustainable, reliable, and efficient power solution that meets the diverse needs of large corporations, educational institutions, and municipalities. Through their innovative technology and strategic approach, they have demonstrated the significant impact that clean energy solutions can bring to different sectors. Bloom Energy's case studies of impactful deployments at Walmart, Stanford University, and AT&T stand as a testament to their mission of changing the way the world generates and consumes energy. As we move into a future increasingly defined by sustainability, companies like Bloom Energy will play an ever-more crucial role in reshaping our energy infrastructure for the better. Whether it’s reducing emissions, ensuring reliability, or fostering innovation, Bloom Energy is at the forefront, paving the way for others to follow.


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