2017 RMI Research Report

https://www.rmi.org/insights/lumens-as-a-service/

Rocky Mountain Institute (RMI)—an independent nonprofit founded in 1982—transforms global energy use tocreate a clean, prosperous, and secure low-carbon future. It engages businesses, communities, institutions, and entrepreneurs to accelerate the adoption of market-based solutions that cost-effectively shift from fossil fuels to efficiency and renewables.

I've just finished going through all 26 pages of the PDF report from May 2017.

Page 7

"The convergence of technological advancements in and cost reductions of light-emitting diodes (LEDs) and smart lighting control technologies has created a major business opportunity in commercial buildings. These developments now allow service providers to cost-effectively capture new value streams through proven advanced LED lighting retrofit solutions—with both mass deployment of LED technologies and market demonstrations of “as a service” approaches creating high confidence in their performance and financial returns as they are brought together."

Why is this important? On 28 April 2016, Vivid Industrial introduced a recurring ‘Save & Share’ revenue model - the first of its kind in the world. They have now proven their model with big companies like Linfox, Coca Cola, Mercedes Benz and Woolworths etc. - and are now ready to start rolling out the solution in 2017 at scale (hence the capital raising). [http://www.vividtechnology.com.au/downloadfile.php?filename=files/announcements/Announcement 20160428.pdf].

This leads to ongoing sales revenue and long-term client partnerships. Vivid is ahead of the curve for the industry - confirmed by the RMI report (I encourage you to read this for yourself).

"Service providers can more effectively tap into this multibillion-dollar market and create new revenue streams by making a Lumens as a Service (LaaS) business model their go-to-market strategy. With LaaS, service providers can deliver the latest lighting technologies to their clients, funded by the value created from the future energy savings of a lumen-optimized lighting system."

Page 9 - 10

"Due to technological advancements and increasing economies of scale, LED lighting now delivers reliability, enhanced lighting quality, and energy efficiency compared with early products—including the ability to tune LEDs to deliver the specific color temperature that occupants want at high-output lumen performance—along with rapidly declining costs. Thus, LEDs are now a proven and leading lighting option for commercial buildings."

"Wireless technology, digital controls, and decreasing costs are enabling significant multibillion-dollar annual investments in lighting controls, which enable a high level of control over lighting systems whereby every diode can be digitally controlled to deliver optimized lighting performance. The wireless nature of digital controls also means that they can easily be installed without needing new wiring or disrupting existing building infrastructure. These enhanced technological capabilities can deliver additional benefits that, in turn, further enable lighting-performance optimization and position the digital lighting controls market for continued growth, including:

• Daylight harvesting: the use of natural light tooffset electric lighting in perimeter areas through
continuous dimming, which is less disruptive to occupants than other approaches

&

• Occupancy tracking: the use of data analytics and sensing networks to better align occupancy patterns
with lighting schedules"

Go to the Vivid website and you will observe that their unique technology utilises daylight harvesting and occupancy sensors (plus much more) which enables 24/7 operation with more reliability and longevity than conventional lights. [http://www.vividindustrial.com/]

"The LED lighting market alone is anticipated to reach 45 percent growth per year through 2020 and ultimately a $63 billion market size. However, this market opportunity is based on traditional business models for delivering new LED lighting technologies. New business models, such as Lumens as a Service, can both accelerate adoption of LED lighting and expand the overall market opportunity. Service providers offering financing or serving as a key channel for finance providers enable the LaaS business model."

"The LaaS market—when considered alongside loans, capital leases, and operating leases—is expected to grow from $35.2 million in revenues globally in 2016 to $1.6 billion by 2025. However, the potential market is likely significantly larger than forecasted if service providers make LaaS their go-to-market strategy."

-verce