January MWAT AMA — with RED CEO ARMAND
the CEO himself took his time to answer a lot of questions and explain what is going on behind the scenes.
Armand: Hello everyone, how are you doing?
I recently finished my last meeting for today and I wanted to address the concerns raised over the new estimated figures in the WP regarding future development and loyalty bonus.
Community Member: Why was there no earlier communication about the updated whitepaper?
Armand: I agree with you that communication could and should be much better handled. The updating of the WP and the consequent announcement was long overdue. Unfortunately, at this moment, we are in a transition phase and it will take more time until we will find the right people for the job. I guess it’s a good time to tell the community we have two open positions in the PR and Community Management departments and we invite any interested and skilled community members to send their applications here: email@example.com ;
It has something to do with trying to develop a brand new energy ecosystem and at the same time running a 150 employee company and the transition period for the community management
The new figures are only estimations that were reduced after 1 year of reviewing hundreds of franchise applications and after deciding that a worldwide market penetration through new energy businesses would take much longer than anticipated. This is also the reason we decided to “tune” the platform and it’s services for integration with existing energy suppliers and their databases of millions of consumers and producers through specific API’s.
RED has absolutely no intention of reducing the speed of the progress, on the contrary we are on the brink of a global premiere, the launch of the first retail-ready P2P energy trading platform, which is by no mean an easy accomplishment in just over 1 year especially considering all the complexity of linking custom designed CE approved smart meters with custom designed blockchain within a complex energy ecosystem of relations made of consumers, producers, distribution companies, transport companies, balancing responsible parties and suppliers all functioning under existing EU regulations in over a dozen liberalized markets.
We are on the verge of signing a very important partnerships with a Billion Euro corporation that will guarantee the success of the RED Platform in the years to come and we are also preparing for an upcoming STO event wherein light of the possibility to receive institutional investors aboard we felt it’s more prudent to reduce expectations given the information we now know about the market speed of adoption. In short words, we prefer to underpromise and overdeliver than the other way around. I repeat these figures are just estimations and won’t affect the initial KWT release by the company and afterward, the real market adoption and partnership catalysts are crucial for development.
Now for the good news, there is considerable interest amongst producers and consumers to join RED, more so then we can currently handle with our limited RED meter production. Basically, every large consumer we approached is extremely interested to join the platform especially considering the energy market conditions and abrupt price rises in Romania today. RED already has meters installed to several large consumers that will be actively purchasing KWT from the launch of the platform. Amongst them are some of the biggest companies in Romania like PROFI. All our teams, hardware, software, and development are working round the clock to make sure that the platform launch will soon perform smoothly.
Community Member: Hello, Armand.
This is a short summary of questions many community members are interested in hearing answers to.
We would appreciate if you could look into them and answer to the best of your capabilities — thank you!
Questions and answers:
1. Why did you reduce loyalty bonus estimates by 85%? Why are you expecting a slower expansion?
Armand: Please see above
2. What is the status of the energy supply license situation for Spain and Germany? Without these, how realistic do you think the new projections are based on Romania alone
Armand: In Germany, we don’t need a supply license just a notice to the authority and the agreements with the network operator and EIC code so in practice we could start in 2 months to deliver electricity if we found the right management team there
3. What can we expect on Feb 15th? If staking begins then, does the 3-month timer on the initial kw bonus start at the same time?
Armand: the entire team is working to achieve this goal; you can expect a period of 15 -30 days in which you can stake your MWAT for the initial bonus KWT ; a working energy trading platform and exchange; of course this is somewhat dependent on having all the pieces of the puzzle in place including some electronics from China for the meters
4. Do you have plans to hire someone who understands how reactive communities are and how to work with them?
Armand: Yes we are looking to hire
5. If liquidity is a problem, can the 3-month expiry be extended for the initial bonus? I’m guessing the initial bonus kw will be purchased by red, not from donations so there shouldn’t be a problem extending the life?
Armand: Electronics from China for the meters; 5) The initial bonus is energy purchased by RED that will be delivered by suppliers and right now we don’t plan to extend the 3 month period but might change if the liquidity is indeed a problem.
6. How do you know how many KWT can a producer issue and sell on the platform? By smart meter right? What if a smart meter is broken? Then how? Does producer bear the loss? Any solution yet? If yes, what is it?
Armand: Yes by smart meter; if the smart meter has downtime it won’t register the production but for a producer, we are using industrial grade accredited providers like Honeywell, Schneider, Lovato etc….
7. Smart meter with metal housing, what’s the status of the metrological approval & certification?
Armand: We decided to partner with an existing meter producer and will soon have a working deal on the table for faster integration with existing systems and regulations.
8. Hydro plant, solar parks etc
..the acquisition deal is still alive or not? If dead, why? If still alive, pending for what? Status update, please.
Armand: We are focusing on the platform launch and afterward on the STO in order to acquire 100 MW that will all be on the platform.
9. RED platform launch on 15th Feb, is dev team able to cope up with your committed deadline or not? If cannot, please take this opportunity to give us a heads up. Revise it with dev team first and make a proper announcement for the official platform launch date when it’s really really really x1000 ready.
Armand: Everyone is working overtime to make it happen but you can be 100% sure when the countdown timer is visible on the website.
10. We have seen the meter for the big energy consumers, can we see the setup for a general household consumer? We were told it was plug and play?
Armand: For households we have a solution consisting of a DIN rail mounted simple sensor with GPRS communication capacity that you can easily install like a safety in the board.
11. Is there transparency on the platform for everyone to see of total kwt traded?
Armand: Yes all the indicators will be public including the ECF
12. Have you found a new CEO to run your current company so you can concentrate solely on this project?
Armand: Unfortunately not yet but I’m looking so if you hear something let me know.
13. How dependant on an injection of funds (sto) is the project in regards future development?
Armand: It’s not dependent on a funds injection but it’s definitely more desirable to be in a group consisting of institutional funds and renewable asset capacities spread all over Europe.
14. How has the business plan changed and what can we expect going forward from Restart?
Armand: Well this is a really long answer and I think we need too much time for this but the main strategy is to focus first on initial adoption and then refinement of the business model and international launch in Germany and Spain this year.
Community Member: How many meters were produced initially and what is the eta on the next batch?
Armand: 20 medium sized up to 100Kw and another 20 industrial up to 3 MW on the way.
Community Member: 150 employees? that’s more than x3 from 2017. Although a number of actual franchises and clients from 2018 are less than expected in wp. I assume it’s because of the company’s focus on the new blockchain business model integration?
Armand: To be honest it’s an extremely time-consuming business and this is the reason we decided to create a new shareholding structure with the STO that would involve more management and financial resources so that my time is better spent on developing the more scalable business RED.
Community Member: Armand, how are the politics in Romania shaping up? You mentioned an egregious tax that some companies may be harmed by but you may have seen as positive for RED. Is that why big producers/consumers are interested?
Armand: That’s another story that’s keeping us up at nights. The government enacted a special emergency ordinance in the last week of Dec 2018 hitting the banking sector, the telecom sector and increasing a special tax that is due to the National Energy Authority by all the license holders for energy-related activities from 0,1% to 2% of the turnover in a sector where the net profit is between 1% and 2%. Besides shocking the market, this stupid order also erased 2 Billion Euro from the market cap of the government’s own energy companies and thus it’s own expectation of dividends for this year. The measure was purely political dressed up in a populistic way for acceptance by the society but everyone is realizing that all the companies will transpose and indeed they started to do that to the final consumers. Moreover the same order partially reinstates a regulated environment for households electricity supply but it’s not sure if the regulated conditions will be cheaper then the market and limits the producer gas price (the price at which suppliers like us buy gas) at almost cost level making local gas producers rather burn their gas in power plants then deliver to the market. My opinion is that the EU Commission will declare infringement over these measures as they are not consistent with EU competition regulations and state aid regulations.
Community Member: Funny, some politicians in Croatia painted it as a good move, as it supposedly is only taxing foreign companies sucking money from Romania.
Armand: Something dangerous is happening in the world as an effect of the 2007 financial crisis namely the rise to power of nationalism socialists even in developed countries in a way very similar to what happened before WW2.
And we see the brutal intervention of the state in the free markets even in EU countries.
I have no idea where this is leading us, I just hope people today are smart enough to not fall in populistic traps.
Community Member: Wow, okay. In short, do you see this issue (if unresolved by the EU Commission) as a significant impediment or setback?
Armand: From a supply volume point of view PARETO’s law applies meaning 80% of the consumers (households) bring only 20% of the volume, the rest being corporate consumption so I don’t see this as a setback for the platform but it’s wasting our time in finding strategies to overcome possible risks.
Community Member: Hi Armand! Who was responsible for previous wp and estimations inside there?
Armand: The entire team was responsible and above the team myself as the ultimate responsible person.
Community Member: it’s a pity that as a group of professionalists your estimations covered only in 15 % with reality. For a lot of people, it’s a disaster. In any other business, responsible person would be fired for something like this.
Armand: Do you want to fire me?
Community Member: Well as one of your top 50 holders I can only sell my tokens…but answer yourself, according to new wp how good was your work from ICO investors point of view?
Armand: I guess it’s easy to complain from the side when you are not inside the fighting pit but if you want to sell your tokens let me know, I will buy them.
Community Member: yes, it’s just waking up to -80% on projection can be a bit of a rough start.
Armand: I understand but we all want to achieve even more than initially planned and we all have much to gain if we succeed.
Armand: So we are now considering to apply for becoming a last instance supplier like the big 4, ENEL, E-ON, ELECTRICA and CEZ for households as we have an extensive customer care and sales network that can act like info points in all 49+1 counties in the country and thus benefit from the regulated acquisition prices.
Community Member: My question is if you intend to improve communication why not start by letting us know platform will not launch in February.
Armand: I want you to understand that we are not making empty promises, we are striving to make it happen based on the info currently available to us. This is not like launching a website, we are launching a brand new blockchain connected to physical meters.
There 3 teams all working round the clock to launch the platform in February.
If something happens that makes it improbable to launch it on Feb 15th we will let you know and anyway worst case scenario is Feb 28th instead of Feb15th.
Community Member: “I would like to ask if loyalty numbers are FIXED?
I understand, mwat holders would receive less kwt if company underperforms, but what if RED over-performs?”
Armand: They are not fixed. They are just estimations. If the project succeeds they can increase or vice versa.
Armand: We have a really good team today and I’m personally proud of our IT and Meter teams.
We have some of the best software and hardware engineers in Romania working on RED.
So much so that we launched national consortium today led by RED to propose the gov to use the RED Platform to record all meter measurements from the 20,000 prosumers that will receive 100% grant from the state starting with march.
Community Member: How do you see an increase for mwat as long as producers with more than 3 mw cannot join red?
Armand: Produces over 3 MW can only sell their energy in structured products on the energy market OPCOM BUT and it’s a big BUT here, the same producers are selling their energy on the day ahead market and doing financial only deals with traders for green certificates offtake as a hidden discount system and the NEW GOV ORDER makes it impossible to apply the same scheme because of the 2% tax and here’s the catch : RED is developing a type of SWAP contract on the platform to serve this category of producers and all the traders on the market.
Community Member: This swap contract sounds really good! 👏. Will this be a solid answer??
Armand: It’s sort of contract where one party takes a fixed leg and the other a variable leg in a transaction settled on energy market indicators.
Community Member: Armand aim to launch on Feb 14 it is Valentine’s day 😊
Armand: A nice present from Cupid don’t you think?
Community Member: How did the Guinness record finish?
Armand: the little Renault ZOE is in service after then unintended exploration of road Crater by Christian so it’s paused for the next 3 weeks.
Community Member: the whitepaper describes producers donating energy as loyalty to MWAT token holders 1–5%, why would they donate 5% while they can donate 1% or nothing at all? Maybe smart contracts are used for suppliers to bring the energy on the platform and the smart contract guarantees at least 1% to be donated?
Armand: it’s fixed at 5% in the KWT smart contract.
Community Member: We know the team works hard, it’s the lack of communication that leads to negativity etc
Armand: I think the level of communication will be improved after we launch the platform and focus on international expansion, an area where our community will make the difference.
Community Member: I hope so as me and my current boss are looking at franchising a type b in 3 states in Australia running it along with his current business.
Armand: that’s really good to hear but was it the current status of the energy market in Australia? I heard many new suppliers went bankrupt recently? Australia is one of the most important future markets for RED if we find the right partners.
Community Member: I was talking to a friend of mine today who works for Wrigley and as it’s very hot here the demand the other day was really high for electricity they had to shut down there factories for 4hrs cause it was costing them 14k a minute to run.
Armand: Sounds like good breeding grounds distributed for solar and wind in a semi-closed system primarily used for self-consumption
Community Member: Is a franchise for Slovakia still on for 2019? Yes, a good winter with a hydro potential. Is Slovak government on a good side towards RED moving into Slovakia?
Armand: We had Mike B apply for such a franchise but after a careful analysis of the time needed to start and run a new Type A he decided not to pursue it as he did not find industry personnel.
Slovakia is close to Romania and we will be able to expand if we find a partner supplier on the platform.
This is actually the plan, launch the platform and start discussing with suppliers in other countries to offer them the entire ecosystem of meters and platform so that they can deliver the platform in locally. Launch first and scale via API integration with supplier’s billing systems.
Community Member: I can’t stay on but read all answers and appreciate you taking the time.
Understand the communication is what agitates most I assume from sentiment, I know it’s my main concern. Now we have all heard that it will be improved before so I hope this time we will see a change in style.
It’s more positive with good communication than putting out fires when community misunderstands/anticipate or get off on a bad string of comments.
Armand: I hear you but looking back into today’s bonfire I can see many members which I considered to be the kind that asks questions first and shoots later did the other way around. I love hanging out here with you guys and discussing what we can do but the day only has so many hours and there’s a constant daily need for acquiring and evaluating info and making informed decisions that take up 80% of my time. I think you prefer that I use my time for the well being of the platform rather than prevent and stop FUD. How many blockchain energy projects do you know backed up by real leading energy suppliers?
In a more serious note, I’m saying again: WE ARE HERE TO STAY AND MAKE RED A REALITY (although we might rebrand it into something more suggestive :)
No amount of FUD can stop us from preventing our goal so I want to deliver this message to all honest and loyal token holders and community members: don’t fall for false info, trust your reasoning and the achievements we had so far, do your homework on everything related to us and our project!
Community Member: It’s ok to get upset when you feel people are ungrateful. I don’t want you to spend days and hours here, but communication isn’t necessarily that time consuming when it’s done in advance. I understand it takes time to replace. Ref your “inside the fighting pitch” $MWAT is my biggest hold that’s why I want it to succeed and gets passionate in favor of and in some critique, some of us puts a lot on the line too and my only concern is communication. I’m not concerned with revised numbers or platform delays etc and honestly, I haven’t complained much.
Armand: Trust me I’m not happy either with many aspects but I’m working with people and right now our energy is focused like a laser for launching the platform and signing the big deals, afterward it will be focused like a laser for expansion and marketing.
Community Member: How many mwat has red purchased from open market so far, approximately?
Armand: Not enough. We have to buy more
Community Member: My concern is about the sto. What is your main motivation to launch a sto? What will be the relation between early-stage investors (MWAT holders) and sto investors…
Armand: We are considering to offer a discount to STO investors based on the number of MWAT owned up to a 20% discount meaning that up to 20 MM from the 100 MM STO could be purchased with MWAT. Now you do the math :)
Armand: Thank you, everyone, for giving RED the chance to change the world!
I’m really proud of our community and hope to see it increase soon to 1 Million Members
Community Member: Is there something I/we can do to help out? I am not related to the power industry, but if there is a way for me to help you here in the Netherlands then please let me know!
AmaZix: Now that’s what a community is all about. Thank you!
Armand: Not yet, we first have to get the Prospectus and Technology approved by the Maltese Authorities.
As it’s already late and I’m a bit tired I want to wish everyone a good night or day and hope to give you some really good news next week (keep fingers crossed because it might be a doozy)!
compiled by tehMoonwalker with help from MC Ape