Derek’s entrepreneurial energy

AUTHOR: Lachlan Colquhoun   DATE: 20.04.06   ISSUE 1, 2006
Derek Myers has had several offers to either merge with competitors or sell his company, and while that may make sense from a “pure return perspective” it is his passion for running his own business which prevents him from taking that step.

Myers, an AGSM MBA graduate from 1993, operates his company iVentures in the UK and is involved in providing technology platforms for energy trading. iVentures was included on this year’s BRW’s Upstarts list of the fastest growing new companies operated by Australian entrepreneurs.

After setting up and then selling a wholesale electricity exchange for trading between generators and traders, Myer’s new venture is called “BuyEnergyOnline,” which takes the same concept further down the supply chain to trade energy between the supplier and the retail buyer.

Derek Myers operates iVentures in the UK and is involved in providing technology platforms for energy trading.
Photo: Derek Myers

It is a long journey from the financial markets, where Myers began his career in the early 1980s as a trader with Macquarie Bank, but is also part of a logical progression in which the AGSM played a significant part.

“I decided to do my MBA because I was interested in business from a broader perspective than I was seeing in the financial markets,” says Myers.

“And I had always wanted to own my own business and the main driver has been independence, and the desire to do something creative and unconstrained.”

After his full-time MBA, Myers joined the former Andersen Consulting – now Accenture – at a time that energy markets in Australia were following the UK trend for de-regulation.

“I spent five years at Accenture focussing on the energy and gas markets, and dealing with energy trading and risk management issues,” says Myers.

“I was also involved in designing several energy trading and risk management operations for different suppliers and that really introduced me to the whole area of energy trading.”

By this time, Myers had moved to the UK and decided to form his own company to develop the opportunity of the wholesale electricity exchange, and raised 2 million pounds from investors.

"I decided to do my MBA because I was interested in business from a broader perspective."

But a change in the UK regulatory environment impacted on the economic fundamentals of the exchange, which was then sold to a rival in the Netherlands.

From there, Myers fine tuned the concept and launched BuyEnergyOnline - an energy exchange which uses a reverse auction for retail and business users to buy electricity and gas supplies.

“This concept made a lot more sense because every individual and business consumes energy and gas, so there are lots of buyers and still enough sellers for it to be feasible in an electronic marketplace,” says Myers.

“What we’ve had to master is the huge amount of data analysis in the transaction process, because electricity is measured in half hour levels so an electricity transaction takes that into account, and prices are so volatile they go up and down up to several percent in one day.

“So you need an electronic process to turn around the quotes quickly enough and match the orders in real time.”

Myers owns 92 percent of iVentures, which is being gradually wound down and subsumed within BuyEnergyOnline, which Myers believes has significant further growth potential.

“We are probably operating at around 50 percent capacity at the moment, so there is still some potential growth at current spending levels,” he says.

“I still feel that my business is evolving, most developed countries are following the UK competitive energy market model and there is still a lot of scope for new ideas.

“And that’s another reason I want to retain my independence, because if I was to merge or sell I’d give that all away, and its taken several years of perseverance to get to this point.”