Why heat pumps are hot – and what we can learn from energy startup Aira

"How did I end up at a digital heat pump launch event?"

…I thought as I sat down in front of Aira's webinar, where I and others in the media were invited under strict confidentiality to watch CEO Martin Lewerth showcase Aira's new heat pump. The model was about to hit the market in several European countries, including Germany, Italy, and the UK.

My question requires a long answer.

I'm not alone in suddenly taking an interest in heat pumps, an interest I never, ever thought I'd develop (seriously, I've never even known how our house is heated, it's that bad).

From being an unsexy, ugly box that sits in a hidden basement somewhere in our homes, the heat pump has suddenly been brought into the mainstream.

Why, and what can we learn from Aira's hype?

Let's take it from the top.

1. A problem and a solution

Forget that Aira’s founders are already some of the biggest names in climate tech—Harald Mix and Carl-Erik Lagercrantz from Vargas, the Swedish investment firm known for funding green tech giants like Northvolt (electric batteries), H2 Green Steel (now Stegra), and Syre (sustainable materials). What’s more interesting is how they came up with the idea for Aira.

When I interviewed Harald Mix earlier this year, he told me that it all started when they saw how a large proportion of emissions were related to heating in buildings, which made them focus on how to limit emissions from household boilers. That, in turn, led them to consider electric heat pumps instead, which Aira says can reduce emissions by 75% from day one.

2. A market with a deadline

In Sweden, where Vargas (alongside Impact Loop) is based, heat pumps are already commonplace. But across Europe, around 130 million homes still depend on gas or oil boilers. To address this, the EU has set a goal to double the share of heat pumps from 20% to 40% by 2030—an increase that equates to installing roughly 50 million new units.

That’s why Aira has raised capital to quickly acquire companies already specialising in heat pump installations—one each in the UK, Germany, and Italy so far. This strategy also secures Aira’s own direct line to customers, cutting out costly wholesalers and third-party installers.

3. A Blue Ocean

This brings us to Aira’s heat pump, unveiled with a glossy commercial at the big launch event I mentioned earlier. The technology isn’t groundbreaking—it’s still a heat pump, after all—but Aira shows that innovation doesn’t always mean reinventing the wheel. With its self-described “timeless, Scandinavian design in neutral tones, rounded corners, and intuitive light signals,” Aira has crafted a product that truly stands out.

For those who’ve read the classic management book Blue Ocean Strategy (if not, consider it a book tip!), you’ll get the idea.

On top of that, Aira offers Aira Intelligence, a feature that learns a customer’s routines to optimise heating and hot water usage. This unique service, I believe, is a key reason Aira has attracted such substantial capital.

4. Design and Brand Identity

Speaking of design—Aira – like many other Vargas companies – offers a masterclass in using graphic design, colour, shape, and a striking logo to make an impact. It’s something many other companies in the sector could learn from. I’m convinced this attention to design played a big part in Aira’s ability to attract significant capital—imagine if their pitch had just been a clunky PowerPoint in the Verdana typeface.

“At every stage, our design team aimed to create a user-friendly system that anyone can understand and enjoy,” said Kaj af Kleen, Aira’s Product Manager, at the launch.

5. Production and customer chains

For smaller companies, it can be a real challenge to produce a hardware product, build a factory for it, and then handle the full sales cycle. Take Quandify, the water-saving startup we’ve written about: they chose to focus solely on their product, sidestepping the complexities of manufacturing and sales.

Aira, however, has raised enough capital to handle the entire chain themselves. Rather than navigating a series of costly stages, Aira can manufacture its heat pump and sell it directly to consumers.

But they’re not stopping there. With a monthly payment plan and a 15-year warranty, Aira essentially acts as a “heat pump bank,” integrating manufacturing, sales, and financing under one roof—avoiding third-party suppliers and maintaining full control at every stage.

The Bottom Line

Whether Aira will succeed remains to be seen. Competition is fierce (for example listed competitor Nibe, and other hardware brands like Cake and Vässla are stepping up). But with strong funding, EU backing, and unique design and brand advantages, Aira has a lot working in its favour.

One thing is certain: we’ll be hearing a lot more about heat pumps.