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Summary:

The Valley’s fuel cell startup Bloom Energy has now raised over $1.1 billion, according to a report. While Bloom has gotten strong traction, particularly with data center operators, fuel cell manufacturing is difficult and capital intensive business.

Bloom Energy

Silicon Valley fuel cell startup Bloom Energy has raised another $130 million in funding, according to Fortune’s Dan Primack. The latest funding means that Bloom Energy has closed on over $1.1 billion in venture capital funding over its eleven-year lifetime.

There’s a few things you need to remember about Bloom Energy. First, manufacturing fuel cells is a very difficult business, and one that is capital intensive with low margins. Fuel cells take fuel (natural gas or biogas) and combine it with oxygen and other chemicals to create an electrochemical reaction that produces electricity.

Behind the scenes with Bloom Energy's new fuel cell thumbnail

Customers can buy several Bloom Energy servers to deliver distributed power on site at a building, and that can have a lower carbon footprint than grid power. Competitors include ClearEdge Power, which recently scored a deal with Verizon, and the publicly-traded FuelCell Energy.

But Bloom Energy has actually gotten some breakthrough traction in the market over the past couple of years, particularly with data center operators. Apple, eBay, AT&T, Adobe, Google and others have bought Bloom fuel cells (or the power from the fuel cells) for both their data centers and building operations.

Primack reports that Bloom Energy’s latest funding was an extension of a round raised in 2011, at a pre-money valuation of $2.7 billion. The lead investor that put in $100 million wasn’t named, but Primack says that Credit Suisse put in $30 million of the round.

Bloom Energy News: CA Regulators Approve Utility Fuel Cell Projects

Because the fuel cell business is so difficult (read my The pain point for Bloom Energy and other fuel cell makers), Bloom Energy is most likely not profitable even after 11 years. Bloom Energy CFO Bill Kurtz told me that the company was “half way to break even” in the Summer of 2012. Primack previously reported that Bloom’s retained earnings through Q3 2012 stood at negative $873 million, with $113 million left in the bank, and with positive gross margins on a pro forma basis. Bloom has a goal to be profitable in 2013.

Existing investors did not participate in the round, according to the report. Previous investors included Kleiner Perkins, NEA, DAG Ventures and GSV Capital. Bloom Energy was previously working with broker Advanced Equities (like on this round in the Summer of 2012) to raise funds, but Advanced Equities has since shut down. The broker was charged for misleading investors back in 2009 for fund raising for Bloom Energy, was fined and shut its offices.

We’ll be interviewing Bloom Energy’s VP Mission Critical Systems, Peter Gross, and eBay’s VP, Global Foundation Services, Dean Nelson, at Structure in San Francisco next month.

  1. Chris van Loben Sels Monday, May 13, 2013

    Katie –

    My impression has always been that Bloom had achieved a breakthrough level of hype without providing any, um, actual breakthrough? Meaning any big improvement in the economics of using fuel cells. Do you think that companies are getting ROI out of Bloom Boxes, or just buying them as part of “go green” initiatives?

    Cheers –

    –Chris.
    http://selligy.com

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  2. Go Bloom! I’m a big fan! Bloom Energy is to be applauded for innovating. CleanTech Investors should feel good, having taking the risk to invest over 1 billion dollars with Bloom Energy. Here is the next disruptive renewable energy idea. Allen Hydro Energy Corporation (AHEC) is renewable energy startup with a US Patented process for generating large-scale hydroelectricity that does not require a river or lake.

    AHEC achieved a breakthrough with its hydroelectric generating process that reuses the same water inside a 70 Story Building, which requires less energy than is consumed during the generation process.

    AHEC’s technology is portable to the world, scalable to meet nation’s demand, environmentally friendly, doesn’t require fossil fuels, uses proven existing generating technology and will be sold for a flat monthly price to consumers. This Global Warming Solution does not restrict developing nation’s ability to develop, grow and compete. It also solves industrialized nation’s energy problems related to their use of cheap fossil fuels that are causing disasters related to Global Warming. AHEC has a win-win solution for the planet.

    AHEC is seeking seed funds to construct a 7 foot operating model to test and validate our process and relaunch the company as a global renewable energy company. CleanTech investors in Bloom Energy, should take a look at AHEC.

    To learn more, visit our website at http://www.ahecEnergy.com

    Charles E. Campbell, Founder & CEO
    Allen Hydro Energy Corporation (AHEC)

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    1. Jeff Williams Wednesday, May 15, 2013

      Was researching Bloom and found this…

      http://www.breitbart.com/Big-Government/2012/06/21/884-May-Be-Bloom-Energys-Fatal-Number-Fuel-Cell-Efficiency-Federal-State-Tax-Credits

      “Buried deep in the permit application, in Table 1 on page 161 of a 163-page application, was the number 884. On that page, under penalty of perjury, Bloom officially told the world that its energy servers emit 884 pounds of carbon dioxide per megawatt hour.”

      Also buried on page 161 of the permit application is a Table 2 notation that says these 235 “clean” servers would emit 22.56 pounds of volatile organic compounds (VOCs) per day. But Delaware, like other states, regulates VOC emissions at far lower levels (Maryland, for instance, regulates boat repair shops that emit more than 15 pounds per day). Moreover, if the same amount of power had been generated by combined cycle gas turbines, only 0.249 pounds of VOCs would be emitted daily. That’s 90 times less pollution!

      To top it off, because of the Bloom servers’ low efficiency and high capital cost, Delaware citizens will pay Bloom over $200 per megawatt hour of power delivered to their electricity transmission grid. But in January 2012, the U.S. Energy Information Agency said the projected “levelized” cost of electricity over the next 30 years from advanced gas-fired combined cycle power stations is $65.50 per MWH.

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  3. I have followed the Bloom Box since it was reported on 60 minutes several years ago. I have always bvelieved we needed a way to replace our dependency on foriegn oil. I was very excited when the report indicated that a ‘bloom box’ for residential use might be available within five years. That was the last I heard of a ‘home bloom box’.

    Have you heard of any progress in this area?

    Tom Mannix
    Staten Island NY

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  4. Bloom is f’ed for investors in the future having paid Dwight Badger and Company (advanced equities) to raise the money in the past..And given Kliener’s efforts with the US government and Fisker – there will be no bail outs here…Unless Ray Lane cooks his books again…..well done by the high and mighty Kliener Execs…

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