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The startup’s growth shows how LEDs are breaking through in the industrial and commercial sectors. That’s because LEDs can save building owners money over the life of the systems, because the lights are more efficient and customers pay smaller monthly electricity bills than they would with traditional lighting. Digital Lumens says it is now saving some of its customers more than $25 million per year.

In contrast, LEDs are moving more slowly into homes, because the cost savings over time aren’t that attractive (or apparent) to the average home owner. A new LED bulb, like the one from Philips, costs $25 compared to a few dollars for a compact fluorescent bulb, or under a $1 for an incandescent.

Industrial building owners also benefit from the LED management systems that Digital Lumens sells, and the company wirelessly networks its lights and uses sensors to dim them in areas of the building that aren’t being used. The startup uses LED components from Cree, and designs its own lighting system and develops the lighting management software.

Digital Lumens also has a lighting as a service business that it’s developed and is launching this year. The company is backed by investors Black Coral Capital, Flybridge Capital Partners, and Stata Ventures.

Venture investors put far less money into cleantech startups in 2012, and that trend will likely continue in 2013. Most companies that are still able to raise funds are maturing companies that are showing growth, like Digital Lumens. And energy efficiency (like LEDs) is one of the sectors that VCs still seem to be willing to fund.

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The funding was led by new investor VantagePoint Venture Partners and also included existing investors Black Coral Capital and Mass Green Energy Fund. According to a filing, the company is still looking to raise another close to $6 million.

Next Step Living is billed as a one-stop shop for making buildings more energy efficient. The company’s 330 workers do audits, answer questions and help customers figure out if they want to buy things like high efficiency windows, install solar panels, or upgrade their home insulation. The four year old company has worked with large companies like Raytheon and Staples to reduce help them connect with their employees about reducing their energy consumption (Updated).

Energy efficiency is still an area that is drawing some interest from investors. When buildings are made more energy efficient, the building owner can save money on an energy bill over time. Next Step Living’s business model is also pretty capital efficient as it just needs to invest in the best way to connect people with energy efficiency tools.

Solar installers are increasingly looking to move more into the home energy audit space, and soon-to-go-IPO company SolarCity has been investing in growing its energy efficiency services.

Image courtesy of Chewonki Semester School.

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“Free has been a competitive factor in a lot of industries, and we think it makes sense in our industry,” said Noesis CEO, Scott Harmon. To use Noesis’ service, building owners or managers input their energy data and in return receive regular reports that show consumption trends and comparisons among buildings they own or manage.

The company recently completed a trial offer of its service, and Noesis says the free service has signed up owners of over 4,400 buildings that cover 380 million square feet internationally. Customers that have registered included hotels, school districts, colleges, restaurants, a drug company, a bank and a chip maker. Those building owners tend to track the energy use of multiple properties – some of which are located in different cities and states.

Noesis hopes the free leads to potential paying customers. Noesis plans to make money by licensing its software and service that provides detailed analyses and modeling of energy reduction plans – from budgeting to returns on investments. The service also can help building owners measure and validate the results of energy reduction projects.

Noesis also charges a fee for finding and uploading energy data for building owners who don’t want to do that in order to get the free or for-fee analytics. In addition, the startup charges fees to companies in the building energy management field — from lighting and sensor sellers to energy audit software developers — that want to advertise their services to Noesis’s registered users.

Building owners who want to save money on electricity are in luck. There’s a wide range of option for tools and startups that will conduct energy monitoring, forecast and management. Some startups focus on using energy data and modeling to provide forecasts while others are employing sensors and computers to reduce the energy consumption of appliances and industrial equipment automatically in order achieve energy reduction goals.

Harmon said he’s found that building owners mostly don’t want to cede the control of tweaking energy use to machines. Some of them don’t trust that the technology will be intelligent enough to reduce energy use without compromising, say, their hotel guests’ comfort.

“It sounds great on paper: if we control the lights then you can save 10 percent. But it’s their building, and they don’t want a cloud gadget controlling the temperatures for their occupants,” Harmon said.

The name Noesis is a Latin term for “understanding through the intellect or reason,” Harmon said. The company chose it to note its aim to use reason and analytics to understand data, he said. The startup received its Series A funding of $6.5 million last year and closed the Series B of $8 million this year. Its investors are Black Coral Capital and Austin Ventures.

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The syndicate’s structure allows the 11 families and their own money managers to pool their knowledge and resources in making investment decisions. Black Coral, for example, makes investments on behalf of one family. Other families have their own money management, which they had in place before the syndicate, said Rob Day, a partner at Black Coral.

McNally and Black Coral will play a key role in bringing deals before the families, but they won’t be the only investors working with the group. One of Black Coral’s advisors is Michael Ahearn, the current chairman and former CEO of First Solar. The group declined to the disclose names of the families.

The syndicate will consider investments in a wide variety of cleantech segments, including energy efficiency, energy storage, solar, chemicals from renewable sources, water, biofuel and recycling, and will invest in both early and late stage deals, Day said. Mostly the investments will be done in companies in North America.

The families and their investment managers don’t have to agree on every deal presented to them and can instead choose which ones they want to place their bets on. “There are a lot of startups that need corporate capital, but they also need project financing, yet the project financing community sometimes view them as too early,” Day said. “We have the flexibility to play multiple roles under the same company.”

These families already were actively investing in cleantech before forming the syndicate. Some have been developers of wind farms and rooftop solar projects while others have founded solar technology companies. The group also includes real estate and fleet vehicle owners who are interested in fuel efficiency technologies.

The investment flexibility of family funds sets the syndicate apart from venture capital firms, which tend to go after high risk, high reward early stage companies. VCs typically expect five to ten times in returns on their investments within a certain period (around seven years). But after years putting money in the cleantech space, many VCs have learned that the amount of capital and time it takes to nurture a startup is a lot greater than they expected. Many greentech startups have run out of money before they could complete technology development, or haven’t been able to raise capital from banks or other investors for building a needed factory, refinery or power plant to start selling their products.

There has been a lot of soul searching in the greentech investing community over the years, and some VC firms have toughened their selection processes, narrowed their investment focus or just plain fled the sector. New investment funds have cropped up to target companies that need later-stage capital for bringing their products to the market. Earlier this year, Silver Lake announced it was launching a new fund, with money from billionaire George Soros, that aims to finance the build-out of more proven technologies worldwide.

With this new syndicate model, the family investors don’t have to follow certain rules that venture capital or institutional investors follow, like the same aggressive investment return goals, which often put pressure on finding exits through an initial public offering or sales. Family investors can consider lower-return, but also lower-risk, investments like financing renewable power project construction.

At the same time, these types of family investors are looking for more guidance about investing in greentech. They don’t always have a large cadre of money managers and researchers, and they don’t always network with each other partly to protect their privacy. As a result, they often follow the VCs’ lead, focus on angel investments, or simply avoid early-stage cleantech investments. With the syndicate, the families, whose collective net worth is over $30 billion, can share resources to improve their investment portfolios.

The syndicate is looking for investment partners, and it plans to launch a European Cleantech Syndicate later this year.

Image courtesy of David Beyer via Flickr.

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Digital Lumens brought back existing investors in the round including Black Coral Capital, Flybridge Capital Partners, and Stata Venture Partners, and also raised a working capital line of credit from Silicon Valley Bank. The company has now raised $25 million, and counts customers like Americold, United States Cold Storage, Maines Paper and Foodservice, for its tech that it says can reduce lighting energy use by up to 90 percent.

How does it work? Each lighting fixture has an on-board computer and mesh networking capabilities, allowing the system to adjust to variables such as whether daylighting is available, the state of a neighboring fixture or if a particular work area or machine needs to be illuminated at a set time. The system can also be programmed, and provide data about usage and occupancy to facility managers through Digital Lumens’ energy management system.

For example, at its installation for Maines Paper and Foodservice, Digital Lumens installed its tech in the company’s 460,000-square-foot headquarters, where Maines distributes products ranging from fruit and meat to napkins and plates to restaurants, convenience stores, educational and healthcare institutions. Digital Lumens claims Maines expects to save an estimated 1.7 million kilowatt-hours annually, about equivalent to the electricity used by 200 homes in a year.

Digital Lumens started out under the name GroomLED Inc., and shared space in its early days with Salem, Mass.-based efficiency services provider Groom Energy Solutions. As Groom has noted on its blog, it recruited a small team for the Digital Lumens venture with the goal of developing LED-based lighting systems meeting the high-wattage needs of its commercial and industrial customers. The idea was for an interdisciplinary team to consider optics, thermal, mechanics, power and control, taking an approach that Groom envisioned being “more like designing a computer than metal bending.”

Other networked, smart lighting companies include (GigaOM Pro report, subscription required) Adura Technologies, Cavet Technologies, Easylite LLC, Fifth Light Technologies, Redwood Lighting and others. It could be a massive market. The Electrical Power Research Institute reported that only 7 percent of the U.S. commercial and industrial market have installed lighting control systems of any kind.

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