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It’s still on: Silver Spring Networks could finally go public within a month

Katie Fehrenbacher — Wed, 30 Jan 2013 01:16:06 +0000

In contrast to the findings of a research note on Tuesday that says Silver Spring Networks could soon shelve its IPO, I’ve been hearing that Silver Spring is actually getting ready to finally go public within the next four weeks, a year and a half after filing its S-1. A delay that long between filing and finally trading is not ideal, but it’s not unheard of for companies to wait through difficult market conditions, particularly as they negotiate pricing.

Beyond discussions I’ve had with sources, in Silver Spring’s latest S-1 Amendment the company notes that longtime investor Foundation Capital now says it plans to purchase $12 million worth of stock at the IPO price, following the IPO, in a private placement. If Silver Spring was planning to shelve its IPO it probably wouldn’t be negotiating this detail with its investor, and also wouldn’t continue to update its S-1 every quarter (it would just withdraw it).

Solar installer SolarCity’s investors used a similar tactic when the company went public last year to try to create interest from Wall Street. SolarCity investors Elon Musk, Draper Fisher Jurvetson and DBL Investors, agreed to buy up about a third of the Solar City float the day before trading, and that helped it get out and pop on its first day. Bankers could take it as a good sign that Foundation Capital is looking to buy up even more shares of Silver Spring.

Silver Spring has continued to grow over the years, despite the fact that selling smart grid networks to utilities is a pretty difficult low margin business. If you only look at Silver Spring’s GAAP revenue and net income it doesn’t look all that amazing, which is what this analyst did. The company hasn’t ever had a positive net income, and it recorded revenue of $147 million for the nine months ended Sept 30, 2012, which was down from $176 million from the same period in 2011.

But if you look at the deals that Silver Spring closed in 2012, and the amount it billed its utility customers for, it actually had a decent year last year. The company recorded billings of $219 million for the nine months ended Sept 30, 2012, up from $183 million for the same period of 2011. Billings are how much Silver Spring invoiced its customers, and they are considered deferred revenue until they can be officially counted as revenue. It had its highest gross margin yet on those billings of 34 percent. The company has a total of $473 million in deferred revenue as of the nine months ended September 30, 2012, and about $60 million in cash for the same period.

That’s the problem with selling gear to utilities. The deals and the sales cycles take a really long time to negotiate from a trial to a commercial deal, and then a long time to see through to the end. We’ll see how comfortable Wall Street is with looking at both its GAAP and non-GAAP financials when it comes to interest in the IPO.

Silver Spring Networks has networked 13 million smart grid devices, and has contracts to network more than 22 million total. The company has a total backlog of $745 million in product and service billings.

Now, we’ll see if over the next four weeks, Silver Spring is able to negotiate and get enough interest to price its shares at the valuation it wants. But from what I’m hearing it’s starting to aggressively try to do just that.

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Chrysalix VCs: Well, we’re making money in cleantech

Katie Fehrenbacher — Tue, 18 Dec 2012 13:00:33 +0000

Not all venture capitalists lost their shirts in the cleantech investing cycle over the past five to six years. Canadian venture capital firm Chrysalix Energy Venture Capital actually put out a press release on Monday noting that it’s latest early stage cleantech fund — which it closed four years ago and which is chock full of young cleantech startups — has seen its collective value go up by 75 percent.

VCs at firms like Sequoia Capital or Andreessen Horowitz might scoff at the call for attention to a positive fund value, but in the cleantech ecosystem a significant positive growth in value is pretty rare. In fact, I’ve heard discussions of cleantech portfolios being waaay, way (way) down in valuation for many VCs’ funds.

Chrysalix put money into 18 follow-on rounds and one new investment in 2012, and the company’s overall portfolio includes startups like nuclear company General Fusion, micro fuel cell maker Angstrom Power, electric scooter company Brammo, solar steam generator maker GlassPoint, and GaN Systems, which makes power conversion chips. Chrysalix’s new investment in 2012 was Axine Water Technologies, which makes clean water technology.

Now that some of the generalist VCs are exiting making cleantech investments, investors that are sticking to their green guns are coming out of the woodwork to throw down their gauntlets. Vinod Khosla says his cleantech portfolio is doing just fine, thank you very much, and he will continue to invest in the space. Others like DBL Investors, which backed both Tesla and SolarCity — two of the most successful cleantech IPOs — clearly have done well (see my profile The Most Successful and Positive Greentech VC You Haven’t Heard of).

Still others that are investing in CleanWeb, or clean IT, continue to be excited about investing in companies that are using IT to manage resources, like energy, food and water. As Mitch Lowe of Greenstart, a digital green accelerator, said on a panel I moderated last month: “Cleantech is dead, like the Internet was dead in 2000.”

Images of Bridgelux and Brammo technologies. Courtesy of Bridgelux and GigaOM.

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SolarCity sets terms for an up to $151 million IPO

Katie Fehrenbacher — Tue, 27 Nov 2012 15:59:59 +0000

Solar installer and financier SolarCity has set the terms of its planned IPO, and says in a filing on Tuesday that it intends to sell 10,065,012 shares at between $13 and $15 per share. At the midpoint of that range SolarCity would raise $141 million, and would have a market value of $1.2 billion. At the high range, SolarCity would raise $151 million.

According to a Reuters report last week, SolarCity plans to go public before the end of 2012. When the company filed its S-1 back in April — which became public last month — it said it could raise up to $201 million. Based in San Mateo, south of San Francisco, and founded in 2006, SolarCity wants to be listed on the NASDAQ under the symbol “SCTY.”

If SolarCity has a successful IPO it could be an important bellweather for venture-backed solar and next generation energy technology exits. There have been very few in 2012 — for example, solar project developer BrightSource ditched its planned IPO because it wasn’t getting the valuation it wanted. But SolarCity has been able to benefit from the drop in cost of solar panels.

SolarCity recorded $59.55 million in revenue and $73.71 million in net losses in 2011, compared with $32.43 million in revenue and $47.07 million in net losses in 2010. For the first six months of this year, the company posted $71.42 million in revenue and $48.91 million in net losses.

SolarCity raised $200 million in venture funding, and its investors include Draper Fisher Jurvetson, DBL Investors, Generation Investment Management and Tesla Motors’ CEO Elon Musk. This would be the second large IPO for Musk’s investments, following Tesla.

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Smart window startup Soladigm emerges from stealth as View

Katie Fehrenbacher — Mon, 12 Nov 2012 13:00:03 +0000

A venture capital-backed startup making smart window systems is officially emerging from stealth on Monday after five years of working on its technology. Soladigm has now renamed itself as View, and its CEO Rao Mulpuri tells me the company has begun commercially selling its dynamic windows that can be tinted on demand by an iPhone or control panel.

In timing with the GreenBuild conference this week in San Francisco, View is also showing off its first pilot installation at the W Hotel (see photos). The window in the W Hotel will be in the lobby, and it will be installed by Monday, if you want to go check it out.

The technology used for View’s windows is called “electrochromic,” where a low-voltage electrical current is applied to the window to change the color of the window to reflect or absorb light. The tinting effect can cool or warm a room, and save energy by cutting down on air conditioning or heating. Mulpuri tells me that View’s windows can save 20 percent of the costs off of a heating and cooling system, 20 percent off of lighting, and can reduce peak load (electricity at peak times of use) by 25 percent.

There’s a few other companies working on electrochromic windows, like Sage Electrochromics which was bought by Saint-Gobain this Spring. The big issue with electrochromic windows, is making the economics work for the customers. The window systems themselves are obviously a premium product over, say, window blinds, which have a similar shading effect. Mulpuri would only say the windows cost two times over a standard system for residential installations, and potentially 50 percent more for commercial installations.

But when the long term savings are considered, the window systems can pay for themselves over time, and can also be cost effective at the start in an overall system by enabling features, like, say, a smaller heating and cooling system to be installed. The windows also have a high-end design and aesthetic effect, and have novel functions, like being able to be tinted using an iPhone app.

View makes its windows by sputtering an atomic layer, 1 micrometer thick, of the electrochromic material onto a pane of glass. The layer is then sandwiched by another pane of glass. The layer is made of tungsten oxide for its initial product, and View licensed this technology from Lawrence Berkeley National Laboratory.

View has raised about $125 million from DBL Investors, GE, Khosla Ventures, Navitas Capital, Sigma Partners, and The Westly Group. The company has been working on this technology for five years, which shows how much funding and time it takes some of these clean technology startups to scale to commercial production. The window systems are being made in View’s factory in Mississippi.

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BrightSource actually raising $130M for solar thermal

Katie Fehrenbacher — Fri, 09 Nov 2012 17:27:18 +0000

Last month solar thermal startup BrightSource announced it had raised a massive $80 million in equity. But in addition to that $80 million, the company is also looking to close on another $50 million according to a filing, which would bring this latest round to $130 million. That’s huge and would bring BrightSource’s total funding raised to date to $665 million.

As I previously pointed out, it’s pretty rare these days that a cleantech startup can close on such a large round — investors are far less willing to put big rounds into cleantech startups in 2012 (see GigaOM Pro’s Q3 wrap up). But some cleantech startup outliers — able to raise sizable rounds — are still out there.

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BrightSource develops solar thermal plants and its design uses fields of large mirrors to concentrate sun light onto the top of large towers. The tower has a boiler at the top that heats liquid, which in turn runs steam turbines and produces electricity. BrightSource is building a solar farm called Ivanpah near Las Vegas on 3,600 acres, and currently has 2,100 workers installing about one mirror a minute onto poles in the desert ground.

BrightSource’s investors include power company Alstom and venture firm VantagePoint Capital Partners, and additional investors included DFJ, CalSTRS, DBL Investors, Goldman Sachs, Chevron Technology Ventures and BP Ventures.

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Green jobs are growing the fastest in red and swing states

Katie Fehrenbacher — Mon, 10 Sep 2012 15:49:54 +0000

While negativity about green jobs, and the zombie that is Solyndra, are being used as political fodder for the election year, it turns out that traditionally Republican and swing states are actually showing some of the most growth in jobs from the clean power and energy efficiency sectors. That’s according to a new report from a cleantech-focused venture firm in San Francisco, DBL Investors, who have backed Tesla Motors, solar thermal company BrightSource and solar installer SolarCity.

Out of the ten states that are showing the fastest growth in green jobs, four of them are Republican-led and four are swing states — only two are Democratic-leaning.

Out of the ten states with the largest percentage of green jobs, out of the overall workforce, six of them are Republican-led, while one is a swing state.

Seven of the 17 states with the fastest growing amount of green jobs are swing states.

The total numbers of green jobs is sizable in states with the largest populations, regardless of political affiliation:

All of these green jobs figures indicate that on a state and local level, green jobs are not such a politicized issue. Jobs are jobs. Republican Governors, like former Mississippi Governor Haley Barbour, Kansas Governor Sam Brownback, New Jersey Governor Chris Christie, Louisiana Governor Bobby Jindal, Texas Governor Rick Perry are actively highlighting the economic and job-creating potential of the clean power and energy efficiency industries in their states. And the green jobs backlash, that is being touted in Presidential campaign speeches, is more a Capital Hill, election-cycle issue — not a state and local issue.

The report concludes: “We need to hear less from Capital Hill, and more from Main Street.” That’s good news for cleantech entrepreneurs, who might be getting down from all the negativity in the election season. If your company, or sector, can create jobs, you’ll still have some state and local support.

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The latest venture play: composting

Katie Fehrenbacher — Wed, 25 Jul 2012 18:28:42 +0000

It all started with a breakfast buffet and some leftover French toast. That was when Dan Blake, the CEO of composting soil startup EcoScraps, says he realized he wanted to make a business off of collecting food waste and turning it into something useful. Two years later, this week, the company announced that it’s raised a series A round of $1.5 million from Utah venture firm Kickstart, Silicon Valley’s DBL Investors (the fund behind Tesla and BrightSource), and Peterson Partners, also in Utah.

Blake tells me that the funds, and the company’s efforts, are all focused on 2013 — that’s when EcoScraps hopes to move beyond the West Coast and set up distribution and business across the U.S. The company wants to open facilities for making its compost mix in Texas, New Mexico, up the East Coast, and across the South and Southwest.

The company doesn’t disclose the volume of compost mix and soil that it currently produces, but Blake said that its current revenues are three times bigger than they were a year ago, and the company’s products are being sold in at least 200 Home Depots. EcoScraps’ current three facilities — in Arizona, California and Utah — are composting over 100 tons of food waste per day.

The company’s business model is pretty simple. Third-party haulers, like Waste Management, collect food waste from grocery stores and farmers — mainly fruits and vegetables, but anything that’s not dairy or meat — and take it to EcoScrap’s facilities. EcoScraps charges them less than other sites that accept waste.

Within their plants, EcoScraps has developed a composting method that takes under a month, compared to other process that can take three to six months. At the end of the composting time, EcoScraps then packages up the mixture with its unique brand and sells it at big box retailers.

The company’s tag line is “no chemicals, no poop,” and it works just like other mixes that gardeners buy to add nutrients and promote plant growth. The compost mix and soil is a premium product that is being sold for an average middle-market price point, says Blake. Just because it’s green doesn’t mean it has to be more expensive.

But venture-backed EcoScraps is competing head-on with some of the gardening industry’s largest companies. Scott’s Miracle-Gro has around $3 billion in worldwide sales and a quasi-monopoly on garden nutrients. That means EcoScraps will have to be a solid marketing company, too, in order to convince customers to buy its mixture over its gorilla competitors.

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Soladigm raises $55M for smart windows

Katie Fehrenbacher — Mon, 25 Jun 2012 15:27:12 +0000

Updated: Soladigm, a startup that makes windows that can be tinted on demand, has raised another $55 million, bringing the company’s total funding to $125 million. Soladigm’s investors include DBL Investors, GE, Khosla Ventures, Navitas Capital, Sigma Partners, and The Westly Group.

Soladigm has been building a $130 million window factory in Mississippi, which was supposed to start shipping windows in the first quarter of 2012. It’s unclear if the company has started shipping its windows yet, but I’ll update this if I hear more from them. I would speculate that this funding will go toward helping the company move into commercial production. Update: A Soladigm spokesperson says the company hasn’t begun commercial production out of the Mississippi plant yet, but is on track to do so later this year.

Founded in 2007 and based in Milpitas, Calif., Soladigm makes electrochromic windows, which change colors to reflect or absorb light when a low-voltage electrical current is applied. The tinting effect can cool or warm a room, and save energy by cutting down on air conditioning. The Department of Energy has noted that electrochromic windows can cut a commercial building’s air conditioning costs by up to 20 percent per year.

The company uses a thin-film deposition process to create conducting layers between two panes of glass for controlling the amount of light and heat that pass through. The secret sauce to the window is the materials used to make the electrochromic layer. Soladigm is using a tungsten oxide-based electrochromic layer for its initial product. Soladigm has licensed technology from Lawrence Berkeley National Laboratory.

The big challenge for popularizing electrochromic windows is cost. Electrochromic windows can fetch around $100 per square foot, while windows with reflective coating already are widely available and cost far less. Soladigm has declined to disclose its manufacturing costs.

Soladigm competitor Sage Electrochromics, was acquired by French glass and construction giant Saint-Gobain earlier this year. Saint-Gobain had long been an investor in Sage.

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Tesla’s Model S electric car is finally here

Katie Fehrenbacher — Fri, 22 Jun 2012 07:10:05 +0000

Customer rides of the Model S Beta

Tesla Motors investor, and DBL Investor Partner, Nancy Pfund has been waiting about three years to get her Model S electric sedan. Her model is one of the elite Signature series, with a unique red paint job, and the largest battery range available at 300 miles. Pfund is one of a group of customers that will receive their Model S cars during a big media event at the Tesla factory in Fremont, Calif. on Friday.

Pfund and her firm backed Tesla back in 2006 and has seen the company’s ups and downs over the past six years. So it’s pretty exciting for her that the cars are finally here and are reaching customers. She plans to drive her Model S off the factory floor for the first time on Friday, and potentially up North to the Napa Valley area with her family. “It’s amazing how Tesla has really captured the imagination,” says Pfund in an interview in her San Francisco office this week.

The Model S is a crucial car for Tesla. It represents the company’s chance at profitability as well as its goal to be a more mainstream auto maker.

The basic Model S costs $50,000 (after federal tax incentives) and has a 160 mile range, while the higher-end Model S can cost $100,000 for a close to 300 mile range. Tesla plans to ship 5,000 Model S cars this year and 20,000 in 2013, and the company has 10,000 reservations for it. Just 8,000 Model S cars sold by 2013, could lead to the company turning a profit for the first time.

As an investor, Pfund wanted to support Tesla early on and was interested in buying Tesla’s first car the Roadster. However, Pfund says her husband is 6 foot 7 and just didn’t fit comfortably in the Roadster, and in addition, she says the $100,000 sports car just wasn’t practical for her family and two children.

But Pfund knew she wanted to put a reservation down for one of the first Model S cars early on. She tells me: the Model S is “a pivotal icon,” for the electric car industry.

If you’re interested to know peoples’ impressions of the Model S, Tesla and electric cars in general, check out our GigaOM Pro research report (subscription required), including results from a survey of GigaOM readers.

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UPDATE: Solar startup Solexant raises $30K, but future unclear

Ucilia Wang — Wed, 14 Mar 2012 18:22:32 +0000

UPDATED: Solexant, a solar thin film startup that once plotted to build its first commercial-scale factory in Oregon, has quietly raised a $30,000 ~~million~~ round.

The new equity round, according to a Securities and Exchange filing from last month, followed the $23.47 million round that the Silicon Valley company raised last summer. Solexant, which set out to make solar cells by depositing cadmium-telluride nanocrystals on rolls of metal foil, hasn’t said much about what it’s been up to since a new CEO, Brad Mattson, took over last year. We briefly caught up with one of Solexant’s board members, Cynthia Ringo, a managing partner at DBL Investors, on Wednesday. Ringo confirmed the new funding and said the company is sorting through options on how to bring its technology to market.

The company was supposed to build its first commercial factory, a 100MW project, in Oregon. The state announced a $25 million loan and $18.75 million in tax credits for the factory, to be located in Gresham, in 2010. But the company missed technical milestones and didn’t take some necessary financial steps to start using the loan, a state official told the Oregonian last July.

Ringo wouldn’t comment on what Solexant plans to do with the new $30,000 ~~million~~ round yet, and said, “It doesn’t behoove us to talk about a lot now because we are not selling in the market right now.” She referred questions to CEO Mattson, and we will update the post if we hear back from Mattson.

Solexant’s technology is based on research from the Lawrence Berkeley National Laboratory. The company was founded in 2006, when the price of silicon was expensive and investors were pumping lots of money into startups that were investigating alternative and cheaper materials for converting sunlight into electricity. Cadmium-telluride and copper-indium-gallium-selenide (CIGS) became two popular choices.

The success of First Solar has made cadmium-telluride an attractive choice, and many startups have hoped to become an alternative source of supply for cadmium-telluride solar panels. But none has taken off in the market as quickly as anticipated. Abound Solar, after securing a $400 million federal loan last year to add production, announced a suspension of production and layoffs so that it could modify the factory equipment to roll out a new product. Meanwhile, GE has announced a 400MW factory to take on First Solar, and the energy giant’s entry doesn’t bode well for smaller players who don’t have the same financial muscle and production scale.

I caught a presentation by Solexant’s co-founder and previous CEO, Damoder Reddy, at a Dow Jones conference in December 2009. Back then, the company had completed a 2 MW pilot line and raised $22.5 million. It then raised at least a $41.5 million round in 2010.

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