Proving the Business Case for the Internet of Things

Smart grid VC funding trebles in first quarter

Steve Rogerson
May 9, 2017



Venture capital funding for smart grid companies trebled in the first quarter of this year with $164m in 14 deals compared with $46m in six deals in the final quarter of last year, according to Mercom Capital Group.
 
Texas-based Mercom, a clean energy communications and consulting firm, has released its report on funding and mergers and acquisitions activity for the battery storage, smart grid and energy efficiency sectors for the first quarter of 2017.
 
Venture capital (VC) funding – including private equity and corporate venture capital – for smart grid companies increased threefold in Q1 2017 compared with Q4 2016. Looking back to last year, in Q1 2016, $110m was raised in 14 deals.
 
The top VC funded smart grid companies included: ChargePoint, which secured $82m from Daimler, BMW I Ventures, Linse Capital, Rho Capital Partners and Braemar Energy Ventures; Urjanet raised $20m from Oak HC/FT; Pod Point received $11m from Draper Esprit and Barclays Capital; Blue Pillar secured $10m from GXP Investments, Elevate Ventures, EnerTech Capital, Allos Ventures, Arsenal Venture Partners and Claremont Creek Ventures; and Enchanted Rock raised $10m from Energy Impact Partners.
 
Forty investors participated in smart grid VC funding rounds during the quarter with smart charging of plug-in hybrid electric vehicles and vehicle-to-grid companies raising the most.
 
There were seven smart grid M&A transactions in Q1 2017 compared with two transactions in both Q4 2016 and Q1 2016.
 
VC funding for battery storage companies came to $58m in eight deals this quarter compared with $156m in nine deals in Q4 2016. Funding in Q1 2016 was lower with $54m raised in ten deals.
 
The top VC funded battery storage companies were: Primus Power, which raised $32m from Success Dragon, Matador Capital, Anglo American Platinum, DBL Partners, I2BF and the Russia Kazakhstan Nanotechnology Fund; NRStor received $8.4m in funding from Labourers’ Pension Fund of Central & Eastern Canada (LiUna) and NRStor founder, chairman, and CEO Annette Verschuren; Ioxus raised $6.5m in funding; and Faradion raised $3.95m in funding from Mercia Technologies, Finance Yorkshire Seedcorn Fund and Haldor Topsoe.
 
Fifteen investors participated in battery storage funding this quarter with flow battery companies raising the most.
 
There were two debt and public market financing deals in battery storage during the quarter totalling $22m compared with $55m in two deals in Q4 2016. There was one battery storage project fund announced in Q1 2017 for $152m.
 
There were two battery storage project funding deals in Q1 2017 that raised a combined $5m compared to one deal that was undisclosed in Q4 2016. There were no battery storage project funding deals in Q1 2016.
 
There was one M&A transaction involving battery storage companies in Q1 2017. In Q4 2016, there were two M&A transactions. In Q1 2016 there were two transactions.
 
Energy efficiency technology companies increased VC funding to $213m in 14 deals in the quarter compared with the $170m in five deals in Q4 2016 and $211m in 14 deals in Q1 2016.
 
The top efficiency deals included: $100m raised by View (formerly Soladigm) from TIAA Investments, an affiliate of Nuveen; the $65m in funding raised by Kinestral Technologies; $15m raised by Sense from iRobot Ventures, Shell Technology Ventures, Energy Impact Partners, Capricorn Investment Group, Prelude Ventures, CRV and hardware accelerator Bolt; and SparkFund raised $7m from Energy Impact Partners and Vision Ridge Partners.
 
Twenty-two investors participated in VC funding in the quarter. Within the sector, Efficient home and building companies brought in the most funding.
 
Debt and public market financing for efficiency companies fell to $301m in three deals this quarter compared with $928m in five deals in Q4 2016.
 
There were four M&A transactions in the efficiency sector this quarter compared with two in Q4 2016. There were three M&A transactions in Q1 2016.