Cost-effective energy storage for electrical grids has been one of the biggest challenges for the power networks that deliver electricity to homes and businesses. Private companies have recently ramped up efforts to develop batteries or “supercapacitors,” enabling for example the use of solar energy at night or the reduction of fossil fuels reliance during peak hours.
Tesla has made some of the most high-profile moves to put renewable energy storage back in the spotlight, including its acquisition of Solar City for $2B, as well as a renewable energy project in the remote US island of Ta’u, and this quarter, the launch of Powerwall 2, an updated version of its rechargeable home storage batteries.
The grid energy storage market has also received government and regulatory support in recent years. California set a mandate for corporations like Pacific Gas and Electric Company and San Diego Gas & Electric Company to hit energy storage targets by 2020. More recently, Japan announced an investment of ¥81B ($709M) into solar energy storage.
Amid rising interest in alternative energy storage technology, we used the CB Insights database to surface VC-backed startups working in the space.
12 startups raise $200M in 2016
We used the CB Insights platform to identify 12 VC-backed energy storage startups, with a focus on energy storage for grids, that have raised equity since January 2014. The companies have raised $200M in aggregate funds in 2016 alone, as of 11/29/16.
The CB Insights Business Social Graph below shows the relationship between the startups and their investors.
*Click on the image below to enlarge.
A few investment highlights:
- Most well-funded: The most well-funded company on the list is Pittsburgh-based Aquion Energy, which has raised $196.6M in total equity funding from investors including Bill Gates, Kleiner Perkins Caufield & Byers, Foundation Capital, and GSV Ventures. Aquion raised $33.2M in Series F in Q2’16. Aquion is developing saltwater batteries for the residential market.
- Bill Gates also backed Massachusetts-based Ambri in a $35M Series C round in 2014. Although Ambri, which is working on liquid metal battery technology, had a round of layoffs and postponed the commercial release of its storage battery, the company reportedly is considering raising funds in 2017.
- Corporate investors: Over 10 corporations and corporate venture arms invested in the companies below. To name a few, GE Ventures backed Germany-based Sonnen in 2 rounds this year, including a $85M Series D round raised in Q4’16. Sonnen is the second most well-funded company on the list ($97.6M). GE Ventures also backed Texas-based FlexGen Power Systems in a $25.5M Series A round in Q3’15, along with CVC Caterpillar Ventures. Siemens Venture Capital backed California-based Sunverge Energy in 2 rounds, most recently a $36.5M Series C round in Q1’16, along with investors like Softbank China Venture Capital and France-based Total Energy Ventures International.
- Smart Money investors: Smart money VCs—our list of the top 24 VC firms based on portfolio valuations and investment outcomes—have participated in 13 deals to the startups on the list. Kleiner Perkins Caufield & Byers backed 2 startups: previously mentioned Aquion Energy and California-based Primus Power. CRV backed Massachusetts-based 24M, an MIT spinoff, which is developing a technology to improve the efficiency of traditional lithium-ion batteries. Khosla Ventures backed previously mentioned Ambri (also backed by Gates) and California-based Alveo Energy.
| Company | Select Investors | Disclosed Funding (USD) |
|---|---|---|
| Aquion Energy | Advanced Technology Ventures, Bill Gates, Bright Capital, CapX Partners, Carnegie Mellon University, Constellation Technology Ventures, DNS Capital, Foundation Capital, GSV Ventures, Horizon Technology Finance Management, Kleiner Perkins Caufield & Byers, Prelude Ventures, Shell Technology Ventures, Silicon Valley Bank, Tao Capital Partners, Total Energy Ventures International, Trinity Capital Investment Group, TriplePoint Capital, U.S. Department of Energy, Yung’s Enterprise | $196.63M |
| Sonnen | Chrysalix Global Network, eCapital entrepreneurial Partners, Envision Energy, GE Ventures, INVEN Capital, Munich Venture Partners, Thomas Putter | $97.63M |
| Fluidic | Asia Climate Partners, International Finance Corporation, Madrone Capital Partners, True North Venture Partners | $90.33M |
| Primus Power | ARPA-E, Chrysalix Global Network, DBL Partners, I2BF Global Ventures, Kleiner Perkins Caufield & Byers, PGM Development Fund, Russian-Kazakhstan Nanotechnology Fund, The California Energy Commission, U.S. Department of Energy | $67M |
| VionX Energy Corp | Starwood Energy Group, VantagePoint Capital Partners | $66.95M |
| 24M Technologies | ARPA-E, CRV, North Bridge Venture Partners | $56M |
| Sunverge Energy | AGL, Australian Renewable Energy Agency, Siemens Venture Capital, Softbank China Venture Capital, Southern Cross Venture Partners, Total Energy Ventures International | $53.5M |
| Ambri | Alberta Innovates, Bill Gates, Building Insurance Bern, Khosla Ventures, KLP Enterprises, Total | $50.2M |
| FlexGen Power Systems | Altira Group, Caterpillar Ventures, GE Ventures | $25.50M |
| Alveo Energy | ARPA-E, Fluxus Ventures, Khosla Ventures, NanoDimension, Prelude Ventures | $11.63M |
| Staq Energy | True North Venture Partners | $10M |
| Powervault | Future matters, Innovate UK, London Co-Investment Fund, Sustainable Ventures | $1.32M |
(featured image credit: iStock.com/vencavolrab)
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