End-to-End Solar Software Startup Wins $3.5M From Obvious Ventures

Sighten’s solar software aims to drive down solar soft costs across the board.

There is a growing group of early-stage solar software companies confronting a largely American problem: disproportionate solar soft costs.

Sighten is a member of that group -- and the startup just landed a $3.5 million round A of venture funding from Obvious Ventures. Sighten's platform looks to drive down soft costs by addressing the "solar lifecycle, from sales to asset management," according to the firm's CEO, Conlan O'Leary.

Andrew Beebe, managing director at Obvious, said, “The solar industry is at a turning point. While we have seen significant advances in solar hardware, financing and sales, software has grown more slowly and still involves horizontal tools and point solutions."

Soft costs include customer acquisition, installer overhead, financing, contracts, inspection, permitting, interconnection, and installation labor. That list now accounts for about 50 percent of the cost of a residential solar system, according to a 2013 NREL report (PDF). Customer acquisition makes up roughly 10 percent of a residential solar system’s total cost.

GTM Research's most recent edition of the U.S. Solar Market Insight report puts the average U.S. installed cost at $3.50 per watt and breaks down the cost components, as shown in the chart below. Solar system costs in Germany and Australia are considerably lower than in the U.S. -- and the big difference is in soft costs.

O'Leary, Sighten's CEO, was previously with Clean Power Finance, a residential PV financing platform. He has "helped manage a salmon cannery in Alaska and lived in a Buddhist monastery in Thailand." (Actually a reasonable skill set for his current role.)

He called soft costs "a real opportunity for competitiveness in solar," and said, "Where we try to differentiate is as an end-to-end platform." O'Leary spoke of "managing a lead through interconnection" and offering investors a better way to manage assets and portfolios, as well as "consolidating key functionality into a single platform."

"Instead of a complex patchwork of point solutions that fix one node in the solar work flow, [this is] a seamless comprehensive solution that you can run your business on," O'Leary said. The CEO suggested that the startup is providing a reporting platform for the asset class that makes it a "Bloomberg terminal for solar." O'Leary added that older analytics and tool sets that essentially consist of "a huge Excel file with 10,000 systems and graphs" act as "an explicit tax on the industry."

Sighten's target customer is "anyone installing or selling residential solar," and its competitive target is increasingly software startup Folsom Labs.

Here's a screenshot from Sighten's solar design tool set.

Other firms leveraging the power of software to scrub out solar soft costs include:

Andrew Beebe, previously VP of distributed generation for NextEra Energy and CCO at Suntech, will join Sighten’s board of directors. The startup previously raised seed funding of $1.5 million from a mix of friends, family and angel investors.

"When we got to know the Sighten team and fully grasped the scope and depth of their software, it became a very easy decision to support their growth," said Beebe, adding, "Sighten is a new breed of platform, which I think the solar industry desperately needs. It’s a market network where almost every part of the solar value chain has a reason to want to use it. That type of industry-specific open platform offering an end-to-end solution is just what we need today."

FIGURE: Residential PV Soft-Cost Reduction Roadmap

Source: NREL Non-Hardware, Soft Cost Reduction Roadmap for Residential and Small Commercial Solar Photovoltaics, 2013-2020