HelioVolt Corp. said Monday it closed $101 million in its second round of venture-capital funding.
The investment, by Sequel Venture Partners, Noventi Ventures and Passport Capital, amounts to $24 million above the $77 million HelioVolt previously announced it raised for the Series-B round.
John Langdon, vice president of marketing at HelioVolt, said the announcement "validates our technology and our business model, and gives us the funds to go forward and build a factory and prove what we say is right."
The news is another sign that venture capitalists are bullish about thin-filmsolar which uses little or no silicon, in a worldwide shortage of solar-grade silicon. Boosters hope the thin films will overcome historical obstacles that have limited their use.
On the same day, Ampulse -- another thin-film solar startup, this one a spinoff from Oak Ridge National Laboratory -- said it had raised $1 million in "pre-seed" funding from Battelle Ventures and Innovation Valley Partners. Thin-film companies Innovalight and Konarka also raised cash this month (see In Brief: U.S., UK Governments Back Greentech, In Brief: Cash for Solar, Inverters).
Why all the interest? Entrepreneurs say thin-film technologies hold the potential to drastically cut the cost of making solar cells.
Because they coat different materials with, literally, a thin film that converts sunlight into electricity, the technologies also could open the door to new applications -- such as solar textiles or solar windows (see In Brief: U.S., UK Governments Back Greentech).
With high silicon prices and a shortage that is limiting the amount of cells solar manufacturers can make, it's no wonder thin-film technologies are attractive.
In 2006, thin-film solar grew from 5.8 to 7.5 percent of the worldwide solar-electric equipment production, according to a report by Greentech Media Research and the Prometheus Institute. The report projected that thin films would continue to grow market share, reaching about 20 percent by 2010, making up 2.5 gigawatts of capacity and nearly $5 billion in module sales.
But so far, few thin-film solar companies -- First Solar, which produces cadmium-telluride films, and United Solar Ovonic, which produces amorphous-silicon films, being notable exceptions -- have been able to reach production scale.
And many thin-film technologies have lower conversion efficiencies than traditional solar cells, meaning they convert sunlight into electricity less efficiently (see Does Going Organic Require Exaggeration?).
HelioVolt is among the companies pursuing a copper-indium-gallium-selenide (CIGS) film, a technology which has converted sunlight into electricity more efficiently than other thin-film technologies in tests.
Some analysts have forecasted a slower market for thin films once the silicon shortage eases. So the race to prove the technologies' manufacturability is on.
But companies have yet to successfully manufacture so-called CIGS films in large volumes. That's because CIGS is more difficult to make than most other thin films, Langdon said.
HelioVolt thinks it has found the solution. The company plans to use its new cash to build a 20-megawatt factory and then to expand production there to 40 megawatts per year.
"Other companies probably didn't understand, in the same depth, how tricky [CIGS] is," Langdon said.
But CEO B.J. Stanbery has spent years working with the material and said he knew what he was getting into. "Because he knows what won't work, we've only spent time on what will work. And I think some people have tried approaches that will never work."
Industry insiders will be watching closely to find out whether HelioVolt is right or wrong and to get a hint whether CIGS can really be produced cheaply and in large volumes.
If HelioVolt is successful with its first plant, Langdon said some of its next 40-megawatt factories likely will be in Europe rather than in the United States because Europe makes up a larger market for thin films and for solar-electric systems today.