Last year we reported that VC-funded efficiency andsolarcompany Next Step Living had sold off its downstream solar business to NRG.
Today, we learned from a number of reliable sources that Next Step Living is closing its doors and letting go its staff of approximately 200 people.
The firm intended to provide a missing channel for residential energy services leveraging its core energy-audit business. At one point Next Step Living had more than 800 employees and was generating more than $100 million in annual revenue. The company was the No. 4 overall installer in Massachusetts in 2014 and No. 6 in Q1 2015, according to the GTM Research PV Leaderboard.
Since its founding in 2008, the startup raised more than $80 million from investors including VantagePoint Capital Partners, Black Coral Capital, Braemar Energy Ventures and Mass Green Energy Fund. The company had taken large C and D funding rounds at a high valuation.
When a startup accepts venture funding, it also accepts the mission of rapid growth. In order to spur revenue, the company moved into downstream energy services such as solar installation and insulation installation and found itself in a low-margin business with a high rate of cash burn.
The company also found itself confronted by conflicting energy program mandates and regulations.
By the time NSL tried to return to its core home energy audit skills and jettison its downstream installation businesses, many of the VC investors had chosen to stop investing in NSL, despite their earlier entreaties for growth at all costs.