Omnidian, the software startup that offers home solar performance guarantees, raised a $15 million Series A to expand operations.
The Seattle-based company raised a $5 million seed round in 2017 to sell digitally assisted performance guarantees to large residential solar portfolio owners. The new influx of capital will support an aggressive expansion to serve individual homeowners via partnerships with vetted installation companies, CEO Mark Liffmann said in an interview.
Omnidian will also expand into the commercial solar market, and over the long term hopes to offer O&M services for other home devices, he added. The aspiration for more asset classes shows up in the root of the company name: a mashup of "omnia," Latin for "all things," and custodian.
"The fact that we depend on homeowners to maintain these complicated assets, whether it's HVAC or residential solar, creates a very negative customer experience," Liffmann said, describing the need for his product. "In the world of [internet of things], that doesn’t have to happen any more."
Insurance technology investor IA Capital led the round, joined by Evergy and National Grid Partners. They were accompanied by seed round investors, including Avista Corp., Blue Bear Capital, City Light Capital and Congruent Ventures. Several of those backers — Evergy, National Grid and Avista — are the investment arms of utility companies.
Omnidian pulls data from a newly installed solar system's monitoring devices, combines it with weather and irradiance data and determines a baseline for expected production. Then, the company uses machine learning to automate detection of issues that lower electricity production, and dispatch outsourced operations teams to the field as needed.
The owner of the system gets a performance guarantee that covers fixes and maintenance, and comes with an annual true-up if production falls short of the guaranteed amount.
To reach individual homeowners, Omnidian had to register as a home warranty provider in each state that it wants to operate in. It has secured regulatory approval in eight states, including Massachusetts and Arizona, and is finishing up the process in California and New York.
The sales pitch, though, is not much different between the two core customer groups.
"Homeowners and portfolio owners basically want the same thing," Liffmann said. "They want to get the energy out of their solar system so that they get the return on investment that they’re expecting."
Omnidian also sends quarterly production reports co-branded with the installer partner, giving the solar provider an additional touchpoint with the customer post-installation.
"It helps them build that referral business, which is really the driver of business in the solar industry," Liffmann noted.
The direct-to-consumer business tracks with the growing consumer preference for cash or loan deals.
Lease or PPA systems bundled into a fund have an asset owner invested in maintaining their output, and savvy enough to mobilize the necessary resources. But homeowners who buy their own system often have little protection against wear and tear beyond an installation guarantee, Liffmann said. As the numbers of self-owned systems grow, so will the need for maintenance.
A solar dealer that wants to pitch customers on the maintenance package can pay Omnidian $300 to give the homeowners the first year free, after which they can subscribe for $13 a month or less.
The offering of a full solar performance guarantee for customer-owned systems, based on automated fault detection, represents a new addition to the solar O&M market, said Abe Yokell of Congruent Ventures, the early stage VC firm that led Omnidian's seed round.
"We think the Omnidian business model is unique in the market, and can develop into a relatively capital efficient growth business with high recurring revenue, arguably a successful recipe in venture backed businesses," he said in an email.
The startup currently manages approximately 80,000 solar assets, and has demonstrated "solid revenue growth" since the seed round, Liffmann said. Since the company invests in software, rather than hard assets or in-house field service personnel, growth could happen quickly.
"We can scale virtually instantly from the nearly hundred thousand assets we manage today to millions of assets," Liffmann said.
At the very least, such expansion will require expanding the sales team — Omnidian currently has a staff of 35.
Updated with comments from Congruent Ventures.