SolFocus needs money to become a competitive player of an emerging solar technology, and it has found $47.5 million to do it.
The Mountain View, Calif.-based startup said Friday the money represents the first close of its C round. SolFocus expects to close a second round later this month that would bring the total C round to around $60 million to $70 million, the company said.
SolFocus also is getting a new chief executive – Mark Crowley. He was previously being named the company's president last August. SolFocus' previous CEO, Gary D. Conley, who founded the company in 2005, will remain its chairman.
In a statement, Crowley touted SolFocus' ability to attract investments during a tough fund-raising climate. But it wasn't all easy.
The company had to look for months to raise the money, said sources, who also believe that the company had to reduce its valuation to attract investors. SolFocus's representatives didn't return calls or emails for comment about the company's valuation.
Apex Venture Partners led the new funding. Other investors included New Enterprise Associates and NGEN Partners. SolFocus has raised $143.1 million since inception, according to its Website.
The company is in the early stages of commercializing its technology and plans to use the new investment to broaden the deployment of its concentrating solar energy systems.
SolFocus installed 0.5 megawatts worth of projects in 2008, including its first ever commercial system (see SolFocus Completes Spanish Project, Eyes California). A 7.2-kilowatt system it installed for a San Francisco radio station last fall was its first commercial project in the United States (see SolFocus Turns on First U.S. Commercial Installation).
The company aims to have 100 megawatts worth of projects installed by the end of 2010. Last November it announced its second product that can generate more electricity than its first system (see SolFocus Boosts Solar Efficiency).
SolFocus recently signed contracts with two new customers. The deal with EMPE Solar calls for developing 10 megawatts worth of systems in Spain. The contract with the Samaras Group involves installing 1.6 megawatts worth of systems.
The company has developed curved mirrors to concentrate 500 times the natural sunlight onto solar cells made with a germanium substrate and gallium-arsenide and other compounds.
Those solar cells are more expensive than the silicon cells used to make most solar panels today, but they also can convert more sunlight into electricity. By using concentrated sunlight, only small cells are needed for power generation.
The company develops and makes the concentrating optics technology but buys the solar cells from companies such as Spectrolab and Emcore. The company then assembles all the components into a giant solar panel and mount it on a tracker that tilts it at different angles throughout the day to face the sun.
Concentrating solar technologies became attractive a few years ago when a silicon shortage began that caused its prices to shoot up. But silicon prices are falling quickly as more silicon makers bring new factories online.
Concentrating solar companies also must contend with the emergence of solar-thermal technologies, which use the sun's heat to generate electricity. Greentech Media analyst Eric Wesoff has described concentrating solar players as being "stuck in the middle between the rapidly commodifying silicon solar market and the well-financed, high-output concentrated solar thermal market" (see Wesoff's primer on concentrating solar here, here, here and here.).
SolFocus already has to compete against a slew of startups within the concentrating solar field, such as GreenVolts, Covalent Solar and Skyline Solar.
Editor-In-Chief Michael Kanellos contributed to the story.