The outlook for solar investment is very bright. California ventures have already raised $4.6 billion, which is 84 percent of what they raised last year. The sector is on track to pull in nearly $7 billion in venture capital by the end of the year. NexTracker raised $1 billion to support the development of monitoring systems for utility-scale storage and SB Energy raised $600 million. Notably, these latter two firms are committed to the implementation of solar energy projects more than the development of the underlying technology. The higher valuation of solar startups may suggest that the investment community has finally bought-in to solar energy’s viability as a mass-market consumer product.
So far, there have been five deals so far valued at over $100 million, and only one of them involved a California-based firm (solar car firm Aptera for $200 million). Two (Electrify America for $450 million and Inspiration Mobility for $215 million) were for Washington, D.C.-area ventures. One (Lordstown Motors for $150 million) is based in the Youngstown, OH area, and another (Superpedestrian for $125 million) is headquartered in Cambridge, MA.
Deal volume is somewhat slower than it was in 2021. At 47 deals, California firms have completed roughly 45 percent of their deal count from last year. Deal volume appears to have peaked in 2020, even though total funding has increased. The reliance of this sector on large deals surely helps to explain its year-over-year volatility since 2013.