UPDATED BELOW: Less than a year ago, solar startup GreenVolts--fresh from a business model revamp-- was basking in the success of a $35 million financing round and a new partnership with power and automation conglomerate ABB, which took a substantial minority stake in the company.
Now, GreenVolts has been reduced to a few core employees and a likely sale after ABB abruptly pulled its investment. The move was so sudden and "severe" that GreenVolts cannot continue normal operation, a company spokesman said in an emailed statement.
GreenVolts' statement in its entirety:
A sudden, and unexpected, change in direction from a strategic investor has affected GreenVolts' access to funding. This turn of events is especially surprising given the recent positive announcements and support from the customers and partners at GreenVolts. The impact was at the last minute and so severe that GreenVolts cannot continue normal operation and has reduced its workforce to a small team to provide customer support and engage other options, including working with potential buyers of the system, technology and IP.
The news is surprising, considering a little more than a week ago, ABB announced it would introduce a fully integrated solar power generation plant controller and smart grid interface as part of its CPV system at the Solar Power International conference, which kicked off Tuesday. That CPV system, as ABB put it in a press release, is the result of an investment in, and strategic partnership with, GreenVolts.
UPDATE: ABB spokesman Barry Dillon said the decision to pull out as an investor was unfortunate, but necessary due to market conditions, specifically an oversupply of solar panels. ABB had already invested $20 million in GreenVolts.
"It would've required further investment commitment that ABB wasn't prepared to make," Dillon said.
ABB is still interested in certain segments of the solar industry that it views as profitable, including remote and grid integration, low voltage products, solar inverters and plant optimization systems, he said.
When asked about the CPV system that was supposed to be introduced at the Solar Power International conference, Dillon said it was "unfortunate timing." He said the system is not being exhibited at the conference and ABB staff is on hand to answer questions.
When ABB took a minority stake in the company, I noted the injection of capital was well-timed for GreenVolts. The solar industry was--and still is-- undergoing a painful consolidation and startup companies that want to survive and scale up need funding and partnerships with major players like ABB. Plus, ABB committed to sell and market GreenVolts' solar concentrating photovoltaic systems, which was a pretty big validation of of the startup and its tech and CPV in general.
GreenVolts makes solar concentrating photovoltaic systems (CPV) — essentially a clean-energy mashup of solar panels and solar thermal tech. The systems use mirrors and lenses to concentrate light from the sun onto super-efficient cells to produce electricity.
GreenVolts had adopted a business model similar to Apple, which designs products start to end. The business model aimed to create a better performing concentrating solar system at a lower cost. And at the time, GreenVolts said it was attainable.
The seven-year-old company ditched the traditional approach of sourcing parts from different suppliers and opted instead to design and make the entire concentrating solar system on its own. That means GreenVolts took on the design and manufacturing of everything including models, trackers, inverters and the energy management software. It also installed the systems. A GreenVolts spokesman told me back in December the company used contract manufacturers in China to makes its systems, keeping the overhead costs extremely low.