More investment dollars for energy storage, but early funding still lacking

More investment dollars for energy storage, but early funding still lacking

In the first three months of 2014, energy storage start-ups Aquion Energy, Amprius, and Primus Power collectively raised more than $70 million. For Aquion Energy, the funding closed a $56.1 million Series D round over the past year. Primus Power raised $20 million in a Series C round led by Anglo American Platinum through its Platinum Group Metals Development Fund. Of the three major investments, Primus Power is the only company to have a strategic investor in Anglo American Platinum.

Anglo American, based out of South Africa, is likely looking to fuel cells and flow batteries as a future demand for platinum. While strategic investors have been touted as a way to bridge the valley of death from investment in manufacturing capacity to first commercialised products, and eventually revenue and profits, a strategic investor does not inherently reduce the risk of failure. It is important for any technology developer and strategic partner to understand what each brings to the table in an investment.

While both the dollar value and production scale of each company is a promising sign for the energy storage industry, there is still a clear funding gap from Seed to Series A investments. New energy storage developers have skirted traditional venture capitalists through Small Business Innovation Research (SBIR) grants, ARPA-E funding, attracting private high net worth investors, and state funding sources like the California Energy Commission and NYSERDA for first projects.

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SMART GRID Bulletin March 2018

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