SolarSquare raises $40 million in India’s largest solar venture round

SolarSquare has raised $40 million in what’s the largest enterprise spherical in India’s photo voltaic sector.

The Mumbai-based startup bootstrapped and was worthwhile promoting to company clients for 5 years earlier than switching to residential solar in 2021. Now it has scaled to powering over 20,000 properties and 200 housing societies throughout India, and is India’s largest operator of distributed photo voltaic belongings.

“That is the chance of a lifetime,” Shreya Mishra, co-founder and chief government of SolarSquare, informed TechCrunch in an interview. “It’s not simply an trade that’s rising superfast — it’s the place revenue and objective align.”

Not like others within the house, SolarSquare ensures returns on photo voltaic investments and compensates clients if techniques don’t ship, making its full-stack service — promoting the techniques, putting in them to the patron’s rooftop, and providing after-sales providers — far more compelling. The general price of shopping for and having the system put in averages about $1,500.

“If we promise you’ll get 5,000 models of electrical energy from photo voltaic however you find yourself getting solely 4,000 models, we pays you again for the stability 1,000 models,” Mishra stated. “This makes photo voltaic like a hard and fast deposit for purchasers as a result of return on funding is assured.”

Due to latest incentives offered by the federal government, photo voltaic curiosity has surged in recent times. The push is critical as solely about 1% of Indian properties have at present adopted photo voltaic, in comparison with nations like Australia, the place 35% properties have photo voltaic, and Brazil, the place greater than 5% properties have photo voltaic.

“Two years again, individuals solely had textbook information — they discovered at school that photo voltaic is one thing good,” Mishra stated. “They didn’t understand how a lot it price, they didn’t find out about authorities subsidies, they didn’t know that the payback interval is actually 4 to five years.”

India has set an bold goal of reaching 500 gigawatts of renewable vitality capability by 2030, with solar energy anticipated to contribute about 280 gigawatts to this aim. To speed up photo voltaic adoption, Modi’s authorities has launched a number of incentives, together with a production-linked incentive scheme value $3 billion to spice up home photo voltaic manufacturing, 40% fundamental customs responsibility on photo voltaic modules to guard native trade, and viability hole funding for utilities to construct photo voltaic infrastructure in distant areas.

The federal government additionally provides accelerated depreciation advantages, earnings tax holidays for photo voltaic tasks, and capital subsidies starting from 20% to 70% for rooftop photo voltaic installations, whereas additionally mandating renewable buy obligations for state utilities to make sure regular demand for solar energy. SolarSquare helps its clients determine and avail the advantages of the federal government subsidies, Mishra stated.

“India is the primary nation on the earth to make net-metering, this alternate of electrical energy, a client proper that makes economics extra viable as you’re in a position to freely commerce electrical energy with the grid,” she stated.

The demand for photo voltaic is slowly extending properly past main cities. “Not like quick-commerce or companies that concentrate on high 10-15 cities, photo voltaic is definitely a nationwide, Bharat form of enterprise,” Mishra stated. “Folks in Tier 1, Tier 2, Tier 3 cities in addition to rural India — all over the place there are properties, individuals will need to go photo voltaic.”

SolarSquare will deploy the contemporary funds to increase from 20 to 50 cities, however is taking a cautious strategy. “As entrepreneurs, we’re not in a enterprise of ‘transfer quick and break issues,’” she stated. “Once you’re doing a severe product like photo voltaic, taking part in with individuals’s life and security, there needs to be that quantity of seriousness.”

For smaller cities, the startup plans to work with native companions whereas sustaining high quality management.

The timing works in SolarSquare’s favor. India has made net-metering a client proper and reduce down allow processing from months to days.

Lightspeed led the funding, a Sequence B financing spherical, with Lightrock becoming a member of, alongside present traders Elevation Capital, Chris Sacca’s Lowercarbon, and Nithin Kamath’s Rainmatter. The startup, which had raised $19.5 million beforehand, may also put money into expertise to construct higher techniques for monitoring and managing residential photo voltaic installations remotely.

“We’re thrilled to be partnering with Photo voltaic Sq., which has quick emerged as essentially the most trusted residential photo voltaic model in India,” stated Lightspeed associate Rahul Taneja in an announcement. “The clear vitality transition has moved from ESG PowerPoint decks to the customers ‘ properties and Photo voltaic Sq. is properly on its method to making #hargharsolar.”