Smith went on to found LevelTen, a Seattle-based startup that allows companies large and small to buy clean energy online. The company just raised $20.5 million to fuel growth of its platform and expand its presence in North America and Europe.
The way energy markets work is complicated. LevelTen’s marketplace lets companies fund new clean energy projects without wading too far into the wonky world of regulated utilities and power purchase agreements.
Bryce thought that a simplified marketplace would make it easier for companies to “go green” without employing a team of people to evaluate hundreds of projects and slog through the financials. Smith has previously compared the platform to a mashup of Match.com and Vanguard — with a clean energy spin.
“One of the reasons we created the marketplace was to extend these opportunities beyond the Microsoft and Google and Apple’s of the world to smaller companies,” said Smith, who previously ran utility-scale solar company OneEnergy.
Just five years ago, the idea that companies would fund their own clean energy projects was still very new. Only eight corporations — including Google, Microsoft and Apple — signed such contracts in 2014. Last year, 75 companies funded contracts for 6.43 gigawatts of renewable power, according to the Business Renewables Center.
The Series B round was led by San Francisco-based Prelude Ventures, which focuses on climate companies, with participation from prior investors Techstars Ventures, Wireframe Ventures, Founders’ Co-op, Avista Development and Element 8 Fund. Three new strategic partners with ties to the oil industry also joined, including Excelon’s Constellation Technology Ventures, Equinor Energy Ventures and Total Ventures.
The fresh influx of cash follows LevelTen’s first major fundraising round two years ago and brings the company’s total funding to $27.3 million. Prelude managing director Tim Woodward will join LevelTen’s board of directors.
“What a [clean energy] project needs to get built is a guaranteed long-term revenue stream,” said Smith. “You can’t build a wind or solar project unless you have that commitment from someone to buy the power.”
Through the platform, companies essentially pledge to pay a fixed amount for the energy that a project produces. If that price winds up being less than the market rate for energy in the future, the company will make money; if not, the company loses money. Either way, they can claim to have reduced their carbon footprint and receive renewable energy credits from the project.
Some of LevelTen’s customers include Salesforce, Gap, Bloomberg and Workday. More than $1 billion worth of renewable energy has been purchased through the platform so far.
While Seattle hasn’t always been a major source of cleantech startups, Smith thinks that’s changing. “Now that software is a vital part of every industry, Seattle is emerging as a hotbed of energy innovation,” he said. Other cleantech startups in the area include solar investment service Omnidian and peer-to-peer energy trading platform Drift.
LevelTen mainly connects companies to wind and solar projects, but there are also opportunities to buy into energy storage, biomass and small hydroelectric projects. The company, a 2017 graduate of the Seattle Techstars accelerator program, doubled its employee headcount to 21 last year and is based in Seattle’s Fremont neighborhood. It currently has projects in 45 U.S. states.
Going forward, LevelTen plans to expand its presence in both Europe and North America and create more tools that allow companies to take advantage of the marketplace data that it has amassed.