SmartSolar, an EnergyTech startup based in Vietnam, has raised $1.85 million seed funding from Picus Capital, 2degrees and Iterative.
The round was lead by Picus Capital and 2degrees, who have extensive experience in this space globally, having previously backed successful European EnergyTech unicorns like Enpal, SmartSolar said in a statement on Monday.
The firm said that in less than six months from launch, it is already live with almost 1MWp of installed capacity across dozens of small and mid sized business customers in Vietnam, and is rapidly expanding across the region.
Despite being such a sunny region, Southeast Asia has been slow to adopt rooftop solar – only about 5 percent of rooftops have adopted solar (comprising about 30GW of capacity across the region).
This is compared to global role models such as Germany – a country with far less sunlight and 1/8th the population, but three times the installed capacity in absolute terms, and four times the rooftop solar penetration.
This is showcasing the clear market gap which players like SmartSolar seek to fill.
While governments play a major role in increasing adoption top down, the on-ground gap for businesses is often more about becoming familiar with new technology and getting confidence that such an investment is actually worth it.
“Many business owners I talked to were openly frustrated about their seemingly ever-rising electricity bills, but did not know how to tackle it,” said SmartSolar Founder Kevin Junker, former consultant at McKinsey in Vietnam and Switzerland, who is eyeing to tackle the problem.
SmartSolar helps businesses address this by installing solar systems on their rooftops.
With zero-upfront cost required, the firm makes the switch to green energy easy for businesses.
Today, few banks in Southeast Asia are willing to loan money for such small-scale installations and even if they do, approval times are long and interest rates tend to be high.
SmartSolar, therefore, aims to be the opposite, pairing fast approval processes with a customer friendly mindset.
They split the savings from solar with their customers so that all parties benefit.
“Electricity is one of the basic building blocks of any economy, with development directly linked with energy intensity,
“We are very excited about SmartSolar’s approach to supply South East Asia with clean and inexpensive power, and strongly believe in the significant value they can generate for their customers, for the environment, and for the region at large – starting with rooftop solar installations and soon expanding across the EnergyTech stack to provide a comprehensive solution for small and medium-sized enterprises (SMEs),” said Abhijay Thacker, Senior Vice President at Picus Capital.
Soren Wiberg Holm, Venture Lead at 2degrees, added that the firm invests in exceptional founders who move incredibly fast and tackle high-impact problems, and Kevin is exactly that.
“We consider the market for solar in Vietnam at an inflection point, with surging local demand, favorable natural conditions, and strong policy tailwinds,
“SmartSolar directly addresses what is perhaps one of the largest barriers to solar adoption by SMEs in the region – access to upfront capital,” he said.
He also said the firm has deep, deep conviction that the SmartSolar team is positioned to build financing infrastructure to power the transition to clean energy in not just Vietnam, but ultimately the entire region.