Mercom Capital Group, llc released its report on funding and mergers and acquisitions (M&A) activity for the smart grid sector for the first quarter of 2014. Venture capital (VC) funding into smart grid technology companies came in at $101 million in 21 deals in Q1 2014, compared to $148 million in 31 deals in Q4 2013. There were no debt or public market financing tracked in the quarter.
"Funding into Smart Grid companies is trending up the past couple of quarters," commented Raj Prabhu, CEO and Co-Founder of Mercom Capital Group.
The Top VC funded companies in Q1 2014 were led by SIGFOX, a wireless connectivity solutions provider for smart metering, building intelligence and M2M using ultra narrow band technology, which raised $20.6 million from Idinvest Partners, FSN PME, Digital Ambition Fund, Elaia Partners, Intel Capital, Ixo Private Equity, and Partech Ventures. EnVerv, a provider of power line communications solutions for Advanced Metering Infrastructure (AMI) and energy management solutions, raised $15.4 million from Cassiopeia Capital Partners, Cisco, UMC Capital, Benchmark Capital, New Enterprise Associates, and Walden International. Smart Wire Grid, a provider of smart wire technology to control power flows on transmission lines, raised $13.4 million from RiverVest Venture Partners and other investors. AutoGrid, a provider of Big Data analytics, cloud computing solutions, and real-time demand response optimization and management systems for the energy industry, raised $12.8 million from E.ON, Foundation Capital and Voyager Capital. Rounding out the Top 5 was Grid20/20, a provider of integrated distribution transformer monitoring solutions, which raised $8.1 million.
Twenty-eight investors participated in funding rounds in Q1 2014. Emertec Gestion was the only investor participating in more than one deal.
Smart Grid Communication technology companies received the most VC funding, raising $62 million in 11 deals. Demand Response companies raised $14 million in three deals. Data Analytics companies raised $13 million in three deals, and Grid Optimization companies brought in $8.1 million in one deal. Notably, AMI did not see any VC funding in Q1.
There were six M&A Smart Grid transactions in Q1 2014, two of which disclosed amounts totaling $3.35 billion. The top disclosed transactions were the $3.2 billion acquisition of Nest Labs, a smart thermostat and home energy solution provider, by Google, followed by the $150 million acquisition of Aclara Technologies, a provider of advanced solutions, by Sun Capital Partners, a private equity firm from ESCO Technologies.
Mercom also expanded their report on smart grid sector funding and M&A to include battery/storage and efficiency sectors, given the convergence of technologies along with the proliferation of distributed energy generation.