SolarCity made its much-bally-hooed debut in public market trading yesterday, raising $92 million through the sale of 11.5 million shares. Although the company did not arrive at the valuation it had hoped for, it looks to have created positive returns for its investors (though a number of those investors are purchasing large quantities of new common shares and will still own about 80 percent of the company).
Such exits have been hard to come by in cleantech lately, and it’s hoped that a successful SolarCity IPO could unfreeze public markets for other cleantech companies.
SolarCity was a good candidate to test these waters, mainly because its good project pipeline, financing partners and a national footprint represented tangible value to the market where other recent planned or withdrawn cleantech IPOs have banked on future projects or planned production capacity. In addition, its position in the downstream market of solar installations has meant that SolarCity has actually benefited from the same plunge in solar panel prices that has bankrupted many upstream solar manufacturers.
This business model distinction – of upstream versus downstream solar – could be key in seeing companies similar to SolarCity through the IPO window. Here are five companies addressing the residential solar market with similar strategies: Sunrun, Borrego Solar, Tioga Energy, Clean Power Finance, and OneRoof Energy. Although they may not all put boots on the roof like SolarCity does, all leverage the use of third party financing and advantaged tax-equity funds to help customers go solar. It will be interesting to see what the future holds for these companies.
To get this and other Cleantech Insights stories delivered weekly to your inbox, sign up for the Inside Cleantech Newsletter: