SolarHome, an energy startup providing Pay-As-You-Go (PAYG) solar home systems in Southeast Asia, has announced the successful completion of a Pre-Series A equity funding round. The round was led by Uberis Capital, the leading impact VC firm in Southeast Asia, with participation from Beenext VC and other regional investors. Forum Capital, a venture builder based in Singapore, had previously provided seed funding. This round brings the company’s total financing to-date to over 1.1 million.
The PAYG Solar business model offers off-grid customers “rent-to-own” plans of energy service subscription, priced at a radically affordable level of $3 to $15 per month. This dramatically lowers the barriers to adoption of solar home systems for the bottom-of-pyramid clients.
“This is the third Forum Capital-built venture to close an oversubscribed funding round in the last few months. SolarHome’s investment proposition lies at the intersection of a few highly exciting trends, such as financial inclusion, renewable energy, digitally-enabled lending, and Southeast Asian economic growth,” said Greg Krasnov, Chairman, SolarHome and Managing Director of Forum Capital.
“We are excited to partner with the lead investor Uberis Capital, who have vast experience supporting impact ventures around Southeast Asia. We look forward to working with them on the Board to grow the company to the next level,” Krasnov added.
The company claims that the market opportunity for solar home systems is substantial in the region, with over 150 million people and close to 27 million households living off-grid in Southeast Asia. While bringing PAYG solar home systems with self-sufficient power generating systems for households, such as solar-powered panels, batteries and electronics, SolarHome systems also offer low upfront cost and low lifecycle cost.
“The PAYG model has emerged as a clear leader in off-grid electrification in Africa, India, and Latin America, having reached millions of homes and attracted over USD500million of investment over the last few years. We see the same tailwinds in Southeast Asia – massive off-grid population, rise of alternative credit scoring and mobile money, and a growing acknowledgement by governments and DFI’s that distributed generation is the answer,” said Nicolas de Boisgrollier, Managing Partner, Uberis Capital.
“Unlike many other renewables businesses, PAYG is very scalable and operates profitably without subsidies, which makes this business model very attractive. We were very impressed by the team’s expertise and achievements to date, and are excited to support SolarHome’s future development into a regional market leader,” de Boisgrollier added.
Under its PAYG scheme, SolarHome’s off-grid customers are able to purchase solar home systems with a small down payment. To activate the power sources, customers will need to purchase energy tokens for daily, weekly or monthly top-up credits, either through scratch cards or mobile money. The ownership of these systems will be automatically “unlocked” and transferred to the customer after two years.