Solar Tribune

PV venture capital funding rises in Q2 2012


Data from the Mercom Capital Group found that venture capital (VC) funding for solar power projects increased to $376 million for the second quarter of 2012.

That’s up from $329 million in Q1 2012, according to the Q2 Solar Funding and M&A Report.

“With news of solar companies downsizing or going out of business seemingly every day, continued steady VC investment activity in the sector is good news,” said Raj Prabhu, Managing Partner at Mercom Capital Group.

“Since 2011, most solar VC investments have gone to thin film companies with $835 million, and with panel prices falling more than 60 percent over the same period, solar downstream companies have been an attractive play,” said Prabhu.

Downstream solar – such as solar leasing firms – received the most investment this past quarter, and while declining PV module prices have meant balance-of-system costs are the biggest cost involved in going solar, investments in this sector have been “surprisingly low.”

Mercom Capital also counted 13 new solar-focused investment funds, with a total of $3.2 billion committed.

On the flip side, there were 13 bankruptcies and insolvencies last quarter, seven of which were thin-film companies.

Sixteen companies also announced restructuring and downsizing, and despite Q2’s uptick in venture capital deals, according to the report “the average VC deal size has been consistently dropping since 2010 with large VC deals becoming rare.”

Read the full report here.

Recent Posts