Green power installation startup SolarSquare raises $40 mn in Series B, led by Lightspeed Venture Partners

(L-R) Co-founders of SolarSquare Neeraj Jain, Shreya Mishra and Nikhil Nahar

Full-stack solar installation startup SolarSquare on December 12 announced a $40-million Series B funding round led by Lightspeed Venture Partners with participation from Lightrock, making it the largest venture capital raise in the Indian solar space.

Existing investors, including Elevation Capital, Chris Sacca’s Lowercarbon, Nithin Kamath’s Rainmatter, and Gruhas Proptech, also participated in the round.

The fresh capital raised will be used to expand the startup’s presence from 20 cities to 50 cities in the next two years, building its tech stack, hiring and brand building.

Mumbai-based SolarSquare is a full-stack residential solar startup aimed at eliminating middlemen and ensuring high-quality solar installations, and a seamless customer experience. The startup handles everything end-to-end for customers - from design to installation, government permits, enabling financing and post-sales maintenance.

Till date, SolarSquare has acquired over 20,000 homes and 200-plus cooperative housing societies as customers across India.

“We are number one on the government’s National Solar Portal for the number of residential solar installations across India. At present, only 1 percent homes or close to 13-14 lakh homes in India have solar. This pales as compared to 5 percent homes in the US, 12 percent homes in Germany or 35 percent homes in Australia.”

“But, with the Pradhan Mantri Surya Ghar Yojana launched earlier this year to solarise one crore households in the next three years, the demand for solar has picked up. We'll be one of the fastest growing and one of the largest residential solar-penetrated markets in the world with a 5 percent penetration,” Shreya Mishra, CEO of SolarSquare, told Moneycontrol.

Mishra shared that the startup has built its own machine learning-based tech stack which helps in after sales services by getting real time data on how much electricity they are producing and predicting issues. In case of an underperformance or breakdown at a customer's home, the system actually creates an alert.

“We are also now guaranteeing savings on solar. So we give a five-year performance and savings guarantee to the customer, which means I'm not just assuring installation, but also underwriting and guaranteeing the performance,” she said.

SolarSquare is also expanding its 800-member team, hiring across management team as well as on-field sales, customer service, after-sales. The startup has an in-built after-sales team of 170.

While the startup was earlier looking to set up an NBFC to offer financing for solar installations, it has now moved to launch an app offering aggregation of other banks and lenders offering residential solar loans.

SolarSquare was founded in 2015 by Mishra, Neeraj Jain, Shreya Mishra, and Nikhil Nahar. In previous funding rounds, it raised about $19.5 million across three rounds. The startup is also backed by marquee angel investors such as Vidit Atrey and Sanjeev Barnwal of Meesho, Amit Agrawal, Saurabh Garg and Akhil Gupta of NoBroker, Ashish Goyal of UrbanLadder, Vijay Shekhar Sharma of Paytm, Nipun Sahni of Apollo Global, and Harsh Shah of GoFynd.

“We love the passion with which Shreya, Nikhil, and Neeraj have built the brand, the product, and the full stack experience, and we are confident that they are building a company that will change millions of consumers' lives with energy independence,” Rahul Taneja, partner at Lightspeed, said.

Mukul Arora, Partner at Elevation Capital pointed out that adopting solar remained complex for Indian households, despite growing environmental consciousness. "SolarSquare's full-stack approach of owning the entire customer experience has already set them apart and made the solar adoption process much simpler. With supportive policies and rising consumer awareness, SolarSquare is well-positioned to bring reliable, affordable solar energy to millions of Indian homes.”

Also read: SolarSquare raises Rs 100 crore in Series A led by Elevation Capital, Lowercarbon