Petaluma's Enphase Energy raises $40 million

<p>Less than a year after raising $22.5 million in venture capital, fast-growing solar startup Enphase Energy is at it again. </p><p>The Petaluma-based company announced Tuesday that it has raised $40 million more to fund its rapid growth, its largest infusion to date.</p><p>Sales of the company's micro-inverters continue to be strong, passing the 250,000 mark, according to the company. </p><p>“It's always heartening when the market recognizes the problem you are solving,” said Raghu Belur a co-founder of Enphase and its vice president of marketing. </p><p>The company, founded four years ago, has nearly doubled in size in less than a year, from 55 employees last May to over 100 today, most of them in Petaluma, Belur said. </p><p>The cash is needed to pay suppliers, increase staff, expand geographically and improve the balance sheet, he said. </p><p>“Anytime there is fast ramp up, you need cash,” Belur said. </p><p><CW-30>Typical solar panels are strung together and their electrical output is converted for household use by a large, high-voltage inverter. But Enphase has designed a system of micro-inverters that attach to each solar panel, increasing the total system's efficiency and simplifying installation.</CW></p><p>Initially, critics said the company's products might be limited to smaller installations, while larger solar arrays would still utilize traditional large inverters. But that has proven not to be the case, Belur said. </p><p>The company has sold products for several large commercial arrays in recent months, including a 120-kilowatt system with 550 panels in Truckee and a 220-kilowatt system in San Francisco with 1,000 panels. A 500-kilowatt project also is in the works, he said. </p><p>The financing was led by venture capitalist Bay Partners, which was making its first investment in the company. </p><p>The round also includes participation from Horizon Technology Finance, Bridge Bank and existing investors Third Point Ventures, RockPort Capital Partners, Madrone Capital Partners and Applied Ventures LLC.</p><p>The involvement of a new investor is another vote of confidence in the company's model, Belur said.</p><p>“It's always a big deal and a very positive thing when a new investor comes in and reaffirms what all the other investors believe,” he said. </p><p>In addition to the funding, the company announced that it would begin manufacturing in Canada to qualify for Canadian subsidies, Belur said.</p>