Software-for-Utilities Provider EnergySavvy Closes Round at $8.3M

VentureWire ,

Yuliya Chernova,

July 01, 2014,

(c) 2014 Dow Jones & Company, Inc.

EnergySavvy, a startup focused on selling software-as-a-service to the power-utility industry, has closed its latest funding round at $8.3 million with the addition of new investors, Chief Executive Aaron Goldfeder told VentureWire.

The startup counts itself among a growing crop of industry-specific information technology companies that are trying to compete with IT generalists like Oracle Corp. and SAP AG .

Mr. Goldfeder, a former engineer and program manager at Microsoft Corp., co-founded EnergySavvy in 2008, to help utilities run their energy-efficiency programs with greater accountability and efficiency. Utilities spend some $8 billion annually on programs aimed at reducing customer electricity use.

EnergySavvy closed the second tranche of the round with $3.3 million from EnerTech Capital , one of the most active energy-technology venture firms this year, and El Dorado Investment Co., which is affiliated with one of EnergySavvy's largest customers, Arizona Public Service. The first tranche of the funding, led by Prelude Ventures, was $5 million and closed in the spring, as VentureWire previously reported. Pivotal Investments also participated in that deal.

The company also plans to bring in between $2 million and $4 million in venture debt, to retain more cash on its balance sheet, an important attribute when dealing with a conservative customer base like utilities, Mr. Goldfeder said.

Mr. Goldfeder said that when EnergySavvy bids for projects, his startup often competes with "classic IT vendors" like Oracle , Microsoft and SAP. His pitch is that as an industry-focused vendor, "we already have 90% of what the customer needs, it's already built." And that way the offer is better than what could be had from a general IT provider.

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