The reality behind Nanosolar’s latest funding: huge valuation drop

Thin film solar maker Nanosolar surprised many when it was able to raise $70 million in a new funding round earlier this month. But the devil’s in the details. According to DowJones VentureWire, Nanosolar raised that funding at a pre-money valuation of $50 million, which was a massive drop from a valuation of over $2 billion years earlier.
The report says that Aeris Capital, a fund that manages finances for SAP founder Klaus Tschira, made a significant investment in Nanosolar as a way to pick up solar assets on the cheap, and to basically zig, when many investors are zagging out of solar manufacturing. The fund thought that they were undervalued over the long term.
In addition, DowJones reports that many of Nanosolar’s original preferred-share investors that didn’t reinvest in the round were wiped out. And at the same time, common shareholders were offered an unusual deal to keep them incentivized: “sign a legal waiver agreeing to not sue the company and, in return, were able to multiply their common shares several times,” according to the report.
Nanosolar has taken in at least $450 million since its start in 2002. Investors in this latest round included OnPoint Technologies, Mohr Davidow Ventures, Ohana Holdings, and Family Offices.