Investors back startup that sells offgrid battery & solar panels

Batteries paired with solar panels aren’t just intriguing customers in the U.S., Europe and Japan looking to ditch their utilities. People are slowly adopting batteries and solar panels in offgrid markets, too, using their cell phones to make reoccurring micropayments and using solar energy to replace kerosene lanterns.

This week startup Fenix International — which is based in San Francisco and Kampala, Uganda, and was founded in 2009 — announced that it has raised a Series B round of $12.6 million to get its battery and solar panel product into the hands of more customers. Fenix emerged from stealth in late 2010 with a plan to sell its lead acid battery product, which comes with a solar panel and other energy adapters, to customers in rural Africa.

Vodafone branded ReadySet charging cell phones.

Vodafone branded ReadySet charging cell phones.

The company struck deals with African telcos like MTN in Uganda and Vodafone in Tanzania for distribution. And also¬† put its ReadySet battery device on Kickstarter. If you’re interested in how it works you can read Gigaom writer Kevin Tofel’s review of the ReadySet (I bought one, too).

One of the main hurdles to selling the battery product was that it cost between $150 to $199, which might not sound like a lot on Kickstarter, but for a customer in Uganda, it sure is. So more recently, in 2014, Fenix launched a mobile payment system in partnership with MTN that enables customers to pay for the battery and solar panels using cell phone payments over time.

ReadySet charging iPad mini

Kevin Tofel uses a ReadySet to charge his iPad mini.

Fenix International’s CEO Mike Lin tells me that the company has now sold more than 25,000 solar systems to date, with more than 15,000 of those connected to their ReadyPay platform. Lin says they’ve recently started adding over 100 new households on ReadyPay solar each day.

This newer pay-as-you-go-solar service puts Fenix more in competition with companies like M-KOPA, a startup created by the early developers of Vodafone’s mobile payment system M-PESA. M-KOPA has sold pay-as-you-go solar products to 100,000 customers and they’ve partnered with mobile carrier Safaricom. There’s also British startup Azuri Technologies, which has developed a cell phone solar payment system, and is also focused on rural Africa, and Simpa Networks and Mera Gao Power that are working in rural India.

Another startup called D.Light sells offgrid solar products (like solar lanterns) and as of last year the company had sold six million devices, affecting the lives of about 29 million people. D.Light works with M-KOPA to sell pay-as-you-go solar panel systems for homes.

Fenix International's ReadyPay solar system.

Fenix International’s ReadyPay solar system.

While the market for offgrid solar panels and battery systems is still small, it has a lot of promise and could grow dramatically in the future. The key to many of these markets is using mobile payments, partnering with local providers like telcos, and figuring out distribution.

Fenix has been working on this funding round since 2012, and investors include GDF Suez, Schneider Electric, Orange France Telecom, investors Tom Dinwoodie and Warner Philips, as well as others.

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