SPAN Raises $20M To Accelerate Smart Electrical Panel Adoption

Span Electrical Panel
Span closes $20M funding round and adds Alexa integration to it's smart electrical panel

SPAN – the company that back in May last year raised $10M to bring their smart electrical panel to market – has finished closing a $20M Series A financing round. As part of this effort they will be using the capital to fuel outreach to homeowners and solar installers across the US while also investing into new product development. 

SPAN is an interesting company. Digitizing the outdated electrical panel sounds like a no brainer and integrating in sensors and building in functionality to replace traditional backup loads panels used by batteries creates a unique value proposition to homeowners that are price and value conscious. 

With significant awareness among the cleantech community – Span has demonstrated to be a valuable grid-edge hardware solution for utilities and operators more so than a “Smart Electrical Panel”.

SPAN Electrical Panels Aren’t Cheap

Priced for the hardware between $1,000 – $2,000 depending on the type of electrical panel you have makes the cost to implement a Span Smart Electrical Panel come out to around $3,000 when you factor in labor. 

Now the pitch is that the cost savings on labor overall – when implementing a solar + storage system outweighs the cost for using something like a Lumin Smart Panel or comparable protected loads panel. 

This is predominantly due to cost. 

Any value that may be available in cash savings by choosing Span over a traditional protected loads panel is likely to be negligible when considering the overall cost of a solar + storage system. 

Which is why most homeowners that will consider purchasing a smart electric panel will likely purchase this premium product from Span since it is the best current choice based on early feedback and system specifications. 

However, for Span to make it to the mass market/incumbent stage a lot of things have to go right for them. 

May Become The Best Demand Response Solution

SPAN’s customer is not the homeowner, it is the utility and the grid operators. 

OhmConnect, Virtual Peaker, Autogrid, Uplight and a few others all play in this “load flexibility/demand response” space. Some specializing in providing load flexibility via physical batteries at homes and some using smart thermostats to reduce load during peak hours. 

SPAN can hit every single breaker to the house. 

Since their product digitizes the entire electrical panel it is hard to see any utility or grid operator not jump at an opportunity to actually use that to their advantage. Turning off entire breakers within the house during demand response events or shifting to backup power from the battery dynamically creates a compelling use case for utilities to heavily subsidize these systems. 

However, this may be a catch 22 as for utilities to see value from SPANs panels – there needs to be a decent number of installs active in their territory.

Homeowner Adoption Is Span's Biggest Threat

Demand response, energy management and renewables as a whole requires a compelling value proposition beyond “savings” to drive adoption. 

Tesla is winning in the residential market –  alongside Sunrun of course – because those who buy a Tesla end up wanting to purchase solar and storage for their home to charge their Tesla with renewable energy. 

Buying solar no longer becomes a question of “savings” for those purchasing solar from Tesla as much as it is about helping the environment, buying a strong brand or literally recharging your Tesla for free.

Span needs to figure this out and fast – $30M is not a lot of runway for hardware companies, especially for those that require significant customer traction to reach a stage where they can unlock the utility clientele. 

SPAN’s partnerships with industry leading battery manufacturers

This has to be the smartest play by Arch Rao and his team at Span. Coupling their smart panels with batteries natively increases the likelihood of adoption as installers aren’t having to sell a smart electrical panel separate from the battery they pitched their prospective customer. 

With native integrations and support from giants like Panasonic and LG for their residential solutions it is likely that Span’s growth rate and adoption rate is betting on the adoption of Panasonic and LG batteries. 

The fear I have here is the explosive growth and saturation Tesla Powerwalls have – especially now since SunRun pushes Powerwalls to all its customers.

Tesla, being like Apple, will build everything internally. Which means Span’s success may depend on beating Tesla in the race for adoption – especially if their primary growth strategy is manufacturer partnerships. 

However, startup founders tend to know a thing or two about growth and figuring out how to beat the incumbent in the space. Span’s founding team is a strong one and likely has multiple paths to market that we haven’t uncovered yet that’ll continue to help them scale well beyond their early success. 

Span’s Team and Capitalization Gives It The Best Shot At Survival

The investors involved, the team building and the product are all great from what we’ve gathered on Span. There are natural concerns on price, homeowner demand, scale performance and the true savings a panel can create – but these are standard for any new company on the block. 

Span has found a niche that the cleantech community has supposedly gotten around and is curious in following. 

We believe that Span – or broadly smart electrical panels – have a niche in the demand response and load flexibility arena because of the level of control they can provide the utility. At the end of the day the thing that will give Span the win in this market over existing startups isn’t price, product or team/capitalization…it’ll be their ability to adopt customers at scale. 

The journey will be long for Span, but given they can continue to improve their product and drive widespread adoption over the next 10 years they may have one of the most valuable demand response assets on the market.

About The Author

Swarnav S Pujari

Swarnav S Pujari

Founder of The Impact

Swarnav has over 10 years of experience in the energy & climate tech space, holds 2 patents and is active in the tech, climate and media industries. He specializes in Product/Product Innovation as well as Go-To-Market and Growth Strategy.

By training he’s a Materials Engineer with a background in research from his time at Georgia Tech and University of Illinois (UIUC).

He founded TouchLight a utility backed energy company focused on developing IP for utilities and startups pushing electrification forward. He also serves as the appointed Chairman for the Town of Yorktown’s Climate Smart Communities Task Force, where he helps with drafting legislation and enabling sustainability efforts within the town.

Concurrently, Swarnav founded The Impact to help investors, emerging founders and driven climate enthusiasts discover and identify new climate-tech startups, technologies and opportunities before they hit the traditional media sources.

Share this post →

DISCOVER CLIMATE STARTUPS & OPPORTUNITIES BEFORE IT HITS THE FRONT PAGE

A weekly newsletter helping climate founders and investors discover undercover climate startups, technologies and opportunities before everyone else. Written by founders, executives and investors with years across the climate-tech space. Subscribe for free today to grow your climate positive impact.

Related posts...

Everyone Should Understand The Carbon Cycle

Measuring carbon levels is important because it is our planet’s natural thermometer. Earth’s atmosphere regulates temperature and will respond to extreme imbalances much like how the human body does once it reaches an internal temperature of around 104°F (40°C): the major organs that give us life will begin to break down.

Read now ➜

Discover Pre Series-A Climate Startups Weekly

Develop your market map of up-and-coming climate startups and market opportunities by subscribing to our weekly newsletter for free.