More than four hundred people invested in Solar Mosaic’s first round of crowdsourced solar projects. A stake in one of the five projects required an investment of at least $100, to be paid back in full, and funded community solar projects that would have otherwise had a hard time putting together the capital needed to install solar panels. Solar Mosaic community members told the company that, while they enjoyed the impact their money was having, they viewed these investments as they would a donation—a nice way to put money to use helping others out.
Now Solar Mosaic is moving into a new phase. By the end of the summer, the startup hopes to be working not just in California and in Arizona, but in Colorado, Nevada, New York, Oregon and Washington. And soon investors won’t just get back the money they invested in the startup’s solar projects; they could earn a return on their investment, too.
Solar Mosaic began with the idea that a group of people could come together to fund a solar project that wouldn’t exist without that funding. The first five projects, in which community members supported solar power for community centers and nonprofits, served as proof-of-concept for the company. Crowdfunded projects often offer a reward for investors, but in the beginning all Solar Mosaic could offer was the knowledge that investors’ money was going to a good cause. The success of these projects showed that “people do want to put their money into solar projects that benefit communities,” says Lisa Curtis, the company’s communications manager. But those initial investors also told Solar Mosaic that they’d want to put even more of their resources—as much as $5,000—into these projects if they could make a little money in the process.
The first round of Solar Mosaic projects cost between $17,700 and $98,000, so even a few thousand dollars won’t fund a solar installation of the size the company’s been working on. But larger investments will mean that the company can support more and larger projects. The five new states that Solar Mosaic is expanding to this summer are only the first that the company’s eyeing for new projects.
Offering a return on investments has been part of Solar Mosaic’s longer term vision from the start, and the company has planned on attracting both small donors and larger investments vehicles, like endowments and private equity funds. The company just announced that it’s raised $2.5 million in venture capital funding to support this round of expansion.
Even though solar projects have proven solid investments, banks are still wary of funding utility-scale solar farms. Solar Mosaic is not only finding a way to finance solar projects through distributed fundraising, it’s helping to build a network of distributed renewable energy, which can help make the country’s energy system more resilient as a whole. People might be willing to lend their money towards these goals no matter whether they make a return on it or not. But it doesn’t hurt if their good intentions earn them a little payback, too.
Photo via (cc) Flickr user sonshine90
