San Jose-based Varentec, a company that builds power management and monitoring solutions for the electric grid, today announced the close of an $8 million Series B round of funding from Bill Gates and Khosla Ventures. The new funding follows its $7.7 million Series A, which was led by Khosla, and previously secured funding from the U.S. government. Varentec is about to start rollout of its energy monitoring and analytics solution for global electric utility companies and other industrial customers, and the funds will help it do that.
What Varentec hopes to accomplish understandably takes considerable funding juice; its aim involves updated outdated legacy systems that are in place at many of the world’s industrial sites, and which are intimidating projects to take on for utilities both private and public. Varentec has spent the past couple of years piloting its so-called “Edge of Network Grid Optimization with investor-owned utilities, including two in the U.S. and one in Mexico, and is now ready to roll things out on a production scale.
The means through which Varentec offers additional efficiency is by allowing utilities to install devices on the points in their system that are giving them the most problems – rather than requiring they install sensors and smart meters at every point throughout their network (hence “Edge of Network”). These devices use a line-based sensor that can actually alter voltage at that spot, with analytics and data gathering tools that make up the rest of Varentec’s secret sauce. These independently operating modules work better than remote sensors tied to a central command hub because they can respond immediately to problems and fluctuations.
Varentec’s founding team, which consists of Dr. Deepak Divan, Andrew Dillon and Mehrdad Hamadani haven’t been able to just convince some of the smartest investors on the planet of the value of their idea; they’ve landed a couple of grants for the U.S. government that total over $7 million, in addition to their venture funding.
Smart grid technology isn’t necessarily the flashiest thing around, but it is an opportunity with lots of potential upside in terms of ecological and economic benefits for some of the biggest and most stable businesses in the world. Initiating change in utilities is probably the biggest barrier to success, but Varentec now has a good amount of money in the bank to help it continue to build momentum thanks to this new investment.