AlertMe closes £8 million to expand in Europe

Cambridge, England-based AlertMe.com said today it wrapped up its £8 million ($13 million) Series B financing round.

The investor mix in itself is significant, said AlertMe’s founder and CEO Pilgrim Beart. It includes Good Energies, Index Ventures, SET Venture Partners and VantagePoint Venture Partners.

“The group of investors we have raised it from is our dream team,” Beart told the Cleantech Group.

Founded in 2006, the company’s online service, called AlertMe, enables European consumers to take control of their energy consumption, bringing the reach of the smart grid and Advanced Metering Infrastructure (AMI) networks into the home. 

“We are all around putting information online and keeping consumers in touch with their homes,” Beart said.

The funding is expected to allow AlertMe to extend its product development program, continue to ramp up its distribution strategy and expand its existing team.

The company’s Smart Home platform—which integrates devices such as lamps and windows in the home wirelessly using Zigbee communication—is being launched through utilities, retailers and telco companies, Beart said. The company’s platform includes a suite of hardware, software and Internet services that run in the cloud and are linked in a seamless application.

In the past few years, interest in the AMI space has grown, driven by favorable legislation and regulatory rulings. In the United States, the Energy Policy Act of 2005 required each state regulatory authority to look at AMI (see What's so smart about smart metering?). 

Just yesterday, VantagePoint led a $30 million round in Boulder, Colo.-based Tendril Networks, a company in the United States AMI space that offers technology that provides two-way dialogue between utilities or retailers and customers (see VantagePoint leads $30M round in AMI solution leader).

“We have a lot of respect for each other,” Beart said. “We are both involved in pushing energy reduction into the home in slightly different ways.”

VantagePoint Principal Lee Burrows said the two deals, finalized in close proximity to each other, just happened that way; there wasn’t an overarching drive to time the announcements together.

“We see the market winds blowing at our backs, and we have chosen to make multiple bets,” Burrows said.

During the past two years, VantagePoint has been researching the AMI space, talking to leading utilities and meeting with startups in pilot and trial phases with utilities.

“We really like [AlertMe’s] technology and their devices. They are also right now really focused on the UK and European markets,” he said.

The company has shipped 15,000 units to customers, and, unlike the United States where companies in the AMI space are competing and facing potential consolidation, Beart said AlertMe doesn’t have direct competition in the UK. 

An AlertMe Energy Kit is shipped to the consumer, who can manage his energy consumption at home or remotely, even from a mobile device. The technology is connected to the Internet via the home’s broadband connection, and can constantly measure individual appliances as well as the home’s overage energy usage.

The company says the system can deliver 25 percent energy reduction annually, meaning that AlertMe pays for itself in about a year and can save 1 ton of carbon dioxide per home per year. The kit can be purchased directly through the company, but the company is also in trials with European telcos interested in launching the service to customers, Beart said.

“We’re focused on B2B commerce through channel partners who already have large customer bases,” he said.

Beart said it’s an exciting time for his company, given the EU’s 30-percent carbon reduction goals by 2020. Utilities are caught in the middle, Beart said, being forced to spend money on energy reduction (see European utilities leading the way on environment).

“But it’s really a huge opportunity for them,” he said, describing how platforms like his company’s can serve as new sources of revenue for utilities.

He said that, in the UK, 29 percent of national energy consumption is in the home, so reducing home energy consumption needs to be a top priority. In particular, 60 percent to 80 percent of that energy consumption comes from heating the home and hot water, which can be controlled and optimized using the AlertMe system.

The company is receiving expert advice from Good Energies, a leading cleantech investor with global reach. Index Ventures is regarded as a leading venture capital firm in Europe with consumer experience from investments in companies including Skype and LOVEFiLM. The Netherlands-based SET Venture Partners has a focus on investing in sustainable energy technologies, while San Bruno, Calif.-based VantagePoint Venture Partners gives AlertMe American exposure and networking. 

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