Energy startup raises $4 million
Ideal Power Converters, now with 10 employees, plans move to bigger digs in Austin next year.
The solar power industry has taken its lumps in the past few years, but Ideal Power Converters, an Austin area startup, is betting things are just getting started and that its technology could be important to the industry’s growth.
The 5-year-old company, which began selling its first power conversion systems this year, has raised $4 million in private investment to pay for more product development and for growth. The funding was arranged by MDB Capital Corp., a Californiabased investment bank, which raised the funds from a group of investors.
“This provides us with important financing and a runway to rapidly grow our business,” said Ideal CEO Paul Bundschuh.
The 10-employee company, based in Spicewood in western Travis County, plans to move to expanded quarters in Austin next year.
Ideal Power makes commercial-level inverters, which take direct current coming from a solar power array, and convert it to alternating current that can be used in a business or transferred to the electric grid.
Bundschuh says its systems are smaller, lighter, cheaper and far easier to install than conventional power inverters. Those advantages, and the price drop for solar power panels, could speed acceptance of solar power both in the U.S. and globally. Anthony DiGiandomenico, head of investment banking for MDB Capital, said the firm’s tech- nology “is proving to be disruptive in several multibilliondollar marketplaces including solar, electric vehicle, grid storage and more.
“We are working closely with them on executing a longterm financial and (intellectual property) strategy.”
While the new financing is the company’s first sizable private investment, Ideal previously won a $1 million grant from the Texas Emerging Technology Fund. It teamed with Rensselaer Polytechnic Institute and Virginia Tech to win a $2.5 million grant from the U.S. Department of Energy’s Advanced Research Projects Agency last year.
The company’s products sell for about $10,000 for a 30-kilowatt system. Its system weighs 94 pounds, far less than conventional products, which can weigh over 1,000 pounds. They are made by a contract manufac- turer in Austin. With software changes, the systems can be used to run electric grid energy storage systems, electric vehicle charging systems or small electric grids in developing countries.
Early customers include the city of Austin, Austin Energy and the University of Texas at Austin. The company also has licensed its technology to Lockheed Martin Corp. to develop military products.
Mitch Jacobson, who runs the clean energy section of the Austin Technology Incubator, calls Ideal Power “our poster child.”
“They came into the incubator and were successful,” Jacobson said. “I wanted them to put the pedal to the metal and go after this market. I think they have something very special.”