SunPower’s $20M Investment Latest Sign of Tendril’s Turnaround
Just two years ago, Tendril Networks was like many other formerly high-flying cleantech startups struggling to stay alive. But now Tendril is back, according to CEO Adrian Tuck—and one of the leading renewable energy companies in the world agrees.
Solar panel manufacturer SunPower and Tendril announced Monday that SunPower (NASDAQ: SPWR) has invested $20 million in Tendril and signed a multi-year deal to license its software. Tendril makes cloud-based software that energy providers can use to create and run targeted programs for customers and keep them informed of how much electricity they use.
For Tendril, which is based in Boulder, CO, it’s an infusion of cash the company will use to improve its marketing, add new features to its software, and possibly expand internationally, Tuck said. While getting the money and landing a new, important customer are big deals, there’s more to the story.
“This is a really good way to underline our turnaround story. We’ve gone from a point of reasonable distress two years ago to a point where we have happy customers and a solid technological platform,” Tuck said. He thinks Tendril has regained its leadership in the industry, and “it’s been gratifying to reestablish that level of credibility,” he said.
Back in the late 2000s when venture investors were more eager to back cleantech companies, Tendril looked to be one of the most successful and most promising. The company raised more than $100 million from investors including Siemens Venture Capital, Good Energies, RRE Ventures, and VantagePoint Venture Partners. The latest round brings that total to $142 million. Tendril also was part of more than 50 partnerships and pilot projects with utilities, appliance manufacturers, and car companies across the world.
Then, as with many cleantech startups, factors within and beyond Tendril’s control forced it to go through a painful downsizing in 2012 as investors fled and the industry crashed. Tendril had grown to more than 220 employees, but cut that number to 60. Senior leaders including founder Tim Enwall left the company.
“It was pretty bad,” Tuck said. “It never got to the point where it became a crisis, but it was something that you couldn’t apply a Band-Aid to. You needed to fix it at its foundation.”
Tuck said Tendril always intended to make software that utilities would need as new technology, new government regulations, and new competitors like solar energy disrupted their decades-old business model.
“We had a vision for the market which we’ve stayed true to throughout this time. We thought utilities would have to change, and our place was to provide software to these guys,” Tuck said.
But if the vision stayed consistent, the approach didn’t. For a while in the late 2000s, Tendril was making devices like networked thermostats and in-home displays that could show energy use in real time. The devices helped put Tendril on the media’s radar, but the company slowly phased those products out.
Then Tendril appeared to shift its focus to software that would connect smart appliances to the grid and enable users to control them with their smartphones. Tendril talked about creating the “consumer smart grid” and the energy Internet, and created a software platform so third-party developers could build apps and software for it.
At the same time, Tendril was signing up for pilot programs and partnerships, including ones with General Electric, to help connect smart appliances to the smart grid, and automaker BMW. Tuck said the company became overextended, and customers were unhappy.
“We were moving forward on such a broad front, we were not delighting anybody—in fact, we were annoying a few people,” Tuck said.
Tendril itself might have had reason to be annoyed, as some of its partners weren’t really committed to the projects in the long run. In retrospect, Tuck has called many of the partnerships “science projects” that were initiated … Next Page »