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Solar cell maker HelioVolt Corp. tacked on another $24 million tranche to its Series B funding, giving it a total of $101 million for the round. The recent funding came from new investors Sequel Venture Partners of Boulder, Colo., Noventi Ventures of Menlo Park, Calif., and Passport Capital of San Francisco. Only eight weeks ago the Austin, Texas company announced that it had closed on $77 million of the current round from co-leaders Paladin Capital Group and the Masdar Clean Tech Fund of the United Arab Emirates. Return investor New Enterprise Associates of Menlo Park, Calif. and new investors Solúcar Energía SA, a subsidiary of Madrid's Abengoa; Morgan Stanley Principal Investments of New York; Sunton United Energy LLC of Salt Lake City; and Houston-based Yellowstone Capital Inc. also participated. Including an $8 million Series A funding led by NEA in 2005, HelioVolt has raised a total of $109 million. Formed in 2001, HelioVolt is one of a new generation of solar energy companies that make "thin-film" panels using a mix of chemicals called copper indium gallium selenide, or CIGS. The company plans to use the majority of the Series B proceeds to build a factory to utilize its "FASST" manufacturing process for making CIGS-integrated solar products. CIGS thin-film companies typically use proceeds from large venture rounds to build facilities to manufacture solar cells. HelioVolt said that its manufacturing process is the most rapid way to make high-quality CIGS thin-film panels. The company expects its faster manufacturing process to allow it to turn out more product per dollar of capital investment in the factory than its competitors. "The rate at which the process works is 10 to 100 times faster than the other processes that have been used to make CIGS," said a source close to the company. The source added that "construction of [HelioVolts'] facility will be finished in 2008, with some production in 2008 and high volume production probably in 2009." The source went on to say that HelioVolt is still evaluating offers from several different locations and should make a decision on where the plant will be built over the next two weeks. With construction costs claiming a majority of the money raised, it's likely that HelioVolt will need to raise more capital, as its plans beyond 2008 include building more factories in Europe, the source added. Another key part of HelioVolt's expansion plans are to co-locate production facilities with its manufacturing partners. The company has not yet disclosed any manufacturing partnerships. The money will also go toward helping the 40-plus employee company bring in top technical talent in the manufacturing and process engineering fields. By the time HelioVolt's plant is at full production, it will require more than 100 employees, according to the source. HelioVolt is far from alone in the development of CIGS thin film panels, as a flood of venture capital has come into the space. Competitors include Nanosolar Inc., which has raised $148 million in venture capital, and Miasolé Inc., which has drawn $58 million. Another CIGS thin-film manufacturer, SoloPower Inc., in July raised a Series B round of $30 million, bringing its total funding to $42 million. Other producers of CIGS solar cells are Honda Soltec Co. Ltd. in Japan and Germany's Q-Cells AG and Würth Solar. The chief advantage of CIGS-based thin-film cells is that they can be made in large batches rather than one cell at time on a production line. "Printing" solar cells in this manner is potentially cheaper than current production methods. So while thin-film cells are less efficient in converting sunlight to electricity, they may still result in lower costs for solar power. Although angel and venture investors have poured more than $330 million into thin-film CIGS companies, the technology has yet to take off commercially. Miasolé earlier this year admitted that it was struggling to make its panels uniform, while some experts have expressed skepticism about the claims that advocates make for thin-film solar products. In the real-world uses of solar cells, as opposed to laboratory testing, silicon panels convert about 15% of the sunlight into energy, compared with roughly 10% for thin-film systems. For an environmentally friendly technology, CIGS cells also might have an image problem because cadmium used in the manufacturing process is toxic and requires special disposal. DLA Piper was counsel to HelioVolt.  Deal Video
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