Last year, solar stocks performed dismally, but this year investing in the right solar companies has paid off handsomely, especially for those who opted in early. Two exchange traded funds that hold solar stocks, Market Vectors Solar Energy and Guggenheim Solar ETF, have more than doubled in value from a year ago. Companies like FirstSolar, Inc. (Nasdaq: FSLR) and SunPower Corporation (Nasdaq: SPWR) have led that growth.
Such resurgent investor interest helps explain how Geostellar, a four-year-old solar tech startup based in Martinsburg, W.V., has been doing so well with its crowd funding at the website Return on Change.
Geostellar, which helps homeowners browse their best options for solar energy installation and financing, launched an online crowdfunding campaign and two weeks in has already raised $635,000, more than half its goal to raise $1 million in 90 days.
"Until recently, only professional, well-connected investors could participate in the financing of promising ventures," David Levine, CEO of Geostellar, said Tuesday in a statement. "With this offering, we're setting a new standard for the availability, transparency and accountability of private companies in the sale of tax-advantaged securities."
The Jumpstart Our Business Startups (JOBS) Act, signed into law by President Obama in 2012, democratized access to capital by allowing entrepreneurs to advertise that they’re raising money and sell equity to accredited investors from the general public. Before the JOBS Act, startups raised capital under 80-year-old laws from only the wealthiest investors.
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Geostellar’s online solar marketplace looks at consumer behavior and utility prices in a user’s neighborhood to estimate how much money a homeowner can save, how much power he or she can generate and how much carbon pollution he or she can prevent by installing solar panels. Data pulled from State University of New York and the National Oceanic and Atmospheric Administration allows Geostellar to factor in local weather patterns and the angles and timing of sunshine.
On Tuesday, Geostellar announced a partnership with Pensco Trust Company, to facilitate investments by self-directed retail investors using tax-deferred retirement accounts.
“As more and more investors look for products that are socially and environmentally responsible to generate income, self-directed IRAs have grown in popularity over the last few years as a way to invest in privately held companies,” Pensco CEO Kelly Rodriques said in a statement. “As a result, we’ve seen an increase in the number of investors that are using self-directed IRAs to invest in alternative investments in areas like solar energy and private company stock. We are excited about our partnership with Geostellar on this offering.”
Geostellar also said Tuesday that four energy and technology industry leaders joined its board. In addition to Levine, the directors now include Paul Feldman, director of the Midwest ISO that manages utilities in the Midwest; Tracy McKibben, a financial strategist and president and CEO of MAC Energy Advisers; Scott Rotruck, an energy attorney; and Howard Teich, a leadership coach and organizational psychologist.
The solar industry appears on a solid growth path. Last year it installed a record number of photovoltaic capacity at 4,751 megawatts, a 41 percent increase from 2012. Prices for solar panels have dropped by 60 percent since 2011, fueling the increase in solar power generation, but straining some solar manufacturers. Further, the U.S. Energy Information Administration predicts that utility-scale solar capacity will increase by 56 percent from the beginning of 2014 to the end of 2015.