Neighborhood Sun

Neighborhood Sun

Growth Stage

A tech-enabled community solar platform dramatically expanding solar access

A tech-enabled community solar platform dramatically expanding solar access

Overview

Raised to Date: Raised: $103,750

Total Commitments ($USD)

Platform

Wefunder

Start Date

05/09/2024

Close Date

09/09/2024

Min. Goal
$50,000
Max. Goal
$618,000
Min. Investment

$250

Security Type

SAFE

Series

Series A

SEC Filing Type

RegCF    Open SEC Filing

Early Bird Val. Cap

$23,000,000

Valuation Cap

$25,000,000

Discount

30%

Rolling Commitments ($USD)

Status

Active

Reporting Date

05/22/2024

Days Remaining

109

% of Min. Goal

208%

% of Max. Goal

17%

Likelihood of Max
likely
Avg. Daily Raise

$7,981

# of Investors

90

Momentum
warm.svg
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Year Founded

2016

Industry

Energy, Power, & Natural Resources

Tech Sector

Cleantech

Distribution Model

B2B/B2C

Margin

Medium

Capital Intensity

High

Location

Silver Spring, Maryland

Business Type

High Growth

Neighborhood Sun, with a valuation of $25 million, is raising funds on Wefunder. The Energy-as-a-Service company has developed a community solar technology platform to bring solar power to everyone. Sun Engine, the advanced technology platform of Neighborhood Sun, is customizable, flexible, transparent, accessible, and responsive. Neighborhood Sun has 136 community solar farms under management across seven states and generated $4.8 million in revenue in 2023. Gary Skulnik founded Neighborhood Sun in November 2016. The current crowdfunding campaign has a minimum target of $50,000 and a maximum target of $618,000. The campaign proceeds will be used to expand into new markets, build out the IT platform, and hire senior management.

Summary Profit and Loss Statement

FY 2023 FY 2022

Revenue

$4,889,506

$1,906,242

COGS

$2,316,881

$742,342

Tax

$0

$0

 

 

Net Income

$-1,622,860

$-2,754,645

Summary Balance Sheet

FY 2023 FY 2022

Cash

$232,621

$735,234

Accounts Receivable

$696,429

$620,671

Total Assets

$7,889,187

$8,355,618

Short-Term Debt

$1,021,776

$2,346,511

Long-Term Debt

$203,381

$247,943

Total Liabilities

$1,225,157

$2,594,454

Financials as of: 05/09/2024
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Raise History

Offering Name Close Date Platform Valuation/Cap Total Raised Security Type Status Reg Type
Neighborhood Sun 09/08/2024 Wefunder $25,000,000 $103,750 SAFE Active RegCF
Neighborhood Sun 09/15/2022 Wefunder $27,500,000 $920,433 Convertible Note Funded RegCF
Neighborhood Sun 01/11/2021 Wefunder $15,000,000 $801,546 SAFE Funded RegCF
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Price per Share History

Note: Share prices shown in earlier rounds may not be indicative of any stock splits.

Valuation History

Revenue History

Note: Revenue data points reflect the latest of either the most recent fiscal year's financials, or updated revenues directly from the founder, at each raise's close date.

Employee History

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Analyst Report

Synopsis

Neighborhood Sun Benefit Corp is at the forefront of a shift in how individuals and communities access solar power. With its tech-enabled platform, Sun Engine, Neighborhood Sun democratizes solar energy, making it accessible, transparent, and responsive to everyone, regardless of location or economic status. This innovative approach to community solar aligns with growing environmental concerns and taps into the increasing demand for renewable energy solutions.

Founded in November 2016 by Gary Skulnik, Neighborhood Sun has shown impressive growth and progress. The company has successfully managed 136 community solar farms across seven states, demonstrating a scalable and effective model for expanding solar access. In 2023, Neighborhood Sun generated $4.8 million in revenue, highlighting its platform's commercial viability and customer acceptance. Neighborhood Sun is well-positioned for further growth with $6,668,863 raised in prior funding rounds and support from notable investors such as TEDCO, ImpactAssets, Chesapeake Bay Seed Capital Fund, and Meyer Global Management.

The company's current fundraising campaign on Wefunder, targeting a minimum of $50,000 to a maximum of $618,000, aims to expand into new markets, enhance its IT platform, and strengthen its management team. This strategic use of proceeds is expected to accelerate Neighborhood Sun's mission to provide clean energy to everyone, especially those most vulnerable to climate change. With a valuation cap of $25 million and a 30% discount, this offering presents a compelling opportunity for investors looking to contribute to a sustainable future while participating in the growth of a high-impact, high-growth company.

Next Section: Price

Price

Neighborhood Sun is currently positioned as an attractive investment opportunity in the rapidly growing community solar sector. With a reported revenue growth from $1.9 million in 2022 to $4.9 million in 2023, the company has demonstrated a significant upward trajectory in its financial performance. This growth is further underscored by the management of 136 community solar farms across seven states, highlighting both the operational scalability and market reach of Neighborhood Sun. The company's valuation of $25 million on Wefunder, coupled with a 30% discount for early investors, presents a compelling entry point for potential investors looking to capitalize on the expanding US Solar Power market. With a 5.1x valuation-to-revenue multiple, the company's valuation is fair for investors.

The impressive revenue growth of 156.5% year-over-year is a testament to the effectiveness of the SunEngine technology platform. This platform's automation capabilities have enhanced productivity, contributing to the company's ability to scale operations and increase revenue efficiently. Such technological leverage within the Energy-as-a-Service sector is critical in assessing Neighborhood Sun's long-term growth potential and market competitiveness.

Next Section: Market

Market

The U.S. Solar Power market, valued at $19.5 billion, is experiencing a surge in growth with a projected annual growth rate of 13.4%. This growth is driven by increasing environmental concerns over carbon emissions from conventional fuels, a heightened demand for renewable energy sources, and supportive government policies and incentives for solar PV system installations. Neighborhood Sun Benefit Corp positions itself within this rapidly expanding market with its unique community solar technology platform, Sun Engine, designed to democratize solar power access. This platform's flexibility, transparency, and accessibility cater to a growing population seeking sustainable energy solutions but lacking the means for private installations.

Neighborhood Sun's innovative approach to community solar projects addresses key market drivers by enabling residential and commercial segments to partake in clean energy benefits without needing individual solar installations. The availability of net metering schemes for grid-connected systems and the integration of battery storage systems further bolster the appeal of community solar arrangements, offering a practical solution to energy storage and distribution challenges.

Despite the high market potential and favorable growth trends, Neighborhood Sun operates in a competitive landscape with established players like Solstice, Nexamp, and Ampion. These competitors underline the market's viability but highlight the importance of differentiation and customer acquisition strategies. Neighborhood Sun's existing management of 136 community solar farms across seven states and revenue of $4.8 million in 2023 demonstrates its capability to scale and sustain in this slightly competitive market.

Government policies, incentives, and tax benefits play a critical role in accelerating the adoption of community solar projects. While the market for solar power in the U.S. is subject to varying degrees of regulation depending on the state, the overall trend toward supporting renewable energy sources provides a conducive environment for companies like Neighborhood Sun to expand their operations.

In conclusion, Neighborhood Sun's innovative community solar platform, Sun Engine, positions the company to leverage the growing demand for clean, renewable energy sources in the United States. The outlook for Neighborhood Sun and the broader U.S. solar power market remains positive, with supportive government policies and a clear consumer preference for sustainable energy solutions.

Next Section: Team

Team

Neighborhood Sun, under the leadership of CEO Gary Skulnik, is making significant strides in the community solar industry. Skulnik, a seasoned clean energy entrepreneur and climate advocate, brings a wealth of experience to the company. His journey from a journalist to a pro-environment lobbyist on Capitol Hill and later founding Clean Currents—a clean energy startup focusing on wind power—demonstrates his deep commitment to renewable energy. Under his leadership, Clean Currents achieved notable success, growing to millions in revenue. Skulnik's transition from Clean Currents to founding Neighborhood Sun highlights his entrepreneurial spirit and dedication to making solar power accessible to all, especially those most vulnerable to climate change.

John Wilson, the Chief Technology Officer (CTO) of Neighborhood Sun, contributes nearly two decades of product and software experience, particularly in the solar sector. His venture into the solar world began with the founding of Better Current, which produced solar charging stations. Today, Wilson spearheads the development of Neighborhood Sun's Sun Engine software platform, a testament to his expertise and innovative approach to technology in the solar power industry.

Cara Humphrey, the Chief Revenue Officer (CRO), oversees the Community Partnership Program, among other campaigns. Her background with Astrum as Sales Manager of NY and her experience at the forefront of commercial energy efficiency and the hybrid vehicle industry equip her with the necessary skills to drive Neighborhood Sun's revenue growth and expand its market reach.

Emily Tokarowski, Vice President of Marketing, has shown remarkable progression within Neighborhood Sun, advancing in various roles over nearly five years. Her leadership in marketing and her educational background, indicated by an unspecified master's degree, position her as a key player in promoting Neighborhood Sun's mission and services to a broader audience.

With a team that combines extensive experience in clean energy, technology development, sales, and marketing, Neighborhood Sun is well-positioned for growth. The company's success in managing 136 community solar farms across seven states and generating $4.8 million in revenue in 2023 reflects the team's capability to execute its vision of making solar power accessible to everyone. As Neighborhood Sun continues to expand into new markets and build out its IT platform, its team's leadership and dedication will be crucial in navigating the challenges and opportunities that lie ahead in the rapidly evolving energy sector.

Next Section: Differentiation

Differentiation

Neighborhood Sun Benefit Corp distinguishes itself in the competitive US solar power market through its innovative community solar technology platform, Sun Engine. This platform is designed to be customizable, flexible, transparent, accessible, and responsive, addressing key customer needs in the solar energy sector. Unlike its direct competitors, such as Solstice, Nexamp, and Ampion, Neighborhood Sun has rapidly expanded its footprint, managing 136 community solar farms across seven states. This extensive network under management is a testament to the company's ability to scale and meet the growing demand for renewable energy solutions.

The company's significant revenue growth, from $1.9 million in 2022 to $4.9 million in 2023, underscores its successful business model and the effectiveness of the Sun Engine platform in enhancing productivity. Implementing automation within Sun Engine in 2023 has been a pivotal factor in this massive increase in productivity, indicating Neighborhood Sun's commitment to leveraging technology for operational efficiency and customer satisfaction.

Moreover, Neighborhood Sun's approach to making solar power accessible to everyone, especially those most vulnerable to climate change, positions it as a socially responsible player in the energy sector. This focus on inclusivity and empowerment through clean energy aligns with growing consumer and investor interest in sustainable and ethical business practices. While the company does not hold patents, its unique value proposition and business model, combined with a high differentiation level in terms of quality and price, set it apart in a slightly competitive landscape with low barriers to entry.

In summary, Neighborhood Sun's differentiation lies in its advanced technology platform, extensive community solar farm management, and commitment to social responsibility. These factors, coupled with impressive revenue growth and operational efficiencies gained through technological innovation, position Neighborhood Sun as a compelling choice for consumers and investors in the renewable energy market.

Next Section: Performance

Performance

Neighborhood Sun has exhibited remarkable growth and performance over the past year, underscoring the company's potential within the renewable energy sector. The company's revenue growth from $1.9 million in 2022 to $4.9 million in 2023, marking a significant 156.50% increase, highlights its successful expansion and the increasing demand for community solar solutions. This growth is awe-inspiring, given the context of the energy sector's competitive landscape and the challenges associated with scaling community solar projects.

The company's management of 136 community solar farms across seven states demonstrates its ability to scale operations effectively while focusing on its mission to make solar power accessible to all. The Sun Engine software platform's successful development, launch, and utilization have been pivotal in achieving this scale. The platform's customization, flexibility, transparency, accessibility, and responsiveness have enhanced operational efficiency and played a critical role in driving customer acquisition and retention.

Despite being in a pre-profit phase, Neighborhood Sun's strategic investments in technology and operational efficiencies, as evidenced by the implementation of automation in SunEngine, have led to a massive increase in productivity in 2023. This strategic focus on technology and process optimization positions the company well for future profitability and growth.

With a monthly burn rate of approximately $101,823 and cash on hand of $435,223 as of the most recent reporting period, Neighborhood Sun's financial management strategies will be crucial in sustaining its growth trajectory. The company's successful fundraising efforts, totaling $6.7 million, underscore investor confidence in its business model and growth prospects.

In conclusion, Neighborhood Sun's performance over the past year highlights the company's successful execution of its growth strategy, the effectiveness of its technology platform, and its potential to lead in the community solar market. As the company continues to expand its footprint and enhance its technology offerings, it is well-positioned to capitalize on the growing demand for renewable energy solutions.

Next Section: Risk

Risk

Despite Neighborhood Sun's promising growth trajectory, potential investors should carefully consider several risk factors associated with the company's current operation and market position. Neighborhood Sun operates in the rapidly expanding US Solar Power market, leveraging its community solar technology platform, Sun Engine, to manage 136 community solar farms across seven states. While the company witnessed a significant annual revenue growth of 156.50%, reporting $4.8 million in revenue in 2023, it remains in a pre-profit stage with a notable monthly burn rate of $101,823.

One primary concern is the company's short-term debt, which stood at $1,021,776 at the fiscal year-end, juxtaposed with its cash and cash equivalents of $435,223. This liquidity position may necessitate additional capital raising in the near term, potentially diluting existing equity holders or imposing financial strain if not managed prudently. Furthermore, while the revenue model is transactional with recurring elements, indicating a potential for stable future revenues, the company has yet to reach profitability, evidenced by a net income of -1,622,860 for the most recent fiscal year.

Another risk to consider is the competitive landscape. Although described as "slightly competitive," the company operates in an industry with notable competitors such as Solstice, Nexamp, and Ampion. These competitors could limit Neighborhood Sun's market share growth or pressure pricing strategies. Moreover, the lack of patents could expose the company to competitive risks, where unique technological advantages are more complicated to defend.

Additionally, the company faces challenges in market acceptance, which is described as low. This could indicate that while the innovative product offering meets a growing demand for renewable energy solutions, customer adoption may be slower or more costly than anticipated.

Finally, while the company benefits from a capped valuation, indicating a measure of protection for investors, it operates in a high capital-intensity sector. This necessitates ongoing access to capital for continued growth and operational sustainability, posing a risk if the capital markets become less favorable or operational efficiencies are not achieved as planned.

Next Section: Bullish Outlook

Bullish Outlook

Neighborhood Sun Benefit Corp's innovative community solar technology platform, Sun Engine, positions the company at the forefront of the renewable energy sector. By making solar power more accessible, customizable, and transparent, Neighborhood Sun taps into the growing demand for clean, sustainable energy solutions, all while providing cheap energy to its customers.

The company has made impressive progress since its last raise in 2022. It manages 136 community solar farms across seven states, generating close to $4.9 million in revenue in 2023 - a growth of 156.5% from 2022. Such growth clearly indicates the company's strong product-market fit and the increasing consumer and business adoption of renewable energy solutions.

The backing by renowned VC investors such as TEDCO, ImpactAssets, Chesapeake Bay Seed Capital Fund, and the hedge fund Meyer Global Management further bolsters confidence in Neighborhood Sun's strategic direction, operational capabilities, and market opportunity. This support provides the financial runway needed for continued growth and validates the company's vision and market approach.

Next Section: Bearish Outlook

Bearish Outlook

Neighborhood Sun operates against competitors such as Solstice, Nexamp, and Ampion. These competitors could limit Neighborhood Sun's market share growth. This competitive landscape could pressure profit margins and market expansion efforts, particularly as the company seeks to manage and expand its portfolio of 136 community solar farms across seven states.

Additionally, while the company has shown impressive revenue growth, with a year-over-year increase of 156.50% to $4.8 million in revenue in 2023, it reported a substantial net loss of $1,622,860 at the most recent fiscal year-end. This discrepancy between revenue growth and profitability may raise concerns about the company's pathway to profitability, particularly if it continues to incur significant expenses without a proportional increase in revenue.

Next Section: Executive Summary

Executive Summary

Neighborhood Sun, an innovative Energy-as-a-Service company, has demonstrated remarkable progress in the community solar sector by leveraging its proprietary technology platform, SunEngine. This platform has significantly contributed to the company's impressive revenue growth from $1.9 million in 2022 to $4.9 million in 2023, marking a 156.50% increase. With 136 community solar farms under management across seven states, Neighborhood Sun effectively addresses the growing demand for renewable energy sources in the US, driven by increasing environmental concerns and supportive government policies.

The company's business model, which combines transactional and recurring revenue streams, is designed to capitalize on the high market potential of solar power in the US. This potential is further underscored by the rising demand for clean power generation and the availability of incentives for solar PV system installations. Neighborhood Sun's commitment to making solar power accessible to everyone, especially those most vulnerable to climate change, positions it as a leader in the community solar industry.

Despite facing competition from entities like Solstice, Nexamp, and Ampion, Neighborhood Sun's unique value proposition lies in its advanced, customizable, and user-friendly technology platform, SunEngine. This platform not only enhances productivity through automation but also fosters transparency, accessibility, and responsiveness, setting Neighborhood Sun apart from its competitors.

With a valuation of $25 million, Neighborhood Sun is currently raising funds on Wefunder to fuel its next phase of growth. The company plans to use the campaign proceeds to expand into new markets, further develop its IT platform, and strengthen its senior management team. This strategic deployment of funds is expected to enhance Neighborhood Sun's market presence and drive further revenue growth.

However, potential investors should consider the company's pre-profit status and the high capital intensity of its business model. With a monthly burn rate of $135,238.33 and a net loss of $1,622,860 in the most recent fiscal year, the path to profitability will require careful management of operating expenses and continued revenue growth. Despite these challenges, Neighborhood Sun's strong growth trajectory, backed by venture capital investors like TEDCO, ImpactAssets, Chesapeake Bay Seed Capital Fund, and Meyer Global Management, suggests a compelling investment opportunity in the renewable energy sector.

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Neighborhood Sun on Wefunder 2024
Platform: Wefunder
Security Type: SAFE
Valuation: $25,000,000

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