Dandelion Energy Inc. has raised $40 million in fresh funding for the national rollout of its geothermal systems that heat and cool single-family homes and multifamily housing.
The new funding brings Dandelion's total outside investment to more than $130 million since its founding by President Kathy Hannun in 2017. It also comes following the relocation of Dandelion's headquarters from Mount Kisco, New York, to Arlington earlier this month.
Google Ventures, the venture capital investment arm of Alphabet Inc., led the Series C round. Collaborative Fund, a New York venture firm, also participated, as did LenX, the investment arm of Miami homebuilder Lennar Corp.; Bill Gates' Breakthrough Energy Ventures; and Dallas investment firm NGP.
CEO Dan Yates, who co-founded Arlington utility management provider Opower Inc. in 2007, told me the startup is committed to scaling its operations in Greater Washington. By year's end, he plans to staff about 15 people at new offices at 1515 N. Courthouse Road, which, coincidentally, was Opower's headquarters before Oracle Corp. acquired the company in 2016 for $532 million. Yates said Dandelion employs over 100 workers today across its other offices in central New York and Massachusetts.
"This is where we're hiring most of our new hires," Yates said of Greater Washington. "Operational folks as well as all of our back-office hires are now going to be in D.C. We just hired a senior HR person, an accountant. We're now hiring sales and marketing staff. I just interviewed a product marketer today. I have a sales interview tomorrow."
Yates said Dandelion has installed more than 2,000 geothermal systems in new homes in states like Connecticut, Massachusetts and New York. Going forward, the company will continue to target regions of the country where overall annual energy demands for heating outpace those for cooling like the Midwest, Pacific Northwest and even potentially into Canada.
"We haven't started selling there yet, but geothermal is just a slam dunk in Canada," Yates said.
Due to nearly $400 billion in federal clean energy incentives from the Inflation Reduction Act, Dandelion’s geothermal systems are becoming an easy sell to homebuilders, Yates said. Depending on tax credit eligibility, some homebuilders can see the costs drop to $0 when certain rebates and credits offset installation costs.
"What's amazing is how much the incentives landscape has changed this," Yates said.
Since its founding, Yates said Dandelion has generated over $100 million in revenue. He said he expects to see the company's annual revenue increase five-fold over the next few years and expects the new capital to keep the company's books balanced until then.
