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2016 IPO Prospects: Bloom Energy Likely to Stay Private

Posted on Thursday, Jun 16th 2016


According to the Department of Energy, the fuel-cell industry grew to $2.2 billion in 2014, up from $1.3 billion in 2013. The $2 trillion a year electric power industry is poised to grow 80% by 2040 while fuel cell market estimates range from $5.2 billion in 2019 to $40 billion in 2022. Bloom Energy is estimated to account for 40% of the large stationary fuel cell market.

Bloom Energy’s Offerings

Sunnyvale, California-based Bloom Energy makes large stationary power devices that use fuel cells to convert natural gas or methane into electricity. It was founded in 2001 by K.R. Sridhar who was a researcher at NASA working on a project to sustain life on Mars. When that project was canceled, he founded a company to commercialize the fuel cell developed for that project.

These power units produce power on premise, thereby reducing reliance on grid power and saving on utility bills and power back up costs. Today its power devices are used in office buildings, retailers, data centers, and other customer locations. Its customers include premier paying customers like Apple, Google, Adobe, AT&T, Walmart, eBay, IKEA, Coca-Cola, and The Home Depot, to name a few. It recently bagged two deals to power Morgan Stanley’s headquarters in Times Square in New York City and AEG’s Staples Center sports arena in Los Angeles. Bloom Energy claims to have installed more than 200 megawatts of its fuel cell units in the US.

Bloom Energy’s Financials

Bloom Energy does not disclose its financials but according to a report from 2013, Bloom Energy had pro forma revenue of $42 million in Q1 2013, down from $101 million in Q3 2012. Q3 2012 pro forma loss was nearly $32 million. It also reported a 26% quarter-over-quarter revenue increase, and had booked 87 new commercial customers in that quarter.

However, profitability is a big concern. Manufacturing, installing, and maintaining costs can be high. Cost for generating 1 kilowatt with a Bloom Box is estimated to be $7000 to $8000 while other public companies are showing that costs are approaching $3000 per kilowatt. Its fate is also subject to the volatility in the price of natural gas. So far, Bloom Energy has relied on state subsidies for distributed energy as well as venture funding.

In 2002, Sridhar convinced John Doerr of Kleiner Perkins Caufield & Byers to invest in the company. Its board members include Steve Case, co-founder of America Online, and Colin Powell, former US Secretary of State. Such high-profile support helped it raise $1.2 billion in all from investors including Advanced Equities Financial, AdvancedStage Capital, Credit Suisse Group, DAG Ventures, E.ON Venture Partners, Goldman Sachs Ventures, Kleiner Perkins Caufield & Byers, Mobius Venture Capital, New Enterprise Associates, and New Zealand Superannuation Fund.

Its last round of funding in 2011 for $150 million valued it at $2.9 billion. Publicly trading competitor FuelCell Energy Inc, which recently reported a 27% increase in losses and a 24% decline in revenues saw its market cap drop to $156 million.

In December 2014, it raised $130 million in a convertible note offering. Michael Dempsey, an analyst at venture capital research firm CB Insights says that the convertible note offering is an indication that another equity round could only have been executed at a dramatically reduced valuation.

Industry analysts are ever hopeful of an IPO for Bloom Energy as its revenue is substantial enough. However, it would trigger a reduced valuation in the current market, which would not go down well with investors. Profitability remains a concern for the company and the industry.

Photo credit: Bloom Energy/


This segment is a part in the series : 2016 IPO Prospects

. Airbnb Sees Skyrocketing Valuations
. Actifio Looks Ready
. AppDynamics May Sustain Unicorn Valuation
. Automattic Needs to Justify Valuation
. Avant Will Have to Wait and Watch
. BuzzFeed Feeds on Native Advertising
. Coupa Manages Expenses Expertly
. Datto Bootstrapped First, Raised Money Later
. Is Uber Ready to Ride the Stock Market?
. Overfunded Domo Looks Promising
. Houzz May Unveil The Curtains
. DocuSign Looks Ready to Sign Up
. Illumio Rides On Security Trend
. Appears Ready to List
. Okta Prepares to Reveal Public Identity
. Palantir Wants to Stay Private
. Nutanix Files for IPO
. Medallia Bootstrapped First, Raised Money Later
. Slack Prepares to Communicate with the Market
. Twilio Expected to go Public Soon
. Snapchat Needs to Up Monetization ASAP
. Zscaler Sets IPO as a Long-Term Goal
. Warby Parker Should Look Before Leaping
. MuleSoft is a Unicorn, but Detailed Financials Remain Unknown
. Apttus Bootstrapped First, Raised Money Later
. Fanatics Expanding Its Playing Field
. Pinterest Finally Sees Revenues, But are they Enough?
. Tanium Bootstrapped First, Raised Money Later
. ironSource Strengthening its Revenue Generating Capabilities
. Anaplan Getting Ready to Go Public
. SecureWorks is Ready to List
. IPO-Ready Cloudera Wants to Wait and Watch
. HelloFresh Puts its IPO Plans on Hold
. Is Stripe Lining up Next?
. Qualtrics Bootstrapped First, Raised Money Later
. Skyscanner Bootstraps First from Scotland, Raises Money Later from Sequoia
. SurveyMonkey Will Likely Wait
. The Honest Company Makes the Online to Offline Model Work
. NantHealth Testing the IPO Markets, Yet Again
. BigCommerce Prepares to List
. Bloom Energy Likely to Stay Private
. Avast Software Preparing for a Listing, Yet Again
. Gusto Expands Beyond Payroll Processing
. InMobi May Have Missed the Bus
. Glassdoor Gearing up to go Public
. Human Longevity Leverages Machine Learning and Analytics to Increase Lifespan
. Blue Apron Cooking up an IPO
. Optiv Grows Inorganically
. Uber Eyeing Self-Driving
. The Trade Desk Files to List
. Deliveroo Delivers its Way to the Bank
. Selfie App Meitu Files to List on HKSE
. Apptio Files Despite Reduced Valuation and Mounting Losses
. Snap Snaps out of Chat Business to Justify Valuation
. From Bootstrapping to IPO, BlackLine Shows the Way

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