Read original article in Nashville Business Journal.
Nashville’s homegrown solar power sensation reached a billion-dollar valuation by targeting Fortune 100 companies.
The company’s next jolt of growth could come from, well, everybody else.
That prospect is what enticed Reagan Farr, CEO of Silicon Ranch Corp., to purchase fellow Nashville solar startup Clearloop Corp. As a result of the deal, announced Thursday, Clearloop will continue operating as a wholly owned subsidiary of Silicon Ranch. Other terms of the acquisition were not disclosed.
The companies have a common tie: Former Nashville mayor and Tennessee Gov. Phil Bredesen, who co-founded both. In an interview, Farr said the idea came from something else.
“I can’t tell you how many discussions I’ve been in with executives — they’re talking to Silicon Ranch but they all want to ask me questions about Clearloop. I had to say, ‘That’s a separate company. We’re not related.’ But after you have that conversation for the sixth or seventh time, you really start thinking, ‘Why are we separate?'” Farr said.
Silicon Ranch is one of the region’s fastest-growing companies and raised $225 million late last year from investors who valued the company at more than $1 billion. Hitting that threshold makes Silicon Ranch a “unicorn” in Silicon Valley lingo, achieving a profile that could draw more capital and entrepreneurs to the city.
Silicon Ranch makes money from customers who sign long-term agreements to buy its solar power, with projects now active at 145 locations in 15 states. Clients include Facebook Inc. (Nasdaq: FB), General Motors Co. (NYSE: GM), Volkswagen and Vanderbilt University.
Clearloop aims for companies that may not have the means or desire to commit to a years-long contract but want to offset the environmental impact of their corporate travel, shipping or office operations. Clearloop broke ground on its first solar project last month, funded partly by Intuit Inc. (Nasdaq: INTU) and Austin-based Vista Equity Partners.
With his customers asking about Clearloop, Farr said he faced a choice.
“Do I try to start this within Silicon Ranch, and take all the time and resources to do that? Or, they’ve already done that and are a perfect complement,” Farr said.
“In this energy transition, speed matters. Being first to market matters,” he said. “This opens up the avenue to do business will all types of companies, regardless of size.”
Farr said he spoke first with Bredesen, who’s no longer chairman of Silicon Ranch but is a board member and chairman emeritus. Farr then negotiated with the two former Bredesen aides who lead and co-founded Clearloop: CEO Laura Zapata and Bob Corney, chief operating officer. (Both remain in those roles).
Bredesen left the room when Farr presented the proposed acquisition to Silicon Ranch’s board, according to Farr. The board features three people tied to Royal Dutch Shell, which is Silicon Ranch’s majority owner. Start to finish, the deal took about six months to complete, Farr said.
“The governor being a part of Clearloop and Silicon Ranch actually made it more difficult and not easier, as you might imagine,” Farr said. “The business plan itself came together quite easily. Our board was very supportive.”
Up next: Asked about seeking another round of investor equity, Farr said: “We and our partners are making sure we position Silicon Ranch to take advantage of this incredible opportunity to scale and grow, both from a capital and personnel standpoint.”
Silicon Ranch’s equity raise in 2020 was the largest of any Greater Nashville company that year and also that year’s second-largest raise for a solar company worldwide.
Clearloop’s first project is in Jackson, two hours west of Nashville. Silicon Ranch will own and operate that solar farm, involving 2,000 panels spread across 10 football fields worth of farmland. That “array” will generate 1 megawatt of energy a year, enough to power 200 homes in Jackson for four decades.
Zapata previously said Clearloop identified Appalachia and the Mississippi Delta as prime spots its next projects.
“Their next project,” Farr said, “will be much larger than 1 megawatt.”
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