Despite record growth in the solar industry last year, software startup Aurora Solar laid off 20% of its roughly 1,000 employees, TechCrunch has learned exclusively.
The company, which provides software to help solar installers manage their sales, project design and installation process, missed growth targets last year, a source said. Monday's layoffs follow about 20 layoffs in November, they said.
Aurora Solar last raised $200 million in a Series D round that closed in February 2022, less than nine months after raising a $250 million Series C. In total, the company has raised $523 million, according to PitchBook.
The company did not respond to a request for comment.
Aurora solar is likely to hit stiffer-than-expected headwinds in California, where changes to net metering have resulted in homeowners paying about 75% less for electricity sold back to utilities. While demand for solar energy among single-family homeowners may not be growing, the new regulations are likely to overturn its previous trajectory.
According to Aurora Solar's data, net metering changes spurred interest last year, giving homeowners a chance before the new rules take effect.
With net metering rates reduced, the state has decided to offer greater incentives to solar installations with batteries. But many door-to-door sales representatives, especially those who work independently, are ill-equipped to sell batteries because they need much more detail about the home than solar.
To design and permit a battery system, sales representatives must calculate the home's daily energy use, size the home's electrical panel, and determine where to place the batteries. Solar, on the other hand, can often be sold by looking at satellite photos of a home's roof and surrounding trees and buildings, from which software can easily calculate how much power a solar array can produce.
As a result, small installers are under pressure under the new regime. While Aurora Solar says its software is used by 90% of the top 100 solar installers, it also has 7,000 customers, many of whom may fall into the long tail of distribution, who say they are under a lot of pressure. In total, California's solar industry is estimated to have cut 17,000 jobs last year.