making moves

Houston energy startup acquired by growing tech company

Trent Crow, founder and president (left), and Paul Paras, founder and vice president, and the rest of the Real Simple Energy team have moved over to Arcardia with the acquisition. Photo courtesy of Real Simple Energy

February's massive winter weather disaster underscored the fragile availability and volatile cost of electricity in the Houston area and throughout Texas. Just a month after the calamity, a Washington, D.C.-based company has scooped up Houston-based Real Simple Energy to help put power back in the hands of electricity consumers in Texas.

Arcadia, a tech company that connects U.S. homeowners and renters to renewable energy, said March 17 that it had purchased Real Simple Energy. Terms of the deal for the three-year-old startup weren't disclosed.

Real Simple Energy's automated platform matches power usage with the lowest rates in the Texas marketplace to reduce electric bills. The company manages all facets of a customer's monthly power bills.

Trent Crow, co-founder and CEO of Real Simply Energy, says all eight of the company's employees have moved over to Arcadia and more workers will be hired soon. The company has maintained a mix of office and remote workers. Arcadia will look for Houston office space later this year, Crow says.

"Expansion plans include doing more of what we're doing now and offering more features for customers," says Crow, who now is Arcadia's general manager of energy services in Texas.

Aside from Crow, co-founders of Real Simple Energy are Paul Paras and Matt Herpich.

Real Simple Energy says its customers save an average of 36 percent, or $548 a year, on electricity. That figure is based on the power bill for a 2,300-square-foot home. The startup says its fixed-rate and fixed-bill plans aren't subject to the types of spikes in power prices that many Texans experienced during February's winter weather disaster.

"Recent events in the Texas market prove that customers shouldn't be exposed to wholesale or variable rates, and want an energy advocate to protect them," Kiran Bhatraju, founder and CEO of Arcadia, says in a release. "Both Arcadia and Real Simple Energy recognize the challenges Texas homeowners and renters have historically faced in the energy-buying process, and we remain committed to removing these confusing barriers. We'll always be on the customer's side, focusing on the best rate and protecting our customers from bad actors."

Crow says the struggle to bring down energy costs at his home prompted him to start the company. He spent several years as a wholesale power trader at JPMorgan Chase.

"The deregulated energy industry, especially in Texas, has underserved customers and, as a result, most customers overpay for electricity and receive poor customer service. Using technology, we are helping customers realize the promise of deregulation and always get the best fixed rates available," Crow says in a release.

This deal represents the first acquisition for Arcadia, founded in 2014. In partnership with 125 utilities in 50 states, Arcadia oversees 4.5 terawatt hours (4.5 trillion kilowatt hours) of residential demand for energy. It's the biggest manager of residential solar in the U.S.

Arcadia has raised $70.5 million in funding, according to Crunchbase.

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Building Houston

 
 

Craig Lawrence and Neal Dikeman co-founded a new venture capital firm focused on funding technology as a part of the energy transition. Photos courtesy

Two Texas entrepreneurs recently announced what they say is the first venture fund in Texas exclusively dedicated to investing in energy transition technologies.

Houston-based Energy Transition Ventures — led by Craig Lawrence and Neal Dikeman — officially emerged from stealth mode with anchor investment from two operating companies from the GS Group of Korea. The fund closed its first capital in February this, completed its first investment in March, and looks to close new investors for a total fund size of $75 million, according to a press release.

"In the near future, energy is going to be delivered and used completely differently. Marginal and average energy and CO2e prices are now on a long term deflationary trend," says Dikeman in the release. "There are 500 multi-billion dollar energy companies globally, and massive portions of global GDP, that are going to get disrupted in the energy transition, from energy & power, transport, real estate, industrial to consumer to agriculture."

Dikeman, who is the managing partner at Old Growth Ventures, a family office investor, also chairs the board at nonprofit cleantech accelerator Cleantech.org, virtual research institute. In 2001, he co-founded San Francisco based cleantech investment firm Jane Capital in 2001.

"We've been successful being highly selective as investors, and using our deep networks and understanding of energy and technology to avoid pitfalls other investors faced. It is exciting to be off the bench to do it again," he continues.

Lawrence, who's also been a part of the cleantech revolution for a chunk of his career, previously started and led the cleantech investing effort at Accel Partners and was previously vice president of product at software company Treverity. The duo chose the Energy Capital of the World to headquarter ETV.

"Texas is the energy capital of the world, and outside of corporate venture capital, there are not many venture funds in the state," says Lawrence. "So it makes sense to start an energy transition focused fund here as the latest wave of clean technology investing accelerates."

ETV will fund from seed to series B with select late-stage opportunities, according to the release, and will colocate a Silicon Valley office with GS Futures, the Silicon Valley-based corporate venture capital arm of energy, construction, and retail conglomerate GS Group of Korea.

"We're excited to be investing in ETV and in the future of energy," says Tae Huh, managing director of GS Futures, in the release. "Energy Transition Ventures is our first investment from the new GS Futures fund, and we've already run successful pilots in Korea with three US startups even before this fund closed an investment – we are working to accelerate the old model of corporate venture dramatically."

Jon Wellinghoff, former chair of FERC, and Deb Merril, president of EDF Retail and co-founder and former co-CEO of Just Energy, have also joined ETV as advisors. GS Energy executive Q Song moves from Seoul, Korea, to join the Houston ETV investment team, according to the release.

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