Backing the electrifying ⚡ Versiro mission powered by AI
Versiro, a startup providing real-time multi-market decision support for electrical power assets, just announced its €2.3M seed round led by Alliance VC with participation from Johannes Teyssen, Sondo Capital, founders from Enode + Superside and existing investors. Jørgen Kildahl is Versiro’s new chairman. We are thrilled to back the founders and company on the mission to enable flexibility and help integrate renewables into the grid ⚡. This is why 👇
News coverage of the funding round by Tech Funding News, EU-Startups, Startup Rise EU, ArcticStartup, Handelsblatt (🇩🇪) and Shifter (🇳🇴).
The volatility and complexity challenge caused by renewables
Electricity is a special commodity that must be consumed when produced. The power grid operates in real-time and only a fraction of the power in the system can be time-shifted with the current energy storage technology and capacity. Renewable energy capacity is growing rapidly to drive the green transition, led by solar capacity increasing much faster than predicted.
Mature renewables, solar and wind, are affordable and accessible but unreliable. The increase in renewables strains the power grid, and flexibility becomes an increasingly scarce and valuable resource in both generation, consumption and storage. The renewables growth, as well as in electrification of industry and transport, is already driving a massive increase in electricity market volatility and intraday (same-day) trade volume. The market and regulatory drivers are strong, and this trend is expected to continue.
With mainly flexible, fossil fuel-based power resources in operation competitive advantage in electricity markets was derived from better long-term decisions. With increasingly volatile power systems, faster and more accurate short-term decisions become key to optimizing resource utilization and maximizing value.
Short-term decisions for asset optimization and electricity trading are complex due to multiple factors:
- the perishable nature of electricity
- the market is tied to an underlying and highly complex physical system with many constraints
- electricity is both traded and regulated in multiple markets with different time windows up to the time of production and consumption
- interdependencies between the different markets and time windows
The various markets and time windows can and must be used to adjust positions to ideally utilize and price flexibility while optimizing return on assets and/or reducing losses. Current market practices and systems are inadequate for managing this complexity, and the pitfalls related to planning errors are big. Better planning and more informed, faster decision processes provide better prices for consumers and better returns for power producers, leading to net benefits for society and a more cost-efficient supply of green energy.
Using a generative AI model to optimize power asset utilization
Versiro offers a real-time AI platform with a holistic approach to decision-making, providing analytics for power assets in various markets and geographies. The multi-market capabilities include day-ahead, intraday and regulated electricity markets, including the interdependence between markets. The platform is already deployed by leading power generation companies to trade electricity in the short-term markets.
The core of Versiro’s platform is a proprietary AI model architecture that simulates the power market. This model has been developed over multiple years building on the founders’ experience, research and interest in the topic. The platform provides real-time analysis of data streams and enables power asset owners to make physics-informed decisions. Versiro shines with its versatility: giving users ownership of their decisions and the ability to execute individual strategies and automatize real-time decision processes — i.e. system capabilities far beyond normal prediction/forecasting models.
Versiro has the functionality to back-test on historical data, proving the platform value and ROI, and provides tools to evaluate and improve decision-making to target and secure further ROI improvements. Versiro’s capabilities are extendable to many new market segments, both flexible and inflexible assets, and both on the generation and consumption sides of the power system. This will help enable and unlock the much-needed flexibility in the market and optimize system utilization.
Deep domain expertise backed by an impressive alliance
Both Versiro founders, Simon Risanger and Markus Löschenbrand, are electricity market researchers with PhDs from NTNU and broad experience in quantitative topics such as electrical engineering, economics, operations research, statistics and machine learning. The Versiro platform is a product of their research into renewable energy and passion for AI. An impressive international team with diverse technical backgrounds and proven AI/ML skills complement the two founders. This mix of deep domain expertise and technical skills provides a unique and ideal foundation for building a great company in this space.
As a venture capitalist, it’s a privilege and an unfair deal-flow advantage to meet and build relationships with smart founders early. I was lucky to meet Simon and Markus already in 2021 when they were part of the REACH program run by Nordic Innovation House in Silicon Valley. REACH is a program aiming to support research-based startups from inception, where I’ve had the opportunity to contribute over the years. When we first met, Simon and Markus were just in the process of founding the company. Even back then it was easy to see that these two individuals were outstanding and that their work-in-progress proposition was fundamentally powerful and differentiated.
The quality of people joining the Versiro journey is a testament to the founders and a validation of both the offering and the mission. Simon and Markus built relationships with seasoned industry experts early in Stine Rolstad Brenna (executive and angel investor) and Knut H. H. Johansen (serial entrepreneur in energy software and angel investor) and established strong collaborations with early customers — not yet announced. It is exciting that two international industry heavy-weights, Johannes Teyssen (former CEO of E.ON and non-exec director at BP) and Jørgen Kildahl (new Versiro chairman, chairman at Scatec, non-exec at Ørsted and Telenor), are joining as investors and resources with the latest funding round. Their involvement will unquestionably boost Versiro’s credibility and reach. Angel tickets from exceptional founders at Alliance portfolio companies, Enode and Superside, further extend the alignment of stars. Our good friends at Sondo Capital, StartupLab and the Fortress Fund complete the great “Versiro alliance” on the company’s cap table.
Ready for Nordic + DACH expansion
Beyond our excitement about the founders, team, supporters, customer offering and opportunity, we are also bullish on Versiro’s plan and timing as the power market is undergoing radical changes.
The Nordic power market will move from 1-hour to 15-minute time windows in Q1 2025; a change that will quadruple the number of available products in the market. This will add complexity and increase the need for better analytics and more automation, thus an important value driver for both Versiro and potential customers. The plan is therefore to expand to Denmark and Sweden this year. Denmark is a prominent and interesting example, where the renewable energy ratio is high and energy trading volumes have taken off, resulting in some energy traders becoming extraordinarily profitable. Needless to say, there are counterparties to these trades, who need better analytics and system support.
Germany is a large power market and another example of a changing power system. Increasing volatility drives regulatory changes, with Germany recently introducing intraday auctions and moving to introduce capacity auctions. Even though these changes have the potential to help reduce the strain on the power grid they provide a more complex optimization problem for power producers and consumers. Versiro will cater to these needs by launching its offering in the DACH region also in 2024. It comes in handy that one of the founders, Markus, is Austrian and based in Vienna, making the DACH region another “home market” for Versiro 😀.
We are confident that Versiro can be a valuable enabler in orchestrating the green transition, and we are stoked to join this electrifying ⚡️journey as a financial backer and contributor. 💚🚀
Alliance Venture Delta is proud to be backed by:
Supported by InnovFin Equity, with the financial backing of the European Union under Horizon 2020 Financial Instrument and the European Fund for Strategic Investments (EFSI) set up under the Investment Plan for Europe. The purpose of EFSI is to help support financing and implementing productive investments in the European Union and to ensure increased access to financing.
