$IPOD = AutoGrid???
When it comes to energy, software will not eat the world — it will help save it.
After an “educated guess” by Shawn J., the fintwit community started to discuss that Chamath Palihapitiya’s Social Capital Hedosophia Holdings Corp. IV (NYSE: IPOD) could potentially merge with AutoGrid.
So, how could AutoGrid fit in Chamath’s vision to build the next Berkshire Hathaway that is focused on technology?
Disclaimer: Base your investment decisions not on rumors only facts. I’m long Social Capital Hedosophia Holdings Corp. IV (NYSE: IPOD) since its IPO.
The Electric grid is being disrupted
The trillion-dollar energy industry is undergoing a disruptive transformation. Energy generation is going from centralized to decentralized. Instead of a few power plants, there will be many solar roofs and wind turbines deployed.
New renewable energy sources, energy storage, and electricity distribution technologies are transforming the electric grid as we know it. Software will play a critical role in making the grid cleaner, more affordable, and more reliable.
With this dramatic change, energy providers must run their businesses in new ways. Energy providers of the future will have to be data-driven, where effective use of data will determine who wins and who loses.
AutoGrid — Smart Grid Category Winner
AutoGrid was founded in 2011 by Amit Narayan with early backing from the U.S. Department of Energy and Stanford University. In total AutoGrid has received over $73.8 million in funding from the leading energy companies e.g. E.ON, Shell, National Grid, and Schneider Electric.
AutoGrid’s suite of “Energy Internet applications” allows utilities, electricity retailers, renewable energy project developers, and energy service providers to deliver cheap, clean, and reliable energy by managing networked distributed energy resources (DERS) in real-time and at scale.
The AutoGrid platform and applications leverage petabytes of smart meter, sensor, and third-party data, along with data science, artificial intelligence, network optimization and high-performance computing algorithms to monitor, predict, optimize and control the operations of millions of energy assets connected across global energy networks.
Energy companies worldwide use AutoGrid’s software to improve their operations, integrate renewables, and drive deeper engagement with their customers. ver 50 global energy companies such as CLP Holdings, National Grid, Shell, Total, Schneider Electric, National Grid, E.ON, CPS Energy are working with AutoGrid closely. AutoGrid has already contracted more than 5,000 megawatts of DERs.
According to a report by Navigant Research, AutoGrid was ranked as the #1 Virtual Power Plant Platform provider in its latest Leaderboard Report published in April 2020.
So, how could AutoGrid fit in Chamath’s vision to build the next Berkshire Hathaway that is focused on technology?
1. Alignment on mission
Social Capital’s mission is to advance humanity by solving the world’s hardest problems. One of those challenges is providing clean, reliable, and affordable energy to everyone.
Social Capital has already invested in a smart grid solution provider called Invenia Labs during its 5 million series A round in 2017. This company uses also machine learning to optimize electrical smart grids.
You could summarize AutoGrid’s mission as “transforming the electric grid to improve access to affordable and reliable power.” It is true that software can’t actually generate electricity. But it can allow us to maximize the value of the power we generate through the effective use of data. In doing so, we can reduce our dependence on dirty fossil fuels and create a more efficient, carbon-free electric grid.
2. 10x Investment Opportunity
Solving the inefficient electric grid offers one of the most compelling investment opportunities.
Around the world, smart grid technology is growing steadily; between 2017 and 2023, the global market is expected to triple in size reaching around $61 billion. As a category winner, AutoGrid can capitalize on the massive opportunity.
3. One Major Hint
Chamath has discussed a smart grid solution that could solve climate change in recent interviews with Andrew Yang:
“Let’s go and get every single home in America to be carbon neutral. […] Every house has a roof. Every roof can support residential solar. All of that solar energy can be basically stored on-site in an extremely safe and predictable battery and then you can give the homeowner or the apartment dweller an app that allows you to know exactly how much energy those solar cells on the roof has generated and then you can use it to power your home or apartment and whatever is left you can put back into the grid.” (Chamath Palihapityia)
Final Words
It is important to remember that I’m just presenting an educated guess and no facts. I’m expecting a deal announcement after IPOC’s vote on January 6th. But no guarantee.
Please do your own due diligence!
Disclaimer: Base your investment decisions not on rumors only facts. I’m long Social Capital Hedosophia Holdings Corp. IV (NYSE: IPOD) since its IPO.
