State of Green Business
A big day for Bloom Energy and distributed energy
Fuel cell maker Bloom Energy just achieved something rare. After 16 years of growing as an energy startup, the company debuted Wednesday morning on the New York Stock Exchange.
The big shocker? After a day of trading (under the symbol BE), the company's shares closed up more than 63 percent to end the day at just above $24 per share. The bankers did their job.
Speaking from the NYSE floor, Bloom Energy CEO and founder K.R. Sridhar told me that ringing the bell was "an incredible moment" and "a fantastic day." He said the initial public offering "opens up the next chapter for us and gives us transparency."
Sridhar invented Bloom Energy's fuel cell "servers" based on technology developed at NASA for Mars missions, and he wrote the business plan for the company in 2000. The company sells the fuel cells (and electricity produced by the fuel cells) to corporate customers such as Intel, Walmart, Home Depot and Kaiser Permanente.
Bloom Energy's successful roadshow — and first day of trading — suggests that corporate energy buyers are becoming increasingly interested in distributed power to reduce costs and make operations more resilient. Bloom Energy's electricity also tends to generate lower emissions than the power grid, and big companies are beginning to look for cleaner power options.
Successful public debuts are, of course, about telling a positive story to investors and getting them to buy in. Sridhar said Bloom Energy's message to investors during the roadshow was: "Don't categorize us."
"We're not a cleantech company, but we're clean. We're an electricity provider, but we're not the grid. We're a tech company, but we're not just a tech company. We're a growth company. We're an infrastructure company. We're one-of-a-kind in the marketplace," Sridhar said.
Bloom Energy's S-1 filings, revealed last month, show a company that's signed up a solid list of some of the biggest corporate customers in the world. It's also been able to lower the costs of its fuel cells over the years.
At the same time, the company carries major debt, is historically dependent on subsidies and is still saddled with maintenance responsibilities for a portion of costly and inefficient first-gen fuel cells that are still out in the field. Bloom Energy's installation footprint is also modest with 312 megawatts worth of fuel cells generating electricity around the world.
Going public is an important step for the investors in Bloom Energy. The company raised $270 million in the debut. Investors finally can see a path to getting some of their money out.
At one point, Bloom Energy was valued at around $3 billion back in 2014. Before the debut Wednesday, Bloom Energy was valued at $1.6 billion. At the end of the first day of trading, the company had a valuation closer to $2 billion (although, of course, that can change in mere hours of trading).
There are also lingering questions about a brokerage firm that helped Bloom Energy raise funds, Advanced Equities. The Wall Street Journal had a piece about those investors Tuesday. Axios has a story on that situation as well.
What is the next step for Bloom? It's often bittersweet for a company to go public, as then the company must start disclosing anything materially relevant to sales. The team also has to focus on quarterly numbers to maintain or lift its stock price.
Sridhar said he can't wait to get back to building the company and continuing "the journey of affordable, reliable, clean electricity."