Despite the booming growth of the solar industry, Aurora Solar, a software startup, has made the decision to lay off 20% of its workforce, totaling about 500 employees. This move comes after the company reportedly failed to meet its growth targets over the past year.
Key Takeaway
Aurora Solar, a software startup serving the solar industry, has laid off 20% of its workforce due to missed growth targets, potentially influenced by regulatory changes in California’s net metering policies.
Series of Layoffs
Reports indicate that this recent round of layoffs follows a smaller one in November, where approximately 20 people were let go. The company’s challenges in meeting its growth objectives have led to this significant reduction in its workforce.
Financial Backing and Challenges
Aurora Solar had previously secured substantial funding, including a $200 million Series D round in February 2022, and a $250 million Series C less than nine months prior. Despite this financial backing, the company has faced difficulties in achieving its anticipated growth.
Impact of Regulatory Changes
The company’s struggles may be linked to changes in net metering in California, resulting in homeowners receiving significantly less payment for the power they sell back to utilities. While this hasn’t diminished the demand for solar among single-family homeowners, the altered regulations may have disrupted the company’s projected trajectory.
Challenges for Solar Installers
The changes in net metering rates have led to a surge of interest in solar installations, particularly from homeowners seeking to benefit before the new rules took effect. However, the new regulations have also posed challenges for sales representatives, especially in selling battery-equipped solar installations, which require more detailed assessments and calculations compared to solar alone.
Industry Impact
The impact of these changes has been felt across the industry, with smaller installers experiencing significant pressure. Despite Aurora Solar’s software being utilized by a majority of the top 100 solar installers, the broader industry has faced challenges, leading to an estimated 17,000 job cuts in the California solar sector last year.
