London-based Tesseract, a new energy company from Revolut alumni, announced on Wednesday that it has raised $78M (approximately €78.7M) in a fresh round of funding led by Balderton Capital and Lakestar, with an aim to fix the broken energy sector.
The round also saw participation from Accel, Creandum, Lowercarbon Capital, Ribbit and BoxGroup, along with strategic angel investors such as Tom Stafford (DST Global), Martin Mignot (Index Ventures), Chris Sacca (Lowercase and Lowercarbon Capital), John Doran and Nico Rosberg (Formula 1 World Champion and sustainability entrepreneur).
Colin Hanna, Partner at Balderton Capital, says, “As Europe enters a critical phase for energy, and the world urgently confronts a warming planet, brave solutions are required. Tesseract’s combination of renewable power and a new model for energy and participation can help us confront these dual challenges without slipping further back into fossil fuels. Alan and Charles are two iconoclasts who have proven themselves capable of reshaping industries during their time at Revolut. We are humbled to be backing them and the entire team at Tesseract.”
Tesseract says it will use the proceeds to buy and build selected renewable energy assets and support the development of its platform.
Aims to provide commission-free energy
Energy costs in the UK are still rising, and the new Ofgem price cap of £3,549 represents an 80 per cent increase since April, while customer satisfaction with energy providers is at an all-time low. Also, climate change worries are on the rise, with 72 per cent of individuals expressing significant concern about its implications on the world as a whole. This is where Tesseract aims to make a difference.
Tesseract was created to decentralise the right to power by delivering clean, cheap electricity to consumers and helping solve climate change.
Founded in 2022 by former Revolut CRO Alan Chang and strategy lead Charles Orr, Tesseract is a vertically-integrated energy startup that aims to fix the broken energy sector with commission-free energy that is 10x better and 100% renewable.
By owning renewable generating assets and selling directly to consumers, the company eliminates the intermediaries in the energy industry, resulting in lower costs.
For customers, this means that they will be able to purchase a “virtual” solar panel or wind turbine via the app instead of having to install pricey solar panels, which may reduce their cost by up to 100 per cent and allow them to profit from selling the extra energy. Tesseract will be able to manage energy flexibility effectively by utilising co-located grid-scale batteries, making its solution more marketable than rivals’.
Co-founder Alan Chang, says, “We started an energy company because it can solve two of the greatest problems the world faces: rising energy prices and climate change. While at Revolut, we saw how ageing incumbents and broken business models held the system back, and how modern technology and an open-minded approach helped consumers worldwide. The energy industry plays a fundamental role in people’s lives yet regularly leaves customers dissatisfied. It is ripe for disruption in the same way as the banking sector was.”
The Tesseract team
The Tesseract team is sure that they can revolutionise the energy sector in the same manner that Revolut did for the banking sector. While co-founder and COO Charles Orr led Revolut’s strategy and later worked as an investor at Mosaic, co-founder and CEO Alan Chang joined the firm as its third employee and served as its Chief Revenue Officer.
To transform renewable energy forever, the founders have put together a team of elite energy sector professionals. This includes Dermot Nolan, the former CEO of the UK energy regulator Ofgem, who has joined as a board advisor, as well as Arnaud Luboinski, the former director of French Power Trading at EDF, Eduard Uraskulov, the former head of M&A at EuroChem and executive at Goldman Sachs.
Additionally, the team has also hired a number of former Revolut employees, including Felix Jamestin, who founded Revolut Junior, Rory Keohane, the creative lead, and Nik Denisenko, the lead backend engineer, as well as software developers from Farfetch, Lyft, and IBM.