SolFocus said Tuesday it raised $25 million in venture capital funding, just four months after completing its $3.5-million seed round.

Originally, SolFocus was planning to wait until October, but “the area is pretty heated up right now,” said Gary Conley, chief executive of SolFocus. “We had so much interest. We had everybody at the gate. So we decided, ‘Why not just do it now and be done?’”

The funding is the first phase of a Series A round expected to close at $32 million in the next 30 days, he said.

New Enterprise Associates (NEA) led the round, and seed investors NGEN Partners and Yellowstone Capital also invested.

Scott Sandell, a general partner with NEA, called SolFocus’ product design “innovative yet practical,” saying it’s reliable, with efficient performance and low cost.

“Rapid growth in the $10-billion global market for solar power is constrained by the availability and cost of silicon,” said Mr. Sandell, a new member of SolFocus’ board of directors. “SolFocus’ unique [concentrator photovoltaic] technology eliminates the silicon bottleneck and significantly reduces the cost of solar power.”

SolFocus will use the money to accelerate large-scale reliability tests, to ramp up its production of solar modules, to secure a long-term supply of photovoltaic cells, and to accelerate development of its second-generation technology, as well as to “significantly expand” its team, Mr. Conley said.

The company, which currently has 15 employees, has 15 positions posted and will be adding another 10 soon, he said. SolFocus is looking for materials and optical scientists, and engineers.

The growth represents rapid change for a company that consisted of two guys in a garage in January, Mr. Conley said.

“We also have an absorption rate issue, so we have to be careful, but we’re trying to get two to three people a week, and we are getting just incredible people applying,” Mr. Conley said.

SolFocus is planning to move out of the Palo Alto Research Center (PARC), which is incubating the company, into its own facilities, and the startup is also ramping up its Sunnyvale, California, pilot plant from 3 to 5 megawatts, said Mr. Conley.

SolFocus is also considering building its own 1-megawatt power plant at an empty U.S. Air Force base, he said.

The Backstory

Last year, SolFocus spun out of Saratoga, California-based H₂Go, which Mr. Conley formed in 2001 “to enable the hydrogen economy.” H₂Go became a nonprofit (see Solar May Get Cheaper).SolFocus’ technology uses small lenses and curved mirrors to concentrate sunlight onto solar cells (see Concentrating the Sun).

The cells use highly efficient germanium instead of silicon, the most commonly used photovoltaic material. Germanium is more expensive, but SolFocus’ system uses so little of it—1 square centimeter per panel—that the company claims it will be able to cut the installed price of solar in half, to less than $4 per watt and still make a healthy margin.

In February, PARC announced it was partnering with SolFocus to work on the second generation of the technology, helping to improve the optics, cell mounts, and tile pressing and other processing technologies.

As part of the two-year agreement, PARC gets equity and royalties from SolFocus in exchange for incubating the company, providing research capability and office space. The second-generation product, which will deliver more energy using even less germanium, is expected to roll out in two years.

Flash Forward

SolFocus does expect to raise another round and plans to reach full commercialization with 100 megawatts capacity by the end of next year, Mr. Conley said. SolFocus plans to sell directly to customers, who include licensees, end users, manufacturers, and power purchasers, he noted.

Overall, analysts have been skeptical of concentrator PV, saying many of the systems have reliability problems, partly because they require moving parts to track the sun and leave mirrors exposed to the elements.

But oil at $73 a barrel, along with a political environment that favors energy independence, has helped push innovation forward. SolFocus is one of several startups that claim to have solved the problems.

Others include Energy Innovations, Practical Instruments, Concentrix Solar, Prism Solar Technologies, and Stellaris (see Energy Innovations Gets Cash, Cheaper Solar Comes Closer).

Energy Innovations Gets Cash

“I think everyone recognizes this is a good idea,” Mr. Conley said. “We’ve pulled technologies from the semiconductor test world, and from the automotive and aerospace industries, to come up with this novel optical solution. A lot of people in other industries are taking new approaches to solving problems in clean energy. The new mantra is ‘doing well by doing good.’”

Contact the writer: JKho@redherring.com