San Francisco-based start-up is poised to change the way cars are charged at retail locations.
THIS ARTICLE WAS PUBLISHED IN THE ‘Q’ – THE REGISTRY’S PRINT PUBLICATION – IN JULY 2014
In January the startup moved its headquarters to San Francisco from Hawaii, where it launched in 2010 and now operates 22 charging stations at shopping centers and other locations on the island of Oahu.
Stoked with $2.5 million from angel investors and venture capital institutions in Hawaii and California, Volta is aiming for a major expansion in the Bay Area and other electric vehicle hotspots on the mainland. By the end of this summer, Volta co-founder Scott Mercer said, the company expects to have 100 of its electric charging stations up and running, up from the 30 now operating in San Francisco, Los Angeles, San Diego and Phoenix.
Finding locations with high visibility and an upscale clientele is key. “We want to move quickly… there’s a bit of a real estate land grab here,” said Mercer. “It’s just about going after the best properties in California and making sure that we lock them down. That’s important to the business right now.”[quote]“It’s rare that I see one available, and that’s a good thing,” Fred Paine, general manager at Oahu’s Pearlridge Center[/quote]
Volta has teamed with national shopping mall developer General Growth Properties since 2012. That’s when the startup installed its first sleek, silver, 7-foot-tall charging stations at several Hawaii shopping destinations, including Ala Moana Center in Honolulu.
In the Bay Area, General Growth operates Eastridge Mall in San Jose and San Francisco’s Stonestown Galleria Mall. General Growth would not comment for publication about the potential addition charging stations at its Northern California properties.
Volta has also installed electric vehicle charging centers at Whole Foods Market stores in Hawaii and Southern California. “Overall, we see the EV charging stations getting a lot of use, and an additional benefit to our customers is that they are free to use,” said Whole Foods Market spokeswoman Hilary Maler in an email. “The feedback we have received is that our customers love having them.”
So far, Volta has received funding from Epic Ventures, an early stage software and Internet infrastructure venture firm; the Ulupono Initiative, a Hawaii-based social investment fund co-founded by eBay founder Pierre Omidyar; and Hawaii Angels, an investment network for seed-level private equity investors.
What sets Volta apart from other companies that power up vehicles? It doesn’t charge motorists to top off their car batteries. And, other than minimal costs associated with installation, property owners don’t pay anything, either. Installing each station costs Volta between $20,000 and $40,000, depending on the location.
Volta covers the cost of electricity and maintenance for the charging units.
“All of our revenue comes out of the advertising side of the business,” Mercer explained.
This year, the company expects to bring in about $2 million to $3 million in revenue, but is not yet profitable and is seeking Series A venture funding.
Volta’s founders selected Hawaii as a test market because of the state’s nexus of high gasoline prices, small driving distances and generous initial government support. Hawaii also tied with Washington state last year for the largest share of the U.S. electric vehicle market, according to automotive research site Edmunds.com.
Starting in 2012, Hawaii law began requiring public places with 100 or more parking spaces to have at least one electric vehicle charging station. “EV drivers quickly learn the whereabouts of free stations and seek them out,” according to a 2012 guidebook prepared by non-profit Plug In America for the state of Hawaii. “They also frequently reward site hosts by shopping at their businesses and suggested that fellow drivers do the same.”
Volta selects its charging station locations based on traffic and wants only highly visible space.
“We don’t have a charging network that’s in the back of the corner of some library,” Mercer said. “We have stations that are front and center in really good locations, and they’re getting used 8 or 10 or 12 hours a day.”
Volta prices its 35 million network views from its 65 stations at an average CPM (cost per thousand) of $2.75 and signs companies to advertising deals lasting about one year. Ad rates vary, depending on how many people are likely to see the station, Mercer said.
In Hawaii corporate sponsors include banks, insurance companies, solar firms, health care businesses and financial services companies. Mercer said the sponsor network for the new stations on the mainland would not be announced until those locations officially open.
Mercer said average stays at its charging docks last 45 minutes to about two hours while vehicle owners visit nearby stores, restaurants or movie theaters.
The units are popular at Oahu’s Pearlridge Center, a busy, 1.4 million square foot mall about the size of Westfield Valley Fair. It started out with two Volta charging stations in 2012 and now has five, all located in premium parking spots right at the mall’s entry doors. The center, owned by Glimcher Realty Trust, is considering adding more Volta charging units.
“It’s rare that I see one available, and that’s a good thing,” said mall General Manager Fred Paine.