Hohm Energy

Rooftop solar marketplace and financing

🇿🇦 South Africa Energy & UtilitiesShut down

Epitaph

“Here lies Hohm Energy. It matched South African homeowners with solar installers and lenders, and raised the largest seed round the country had ever seen. Then the load-shedding stopped. Seven months after the record raise, the lights came back on and Hohm went out.”

Overview

Born: 2021 (Year)
Died: September 2024 (Month)
Lifespan: 4 years
Fate: Shut down
Headquarters: 🇿🇦 South Africa
Category: Energy & Utilities
Stage at death: Seed
Primary cause: External shock
Contributing causes: Execution, Business model or unit economics

Death certificate

Timeline

2021Founded
Tim Ohlsen and Emir Gluhbegovic launch Hohm Energy as a rooftop-solar marketplace in South Africa
2022Pre-seed
the company raises $800,000
2023Bridge capital
a further $4.25m is invested as load-shedding peaks
23 February 2024Record seed round
E3 Capital and 4DX Ventures lead an $8m (R153m) round, the largest seed ever raised by a South African startup
2024Demand falls
load-shedding eases and an ABSA study records falling demand for alternative energy
August 2024CEO exits, business rescue
Tim Ohlsen departs; MD Ryan Steytler files for business rescue and the company stops trading
16 September 2024Voluntary liquidation
Hohm files with the CIPC and notifies creditors with claims over R1,000

Autopsy report

Why did Hohm Energy shut down?

Hohm Energy was a South African rooftop-solar platform founded in 2021 by Tim Ohlsen and Emir Gluhbegovic. It connected homeowners, solar installers and lenders, letting installers design, quote and manage projects and letting customers size a system and obtain finance through partner banks. In February 2024 it announced an $8m seed round, then the largest ever raised by a South African startup, taking its total to roughly $12m. By August 2024 it had stopped trading and entered business rescue, and on 16 September 2024 it filed for voluntary liquidation with South Africa's CIPC.

What Hohm Energy attempted

Hohm Energy ran a marketplace and design tool for residential solar. Installers used it to design systems, produce quotes and manage jobs; homeowners used it to assess their energy needs and apply for credit to finance a rooftop installation, with financing routed through banks including Investec, Nedbank, FirstRand and Capitec.

What worked

Hohm raised roughly $12m across two years: an $800,000 pre-seed in 2022, a $3.7m seed, a $4.25m injection at the end of 2023, and an $8m seed round announced on 23 February 2024 (about R153m), led by E3 Capital and 4DX Ventures with Breega, E4E Africa, To.org, Tekton Ventures, Sunu Capital, Musha Ventures and Climate Capital Ventures Fund participating. The round beat South Africa's previous seed record of $5.3m. At the time of the raise the company said revenue had grown more than fivefold year on year. Note that the itemised rounds add up to more than the roughly $12m headline total reported alongside them, and Techpoint does not reconcile the two figures.

Early warning signs

TechCabal reported that Hohm expanded headcount quickly on the assumption that solar demand would keep rising, carried high fixed costs it could not restructure fast enough, had weak governance in its early years with a board only formed in early 2024, and did not report to its parent company with enough transparency. An ABSA study cited by Techpoint confirmed alternative-energy demand fell in Q2 2024.

What happened

South Africa's load-shedding eased sharply from late 2023 into 2024 - by September 2024 the country had gone more than 100 consecutive days without power cuts - and demand for rooftop solar fell with it. In early August 2024 co-founder and CEO Tim Ohlsen left the company; managing director Ryan Steytler took over and filed for business rescue, a move Techpoint reported he made unilaterally against shareholder advice. Franc Gray, CEO of parent company Spark Energy Services, said in August that 'Hohm is currently not trading'. On 16 September 2024 the company filed for voluntary liquidation with the Companies and Intellectual Property Commission and notified creditors with claims above R1,000.

What future founders can do differently

A business whose demand curve is drawn by someone else's failure - in this case Eskom's - is a business with an expiry date it does not control. Hohm hired and spent against a crisis that ended earlier than its cost base could adjust to, and governance that arrives after the record fundraise arrives too late to stop it.

Lessons for future builders

A business whose demand curve is drawn by someone else's failure - in this case Eskom's - is a business with an expiry date it does not control. Hohm hired and spent against a crisis that ended earlier than its cost base could adjust to, and governance that arrives after the record fundraise arrives too late to stop it.