September 4,
2009
Goffstown Wood Pellet Distributor Growing
WoodPellets.com Secures Financing To Continue Expansion
GOFFSTOWN - American Biomass,
a Goffstown-based company, has raised $11 million in a Series B round of funding led by Monitor Clipper Partners of Chicago. Boston-based .406 Ventures, which funded the company’s $4 million Series A last June, returned to participate in the round.
The company sells compressed wood pellets through its website
Woodpellets.com, letting pellet stove owners compare prices. Its business took off last summer with spiking home heating oil prices driving pellet stove sales. Pellet stove conversions have dropped since, but a federal tax credit program has kept sales moving. Unlike other alternative fuels, demand for the pellets continues to grow
- as the pellets are still cheaper and cleaner than oil, said CEO Jon Strimling.
The Goffstown-based company plans to lay the groundwork for a domestic bulk pellet fuel market, hiring engineers to design the system — already in use in Europe — and buying trucks and storage units. “It’s basically an oil truck that pulls up to your house,” he said, “except it doesn’t have oil, it has pellets in it. We blow them through a hose into a storage unit.” From the unit, they feed directly into the heating stove, he said.
Earlier this month, American Biomass changed the name of its website from Pelletsales.com to
Woodpellets.com.
Strimling declined to discuss revenue or growth, but said the 40-person company expects to grow in headcount by 25 to 35 percent before the end of the year. In addition to engineers for its bulk system, the company will hire sales and marketing,
Internet development, logistics development and business development staff, he said.
Meanwhile, for those who think wood pellets too crunchy, a Massachusetts-based tech entrepreneur has started
LowerMyHeat.com, operating a website that lets propane and heating oil customers compare rates with federal averages, and their own neighbors. The site mixes price information contributed by users, with weekly price quotes tracked by the Department of Energy.
Newburyport-based founder Arik Keller said he began work on the online tool after negotiating a 15 percent cut in his heating bill by talking to neighbors and doing a little research.
“It’s not that oil and gas providers are out to get you. They’re just very busy. A lot of them are mom and pop shops,” he said. “They don’t have algorithms to figure out whom you should call to better their rate.”
Keller helped found a market research company called MindBranch Inc., which sold in 2005 to Marketresearch.com Inc. Since then, he was COO at Newburyport-based DNSstuff LLC, making network forensic tools for IT professionals. He left two weeks ago to start LowerMyHeat full time.
Keller is contemplating how
LowerMyHeat.com will make its first revenue. Once it gets to a critical mass of users, he hopes to add a subscription service that will automatically alert users when the typical fuel rate drops below what they’re paying.
In addition, he said there may be opportunities to work with providers on tank-level monitoring systems. Currently, most propane and oil delivery companies rely on guesswork to determine when to send a truck out to a home, which often results in wasted trips, he said.
A networked device attached to the tank could be a major cost-saver, he said. “Other companies have started to do this, but a leader has not been identified.”
|
