Zach Dell aims to build a name for himself with Base Power
· Fortune
This is Jordan Blum, filling in for Allie. It seems we’re still dedicated to the so-called nepo baby discourse—as fair or unflattering as that term might be.
In the case of Zach Dell, who turns 30 this month, at least he’s built a home battery and tech business successfully fundraising on a $13 billion valuation. It certainly doesn’t hurt though that he carries the same surname as his father, Michael, the fifth-wealthiest person in the world—just behind the Google cofounders but ahead of Mark Zuckerberg.
Visit newsbetting.cv for more information.
But Zach Dell’s business is so based—as in Base Power (sorry, as an elder Millennial, I can’t even pull off using long-outdated slang).
And it is a unique offering that started in his home state of Texas and recently expanded to Illinois with much grander, long-term ambitions. “We want to bring Base to every neighborhood in America over time,” Zach Dell told Fortune, noting that the residential retail electricity market in the U.S. is about $200 billion. “The scale of the opportunity is just massive, and of course, we do have global ambitions. We think markets like the U.K., Germany, Australia, and potentially others are attractive as well.”
Base’s business model is a one-stop shop for the home: electricity and backup power courtesy of a battery storage system, not a standard gas generator. Instead of paying for a backup power system that can easily cost $15,000 or much more, Base offers electricity services and charges an installation fee—no more than $695—and a flat monthly membership fee of $19—call it the Costco model, as well as the cost of electricity. Dell argues its electric charges are typically cheaper on average because of the money saved by the batteries giving power back to the grid when demand is lower.
And, when there’s a power outage, the battery (or the upcharge for a dual-battery system) keeps the lights on—so long as it isn’t a prolonged outage beyond two or three days.
Base, which Dell cofounded in 2023, just raised another $1 billion in a Series D funding round, bringing its total to over $2.5 billion. The new round revealed Base’s valuation spiked from $4 billion to $13 billion in less than a year—outsized for a garden-variety electricity business, but not necessarily for an innovative tech startup. Base is in the eye of the beholder.
The Series D round featured four co-leads in fundraising: Ribbit Capital, Addition, Valor Equity Partners, and JPMorgan Chase’s Strategic Investment Group. Dell said Base’s other major existing investors have re-invested, including Thrive Capital, a16z, Lightspeed, Trust Ventures, CapitalG, and more.
Earlier this year, Base opened its own battery manufacturing plant, Base Factory 1, in the former building of the Austin-American Statesman newspaper. As a journalist, a tech startup replacing a daily newspaper may seem symbolic and depressing, so I’ll try not to overthink it. Anyway, a much larger second factory is under construction and slated for completion in 2027.
The questions to follow mostly revolve around how quickly Base can scale and achieve market penetration nationwide. At the same time, on a monthly fee model without a lot of upfront costs, how long might it take Base to turn the page to profitability. It’ll be interesting to watch. You can read my whole story here.
See you tomorrow,
Jordan Blum
X: @JDBlum23
Email: [email protected]
Submit a deal for the Term Sheet newsletter here.
Joey Abrams curated the deals section of today’s newsletter. Subscribe here.
This story was originally featured on Fortune.com