Pylon, an infrastructure management platform that transforms electricity and water companies in emerging market markets, has announced a $19 Million seed funding round.
The seed round was a financing round for the fast-growing startup. This funding round, which is profitable and grew by 3.5x per year in 2021, began with initial funding from Y Combinator, a US technology startup accelerator. It attracted diversified investors from North America as well as MEA.
This funding round, comprising equity and debt, was led by Endure Capital, which is backed up by CDC, the UK Government’s Development Finance Institution. Cathexis Ventures was also represented, along with Loftyinc Ventures (Kharizmi Ventures), Loftyinc Ventures (and other prominent angel investors).
Proceeds will accelerate Pylon’s growth via expansion into other emerging markets (South-East Asia, Africa, Latin America) and advance engineering and product development. The startup is already working with multiple companies across two continents that have deployed more than one million endpoints of Pylon’s smart grid technology, across 15 distribution companies. Pylon’s goal is to increase its smart metering points to three million by 2023, which would represent 4x year-on-year growth.
Pylon doesn’t charge utilities companies upfront for its hardware. However, Smart Metering as a Service (SMaaS), makes it simple for cash-conscious utilities companies to scale up its solution. Pylon is able to help utility companies improve their bottom line by as much as 40% by simply signing up.
Pylon is a platform that democratizes smart infrastructure for energy and water distribution companies in emerging market countries. This allows them to capture as much as $400 billion of uncollected revenue and losses. Pylon’s platform uses data and artificial intelligence to improve revenue collection, reduce losses and achieve a more efficient environmental footprint.
Pylon is saving the planet, one metering point at a time, as smart electricity grids can reduce utilities’ carbon emissions by 25%. Another of Pylon’s goals is to achieve 1 Gigaton of total CO2 emissions reduction by 2035. Over 45 million cubic meters of water are lost each day in emerging markets. This can be reduced by Pylon, which can provide enough water for over 40 million people.
Ahmed Ashour, Co-founder, and CEO of Pylon, commented: “We are delighted that our solution received such heightened interest and acclaim from a wide range of global investors. Many responded to our call for action to develop technology that can better manage resources, eliminate inefficiencies, and remove the pain points in utility sector.
“Our plug-and-play solution and flexible pricing models give utilities the full benefit of smart grids just by signing with us – increasing their aggregate revenue by up to 40%. Investors looking for a fast-growing and profitable company with a potential market of $22 billion will find us a compelling option. We also have a significant impact in conserving our planet. Pylon’s ultimate goal is to benefit humanity, our clients, and our stakeholders.
“2022 will be an exciting year for Pylon as we embark on our next phase of growth which will see us expanding further into Africa, Latin America, and SE Asia. We will also seek increased debt facilities to fast-track the accessibility of infrastructure solutions to utilities in friable economic landscapes.”
Tarek Fahim, GP and founder of Endure Capital, commented: “We are excited to support the strong team at Pylon, who are building a unique software-centric solution to support more sustainable and smart infrastructure for utility companies in emerging markets. As one of the highest-ever valuations for a seed-stage company in the Middle East & Africa, and we are delighted to be at the forefront of positive change in the region.
“We believe that there is a multi-billion dollar market opportunity at hand and that Pylon’s frictionless model provides a compelling solution for utility companies to be more efficient, sustainable, and digitally driven. Most importantly, we believe that Pylon will have a significant environmental impact on preserving our planet, benefit our local communities, and create lasting economic value for our own stakeholders.”
Ahmed Medhat, Board Advisor at Pylon (and Principal Research Scientist at Meta), commented: “When Ahmed Ashour and co-founder Omar Radi first walked me through what they had built, I was immediately hooked. Two of the most innovative and bold approaches to solving efficiency problems in legacy utility distribution networks in emerging markets has been taken by Omar Radi and Ahmed Ashour. Their MVP has seen tremendous financial growth.
“By focusing their R&D and overall product ethos on approaches that fit the specific market dynamics of emerging market utilities, Pylon have developed their unique SMaaS model and has been able to upend big international players whose off the shelf utility management solutions don’t fit the needs of local utility companies in emerging markets.”