Energy X secures $20M at $120M valuation to slash building sector emissions

Countries worldwide have pledged to reduce their energy usage and reach net-zero energy targets by 2050. To get there, they will need to find clever ways to decarbonize especially dirty businesses, including the buildings sector. The push to clean up the built environment has spawned a lot of policy, as well as overlapping acronyms, including net-zero energy buildings (nZEBs) and zero-emission buildings (ZEBs).

In the EU, a ZEB requirement is expected to start in January 2030 for all new buildings. Likewise, the U.S. Department of Energy said it will retrofit new federal buildings that are greater than 5,000 square feet by 2030. South Korea is also taking measures to reduce emissions in the building sector by retrofitting buildings and strengthening ZEB requirements for new buildings through 2030. 

Buildings are a major source of air, water and noise pollution. The built environment’s whole process — including materials manufacturing, construction, heating and electricity, maintenance and demolition, drives an estimated 40% of greenhouse gas emissions globally. The steep environmental cost and looming deadlines inspired Energy X, a Seoul-based startup and marketplace that “enables the construction of zero-energy buildings,” from architectural design to completion of construction.

Energy X was founded in 2019 by co-CEOs Sean Park and Tom Hong. That’s when the duo pivoted from their first startup — a sustainable architecture crowdfunding platform, called Xquare.

The outfit already works with a host of clients, including large conglomerates that want to retrofit their buildings in South Korea, like Hyundai, Naver and Lotte, Park told TechCrunch. Energy X’s users include building owners, construction companies and architects.  

Since its inception in 2019, the startup says it has sealed 573 deals, which it estimates are worth 1.6 trillion won ($1.3 billion) in terms of the construction cost for sustainable architecture — like zero-energy buildings and LEED-certified (Leadership in Energy and Environmental Design) buildings. Some projects are still ongoing, and others have already been completed, Park said. 

There are lots of other construction marketplaces on the scene. Procore, a construction tech unicorn, went public in 2021, and Aconex, an Australia-based construction platform, was acquired by Oracle for $1.2 billion in 2017. In energy-efficiency tech, Energy X’s peers include Enpal, which raised a $174 million Series C at a valuation of $1.1 billion in 2021, and Uplight, which received undisclosed funding at a $1.5 billion valuation in 2021, Park mentioned.   

Beyond hosting a marketplace to develop energy-efficient buildings, Energy X says it’s working on solar and energy-saving tech, including BIPV (building integrated photovoltaics) for energy production, HVAC (heating, ventilation and air conditioning) for energy conservation and BEMS (building energy management systems) for energy management, Park explained. More than half of Energy X’s employees focus on energy technologies for the R&D team, Park added. 

“Most building owners are not experts in building management, and they don’t know how to use it because building energy management systems (BEMS) are software-based,” Park said. In addition to the marketplace, “Energy X provides cloud-based BEMS where our AI manages, maintains and optimizes the system at all times without always having to monitor, manage or control directly,” said Park.

The Seoul-headquartered startup secured $20.3 million in Series B financing at a valuation of $120 million, Park told TechCrunch. 

The new round, led by Shinhan Financial Group, brings the startup’s total funding to approximately $31.5 million. The funds will help Energy X expand its marketplace and energy efficiency tech, grow its team from 86 to 200 employees this year and launch in Japan, Park said. The startup will open an office in Japan in February, Park added.

Note: We’ve updated the story to reflect that Energy X plans to grow its team to 200 employees this year.