Investors light up Finally bulb company with $15m
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A new idea for replacing the old-school incandescent lightbulb has attracted more investor cash as a small Boston company tries to establish a foothold against the rapidly growing LED lighting market.
Finally Light Bulb Co. said Tuesday that it has raised $15 million from individuals and family investment offices. The company, headed by former IdeaPaint founder John Goscha, has now raised a total of $38 million. Investors valued the company at $75.5 million after accounting for the new cash.
Finally sells next-generation bulbs that are designed to emit a warmer, more yellow-toned light than many semiconductor-based LED bulbs. The startup debuted its bulbs in 2015 and sold more than 100,000 of them last year, increasing its distribution footprint from 23 retail outlets to more than 1,400, including Staples and Ace Hardware, Goscha said.
“In a hardware, consumer-product technology, which hasn’t been the hottest space here in the US, it’s amazing to see the kinds of people who have gotten attracted to our technology and our bulb,” Goscha said. “That momentum that we’re seeing on the retail side has clearly translated into investor excitement.”
But Finally will need a lot more progress if it hopes to make a dent in the market.
LED bulbs are leading the race to replace metal-filament bulbs, which are being phased out as the government toughens energy-efficiency standards. There were already more than 200 million LED light bulbs installed in the US in 2015, according to the US Energy Department.
Goscha said his company’s bulbs, though a direct competitor to LED lights, have a benefit that they do not: a more pleasing, less harsh, glow.
“There’s 10 billion sockets in US consumers’ homes, and 6 billion of those will have a traditional light bulb burn out in the next couple of years,” he said.
Finally’s bulbs are based on a modernized version of technology proposed in the 1890s by famed inventor Nikola Tesla.
A copper coil inside each Finally bulb produces an electromagnetic field that prompts a mix of gases to produce ultraviolet light. That’s turned into visible light when it passes through a phosphor coating on the inside of the bulb’s glass.
The process, known as induction, has been used for years in industrial lighting but was only recently adapted for home use. Finally says its bulbs are 75 percent more efficient and last 15 times longer than old incandescent models.
Goscha said Finally fine-tuned its manufacturing operations in India and China during 2016, allowing it to raise quality and cut costs. Newer versions are much more energy-efficient than the introductory models, and this year the company plans to introduce a bulb that “warms up” to full light faster than current versions.
The bulbs are still not the cheapest on the market. Last week, a six-pack of Finally 60-watt equivalents was selling for $54 on Amazon, while a comparable six-pack from Philips was available for about $23.
Goscha said that competition won’t be out of balance forever. “Our performance is going up, and our costs are declining,” he said.