According to Solar Mosaic, around a quarter of the roof area in the U.S. is suitable for photovoltaic arrays. However, property owners oftentimes do not have a sufficiently high credit rating to be able to borrow capital from a bank and finance their investment in solar energy. Mosaic comes in as the company that will “democratize investments in photovoltaics”, allowing people who do not have access to suitable roofs to invest in such projects  . The value-added is that Mosaic able to provide both lower-cost of capital and more favorable terms than commercial lenders. At the moment only “accredited investors” as well as NY and CA residents are able to invest, though regulations are expected to change with the JOBS act, enabling a wider range of people to participate . The key stakeholders are the investors, homeowners, installers, and maintenance companies.
The way Solar Mosaic captures value is the following: Investors do not put their capital directly into a project; rather, they invest in Mosaic, which distributes that money as loans through Special Purpose Entities to the real-estate owners. Once the projects are operational, the investors receive a guaranteed 4.5% to 7% annual return [for comp. 10-year Treasuries yield only 1.9%] . Mosaic charges 2-3% of the loan as origination fee plus a 1% yearly fee . The loan duration is from 5 to 10 years. The minimum investment is only $25 and project sizes range from 50kW (small rooftop) to 1MW (large on-ground installations) . Cash is generated either through repayment of the loan by the building owners or through the sale of Renewable Energy Certificates to local utilities. It adds value in that it also provides a maintenance contract for the full duration for both the panels and all equipment. Hence, Mosaic is technically speaking not a solar developer but a finance company and does not need to work directly with utilities regarding pricing, incentives for solar, or net metering .
Mosaic ensures that there is alignment between users and investors and therefore chooses non-profit community-based organizations as the beneficiaries of the solar loans. The organizations receiving the installations include government agencies, community housing projects, military bases, and companies, and since 2014 also homeowners  . Moreover, homeowners are offered no downpayment and a 20-year loan term. The commercial organizations and individuals will benefit from the savings created from switching to solar – mainly because electricity prices are projected to increase steadily for the next 20 years.
The loan origination happens via an SPE, or a Special Purpose Entity, to which Mosaic transfers the capital to and which formally owns the installation. Legally, Mosaic is registered as a Benefit Corporation, meaning it is a for-profit entity, creating value for society or the environment . Unfortunately, this does not result in any tax benefits, but allows for the company to have certain degrees of freedom. For example, a Benefit Corporation would not be financially liable to its shareholders if it decides to accept a lower purchase offer by choosing a socially responsible investor .
The user interface is key to the success of Solar Mosaic. The team was able to create a highly efficient UX for both investors and homeowners, which lets users explore existing investment opportunities or as get an instant quote for owners. Mosaic has been able to create a trustworthy web platform, which runs smoothly and visually represents the business model, all cash flows and fees.
Team Structure and Culture
Founded in 2010, it is based in Oakland, CA. Mosaic stands in the space between a tech startup and a value-adding energy business. It is driven by the strong mission to empower people to benefit from clean energy both as users and investors. Behind the office doors Mosaic looks like a typical tech startup – beanbags, a ping-pong table, and foosball. The focus is on creative solutions and the team backgrounds are more than diverse – from tech savvy developers, to photovoltaics PhDs, financiers, to community managers. With less than 30 people on the team, the company is staying agile and expanding at a steady pace .
To date, Mosaic has crowdfunded more than $8 million in solar loans. The synergies between the operating and business model allow Mosaic to be a first-mover in the cleantech crowdfunding space, allowing the company to develop key partnerships and secure the funds for the sustained growth of community solar projects.
 “Benefit Corporation”. Benefitcorp.net. 12/3/15. <http://benefitcorp.net/state-by-state-status>.
 “Solar Mosaic: One Tile at a Time “. Pv-magazine.com. 12/3/15. <http://www.pv-magazine.com/news/details/beitrag/solar-mosaic–one-tile-at-a-time_100007948/#axzz3ts6ZkugZ>.
 “Community Owned Solar Creates a New Business Model in MA”. Greentechmedia.com. 12/3/15. <http://www.greentechmedia.com/articles/read/How-Virtual-Net-Energy-Metering-Attracts-Money-to-Solar-in-Massachusetts> .
 “Innovative Business Models and Financing”. Iea-pvps.org. 12/3/15. < iea-pvps.org/index.php?id=311&eID=dam_frontend_push>.
 “Interview with Billy Parish, Founder and President of Mosaic”. Forbes.com 12/3/15.
 “Join Mosaic”. Joinmosaic.com. 12/3/15. < https://joinmosaic.com/solar-financing>.
. “Crowdfunding Projects with Mosaic”. Nanalyze.com. 12/3/15. < http://www.nanalyze.com/2014/01/crowdfunding-solar-projects-with-mosaic/>.