The Glasgow-based company has raised the money from Scottish Equity Partners (SEP), the University of Strathclyde, and economic development agency Scottish Enterprise through its Scottish Investment Bank unit. SEP was lead investor in the funding round.
The funding will enable Smarter Grid to accelerate its development of products, expand its UK business and move into markets in North America and Europe, build its workforce, move to a larger headquarters in Glasgow, expand its London operation, and open an office in New York.
Alan Gooding, managing director of Smarter Grid, said the firm was keeping its future options open and acknowledged eventual flotation on the stock market or a trade sale of the business to a big industry player were two possibilities.
He co-founded the business in 2008 with Bob Currie, whose PhD work at Strathclyde University provided the initial intellectual property behind the company, and Strathclyde professor Graham Ault. All three retain shareholdings in the business.
Mr Gooding noted that he had also been at Strathclyde University, "doing an entrepreneur-in-residence role".
He highlighted the role of Smarter Grid's software in giving power companies visibility of what was happening in networks built 50 or 60 years ago, and now having to cope with the addition of electricity generated by wind farms and solar power.
He also cited the software's part in providing power companies with the tools to interact with devices on their network, such as energy storage systems, so they could increase the operational utilisation of their assets.
Mr Gooding highlighted the part this could play in reducing the need for expensive upgrades to the network, and the associated environmental impact.
He said the benefits of minimising the cost of upgrades to the network would flow to consumers in terms of electricity bills and to the likes of wind-farm operators, in terms of their grid connection charges.
Smarter Grid, which is chaired by Robert Armour and now employs more than 30 people, said it was targeting a huge potential market estimated to be worth more than $56 billion (£35bn) by 2020.
It added that its UK business was playing a key role in innovative low-carbon network projects with five of the UK's six electricity distribution companies, UK Power Networks, SSE, ScottishPower Energy Networks, Western Power Distribution, and Northern Power Grid.
Smarter Grid declared it had also attracted widespread interest from distribution and transmission companies in Europe and North America.
Mr Gooding declined to disclose the size of the various shareholders' stakes in Smarter Grid.
Tony Robison, of Glasgow-based SEP, said that no shareholder had a majority holding in the company. He added that SEP remained a "substantial minority shareholder" following the latest investment round.
In 2011, SEP partnered with Perth-based electricity and gas company SSE to raise the £95m Environmental Energies Fund – focused exclusively on "clean-tech" companies. This fund includes investments in nine companies across the renewables spectrum, including Smarter Grid.