Introduction
I’ve heard some interesting talks giving examples of successful funding as well as hearing of a variety of funding opportunities. Below is a miscellany of insights I have come across. Some suggest sources of funding, others give examples of how individual companies gained their funding. Others may be added from time to time.
Grants and Funding Finder – Envirocluster Peterborough
This is a brilliant overview of grant and funding opportunities in the sustainable/cleantech sector!There were 126 different funding sources listed in March 2013 alone, so go and visit http://www.envirocluster.co.uk/knowledge-centre/funding/
Venture Capital
Presenter Aine Shaffrey, Greencoat Capital at Cleantech Route to Finance Event, 28.02.13Greencoat Capital is a Venture Capital investor in the renewables and cleantech sector. They are advisors to the ESB Novusmodus LP, a €200m cleantech fund. ESB, the leading Irish utility is the sole investor in the fund and provides Greencoat Capital with a unique platform of support and know-how.
Greencoat Capital have an EU focus and provide €3m to €20m equity investments. Their aim is to have a significant minority position and look towards to a 5+yr investment horizon.
- They do invest in development and commercialisation
- They do not support large infrastructure projects or one off projects
Joint Venture
Presenter Julian O’Neil, Finance Director, Biogen at Cleantech Route to Finance Event, 28.02.13Biogen is the No 1 food waste anaerobic digestion operator in the UK. Their route to £24m Joint Venture funding resulted in a good partnership with the Keir construction group.
To gain the trust and positive involvement of a larger funding partner in a Joint Venture, the key lessons were:
- Your demonstrated excellence and expertise is critical
- Have a proven track record of success
- Know your business model
- Be the one everyone wants to work with
AD (Anaerobic Digestion) Loan Fund, Defra
I came across this one by chance whilst browsing the web re Anaerobic Digetsion.The Anaerobic Digestion Loan Fund (ADLF) is a £10m fund designed to support the development of new AD capacity in England. The fund aims to support 300,000 tonnes of annual capacity to divert food waste from landfill by 2015.
The ADLF offers direct financial support to organisations building new AD capacity in England. http://www.wrap.org.uk/content/ad-loan-fund
Crowd Funding
Crowd funding is a new idea which relies on getting large numbers of small investors to provide capital. An example in the green energy sector is Abundance https://www.abundancegeneration.com/
A general overview can be found here
http://en.wikipedia.org/wiki/Crowd_funding
Peter Magowan talked us through the investment history of Amantys, a company set up specialising in power switching, e.g. in electric vehicle and high voltage DC. The company started with a single Angel investor to provide seed money. Once the system was established, more funding was required to expand. They excited the interest of two investors, ARM and Moonray Investors. Success in getting investment was due the combination of a demonstrable product with potential for growth and synergies with Moonray who already had an energy interest in the form of Moonray Energy.
Investors
Presenter Peter Magowan, Amantys at Cleantech Route to Finance Event, 28.02.13Peter Magowan talked us through the investment history of Amantys, a company set up specialising in power switching, e.g. in electric vehicle and high voltage DC. The company started with a single Angel investor to provide seed money. Once the system was established, more funding was required to expand. They excited the interest of two investors, ARM and Moonray Investors. Success in getting investment was due the combination of a demonstrable product with potential for growth and synergies with Moonray who already had an energy interest in the form of Moonray Energy.
Low Carbon KEEP Programme
Presenter Carole Randall, Low Carbon KEEP Programme Manager, Envirocluster Meeting 13.02.13Until December 2014, there will be €7.6m of funding for business collaborating with any UK institution. To date 38 projects have been approved in all business sectors.
The funding is accessible to SMEs in Essex, Suffolk, Herts, Beds, Norfolk and Cambridgeshire and can be used with any university/research centre in the UK.
The benefits are as follows:
- To business
- To our knowledge base
- To the graduate employed as part of the process
Low Carbon Innovation Fund
Presenter Laura Chellis, UEA, Low Carbon Innovation Fund at Envirocluster event 12.09.12The Low Carbon Innovation Fund (LCIF) is a venture capital fund supported by the European Regional Development Fund (ERDF). It received £12.5m from the ERDF which will be matched with over £17m private sector investment – generating a total over £30m of investment in the East of England. The Fund runs until December 2015.
https://www.lowcarbonfund.co.uk/LCIF/Index.action
The fund makes early-stage equity investments into small and medium sized enterprises ("SMEs") within the East of England that are developing new and innovative products or processes in a low carbon, environmentally sensitive manner.
R&D Tax Credits and Patent Box
Presenter Kevin Edwards, MHA MacIntyre Hudson, Envirocluster Meeting 13.02.13R&D Tax Credits
The UK Government wishes to help innovative businesses and has therefore created R&D Relief schemes. If your company is liable to pay Corporation Tax then you may be able to reduce your tax bill (see http://www.hmrc.gov.uk/ct/forms-rates/claims/randd.htm).In particular, the Small and Medium-sized Enterprise Scheme, for every £100 you spend on qualifying costs, you could receive an additional £125 relief from Corporation Tax. Some of the relevant features are (not exclusive):
- Only companies can apply
- The relief is retrospective
- The research has to be innovative, leading either to appreciable improvement or built in a fundamentally different manner.
- You need a competent professional in the field
- Must be able to document methodology, process and results.
- Staffing
- Software or consumables
- Sub-contracted R&D (-65% of labour costs)
- Externally provided workers.
Patent Box
From the 1st April 2013, HM Treasury is introducing the Patent Box scheme, where companies can apply a reduced 10% Corporation Tax rate on profits from Patents and similar types of intellectual property. (http://www.hm-treasury.gov.uk/patent_box.htm).Third Party Assistance with getting funding
Example Team Ventures
Presenter Simon Haworth, Team Ventures, at Cleantech Route to Finance Event, 28.02.13Dr Simon Haworth founded Team Ventures Ltd, the European operation of BSG Team Ventures, and leads the Biotechnology and Cleantech practices for BSG Team Ventures worldwide. He also founded European early stage investor IPSO Ventures PLC and uses this experience to lead their Fundraising activities.
They build teams typically starting with the CEO or Board Chairman, and source equity for companies best able to use it. Their UK-based fundraising service sources new capital for growing companies - typically seeking $5m+ from US and UK sources.
Simon is also very knowledgeable about opportunities for new businesses accessing resources in China.
http://team-ventures.co.uk/simon-haworth.html
Example CSG - Capital Solutions Group
Presenter Colin Hayter, CSG at Envirocluster Event 12.09.12CSG provided finance and routes to bring buyers and sellers together. The example given at this event was the BigBelly bin, where they had a 60% investment. BigBelly linked to councils who achieved a 90% saving on collection costs (http://www.bigbellysolar.co.uk/). http://www.csg-lease.co.uk/
Example Dr Alex Smeets, Cambridge Funding Solutions
Met at Cleantech event "Influencing the TSB’s Strategy for Innovation in the UK Cleantech Sector" 23.04.13
