The energy sector is increasingly shifting towards advanced storage solutions and smart grid technologies, as illustrated by the 10 biggest deals of the year since September last year. They include investments in companies such as Enevate, which is working on more efficient batteries for smartphones, and Actility, a smart grid and internet-of-things technology developer that has also attracted the attention of telecoms firms such as Orange.
Overall, energy company ConocoPhilips was the most active investor over the past 12 months with 10 deals, though it is largely missing from our 10 biggest rounds – nine of its deals were of undisclosed size.
Petroleum company BP contributed funds to nine deals, followed by energy corporation Chevron at seven, while Statoil has participated in six deals.
Utility Eon SE and oil and gas company Royal Dutch Shell meanwhile took part in four rounds each. Shell and peer Total were the only two corporates in the sector to invest in series E rounds and later.
The vast majority of deals were conducted in North America – 33 in the US and five in Canada.
People
Investment firm Greencoat Capital, which manages the $200m ESB Novusmondus fund, hired Andy Tupholme as a senior team member to oversee the fund, which is backed by utility company ESB. Tupholme was previously a partner of Gresham Private Equity for 12 years.
Meanwhile, “Ananth” Ananthasubramaniam has left utility company DTE Energy’s corporate venturing arm DTE Energy Ventures, having served as the unit’s vice-president since 1995. He has launched a stealth startup called AerLinx.
Jens Umehag returned to petroleum company BP after a two-and-a-half-year stint at lubricants producer Castrol, where he was a finance director. Umehag has joined BP Ventures, an investment vehicle of BP, as chief financial officer and has additionally been named head of finance for BP’s group technology division, which aims to generate long-term plans for technology-based risks. He previously served in various positions at BP for 11 years.
Crispin Leick, who helped establish energy company RWE’s corporate venturing subsidiary Innogy Venture Capital, is set to leave the unit at the end of this year. Innogy was launched in 2010, with Leick as its managing director and chief investment officer. He will reportedly join German energy utility Energie Baden-Württemberg’s corporate venturing arm ENBW New Ventures. Leick was selected for Global Corporate Venturing’s Powerlist in 2012, 2013 and 2014.
Funds
Statkraft, a Norway-based and state-owned utility company, has set up a corporate venturing unit in Germany, Statkraft Ventures. The company reportedly put NKr60bn ($7.1bn) aside to invest in companies in Norway and Europe, Asia and South America, though the Germany-based office will target only European businesses in the wind power, hydro-power, district heating and renewable energy sectors. Statkraft Ventures will make individual investments of up to €2.5m ($2.8m), with a €100m total commitment over 10 years.
China-based water purification plant operator Beijing Water Business Doctor has joined forces with private equity firm JD Capital to launch a RMB2bn ($320m) fund aimed at the environmental protection sector. The fund will focus on water supply, production, treatment and optimisation technologies, alongside drainage and recycling. Beijing Water has committed $24m to a first tranche of $80m, while the remaining capital will be secured from outside investors.
Aerospace company Safran has also launched a corporate venturing subsidiary, Safran Corporate Ventures, with €50m. The capital will go towards companies developing energy storage technology for aircraft and other vehicles, as well as businesses focused on the aerospace, defence, security, advanced materials, robotics, network sensors, data analytics and user authentication sectors. Safran expects the money to be invested over three years.
In Japan, biotech company Euglena, financial services firm SMBC Nikko Securities and science venture firm Leave A Nest have established a ¥2bn ($17m) investment fund for startups in the energy, internet-of-things, robotics, biotech, agriculture, and research and development-related sectors. Cigarette manufacturer Japan Tobacco, real estate developer Mitsui Fudosan, restaurant chain Yoshinoya Holdings, pharmaceutical company Rohto Pharmaceutical and electronic components trading company Kanetsu are also investors. The fund is expected to rise to $42m.
Financial services provider Wells Fargo has set up a $10m fund targeting US-based cleantech startups working on sustainable building technologies for commercial properties. Dubbed Innovation Incubator, the programme will be jointly operated by the US Department of Energy’s National Renewable Energy Laboratory. Participating startups will receive $250,000 in funding.
Agricultural company Andersons has launched a corporate venturing unit, Maumee Ventures. The investment arm will target startups in the renewable energy, food safety, grain supply chain, freight logistics, precision science and plant nutrients sectors. Maumee Ventures will participate in series A and B rounds, contributing between $500,000 and $5m.
Energy Technology Ventures, an investment fund created by energy companies NRG Energy and ConocoPhilips as well as industrial conglomerate General Electric, was shut down at the end of 2014. The fund had been established in 2011 with a commitment of $300m. It was expected to back some 30 startups but invested in only 19 businesses, without disclosing the total amount.
Deals
The largest investment in the past year was secured by Enerkem, a Canada-based biofuel producer, which attracted C$152.6m ($115m) in equity funding and debt financing. The $37.7m equity was provided by existing shareholders, including waste services provider Waste Management and petroleum company Valero Energy as well as ATEL Ventures, the corporate venturing subsidiary for leasing and financing firm ATEL, Rho Ventures, Braemar Energy Ventures, Westly Group, Cycle Capital, Fonds de solidarité FTQ, Fondaction, BDR Capital, EB Investments and Quince Associates. The debt was provided by asset manager Integrated Asset Management and two unnamed lenders.
US-based intelligent energy storage technology provider Stem closed a $45m series C round in August, backed by RWE Supply & Trading, the energy trading subsidiary of utility RWE. The company raised a first tranche of $12m in April, following a $27m series B round in January and featuring GE Ventures, the investment arm of General Electric, Total Energy Ventures and Constellation Technology Ventures, the respective corporate venturing units of petroleum producers Total and Shell, as well as utility Iberdrola and investment firm Angeleno Group.
Total Energy Ventures, Constellation Technology Ventures, and Shell Technology Ventures, the investment vehicle for energy company Exelon, backed a $36.8m series E round for US-based energy storage developer Aquion Energy. CapX Fund IV, Bill Gates, Yung Enterprise, Prelude Ventures, DNS Capital and Tao Invest also joined the round. Aquion has obtained about $146m in equity and debt to date.
Enevate, a US-based developer of batteries for smartphones, raised a $30m series C round from Presidio Ventures, an investment unit of conglomerate Sumitomo. The round was co-led by Tsing Capital, Mission Ventures and Infinite Potential Technologies. The company is a spinout from University of California Irvine, and was called Carbon Micro Battery until 2010.
Primus Power, a US-based grid-scale battery developer, raised a $25m series D round led by I2BF Global Ventures and featuring platinum mining company Anglo American Platinum, Chrysalix Energy Venture Capital and DBL Partners. I2BF also invested through its Russia-Kazakhstan Nanotechnology Fund.
Meanwhile, France-based smart grid developer Actility secured $25m from telecoms firms KPN, Orange and Swisscom, as well as contract manufacturer Foxconn. Ginko Ventures led the round, and was also joined by Idinvest Partners, BPIfrance’s Fonds Ecotechnologies and Truffle Capital. The company’s existing shareholders include Electranova Capital, a fund set up by utility company EDF.
FirstFuel Software, a US-based software-as-a-service developer focused on the energy sector, received $23m in series C funding from investors including energy company Eon. The oversubscribed round was led by Next World Capital, while Idinvest Partners, Battery Ventures, Rockport Capital and Nth Power also took part. FirstFuel’s software remotely collects data on energy use from commercial properties, and combines it with weather and location data to offer ways to reduce energy use.
US-based grid-scale energy storage company Eos Energy Storage closed a $23m series C round including utility NRG Energy, real estate firm Fisher Brothers, OCI and unnamed existing shareholders. The round was led by investment firm AltEnergy.
Innogy Venture Capital participated in an €18m series C round for Germany-based organic solar film manufacturer Heliatek. Investment holding firm Aqton led the round, while industrial manufacturers Robert Bosch and BASF, as well as corporate-backed High-Tech Gründerfonds, Wellington Partners, eCapital and TGFS also contributed funds. Heliatek is a spinout from the universities of Dresden and Ulm.
Finally, Renewable Energy Group, a biofuel and renewable chemicals producer, purchased a 69% stake in Germany-based biodiesel producer Petrotec for $20.9m. The stake was sold by holding firm Israel Corporation’s alternative energy investment arm ICG.