Supercharging Capital Solutions for Energy and Manufacturing Projects — Why We Invested in Crux
MassMutual Ventures recently invested in Crux, the leading capital markets platform for clean energy and manufacturing projects. This is the latest investment for the MMV Climate Technology Fund. Crux sits at the nexus of two of our fund’s focus areas — climate intelligence and clean power.
Macro Trends
The Surge in Power Demand. For the first time in decades, the US is experiencing a spike in power demand driven by new data centers, electrification, and manufacturing. Over 90 percent of new power capacity added to the US grid in 2024 came from renewables, with over 80 percent from solar and storage projects. This trend is expected to continue, given that renewables projects make up the vast majority of projects in interconnection queues. For US power supply to keep pace with rising demand, it will be critical to accelerate the construction of renewables and storage projects — an effort that will require more efficient and scalable financing mechanisms.
The Drive for Domestic Manufacturing. The push to re-shore critical supply chains and revitalize US manufacturing has gained bipartisan momentum in recent years. The Infrastructure Investment and Jobs Act (2021) and the CHIPS and Science Act (2022) reflect the growing consensus that domestic manufacturing is a national security priority. While there are differences in how policy makers prioritize sectors, there is broad alignment on the need to encourage capital investment toward US-based production of semiconductors, batteries, critical minerals, and other strategic technologies.
Financing for Clean Energy and Manufacturing Projects. Despite strong macroeconomic and policy tailwinds, many developers and manufacturers struggle to access capital efficiently. The issue is not a lack of capital — there’s an estimated $1 trillion in energy transition infrastructure dry powder waiting to be deployed. The real challenge is inefficiency in the form of high transaction costs, fragmented markets, and opaque diligence processes that can delay execution and inflate budgets. Unlocking this capital at scale will require innovation in financial tools and platforms that streamline deployment and reduce friction across the project lifecycle — especially as the policy landscape continues to evolve.
The Role of Federal Tax Policy. For over 40 years, the US federal tax code has supported tax equity investing — generally defined as partnerships between tax inefficient project developers and tax efficient corporations. The trend, which started in real estate and expanded to energy in the 2000s, has been a consistent feature during both Republican and Democratic administrations. In 2022, the Inflation Reduction Act (IRA) broadened the scope of tax equity by creating new credits for energy storage, nuclear, hydrogen, biogas and advanced manufacturing, while also allowing for transferability, making it possible for project developers to sell their credits directly to third parties for cash for the first time. These changes to the tax code effectively doubled the size of the tax equity market and had a significant economic impact across the country, generating ~$131 billion of private sector investment across 379 projects in 42 states, and creating 117k jobs in 2023–24. As many analysts have pointed out, most of the economic benefits of these projects have occurred in Republican-controlled congressional districts.
Currently, the Trump Administration and Congressional Leadership are focused on extending the Tax Cut and Jobs Act (2017), while balancing concerns about the federal budget deficit and other priorities. Through this process, the details of IRA specific tax credits will change. We expect that the federal government will continue to use parts of the tax code to encourage private investment in selected areas of power generation, critical infrastructure, and domestic manufacturing. Regardless of how specific credits are reshaped, project developers and manufacturers will continue to seek efficient access to capital. That is where Crux comes in.
Why We Invested in Crux
Crux launched in 2023 to address the opportunity of transferability of tax credits (TTC). Crux built the leading platform, bringing transparency, price discovery, and scale to this new market. In just two years, they facilitated over 70 deals, unlocking billions in clean energy investments. This year, Crux expanded into infrastructure debt, a natural complement to their core platform. The infrastructure debt market is ~10x the size of the TTC market and is ripe for modernization. The Crux debt platform is gaining momentum and has positioned the company to support project developers across the financing lifecycle.
Since launching our Climate Technology Fund, we have spent time with many entrepreneurs creating solutions for renewable developers. Those conversations have given us a deep appreciation for the need to reduce project soft costs — the transaction costs, legal fees, diligence timelines, and administrative burdens that inflate budgets and slow projects down. As hardware costs have fallen, soft costs have grown to account for 40–70% of total renewable project costs. Crux reduces financial soft costs by streamlining transactions and introducing transparency into what had previously been complex, opaque processes. Crux stood out for their leading position in the TTC market and their ability to scale horizontally and provide additional financial solutions to both project developers and investors. As a transactions hub, Crux sits on a massive amount of data and can leverage LLMs across the full project finance lifecycle, further improving deal efficiency. For example, they are currently working on embedding artificial intelligence workflows into the platform to accelerate contracting and diligence, without sacrificing quality.
We’re excited to be backing a standout team building this platform. Crux’s founders, Alfred Johnson and Allen Kramer, are experienced entrepreneurs who bring a unique blend of experience across policy, software, and project finance. They’ve recruited a high-caliber team of experts from across the energy, finance, and technology sectors. Recent hires include Yonette Chung McLean, a veteran of the industry with over 20 years of experience at RBC; Andrew Hsiung, formerly of Blackrock and Carlyle Group; and Hasan Nazar, former head of federal policy at Tesla.
At MassMutual Ventures, we invest in transformative technologies that address the most pressing challenges in climate and energy. By leveraging market data and AI to accelerate the development of renewables, storage, mining, and manufacturing, Crux sits at the intersection of two of our priority investment themes — climate intelligence and clean power. Our unique relationship with our sole LP, MassMutual, enabled us to quickly build perspective and conviction in Crux. MassMutual’s expertise in corporate tax, its partnerships with project developers Low Carbon and Counterpointe, and its relationship with Barings, an expert in infrastructure debt, helped us to appreciate the potential of the Crux platform. We look forward to leveraging our expertise and connections to support the company in the next stage of its development.
