Energize Ventures
Published in

Energize Ventures

Announcing Energize Growth Fund I

An expansion of our overarching investment strategy

When we launched Energize Ventures Fund I in 2016, we were investing in the thesis that the energy and industrial sectors are undergoing a massive digital transformation in a world increasingly focused on sustainability. We believed (and still believe) that the time for these traditionally analog sectors to solve their most pressing challenges by adopting and deploying new digital technologies has arrived.

Fast forward five years, and the landscape around investing in the transformation of energy and industry has changed. We’re seeing more capital being deployed into more companies at higher volumes than even we predicted. The stock price of publicly traded firms enabling the energy transition are up an average of 212% over the last year, and the private markets’ financing volumes targeting this theme have tripled in four years[1].

  • $16.3 Billion in 2019 flowed into climate tech, up from ~$6 billion in 2016
  • Greater than 30 billion dollar + startups today, up from ~10 five years ago[2]
  • More than 26 energy transition stocks currently valued over $1B

The transition towards renewable energy is happening remarkably fast. Companies across these markets are decarbonizing, digitizing, and decentralizing ahead of expectations. Amidst these upside conditions, market leaders can achieve outsized market share, capital investment and value appreciation. In response to market shifts, we are excited to officially announce the formation of Energize Growth Fund I (Growth I) — our first fund aimed at supporting later-stage companies experiencing sustained tailwinds and rapid growth.

Two key investment themes, one past and one present, create the perfect opportunity for growth investing in our sector.

  1. First, the increase in available capital for energy-focused startups in the earliest stages is a new phenomenon. As recently as 2017, the pace of investment reached a tipping point that created the high volume of startups that are now becoming growth investment opportunities. Today, we’re starting to see the winners emerge from this wave of capital.
  2. Second, software and software-enabled businesses are finally capturing the value created by the declining costs of technologies like electric vehicles, solar PV and batteries. Aurora Solar exemplifies this trend as solar design software that enables the rapid deployment of increasingly cost-effective solar. We’ve noted that these types of companies tend to stay private longer and require additional capital in order to cement their market leadership before going public.

At Energize, we pride ourselves on our entrepreneurial approach and our ability to evolve when market conditions change. In this case, the opportunity is growing, and we are growing with it.

Growth I is meant to complement our core funds; We will continue to be obsessively focused on leveraging software to enable the evolution of energy and industry into sustainable, digitally-native sectors. The availability of this additional investment vehicle will allow us to continue to support our most established, fastest-growing companies as they solidify their positions as market leaders.

To date, we’ve funded Volta Charging, DroneDeploy, and Fast Radius from this fund as they continue to surpass our initial expectations in terms of revenue growth and market share. We are also excited to announce today Energize Growth Fund I’s funding of Aurora Solar’s $250M Series C round led by Coatue Management.

At Energize, we’re committed to supporting founders from commercialization all the way to exit through acquisition or IPO. With this growth fund, we are confident that we are better equipped to deliver on that promise to our founders.

[1] Energize research

[2] https://www.pwc.com/gx/en/services/sustainability/assets/pwc-the-state-of-climate-tech-2020.pdf

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store