Why Toniic members invested in Mortar IO
Buildings are at the forefront of the global energy challenge, accounting for 30% of global final energy consumption and 26% of energy-related emissions.
This significant environmental footprint has placed the sector under intense scrutiny, driving the implementation of regulations worldwide to encourage decarbonization. Global regulations that push for decarbonization include the UK’s Minimum Energy Efficiency Standard (MEES), which mandates commercial properties to achieve a minimum EPC C rating by 2027 and EPC B by 2030 to be able to lease properties; or New York’s Local Law 97 which imposes carbon caps on buildings to cut down emissions, enforcing compliance through fines. Similar laws are also being introduced in Boston (BERDO), Washington (BEPS), California (Existing Buildings Ordinance), and the rest of Europe (Energy Performance of Buildings Directive or EPBD).
Mortar IO
Powered by AI and Physics, Mortar IO’s 3D simulation technology identifies the most cost-effective route to net zero goals for the buildings sector
Founded in 2022, Mortar IO offers a timely solution with its virtual modelling platform, enabling building owners and managers to navigate toward net-zero targets efficiently. Their mission is bold: to decarbonize existing buildings swiftly and efficiently, contributing significantly to the global fight against climate change; all whilst ensuring property value growth and rents; hence enabling a strong business case to invest in sustainability.
Energy retrofits are essential for mitigating climate change impacts. However, the process is notoriously slow, expensive, and disruptive, often requiring extensive surveys of individual buildings that can span months. Despite these challenges, the urgency for retrofits escalates as global temperatures rise and energy demands increase.
Mortar IO helps with this process by leveraging multiple data sources to create virtual models of existing buildings within their clients’ portfolios. Powered by AI and Physics, their robust 3D simulation technology identifies the most cost-effective route to net zero by aligning with clients’ budgets, net-zero goals, tenancies, and wider regulations.
Unlike traditional solutions that focus on single aspects of building management, their platform offers holistic, portfolio-wide modelling solution. This empowers building portfolio owners and managers with comprehensive insights, enabling them to make informed decisions in minutes rather than months. This capability is critical as the range of retrofits extends from simple upgrades, such as window replacements and insulation enhancements, to complex overhauls of mechanical and electrical systems.
Their revenue model is based on a cloud-based SaaS subscription service with annual contracts. The tool serves clients during the planning and execution phases of building retrofits and continues to monitor building performance afterward.
Traction
To date, Mortar IO has successfully concluded a series of pilot studies encompassing 150 buildings from three customers. Based on the outcomes of these pilot studies, Mortar IO generated high levels of interest from both commercial landlords and local councils. They received a non-dilutive grant to extend the pilot program to 150,000 buildings within Barnet Council and have signed an early adoption pilot program with Langham Estates, a prominent investor and manager of commercial real estate in West London. As they continue to have conversations with property owners and managers for early adoption program, the minimal viable product (“MVP”) is scheduled to be rolled out in early April.
Additionally, Mortar has a development partnership with Mitie, the largest property management company in the UK, which has about 450,000 buildings in its portfolio.
Incubation and Pre-Seed Round
Mortar IO was formed out of Carbon13. Carbon13 is a UK- and Germany-based venture builder for climate emergencies.
Mortar IO recently closed a $1.45M pre-seed round to expand their engineering team and execute on their pilot projects. Investors include Carbon13, Mission One Capital and two private investors of the Toniic community (among others).
Toniic, Carbon 13 and Mortar IO
After her investment in Carbon13 cohort 3, private investor Naomi Ronn also invested directly in Mortar IO. Learning about the company on a Toniic webinar, fellow Toniic member Donald Dolifka joined the round, after connecting with Naomi.
In 2022, Carbon13 participated in Toniic’s fund program on two separate occasions for two of its cohort’s capital raises, successfully raising capital from Toniic members for SEIS Fund 3 and SEIS Fund 4. At least 5 Toniic members are investors in Carbon13 across various cohorts, including Naomi Ronn, who invested in Cohort 3.
Through this investment, Naomi got to know the Mortar IO team as she also mentored the entrepreneurs. Naomi decided to invest directly in the company as an angel investor as well, since she liked the very novel way that Mortar IO approaches climate/carbon compliance for landlords, property managers, and municipalities alike.
Naomi Ronn:
“I met Mortar through having joined Carbon13 accelerator (introduced at Toniic). I felt very strongly about this team, who was part of the cohort. The founders have impressive experience, an AI driven prototype and strategic collaborators and beta sites. They have a novel way of approaching climate/carbon compliance for landlords, property managers and municipalities alike. The level of information provided has the largest real estate portfolio holders in London excited and committed. They have a clear path to market, and a welcoming ecosystem, especially in the UK.
What I appreciate most about the founders is that they are authentic, committed, and the difficult start-up investment climate, has been unrelenting in their mission and continues to gain momentum.”
In addition to Toniic’s fund program dedicated to sharing capital raises of impact funds across asset classes, Toniic also runs a direct deal program, with deals exclusively sourced from within the Toniic community, as Toniic members are keen to share impactful ventures with their peers. Naomi referred her portfoflio company to Toniic’s direct deal program when Mortar IO began raising its pre-seed round in Q3 2023.
After learning about Mortar IO on one of Toniic’s Investment webinars, Toniic member Donald Dolifka and Naomi connected with the team to gain deeper insights into the company and share Due Diligence notes. Donald ‘Don’ also committed to the round.
Don Dolifka:
“Mortar IO is creating a much-needed digital platform designed for large land advisors/managers to organize, analyse and thoughtfully deploy decarbonization projects within their portfolios. Additionally, the platform is projected to save portfolio owners significant CAPEX required for decarbonization projects.
The founders have deep experience in sustainable real estate and tech, and have engaged one of the largest property advisors in the UK to help curate the platform. I invested in the company because I believe this tool has the potential to greatly accelerate building decarbonization globally over the coming years.“
Speaking about the whole experience, Naomi shared:
“One of the aspects I really appreciate about being a member of Toniic is the comfort to share innovative opportunities that align with the values of the community. Connecting with Don and being able to openly discuss investing in Mortar IO was a pleasure and a testament to the power of our network.”
Min Dhillon — Head of Capital, Carbon13:
“Toniic has been an amazing partner for a few of our capital raises, as we’ve been very happy with the outcome of their fund program for our funds 3 and 4. Investors from the Toniic community are generally value aligned with our mission of using entrepreneurship to tackle climate change, also several members have added significant value to our startups and investor network. We were delighted to learn that one of the portfolio companies received an angel investment from Naomi. It is truly impressive that Toniic has been able to support both our fundraisers and Mortar IO.”
About Carbon13:
Carbon13 is the Venture Builder for the climate emergency. Carbon13 grew out of the Cambridge ecosystem of innovation, academia, and entrepreneurship, and their expansion to Germany places them at the heart of climate tech in the EU.. Through their programmes, the Venture Builder and the Venture Launchpad, founders form teams and develop ventures capable of mitigating 10 million tonnes of CO2e per year once at scale. They have worked with over 650 founders so far and since 2021 they have invested over £7 million into 64 startups in the UK and EU. Currently, their portfolio is working towards a collective decarbonisation impact of 0.5 gigatons per year by 2040. For more information about investment opportunities into Carbon13, contact Investors@carbonthirteen.com.
About Toniic:
Toniic is a global community of asset owners seeking deeper positive net impact across the spectrum of capital. Our members consist of around 500 high-net wealth individuals, family office, and foundation asset owners who are deepening their impact across the spectrum of capital and personal resources in more than 25 countries around the world.
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