Conduit Partners Deliver 11:1 Return on Investment

Conduit Partners are delighted to have our contract with the Carbon Trust extended for a further two years, this follows on from an extremely successful three years whereby Conduit have delivered and 11:1 ratio return on their investment in our services to the Carbon Trust. During this period the Carbon Trust has build renowned reputation as the premier support service of choice devoted to low carbon entrepreneurs and, as such, Conduit demonstrated exceptional expertise and experience to be selected as one of a small number of preferred suppliers.

The services provided, delivered and managed by Conduit to 30 companies included:

  • Understanding Market Opportunities
  • Supporting Patenting and Intellectual Property Policies
  • Finding Customers and Partners, and Assistance in Negotiations with them
  • Securing Sales and Building Pipeline
  • Providing Interim Management and Mentoring
  • Building the Case to Attract External Investment, and making introductions to Investors
  • Supporting Companies to Define and Refine their Business Strategy
  • Teambuilding
  • Venture Due Diligence
  • Research and Development Grant Project Appraisals, Mentoring and Project Management.
  • Fundraising

Conduit also provided Carbon Trust client companies with valuable insights into technology commercialisation and venture business development and made a material difference to the success of some of the UK’s most innovative clean tech ideas through the Carbon Trust relationship. Conduit engaged directly with venture teams and industry and have a “hands-on” approach that enables us to deliver practical solutions and resolve complex problems; we have proven that this approach  adds much more value than purely providing generic advice. The Carbon Trust benefitted from our ten years of experience and found it particularly useful that we were able  to communicate and work equally well at board and senior management level as well as with technical, sales and operational teams. They found us effective at tackling difficult situations in which conflicts or tensions are present. The Carbon Trust held regular formal KPI performance reviews and Conduit consistently came out a top-rated, high quality supplier.

The success of these services can be judged by the success of the companies supported. Conduit was involved in over 30 Carbon Trust early stage companies, which subsequently leveraged £11.1m of external funding or direct sales revenue. These figures made Carbon Trust the most successful low carbon entrepreneur support service in Europe, a result which was to a very large extent due to the direct support to entrepreneurs provided by Conduit, and one of which we are extremely proud of being involved in.

I have been showing anyone who would take notice the NESTA figures proving that expert support intervention delivered in the early stage of a companies gets them to revenue quicker and builds valuation. The returns on this early investment by a ratio of 6:1 (NESTA FIGURES) these latest Carbon trust figures go to further prove that experienced focused and dedicated expert intervention, working closely with management teams, stake holders and investors delivers nearly double that return and helps significantly mitigate risk. Whilst many investors believe they can do this themselves or leave it to the management team, we, having proven this, believe that if that were the case fewer portfolio companies would be needing follow on money today.

Is anyone taking notice?

Why SMEs and government should rise to the cleantech innovation challenge

There’s a dilemma with innovations in low-carbon technology: there’s no shortage of them, and there’s a compelling need for them, but there’s a challenge in securing capital and commercialising them in a way that provides a sufficiently speedy return on investment.

In my presentation to Showcase Wales, the Carbon Trust’s Annual Conference this week, I said one of the principal challenges was the uncertainty of value that society and government choose to place on reducing carbon emissions.

It was no coincidence that I emphasised this point in the days following the agreement reached in Durban during the climate change talks. I do hope the ‘Durban platform’ means the world’s economies – especially the developing ones like India and China – really have committed to reducing greenhouse gases. However, hasty verbal agreements concern me almost as much as the three-year timescale required to draft the treaty, let alone the fact that it won’t come into force until 2020.

It’s certainly a move in the right direction, though I admit that until I heard the outcome in the early hours of Sunday, I feared it would not happen. Support for the Green Climate Fund – which has promised $100bn of aid per year to help developing countries –also sounds promising, but I question where the money is coming from. Will it be too little, too late?

Whatever the eventual outcome of the Durban summit, I believe we in the UK should continue to lead by example and innovate for the future – in spite of the considerable challenges. If we are smart, we can position ourselves as global thought leaders in the development of new technologies that not only reduce carbon and save fuel but open up new possibilities for economic growth, new skills and routes to international markets for our innovations!

How can we do this? As well as setting out the challenges in my presentation, I also outlined some solutions:

  • The government, as a major purchaser, needs to reduce the market risk for SMEs by adopting early-stage innovations in the low-carbon technology sector. It should set itself up as an early adopter. In fairness, many local authorities are doing this but we need to see more activity. Could it be mandatory to trial and develop homegrown IP in the government and local authority workplaces? We have seen evidence of huge energy savings in the sector by the adoption of homegrown technologies, hi and low tech. Renewable Obligation Certificates (ROCs) might even be stifling innovation by providing poor quality intermittent electricity. Maybe this needs reviewing: maybe ROCs should be taken away for poor supply, which might put the focus on other innovations that provide continuous electricity?
  • There needs to be an improvement in access to risk capital and aligning technology solutions to corporate innovation needs. While venture capital remains challenging – often nonexistent – we believe corporates will play an increasingly important role here, and SMEs should be formulating strategies around understanding corporate needs and where their pain is.
  • Corporates, in turn, also need to develop a strategy of how to embrace the opportunities that cleantech SMEs present – using intermediaries or external technology scouts, where appropriate, to make introductions – and to invest further up the supply chain of SME innovation. We see many early-stage technologies looking for corporate partners with hugely appealing solutions in our position with the Carbon Trust.
  • We need to tackle the skills deficit by providing credible business support services to assist SMEs, such as the investment readiness services, corporate introductions, training and mentoring services that we at Conduit Partners provide as part of the Carbon Trust Entrepreneurs Fast Track programme. Other funds and corporates would be well advised to look at this model, as the impact has been significant.

All of these steps would help make the UK a leading light in demonstrating the principles of the Durban agreement. We could demonstrate a climate-saving reality, it would give us international routes to market for our solutions, and we could prove to other nations the benefits of such an agreement rather than it being just a lot of hot air and something to be avoided. Energy is a global issue.

If you’re an SME interested in the Entrepreneurs Fast Track, or a corporate interested in finding suitable SME innovations, email hollymunns@conduitpartners.co.uk or call 01235 831777.

Why investors need to overcome their fear of risk and bring innovation to life

Without the momentum of innovation, the UK economy will be dragged to a halt. However, while innovation is the very essence of business, it needs the beating heart of investment to bring it to life. But in the current climate, investors are playing safe and avoiding risks.

That’s why it is such good news to hear that the government has announced a major catalyst for angel investing in innovating entrepreneurs, as reported by the British Business Angels Association (BBAA). The Seed Enterprise Investment Scheme, from April 2012, will investors backing early-stage seed businesses up to 50% tax relief. Early-stage businesses will be able to receive up to £150,000 under this scheme – which will be crucial in helping get businesses established and create a structure for growth.

We also applaud the new £50m Business Angel Co Investment Fund – called the Angel CoFund – supported by Capital for Enterprise Limited and a grant from the Regional Growth Fund. The fund will be able to invest between £100,000 and £1m in SMEs, alongside syndicates of business angels.

BBAA chair Anthony Clarke is quoted as saying: “This enhanced 50% tax break will stimulate high net worth individuals to see the benefits of using their cash for investments in very early seed-stage businesses where these deals may have seemed too risky.”

Anything that mitigates risk has to be welcomed. Innovative entrepreneurs have been starved of venture risk money, and these moves should encourage investors to look at mid to longer term investment opportunities especially in the technology and clean energy sectors, which are a hotbed of innovation. Adopting new technologies – whether high or low tech – will ensure companies have competitive advantage now and in the future.

It’s not just the SMEs that will benefit from a more fluid approach to risk: innovation and diversity are essential for large companies looking to maintain and grow revenues and provide enhanced shareholder value, and they will have to consider where their next profitable innovation will come from. Process-driven companies need to develop and apply creative solutions for their own sustainability, and they need to look for innovations that offer good prospects for growth.

To enable corporates to engage and invest in innovative clean technology start-ups in areas that have been deemed strategically important for their business. Conduit Partners is launching a new initiative in the New Year following 10 years at the forefront of evaluating technology for commercial potential. This new service will not only identify these companies but ensure they are investable and then managed to ensure value is created in both the business and product. We intend identifying and bringing businesses with innovations that can help corporations advance through and beyond the current economic climate and future proof their profitability and their prosperity.

For a risk-free discussion about the innovations and opportunities that can put renewed life into your business – or to discover more about our new service – email holly.munns@conduitpartners.co.uk or call 01235 831777. 

 

Lontra wins ‘Best Pitch’ at Conduit Partners/Carbon Trust Investment Showcase

Congratulations go to Simon Hombersley, business development director of Lontra, who won the ‘Best Pitch’ award  at the Investment Showcase event held by Conduit Partners and the Carbon Trust on 21 November.

Lontra – a UK-based cleantech start-up developing energy-saving compressors and engines – was one of five companies in the low-carbon sector pitching to a room full of potential investors at the event, which was held at Home Housein central London. Everyone was asked to vote for their favourite pitch at the end of the evening. Simon emerged the winner, and was lauded for his lively presentation that was articulate and simplified the business and investment case. He wins a bottle of Champagne.

Conduit Partners’ chief executive Paul Gooch said: “The event showcased five high-growth potential companies in the low-carbon sector. My congratulations to all the presenters who performed extremely well in putting forward the opportunity and value proposition for each of their companies.”

The next Investment Showcase is planned for spring 2012. For more information email holly.munns@conduitpartners.co.uk or call 01235 831777.

What will put the Venture back into Venture Capital?

Where have all the risk takers gone? And how ‘safe’ does a deal have to be before investors will venture forward?

I’m beginning to wonder that this week, after our investment showcase on Monday, supported by the Carbon Trust, where we presented five cleantech companies that have created innovatons in energy efficiency. They have been through the Carbon Trust Entrepreneurs Fast Track programme, and are bang on trend as far as investment opportunities go.

Our timing couldn’t have been better, as we hosted our event just two days before the government launched its Green Deal, a programme to bring the UK’s buildings up to date with energy-efficiency improvements.

This is a major opportunity for businesses. Chris Huhne, secretary of state for energy and climate change, says that the Green Deal will give energy companies and investors “access to a huge and growing market, with implications for jobs and skills across the supply chain – and across the country”. He estimates that the energy-efficiency sector will support 100,000 jobs within five years across the UK – as well as helping the country to achieve its carbon emissions reduction targets.

The five entrepreneurs who presented their cleantech innovations can do exactly that. Eco Answers’ Loftzone – which was quoted in a BBC News story on the Green Deal – has a patented insulation system for loft floors; Lontra has an energy-saving compressor; Calon Controls has energy-saving lighting control solutions; ElectronicaUK has energy-efficient electronic control systems; and ModCell has pre-fab wall and roof cladding to improve insulation.

These five companies are well primed for investment, with a track record of revenues, and a robust, tested business plan that will bring healthy returns to investors.

It’s an exciting sector, ticking not just the cleantech box but also ticking a long-term return-on-investment box. We’re aware that the ROI is not a three-to-five years box, but what technology investment would achieve that?

Yet, while 30 investors came to our showcase this week and took away a positive impression and requested follow-ups on the five presentations, I’m sure that, given the excitement around the Green Deal opportunity, we should have five times as many investors turning up to our next showcase in March 2012. If they’re prepared to take what is a calculated but long-term risk.

The markets may have been affected by austerity measures across Europe – but even in this article in the Financial News on global cutbacks hitting cleantech investments, the commentator states that “energy efficiency and the water industry offer better prospects for mid-market investors” because they are “seen to offer a better risk/return profile”.

Being an entrepreneur is about facing the failures as much as celebrating the successes. That’s what risk is all about: it brings the buzz to a brilliant deal, and that buzz sustains you through the less buoyant times.

As the old adage goes: nothing ventured, nothing gained.

If you’d like to take part in the Entrepreneurs Fast Track programme, or to register your interest in our next showcase event, email holly.munns@conduitpartners.co.uk or call 01235 831777.

Five companies in a room full of sophisticated investors driving technologies of the future

Businesses large and small need to be sustainable if they’re to survive and thrive in the 21st century. Big-name companies are making green their colour of choice and committing to low-carbon practices because they know it’s an essential investment in their future.

Soft drinks giant Coca-Cola Enterprises has just received the Carbon Trust Standard with the highest score for carbon performance in the carbon reduction assessment’s history. And DIY retailer B&Q is putting low-carbon growth at the centre of its business strategy, with thousands of eco products now on sale in its stores. We’re also seeing biofuel for airlines and taxis, low-carbon vehicle technologies, and homes built from low-carbon materials.

This is not just a nice to have, or a trendy way to approach corporate social responsibility. It makes good business sense to have sound carbon management strategies in place. Did you know you could make savings of 25% on energy costs with effective energy management? And businesses investing in renewable energy could make average returns of 11-12%, and sometimes in excess of 20%, according to the Carbon Trust.

That’s why we’re giving a unique insight into the technology that will shape the 21st century low-carbon economy. On Monday 21 November, we are showcasing five businesses that will reveal how we will be powered in the future, and they represent some of the most exciting investment opportunities in the cleantech sector.

At the event, which is supported by the Carbon Trust, investors will have a unique opportunity to meet and question the companies presenting at the event: ModCell, which has created pre-fabricated wall and roof materials for carbon-negative buildings; Calon Controls has developed energy-saving lighting control solutions; ElectronicaUK has developed electric motor technology to improve the range of electric cars; Lontra is marketing a patented novel processor for the water industry; and Eco Answers has developed Loftzone to help improve property insulation and reach carbon-reduction targets.

These five companies have successfully been through the Carbon Trust Entrepreneurs Fast Track, which is a robust, commercially focused programme for early-stage low-carbon technology ventures. These cleantech businesses have a business model that is clearly aligned to a significant reduction in carbon emissions and generating revenue. The programme ensures this model is rigorously tested, they have a value proposition that is strongly articulated, their technology is different from anything else on the market, their products have IP protection, and they have a pipeline of customers ready to buy.

These companies now need an injection of capital to fuel their next stage of growth and bring healthy returns for their investors.

If green isn’t your business colour of choice yet, it soon will be.

To attend the event on Monday 21 November at 5.30pm at Home House in central London, email hollymunns@conduitpartners.co.uk or call 01235 831777.

Conduit Partners and Carbon Trust showcase five exciting cleantech investment opportunities

Conduit Partners is delighted to reveal the five cleantech businesses that will be pitching to a panel of investors at the Conduit Investment Showcase on 21 November.

The event, which is supported by the Carbon Trust, features innovative low-carbon early-stage businesses that already have a market presence and a significant revenue pipeline, and are looking for investment to propel them into the next profitable stage of growth.

All five businesses have gone through the Carbon Trust Entrepreneurs Fast Track programme – helping to define their business plan and articulate their value proposition – and the entrepreneurs are primed and prepared to deliver compelling investment pitches at the event.

The five companies are:

ModCell has created a system that makes carbon-negative building a commercial reality. It manufactures pre-fabricated wall and roof cladding using the thermal insulation qualities of straw bale and hemp construction to be used in offices, schools, housing and commercial buildings. ModCell buildings can have zero heat requirements, saving money and CO2 emissions.

Calon Controls designs, develops and supplies energy saving lighting control solutions for office, retail and education environments. Calon’s products can be integrated seamlessly into a low-carbon ‘smart building’ solution.

ElectronicaUK develops energy-efficient electronic control systems that can be applied in a number of markets. Its electric motor technology doubles the driving range of electric vehicles in the city, and its energy-efficient heating control system for the global leisure market will drive early revenues into the business in 2012.

Lontra is bringing to market a patented novel compressor, initially for the water industry, where compressed air is used to treat sewage. As 10% of all industrial electricity is used by compressors, it aims to reduce energy spend by 20%.

Eco Answers has developed Loftzone, an innovative patent-pending loft flooring system to protect the insulation of household properties and deliver the energy savings that come from a properly insulated property. It will help governments and utilities achieve their carbon-reduction targets.

The Conduit Investment Showcase begins at 5.30pm on Monday 21 November at Home House in central London. The presentations take place between 6pm and 7pm, with the opportunity to network and talk with further with the companies afterwards.

To attend the event, or to find out more information about taking part in the Carbon Trust Entrepreneurs Fast Track programme, email hollymunns@conduitpartners.co.uk or call 01235 831777.

Conduit Partners to stage its first Investment Showcase

We at Conduit Partners are extremely proud to be holding our first Conduit Investment Showcase in conjunction with the Carbon Trust.

As a Carbon Trust Entrepreneurs Fast Track (EFT) partner, we are delighted that the Carbon Trust is partnering with us and endorsing what will be a sophisticated investment event for the investment community in the exciting clean technology sector.

Together with the Carbon Trust, Conduit has worked extensively with five entrepreneurs in the cleantech sector, helping them improve their ideas and develop them into workable and exciting investment opportunities. We have given them expert commercial input on their business plan, how to articulate their value proposition, and how to develop the skills the management team will need to unlock the business potential.

They are fully prepared to present their business proposition to a select audience of investors at this exclusive Investment Showcase to explain exactly why they are worthy of investment – and to demonstrate to investors how and when they will deliver a healthy multiple return to any investor.

The event is being held at the prestigious Home House, Portman Square, London on the evening of Monday 21November 2011.  Starting at 6pm sharp, the five companies looking for investment will be presenting and will be available after the presentations to meet with interested investors.

Following each company presentation there will be an opportunity for questions from the floor. After the formal part of the evening is over, there will be drinks and canapés and plenty of time for networking.

If you are seeking quality investment opportunities in an exciting sector from some of the most leading-edge technologies today, please register your interest in the Conduit Partners investment event. If you’re a start-up business or early-stage cleantech venture looking for assistance on how you can benefit from the EFT programme that may lead to investment, then we’d love to hear from you. Email info@conduitpartners.co.uk or call 01235 831777.

How to Impress a Cleantech Investor

You’re a cleantech entrepreneur with the innovation, the passion and the vision. All you need now is the finance to fuel your ideas and make them a commercial reality. And all that’s standing between you and success is the pitch to investors to convince them to back you – so you have to do your homework and be pitch perfect when you come to face them.

It’s never been a better time to invest in cleantech, which is why at Conduit Partners we work with fledgling businesses to help them identify opportunities, articulate their USPs, and accelerate their market entry. We do all this because we are partners in the Carbon Trust Entrepreneurs Fast Track (EFT) programme, and we want to help early-stage cleantech ventures become market ready and offer an exciting investment proposition.

However, just because cleantech is THE sector to be in right now, it doesn’t mean investors will just throw their money at embyronic ideas in the hope that they might grow into strong propositions. No, they’re looking for near-to-market or revenue-generating technologies. A lot of money has been ploughed into energy generation, but the focus now is on energy efficiencies – not least because they offer investors nearer-term returns.

So, if you want to impress investors, you’ll need to have:

  • A credible and realistic business plan that identifies customer needs and how your business will anticipate, track and satisfy those needs.
  • The right team in place to execute the plan. Too often, teams in the cleantech sector lack strong commercial people to make the plan happen. They often rely on the science and technology aspects, but without a credible business model and people equipped and experienced to execute that model, you won’t cut it with investors.
  • Proof that your idea has a market. You will need to have carried out validated research to prove that your plan is real and achievable.
  • Commercial traction:  Have you made headway with commercial partnerships, sales and alliances? Do you have proof that customers will buy?
  • Defendable IP that is not just a patent but freedom to operate. This market is extremely complex when it comes to IP, so you must do the groundwork first to ensure you are unique and protected in the market.
  • Understanding and enthusiasm: it’s going to be a long journey and investors want to be excited by the investment. They love the thrill of exciting investments. Just like everyone else they want to buy into the future, and the future is clean

Conduit Partners is hosting an investment forum in central London in late November where five companies that have taken part in the Carbon Trust EFT programme will pitch to a panel of sophisticated investors.

Whether you are an investor or early-stage business, if you would like to register your interest in the Conduit Partners investment event, or if you’re a start-up business or early-stage cleantech venture looking for assistance from the EFT programme that may lead to investment, then we’d love to hear from you. Email info@conduitpartners.co.uk or call 01235 831777.

How to qualify for the Carbon Trust Entrepreneurs Fast Track

If you’re a cleantech entrepreneur with a brilliant idea, or are overseeing an early-stage venture, timing has never been better for you to get your fledgling business off the ground. The Carbon Trust has funding of £3m to support British low-carbon technology entrepreneurs this year –which includes £70,000 of technical and commercial consultancy to help your business become market and/or investment ready.

Conduit is a partner in the Carbon Trust Entrepreneurs Fast Track programme. We deliver the package of commercial advice, and we’re currently recruiting new businesses to join the scheme. Here’s what you need to qualify:

Carbon impact: The Carbon Trust is seeking technologies that can deliver 100k tonnes of carbon savings every year – or the potential to deliver this. You will need to demonstrate the carbon savings that your idea, product or service can achieve.

IP strategy and protection: You need a unique idea or process in order to stand out in the market, and you need to protect it. This can be an incredibly complex and competitive arena, so you need to show how you plan to protect your know-how, whether through a patent or another mechanism to secure your company’s intellectual property.

Independent technology validation: Your technology must have matured to a level that it ‘does what it says on the tin’, or has the potential to do so.

Differentiation: How is your technology distinct and different from others? You have to offer an exciting and achievable alternative to what is already on the market, so make sure you understand and can articulate your unique selling points. With such a crowded market, don’t run the risk of being seen as a ‘me too’ company; make sure your differentiator is clearly outlined and convincingly expressed.

Scalability: This is vital. Your product or service will need scale if it is to achieve its carbon-reducing potential. If your approach or process perhaps isn’t as innovative as others on the market, then make sure you strongly demonstrate the carbon savings and scalability in your application.

Commercial focus: You will need to demonstrate how you have funded your business so far, and what investment you anticipate will be needed to make it commercially viable. Make sure that you focus your application on how you would benefit from the expertise and funds of the Entrepreneurs Fast Track programme. Highlight your need for professional commercial support, especially around the development of the business case and potential fundraising, to help you qualify.

We can review the initial draft of the application form before you submit it to the Carbon Trust, and advise on areas you will need to emphasise to be in with a chance of being accepted. The purpose of the scheme is to make a significant step change to your business, not an incremental improvement. So, think big and go for it.

For an initial chat about whether you would qualify, call Susan Dunstall on 01235 831777 or email susandunstall@conduitpartners.co.uk