A New Approach to Financing Cleantech Companies.


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Juergen Habichler, Founding Partner - Mountain Cleantech AG - Switzerland

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A New Approach to Financing Cleantech Companies.

  1. 1. - A new approach to financing Cleantech Companies - Jürgen Habichler, Managing Partner Mountain Cleantech AG Cleantech Invest AG www.cleantech-invest.ch
  2. 2. Table of Contents <ul><li>1. The Cleantech Industry – Overview </li></ul><ul><li>2. Investment in a Promising Market </li></ul><ul><li>3. The Group Structure </li></ul><ul><li>4. Cleantech Invest AG </li></ul><ul><li>- Novel Investment Approach </li></ul><ul><li>- Investments – Portfolio Companies </li></ul><ul><li>4. Excursus - Cleantech Initiative Deutschland </li></ul><ul><li>5. Our Success Factors </li></ul><ul><li>6. Contact </li></ul>
  3. 3. <ul><li>Clean Technologies </li></ul><ul><li>- Bio-Gas / Bio-Diesel / Bio-Ethanol </li></ul><ul><li>- Solar / Photovoltaic </li></ul><ul><li>- Wind Energy </li></ul><ul><li>- Fuel Cells/Advanced Batteries </li></ul><ul><li>- Hybrid Systems </li></ul><ul><li>- Lighting / Buildings </li></ul><ul><li>- Emission Control </li></ul><ul><li>- more efficient usage of resources </li></ul><ul><li>… </li></ul>The Cleantech Industry Overview (1/2) So – what really is Cleantech? It‘s the striving for an alliance between Technology and Nature, rather than exploiting the latter like in the first periods of industrialization. The term Cleantech thus embraces all (hightech) methods, which either reduce the production of harmful emissions or work in a more resource-saving way. Recycling & Waste Water & Wastewater Energy Generation Energy Storage Air & Environment Energy Infrastructure Transportation Materials Agriculture Manufacturing / Industrial Energy Efficiency
  4. 4. The Cleantech Industry Overview (2/2) <ul><li>Temporarily #2 Investment-Sector in USA in 2006 </li></ul><ul><li>Pure-play Cleantech funds (KleinerPerkins, Khosla Ventures, nth power, etc.) </li></ul><ul><li>EUR 1.9 billion invested in Cleantech Ventures in Europe since 2003 </li></ul><ul><li>UK and Germany as the most active nations for Cleantech investing </li></ul><ul><li>CVN estimates about 900 to 1100 new venture investments in Europe until 2010 totalling between EUR 4.8 billion and EUR 10 billion in capital invested </li></ul><ul><li>Emergence of dedicated Cleantech funds (ETF, Zouk, Emerald, Demeter, Capricorn, etc.) </li></ul>The US are leading the Cleantech Wave Europe is catching up Germany could emerge as Cleantech Country #1 in Europe <ul><li>#1 worldwide in Solar, Wind, Bio-Diesel, Bio-Gas </li></ul><ul><li>Top Cleantech success stories and exits </li></ul><ul><li>… but limited number of funds with a Cleantech orientation, </li></ul><ul><li>… UK / EU based funds do few deals in D/A/CH </li></ul>
  5. 5. Investment in a Promising Market (1/2) <ul><li>Positive development of the Cleantech industry </li></ul><ul><ul><li>Continuous market growth due to limited raw materials, structural deficits in the supply of energy, the issue of climate change, etc. </li></ul></ul><ul><ul><li>Increasing market volume of € 60 bn. in 2006 to € 400 bn. in 2030 predicted </li></ul></ul><ul><ul><li>World market share of German companies in the fields of Cleantech up to 30 % </li></ul></ul><ul><ul><li>„ German companies already offer solutions for global issues by today.“ Sigmar Gabriel, German minister for the environment </li></ul></ul><ul><li>Favourable political conditions </li></ul><ul><ul><li>Acceptance of the „Erneuerbare-Energien-Gesetz“ (feed-in tariffs for alternative energy over the next 25 years) in Germany, similar laws in many other countries </li></ul></ul><ul><ul><li>Guaranteed compensation for eco-energy (favourable abatement conditions / sales-conditions for eco-energy provider) </li></ul></ul><ul><ul><li>Germany is the leading R&D location of environmental technologies </li></ul></ul>Source: Cleantech Venture Network (www.cleantech.com) Cleantech Survey Hoyer & Partner Private Equity Consultants Greentech Survey of Roland Berger Strategy Consultants/Bundesministerium für Umwelt
  6. 6. Investment in a Promising Market (2/2) <ul><li>The opportunity for Venture Capital in Cleantech </li></ul><ul><ul><li>The development stage is completed in many fields, the stage of commercialisation has begun </li></ul></ul><ul><ul><li>US-Market: $ 3 bn. Invested in the Cleantech industry in the last three years </li></ul></ul><ul><ul><li>Germany is catching up! Aprox. € 450 M. invested in Cleantech companies in 2005 </li></ul></ul><ul><ul><li> continuous increase anticipated </li></ul></ul><ul><ul><li>The interest of independent fund-managers is rises, but a lack in the focus on Cleantech entails risks due to limited knowledge in that field </li></ul></ul><ul><ul><li>Strong deal-flow: Up to 200 financing requests at leading venture capital companies </li></ul></ul><ul><ul><li>Excellent exit-potential </li></ul></ul><ul><ul><ul><li>Via trade-sales: Leading energy- and technology companies (BP, GE, Shell, Siemens, etc.) focus more and more on Cleantech </li></ul></ul></ul><ul><ul><ul><li>Via IPO: Excellent performances at stock exchanges of Cleantech shares after listing </li></ul></ul></ul>Source: Cleantech Survey Hoyer & Partner Private Equity Consultants Greentech Survey of Roland Berger Strategy Consultants/Bundesministerium für Umwelt
  7. 7. The Group Structure Further Investment vehicle Co-operation partner for co-investments Further fund-vehicle planned for 2008 Mountain Real Estate Matthias Kuehn Jürgen Habichler Cleantech Invest AG Mountain Super Angel Daniel S. Wenzel Ayman Ashour Bluehill Identification Technology
  8. 8. The Group Structure Fund Management Team <ul><li>Jürgen F. Habichler (BA in Computer Science, MBA Wharton) – Managing Partner </li></ul><ul><li>since 1994 active in the venture capital sector </li></ul><ul><li>passed activities: Morgan Stanley Investment Banking, Siebel Systems 2001, Atlas Venture </li></ul><ul><li>Daniel S. Wenzel (Diploma in Business Administration – WHU) – Associate Partner </li></ul><ul><li>Co-founder and partner of Mountain Partner </li></ul><ul><li>passed activities: ACG AG, Bain & Company, Dresdner Bank, BNP Paribas </li></ul><ul><li>Alexander von Hutten (BA in Economics / Business Admin. – EBS) – Associate Partner </li></ul><ul><li>12 years experience in the Cleantech/Energy sector </li></ul><ul><li>until 2007 COO of CVP Clean Value Plastics GmbH </li></ul>
  9. 9. The Group Structure Advisory Board <ul><li>Hemjö Klein (Chairman, pending) </li></ul><ul><li>CEO of LIVE Holding AG, deeply involved as an investor and Business Angel </li></ul><ul><li>Dr. rer. pol. Cornelius Boersch (Diploma in Business Administration – EBS) </li></ul><ul><li>elected “Entrepreneur of the Year” Germany in 2002, entrepreneurial activities in the Mountain Partners AG (Switzerland ) </li></ul><ul><li>Prof. Jochen Tschunke </li></ul><ul><li>Business Angel and investor, co-founder and partner of the EQUITYplus GmbH </li></ul><ul><li>Dr. Guenter Schneider </li></ul><ul><li>Managing Director of M+W Zander FE GmbH </li></ul><ul><li>Torsten Merkel </li></ul><ul><li>Torsten is managing the European Operations of the Cleantech Group™ </li></ul><ul><li>Samer Zureikat (BSc Economics, Wharton) – Associate Partner </li></ul><ul><li>12 years in an entrepreneurial capacity in the Middle East and North Africa </li></ul>
  10. 10. Cleantech Invest AG Our Approach to create value Market Investment Approach Organisational Set-Up Track Record <ul><li>Cleantech Market </li></ul><ul><li>Various drivers ensuring long-term market growth </li></ul><ul><li>Political commitment to clean energy / technology </li></ul><ul><li>Public sentiments towards climate protection </li></ul><ul><li>Broad definition of Cleantech, incl. energy, water, material, logistics, recycling, etc. </li></ul><ul><li>€ 2 Bn+ of cleantech investments during 03-06 (representing 500+ firms) </li></ul><ul><li>Attractive exit potentials (both IPO + M&A) </li></ul><ul><li>Institutional Business Angel investment style </li></ul><ul><li>Opportunistic </li></ul><ul><li>Syndication oriented </li></ul><ul><li>Faster than VCs </li></ul><ul><li>Exit-oriented </li></ul><ul><li>Ticket size € 100K - € 2 Mio. </li></ul><ul><li>No. of investments 15 - 20 </li></ul><ul><li>Allocation Strategy : </li></ul><ul><li>40% Seed / Early stage </li></ul><ul><li>40% Late Stage / Pre-IPO </li></ul><ul><li>20% Recap / MBO / spin off </li></ul><ul><li>80% D/A/CH </li></ul><ul><li>15% Europe </li></ul><ul><li>5% ROW </li></ul><ul><li>Leveraging Mountain Partners‘ Network! </li></ul><ul><li>Initial Board of Directors </li></ul><ul><li>Jürgen F. Habichler </li></ul><ul><li>Daniel S. Wenzel </li></ul><ul><li>Alexander von Hutten </li></ul><ul><li>Excellent track record </li></ul><ul><li>Cleantech inv. expertise </li></ul><ul><li>PE and VC skills </li></ul><ul><li>Part of Mountain Partners Group </li></ul><ul><li>Advisory Board </li></ul><ul><li>5-10 industry experts, serial entrepreneurs, investors </li></ul><ul><li>Entrepreneurial investors and “Trusted Investors” </li></ul><ul><li>Experienced Business Angels with sector expertise </li></ul><ul><li>Leverage for sourcing, due diligence and portfolio management </li></ul><ul><li>IRRs of prior Investments in between 99,7% and 4611,3% </li></ul><ul><li>Currently invested in three promising projects: </li></ul><ul><li>- Sinosol </li></ul><ul><li>(Photovoltaic, wholesaler) </li></ul><ul><li>- Cowatec </li></ul><ul><li>(Planing & installation of biogas facilities) </li></ul><ul><li>- BioGate </li></ul><ul><li>(Hygiene technology) </li></ul><ul><li>Close cooperation with KfW (automatic doubling of investment sum without claiming for management leadership) </li></ul><ul><li>Strong project pipeline for 2007 /2008 </li></ul>
  11. 11. Cleantech Invest AG Novel Investment Approach (1/2) Pre-IPO Investments in close co-operation with experienced partners Mountain Partners’ fast and opportunistic investment approach is highly valuable for companies in „special situations“ Diversified Portfolio consisting of many small investments (on average €50K to €100K) The Investment Strategy of Cleantech Invest AG Seed Pre-IPO Special Situations 1/3 Risk minimising Return potential maximising extraordinary favourable entry conditions  <ul><li>Distressed </li></ul><ul><li>Growth </li></ul><ul><li>Buy-Outs </li></ul><ul><li>Many more </li></ul>High ROI at pre-IPO discounts and controllable exits  1/3 1/3   Company 1 Company 2 Company.. Company .. Company .. Company .. Company .. Company .. Company n
  12. 12. Cleantech Invest AG Novel Investment Approach (2/2) “ Syndicated”; in cooperation with “trusted advisors” / other bus ang. With other “trusted advisors” i.e. business angels / active entrepreneurs Deal driven – based on opportunities Seed, Early, Growth, Pre-IPO, Recap Based on opportunities (€100K to €2M) Depending on Stage; at least adjusted 3x required “ Flexible” including various financial instruments Minimum 6 – 10 weeks (in-depth DD) Often alone or with similar VCs. Usually no bus. angels involved Very stringent. Often not fulfilled within a certain time frame Usually one specific focus (i.e. early) Pre-determined range (typ. €3M-€5M) Early Stage: at least 10x Mainly direct equity participations Primarily through Corporate Finance Advisors Traditional VC Approach Rigid investment approach Cleantech Invest AG Flexible investment approach Investment Focus Size of Investments Return Potential Transaction Structure Time Line Syndication Pre-Closing Requirements Deal-Flow Generation Characteristics Proprietary deal flow through investors, own network and “trusted advisors”
  13. 13. Cleantech Invest AG Investments – Sinosol AG <ul><li>Sinosol AG is a German holding company with affiliates in Peking, Stuttgart and Frankfurt, which bundles the following services: </li></ul><ul><ul><li>“ Renewable energies ”- companies in China (Trading of photovoltaic-modules, PV-system solutions, investment vehicle) </li></ul></ul><ul><ul><li>Technology- and sales companies in Europe (PV-systems, tracker systems und PV-project financing) </li></ul></ul><ul><li>Aims to obtain a market leading position in the Chinese market for renewable energies </li></ul><ul><li>Target markets are Germany and China </li></ul><ul><li>Since January 2006 China accepted laws that are supposed to increase the share of renewable energies up to 10 % </li></ul><ul><li>Cleantech Invest / Mountain Partners invested in April 2007 to finance the organic growth </li></ul><ul><li>Strong growth of sales volume, IPO planned for 2008 </li></ul>
  14. 14. Cleantech Invest AG Investments - Covatec <ul><li>Cowatec is a System provider for planning, installation and operating of bio gas facilities </li></ul><ul><li>Market leading position with numerous plants installed </li></ul><ul><li>Strong management-team with a high amount of industry experience </li></ul><ul><li>Competitive edge due to special enzymes that increase the bio gas outcome </li></ul><ul><li>Mountain Partners leads the syndicate of top-class investors </li></ul><ul><li>IPO planned for 2008 </li></ul>
  15. 15. Excursus Cleantech Initiative Deutschland <ul><li>Founded in June 2007 by well-known associates, entrepreneurs and personalities of the German speaking cleantech industry </li></ul><ul><li>Based on a cooperation of Mountain Cleantech AG and the Cleantech Network that has significantly shaped the term „Cleantech“ </li></ul><ul><li>The objective of this initiative is to raise the attention and catalyze the development of cleantech. </li></ul><ul><li>We understand ourselves as a platform for communication, exchange of interests and information directed to business, politics and science to establish cleantech in Germany, Austria and Switzerland. </li></ul><ul><li>Led by an Advisory Board composed of well-known representatives from business, politics and science </li></ul><ul><li>Advisory Board members: </li></ul><ul><ul><li>Jürgen Habichler (Mountain Cleantech AG) </li></ul></ul><ul><ul><li>Torsten Merkel (Cleantech Network) </li></ul></ul>http://www.cleantech-deutschland.de
  16. 16. Our Success Factors <ul><li>“ Entrepreneurs for entrepreneurs” </li></ul><ul><li>Opportunistic investment approach differs from traditional VC approach </li></ul><ul><li>Strong and promising „deal flow“ in the Cleantech sector </li></ul><ul><li>Premier network of business angels, “trusted advisors”, industry experts and political decision makers </li></ul><ul><li>VC experienced management team and seasoned advisory board </li></ul><ul><li>International network in VC / PE for co-investments / follow on rounds </li></ul><ul><li>Existing investment (company) portfolio </li></ul><ul><li>Track record in building / exiting (Cleantech) companies </li></ul><ul><li>Attractive return profile for investors </li></ul><ul><li>Engagement “beyond the edge of the plate” </li></ul>Investing in Sustainability…Investing in the Future…Investing in Cleantech Invest!
  17. 17. Contact Jürgen Habichler +49 160 964 64 055 Mountain Cleantech AG Fuhrstrasse 12 8820 Wädenswil / Zürich Switzerland [email_address] www.cleantech-invest.ch It is with great pleasure that we would like to present the amenities of a financial investment in Mountain Cleantech to you in person and kindly ask you to address your contact request to: