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BFD Expert Voices - Climate Deals

BFD Expert Voices

The onsite-power startup Mainspring Energy has raised $150 million in the first close of its Series E, and will be deploying up to 150 of its linear generators over the next two years, Alan has learned.

Why it matters: The double-barreled announcement reflects significant buy-in from major players: Khosla Ventures and Bill Gates, and industrial customer Lineage Logistics.  

What's happening: Other investors include Lightrock, a growth equity investor that led the series E, and existing investors Fine Structure Ventures and Princeville Capital.

Mainspring did not disclose the total it intends to raise in the round, but says it will use the funds to develop new generator models and accelerate deployment. 

Meanwhile: Lineage Logistics has agreed to purchase as many as 150 of the generators — a deal representing "more than $100 million," Mainspring founder and CEO Shannon Miller tells Alan. 

Lineage, a warehousing and logistics management company, bought two Mainspring generators in November. 

The bottom line: "The market is definitely on a roller-coaster ride," Miller says.

"We’ve seen fluctuations in the public companies, so I’m not sure if stage had a lot to do with it or not. A lot of the trouble is coming from the SPAC market having a lot of companies going out with high valuations and then having this market correction now coming in. We’ve avoided that kind of cycle." 

1 big thing: $150M for onsite linear generators

Illustration of power switches turned on and surrounded by abstract shapes and dollar elements. 

Arcadia, a utility-data insights software company most recently valued at $1.45 billion, tells Megan it has purchased utility data broker Urjanet for an undisclosed amount.

Why it's the BFD: As the private markets cool, look for more consolidation to sweep areas like ESG software and data tools, among other formerly frothy sectors. 

What's happening: Urjanet will become part of Arcadia once the deal closes, and Urjanet CEO Sanjoy Malik will become a senior adviser, Arcadia CEO Kiran Bhatraju tells Megan.

The acquisition was a mix of equity and cash, Bhatraju says. 

Arcadia closed $200 million in Series E funding on May 10.

State of play: Urjanet is a decade-old company that provides utility data to corporations. Roughly 30% of the Fortune 500 uses its software, Bhatraju says.

Those corporations are now Arcadia customers, and Arcadia can now provide recommended actions and ESG goals using Urjanet's data sets.

Arcadia had previously indicated its interest in working with corporations on ESG data targets and other emissions-cutting initiatives, and the acquisition moved that timeline forward by years, Bhatraju says.

The intrigue: The acquisition was already on his radar prior to the $200 million funding round earlier this month, he added.

He also says Arcadia is willing to pursue other acquisitions in the future, but that the current funding environment didn't play much of a role in this particular deal.

The bottom line: "You will see more private-to-private acquisitions" in this market, Bhatraju says. 

2. The BFD: Arcadia buys utility-data provider

Illustration of a lightbulb with a glowing filament in the shape of a bar chart.

The carbon-credits-plus-blockchain startup Flowcarbon has raised $70 million in venture funding and through the sale of a carbon-backed token, Alan reports.

Why it matters: The company — which counts ex-WeWork founder Adam Neumann as a co-founder — is taking a crypto-first approach to carbon credits. 

The influx of capital suggests it has believers.

The details: The round was led by Andreessen Horowitz fund a16z crypto. 

General Catalyst, Samsung Next, 166 2nd, Sam and Ashley Levinson, RSE Ventures and Allegory Labs also participated in the funding round.

Fifth Wall, Box Group and the Celo Foundation participated in the token sale.

What's happening: Flowcarbon is aiming to bring greater transparency to carbon credits — and circumvent brokers — by connecting them with tokens. 

"We’re trying to create a financial mechanism where the function is to funnel capital to our natural carbon sinks," co-founder and CEO Dana Gibber tells Alan.

Zoom out: Another startup, JustCarbon, also "seeking to build confidence in carbon markets," launched its "governance token" on Monday.

Then there's AirCarbon Exchange, Base, Carbon Token Project, KlimaDAO, KumoDAO, Moss, SavePlanetEarth and Toucan, to name a few.

Of note: Neumann and his wife, Rebekah Neumann, who also held senior roles at WeWork, are listed as "co-founders." When asked about their role, a spokesperson responded that the two "have been supportive to the operating team."

"Per the release, the company is run by Dana Gibber, Caroline Klatt, and Phil Fogel," the spokesperson adds.

3. Flowcarbon books $70M for tokenized credits

The pre-Memorial Day weekend funding announcement rush is upon us. A curated selection of the deals:

Batteries on the move: The mobile charging startup SparkCharge raised a $23m Series A.

The round was co-led by Tale Venture Partners and Pendulum, with additional investments from Revolution’s Rise of the Rest Seed Fund, Mark Cuban Companies and Silicon Valley Bank. Pusha T and Summer Watson also joined the round.

More funds for a Climate SaaS down under: Neara, an Australian software startup that creates digital models of utility grids and infrastructure, raised $14m in Series B funding.

Skip Capital led the round, which included participation from its Series A lead investor Square Peg Capital and OIF. The company has raised $19m since its founding in 2016.

Agtech SaaS also nets some dough: Regrow Ag, an ESG software startup aimed at food producers and agriculture companies, raised $38m in Series B funding.

Galvanize Climate Solutions, the VC firm started by Tom Steyer and Katie Hall, led the round. Marc Benioff's TIME Ventures and Rethink Impact joined the round, which also included existing investors Cargill, Main Sequence Ventures, Ajax Strategies, Neglected Climate Opportunities and Microsoft’s M12. The company raised $17m in Series A funding in August.

Trash-to-fuel: Fulcrum Bioenergy, a Bay Area-based landfill-to-energy startup, kicked off operations at its Sierra BioFuels Plant outside Reno, Nevada.

The plant takes landfill waste and converts it into hydrocarbon synthetic gas, which is then used to make conventional Fischer-Tropsch fuel. The plant has the capacity to convert 175,000 tons of prepared landfill waste into eventual biofuel. 

4. 🌡️ Temperature check

Illustration of an earth emoji combined with a sick face emoji.

Singularity Energy, a CO2 emissions data startup, has raised a $4.5m seed round led by Spero Ventures and Energy Impact Partners. Third Sphere, J Ventures and individual investors also participated. http://axios.link/sOoF

ClearSign Technologies (Nasdaq: CLIR) received a $250,000 small business grant from the U.S. Department of Energy to develop ultra-low NOx hydrogen burner technology. http://axios.link/bZ5S

EVgo (Nasdaq: EVGO) and OSCWEBco were granted participation in a five-year blanket purchase agreement with the United States General Services Administration to provide EV supply equipment and services as the federal government looks to electrify up to 650,000 vehicles. http://axios.link/65fS 

GreenPower Motor Company (Nasdaq: GP), manufacturing electric medium- and heavy-duty vehicles, announced that its wholly owned subsidiary EA Green-Power has entered a joint venture with Jupiter Wagon Group to bring GreenPower EVs to the Indian market. http://axios.link/1ai3

Wunder, a C&I solar company, announced a partnership with ClearGen, a Blackstone Credit portfolio company, to provide up to $650m for solar projects. http://axios.link/hu17

Chevron U.S.A., Talos Energy (NYSE: TALO) and Carbonvert have executed a definitive documentation and closing of an expanded joint venture to develop the Bayou Bend offshore CCS project. Under the terms of the deal, Chevron acquired a 50% stake for $50m. http://axios.link/Utz1

MSBAI was awarded about $200,000 by the Department of Energy to adapt its AI interface for advanced nuclear reactor digital engineering. http://axios.link/UHAc

NuScale Power has signed an MOU with Romania’s state nuclear power corporation S.N. Nuclearelectrica S.A., to explore the potential deployment of a small modular reactor. http://axios.link/Dgtc

StoreDot, an EV fast-charging developer, announced a partnership with Polestar following an investment from the EV automaker. http://axios.link/seHB

Piston Automotive has partnered with Our Next Energy, developing energy storage technology, to manufacture EV batteries at Piston Automotive's facility in Van Buren Township, Michigan. http://axios.link/HQQy

Nextracker has entered a master supply agreement to provide 1.5 gigawatts of solar trackers to Silicon Ranch projects through 2024. http://axios.link/pRnt

The Bipartisan Policy Center in D.C. announced the formation of the American Energy Innovators Network, a group of energy startup founders and funders focused on federal policy and — yes — public-private partnerships. http://axios.link/V6YO

Air Liquide opened its liquid hydrogen production and logistics infrastructure facility in North Las Vegas, Nevada. http://axios.link/WncZ

Convergent Energy + Power, an energy storage provider, and National Grid announced the completion of a solar-plus-storage system — 15 MWdc plus 40 MWh, respectively — serving customers in Cicero, New York. http://axios.link/MnzR

5. Hot deals

Ballard Power Systems (Nasdaq: BLDP) has appointed David Mucciacciaro as senior vice president and chief commercial officer. Mucciacciaro was most recently vice president, global sales, M&A and marketing, for Magna Electronic. He succeeds Rob Campbell, who is retiring. http://axios.link/jk9p

Arizona Public Service has named Adam Heflin executive vice president and chief nuclear officer of Palo Verde Generating Station. Heflin was previously CEO and CNO of Wolf Creek Nuclear Operating Corporation. http://axios.link/Bs0F

6. It's personnel

Tim Latimer, Fervo Energy founder (and, with 12,500 followers, geothermal influencer), provides a periodic reminder about the levelized cost of energy benchmark, and the fraught practice of trying to apply it to variable renewable energy.

7. Tweet o' the day: LCOE and VREs, FYI

🤝 Situational Awareness: Two climate-tech coalitions are going live — the Coalition for American Battery Independence and the Direct Air Capture Coalition — and our colleagues Ben and Andrew have the rundown in today's Generate.

🤠 Megan is hitting up all the local vintage and thrift shops ahead of this weekend's Pioneertown Film Festival, which is requiring the best dress code she's ever heard of: Western black tie.

📺 At least three people texted Alan last night about "Better Call Saul's" mid-season finale. He'll be getting to it tonight, so no spoilers.

Thanks for reading Climate Deals! Please share with your friends, family, co-workers and R&D team.

May 24, 2022

1 big thing: $150M for onsite linear generators