The Ecofuel accelerator for cleantech ventures is looking at good times ahead as it selects its new cohort.
According to the program leaders, Ecofuel received 30 applications for its new cohort. About a dozen of those teams were shortlisted to pitch to a selection committee for entrance into the four-month program.
Operations manager Catherine Saine was on hand Thursday night at ProductHunt Montreal. She told MTLinTECH that six teams have been extended offers.
“We’re a very small team so it’s difficult for us to have ten companies. Right now with the team we have, around five to six companies is the best way for us to be with them and help their development on a one-on-one basis,” said CEO Richard Cloutier.
Cycle Capital, a Montreal-based cleantech fund, is the parent company of the Ecofuel accelerator. The program offers a seed investment of “up to $75,000″ and an “intensive program with training workshops, networking sessions and a heavy-hitting mentoring ecosystem.”
Saine told us Ecofuel is close to finalizing its own fund worth around $30 million. It would make Ecofuel a rare exception among accelerators in which the program itself holds its own fund and not a parent venture capital fund.
The teams get $75,000 up front via a convertible loan and are always eligible to raise up to $3 million in a following round, said Cloutier.
Interestingly, Ecofuel doesn’t discuss how much of an equity stake it’ll take until the company raises another round of funding. Cloutier said the idea is to add to the entrepreneurial capacity of the team and to be able to help companies reduce risk based on their tech.
“When you’ve done that and others on the outside are open to make a round, that’s the time to look at the value of a company,” he said. “I’ve worked in the field of innovation and tech transfer for the last 32 years now and I know that it’s very difficult to take a company to say the value is X million.”
— Ecofuel Accelerator (@EcofuelStartups) July 13, 2016
— Ecofuel Accelerator (@EcofuelStartups) June 29, 2016
Through three cohorts Ecofuel has accelerated 11 startups, including three from the most recent Spring 2016 cohort. Lito, Asastra Opto and Kelvin Storage all graduated in May. Lito makes “the first 100% electric luxury motorcycle,” while Asastra Opto focuses on development of optoelectric components for electric and hybrid vehicles.
“Lito was an example of this big global war of electric transport we’re in right now. We’re not the only one around the world doing something,” said Cloutier. “We have a large network around the world and that’s the main idea with a company like Lito. They already have a good product and we’re trying to help them integrate into the right market.”
Finally, Kelvin Storage developed an energy storage unit that transforms power produced in off-peak hours to a thermal form. Everyone from oilsands to nuclear to natural gas can use Kelvin’s product.
Cycle Capital is the Montreal fund that thinks its the “cleantech time” right now in 2016. Armed with $230 million, the firm invests in Quebec and northeastern North America.Cycle Capital calls among its strategic partners Brookfield Renewable Energy, Rio Tinto Alcan, Cascades, Group M3, Lonza, Gaz Métro, Systemex Énergies, Aluminerie Alouette, and Hydro-Québec.
Cycle Capital founder Andrée-Lise Méthot said the firm is funding Ecofuel to support the entire cleantech industry – not just Cycle Capital.
“I think it’s important to have a high deal flow, and the role of Richard is to make sure we can help our young entrepreneurs, bring them in at the right level and to make sure they have the financial support,” Méthot told MTLinTECH. “Cycle is there to support the Ecofuel effort to make sure we’ll have a very nice pipeline for our ecosystem.”
Ecofuel first opened its doors in October, 2014 and now has over 40 global mentors assisting its startups. Cloutier said the biggest challenge remains finding and working with entrepreneurs who know how to accept help and guidance.
“Sometimes people think that their tech is the best in the world, but they don’t have the skills to bring this tech to market. The challenge we’re facing every time is to pick an entrepreneur who can work well with mentors and who is open to do more,” said Cloutier.