Tritium co-founder takes a punt on new green finance venture
No stranger to tech finance, David Finn has joined up with two others to start a new green VC fund with plans to inject up to $100m of early-stage investment.
The three partners in new venture capital fund Jekara are no strangers to investment in the cleantech sector. Kara Frederick, Jeff Phillips and David Finn have been putting their own money into sustainable start-ups for a decade, and after 13 successful projects and top quartile VC returns, say they have the track record to scale up efforts.
With Jekara, established in June, they’re using their experience to access third-party funding, with plans to inject up to $100m of early-stage investment into electrification, grid optimisation and energy generation.
Together they are listed among the Top 100 Green Energy Players in Australia, a list that will be released in The Australian on Friday.
The group brings a range of skills to Jekara, which they say helps lower the risk of its investments compared with any standard venture capital outfit.
Finn is one of Australia’s most successful entrepreneurs. With a PhD in electrical engineering, he co-founded high-profile, Brisbane-headquartered EV charging company Tritium in 2001; served as its CEO till 2020; and remains a director.
Tritium has been one of the nation’s green success stories but is currently confronting big losses and a collapse in its Nasdaq share price.
Frederick has held executive roles in venture capital and private equity financing in New York, Silicon Valley and Australia for 20 years. In 2011, she set up the Tiger Financial Group, an investment advisory company that works across all technology and is focused mainly in the private sector.
Since 1995, Phillips has run the mid-tier Varley Group, which is one of Australia’s oldest engineering and advanced manufacturing companies. It employs more than 1000 people nationwide and does business internationally.
Frederick argues that Jekara Group not only has the clout to raise funds but the expertise to assist startups to operational stage.
“You can’t just be a banker, you’ve actually got to understand, like David, how the technology works from a first principles’ perspective, and then you’ve got to understand how to build it at scale in a way that, in this supply chain environment, the unit economics work, and that’s where Jeff comes in, the manufacturing side,” she says.
There’s no shortage of talent and expertise in Australia, she adds, but cleantech faces a gap on the investment side and suffers from limited support for world-class founders. “There’s about $7 trillion globally that needs to be invested in this space annually in order to achieve our 2023 and 2035 [emissions] goals,” says Frederick. “But we are at the very early end of that transition. Where we see the deep part of the opportunity is in Series A investment [the round of startup funding that follows seed funding] and that’s what we’re focusing $100 million on – Series A cleantech with companies that have an Australian angle but are global from day one.”
About 50 per cent of Jekara investments have a hardware-enabled component, whether it’s long-duration thermal energy storage companies such as MGA Thermal, or Gridcog, which provides holistic software to plan, track, and optimise a company’s green-energy transition.
Finn says: “This fund, unlike any others, really brings a lot more than just the money side of things, that [supports] how to actually bring that hardware-enabled solution. This is something that both Jeff and myself have decades of experience doing, and that is unique in a VC fund.”
Frederick agrees there has been a great deal of hype around cleantech but it has not always delivered the promised returns.
“What I think is really positive today is we’ve got a very positive political environment in which we can actually scale a fund like this in a way that we couldn’t have done a couple of years ago,” she says.
“In Australia, and frankly around the world, for the first time we have global coordination around mandated targets … and they involve utilities, energy players, supply chain players all coming together in partnership to achieve those targets.
“We see an incredibly deep and rich [group] of world-class entrepreneurs who are focused on this space sitting in our own backyard right now.
“With the more favourable political climate and a corporate culture that is shifting, with its own public mandates expressed to its own public shareholders, this is a unique time.”
See the full Green List: Australia’s Top 100 Energy Players, in The Australian and online on Friday.
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