Generate Capital raises capital for sustainable infrastructure projects with its software-as-a-service (SaaS) model
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Spotted: Generate Capital was founded in order to act as a type of “sustainable infrastructure” company. As with software-as-a-service (SaaS), Generate aims to turn infrastructure into a service. The company’s central focus is sustainable technology, partnering with companies or communities and providing them with the capital to build sustainable infrastructure projects, such as geothermal power plants.
The startup also works with communities, regulators, customers, and developers to ensure the deal goes ahead. Once the project is ready, Generate buys the asset from the developer and operates it, selling the service to customers. Instead of raising private equity funds, which must often be returned to the capital to investors within 10 years, Generate offers institutional investors the opportunity to buy stakes directly in the firm. This capital is then used to back development projects.
Generate is also unique in that it invests solely in businesses whose projects will decentralise infrastructure and reduce carbon emissions. In fact, the companies’ approach to raising funds allows the firm to hold on to assets for decades, rather than focusing on generating revenue immediately and gives it more flexibility in structuring deals.
The €1.7 billion recently raised by Generate from institutional investors will join €843 million from an earlier round and will be used for long-term investments.
Similar innovations recently spotted by Springwise include a platform that helps businesses and consumers to improve their sustainability and a wool sourcing platform that promotes regenerate agricultural practices.
Written By: Lisa Magloff