Government grants and public funded projects have been a boon for climate tech and clean-energy businesses. While companies receive these funds, they are often paid slowly or upfront cash is needed to get the project started.
A startup with roots in Pacific Northwest helps bridge the cash-flow gap.
EnduringPlanet was launched in 2021, offering loans against grants from the government. More recently, it expanded its offerings by providing loans to companies that have government contracts. It also offers chief financial officer services, either on a fractional or part-time basis.
“Our overarching goal for Enenduring Planet was to ensure that climate entrepreneurs had the capital they needed to be successful,” said Dimitry Ghershenson the startup’s co-founder and CEO based in Portland, Ore.
The fintech company has raised $ 9 million to lend to climate tech startups, ranging from $100,000 to $500,000. Green Spark Ventures and ImpactAssets are among the backers, as well as Toniic, the Toniic network of impact investors, and clients at Figure 8 Investment Strategies.
Cash is still available at a price. Annual interest rates can reach up to 18.5%. The origination fee is 1.5%.
Gershenson stated that his company was one of the lowest-cost providers when you include all fees. He said that while other lenders may require a personal bond or asset liens to secure the loan, his company only uses government grants and contracts as collateral.
Enduring Planet has a network that includes venture capitalists. It will also connect its customers with investors if they choose to seek additional funding.
“[We] are unsticking climate finance ecosystems where we see inefficiencies,” said Erin Davis. Co-founder and Chief Operating Officer. Davis is based out of Washington, D.C.
Joshua Krafchin is the third co-founder of the startup and its chief technology officer. He lives in Oakland, Calif. The company has 17 staff members.
Enduring Planet has recently closed its own funding round, and has taken in nearly $4.9 million from investors including K Street Capital, Avesta Fund. Cerulean Ventures. Dangerous Ventures. Portland Seed Fund.
The team finds customers for its loans through partnerships with accelerators for startups and working with investors. It also tracks grant and contracts awards and reaches recipients.
Enduring Planet raised $9 million in loans but has invested $13 million due to its returns. Gershenson stated that more than 90% of startups receiving loans have a founder who is underrepresented, a diverse team or are serving a marginalized group with their products and services.
There are a few organizations that provide financial services and support to early-stage climate technology startups, including the Los Angeles Cleantech Incubator (LACI), Ezra and Spring Lane Capital.
Gershenson said that working with entrepreneurs who are passionate and committed in this field is inspiring. It gives them hope for the future of global warming. It also helps to drive the field’s success.
Gershenson stated that “most people who are building in this area are not doing it because of the financial opportunity.” “That’s their first thing. That means they are much more motivated to push through the challenges of being an entrepreneur. They are committed because they love it.
Editor’s Note: Story updated with names of venture capitalists who invested in Enduring Planet and to correct the investor in the fund available for customer loans.