ImpactAlpha, Jun. 8 – The Los Angeles Cleantech Incubator, or LACI, has a new tool to increase access to capital for cleantech founders historically excluded from investment capital.
The $6 million LACI Cleantech Debt Fund will provide loans up to $50,000 to help earlier stage startups to serve their first customers, and bridge loans of $250,000 to help later stage startups scale. The kicker: Unlike traditional bank loans, LACI will not require personal collateral or personal credit scores to underwrite the loans.
The fund will provide “early stage cleantech founders a timely, affordable alternative to expensive venture capital and slow-moving bank debt,” said LACI’s
Somerville, Mass.-based SparkCharge, which last month raised $23 million, and Culver City, Calif.-based Envoy, received loans from a pilot of the fund.
LACI has partnered with Greentown Labs in Boston and Houston, Evergreen Climate Innovations in Chicago, and New Energy Nexus in Oakland and New York to source deals. LACI’s $5 million equity fund, Impact Fund I, is nearly fully committed; the incubator is raising Impact Fund II.
The cleantech debt fund is backed by Sobrato Philanthropies and Homecoming Capital. Wells Fargo Foundation provided a “catalytic grant” to cover operating costs and loan-loss reserves.
EMBARGO FINAL LACI Funds Press Release 5.31.22
“We’re excited to partner with LACI to fill a capital gap that will enable more companies, from more regions and founder backgrounds, to access investment for their growing businesses,” said Victoria Fram of Sobrato Philanthropies and Pat Arnold of Homecoming Capital.
San Diego-based Mission Driven Finance will assist with loan origination and servicing, as well as underwriting.