ImpactAlpha, Feb. 6 – The Los Angeles Cleantech Incubator raised a $5 million impact fund as a follow-on vehicle for the more than 200 early-stage startups in its portfolio.
The fund’s first two investments are in Monrovia-based Seatrec, which harvests energy from temperature differences in ocean water; and San Leandro-based Freewire, a mobile and off-grid charging and power supplier.
The investors in the fund were undisclosed. Emerson Collective, Laurene Powell Jobs’ philanthropic investment firm, will serve on the investment committee.
“We’ve seen recognition from the cleantech investing space that these are needed investments,” says Matt Petersen of LACI, which was founded in 2012 as a partnership between the City of Los Angeles and its Department of Water and Power.
- Regional ecosystem. LACI is feeder of entrepreneurs starting up in South California in electric cars and flight, electric infrastructure and municipal mobility, says Andrew Beebe of Obvious Ventures, which shares portfolio companies with LACI. Both firms, for example, invested in Mountain View-based Amply Power, an autonomous power charging-as-a-service company. “LACI is playing a critical role,” says Beebe.
- Equity earnback. Rather than upfront cash, LACI provides sweat equity for startups in its incubator program in the form of curriculum, advisory services and eligibility for $20,000 for small-scale pilot deployment. Companies can earn back back the equity by hitting impact milestones around diversity, environmental and community benefits. The new fund will consider the impact milestones when making investments.