October 2021
Vol 8 | Issue 552

Q&A with Lars Johansson of E8 Ventures

Managing Director

Principal Series:

E8 Ventures is a venture fund focused on early-stage climate technology companies, a sector poised for rapid growth as the economy shifts to more sustainable solutions. Spun out of E8 Angels, the largest cleantech angel investment group in North America, and building on the success of its pilot fund, E8 Ventures benefits from an extensive existing deal flow of high-quality investment opportunities, experienced Venture Partners and Advisors, and strong eco-system connections from more than 15 years’ investment experience in the sector.

Join us for an introduction to E8 Ventures, a fund uniquely well-positioned to invest in early-stage climate technology companies in North America.

October 7, 2021 at 2:15pm – 3:15pmEST
RSVP & Confirmation Required

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What are the opportunities that E8 Ventures sees in climate tech, and why now?

The Climatetech sector is booming, with unprecedented support for a rapid transition to more sustainable solutions across the economy, from governments, corporations, financial institutions, and consumers. This is fundamentally different from a decade or even five years, ago when cleantech was considered a “nice to have”. Today climatetech and sustainability is becoming mainstream with many large corporations pledging to decarbonize under pressure from employees, customers and increasingly from shareholders as the economic effects of inaction become clearer.

To meet this challenge, funding is increasing at the R&D stage, driving innovation in private companies as well in universities and national research institutions. Substantial capital is also available at the later stages of commercialization from institutional and corporate VCs, private equity and from the public markets (including additional routes like SPACs). And large corporations are looking for acquisition targets that can help them achieve their sustainability targets and to help them compete as markets transition towards new solutions.

However, a funding gap persists at the early stages of commercialization, at the pre-seed to series A stage. This presents an unprecedented opportunity for experienced climatetech investors to generate strong returns by identifying the most promising opportunities and create value by helping them reach critical milestones towards follow on investments and exit opportunities.

What differentiates you from other investors in this field?

E8 Ventures is uniquely well positioned to capitalize on the investment opportunities in early stage climate technology companies as it builds on the expertise, processes and track record of E8 Angels, a leading North American private investor group focused on the cleantech sector for more than15 years, and on the positive results of the Element 8 Pilot Fund. Fund managers bring deep sector and investing experience, augmented by 10+ Venture Partners and an Advisory Board.

Members of E8 Angels have invested more than $45M in over 110 companies to date, which have received over $800M in follow-on funding. The Fund managers will leverage their extensive network for deal sourcing and due diligence, and will actively engage with strategic co-investors and partner firms to help its portfolio companies scale and achieve strong exits.

In addition to the connection with E8 Angels, E8 Ventures will also collaborate with Clean Energy Venture Group, another premier climatetech investment group based in Boston and New York, providing strong connections both on the East and West Coasts. One of the Managing Directors is the current Executive Director of CEVG.

E8 Ventures benefits from E8’s existing deal flow of over 300 companies per year, expected to further improve with the fund introduction. And from having the processes in place to manage it, including 22 Fellows, PhD Candidates available to support technology diligence. The fund has engaged 10 Venture Partners that will actively work with the management team from deal screening and due diligence through post-investment engagement and has attracted a group of world class advisors.

E8 Ventures has also established partnerships with companies that can actively support portfolio companies post investment, including Cipactil, a firm specialized in leadership assessment and planning, and Global Sustainable Futures, a firm providing pilot installation financing.

What is the opportunity for investors?

E8 Ventures has identified a number of key trends and themes within the broader climatetech sectors of Energy, Transportation, Industry & Buildings, and Water & Agriculture. Based on these trends and themes E8 Ventures will prioritize certain sub-sectors in each, sectors in which the team has past investing experience, and plan to invest in approximately 15-20 companies.

The fund is expected to generate strong returns based on an investment thesis focused on “enabling technologies”, defined as companies with a high potential for disruption in large markets, capital efficient business models, reasonable valuations and a well-articulated exit path. Such enabling technologies include areas like software, AI and marketplaces but also hard-tech companies, then often technologies that are drop-in replacements into the supply chains of existing industries (e.g. battery anode materials).

In addition to the prospect of returns from the fund itself, investors in E8 Ventures get access to opportunities for co-investment and follow-on investment in the fund’s portfolio companies, as well as exposure to the broader trends in a sector that aligns well with the mission of many investors in 2021.

Lars Johansson of E8 Ventures

Lars Johansson will serve as Managing Director. Lars is a long-term board member and former board chair of E8 Angels where he is an active investor. He is also a manager of the initial Element 8 Fund I. Active in this field since 2006, he is very well connected in the cleantech community. His background is in tech, having served as an executive at Microsoft for a combined 17 years, initially in his native country of Sweden and since 1993 located in the Seattle area. Contact Lars: lars@e8-ventures.com