GOLDEN — The Wells Fargo Foundation is adding a $20 million investment to the Department of Energy’s National Renewable Energy Laboratory’s Innovation Incubator, a partnership between NREL and Wells Fargo to grow sustainability startups.
Wells Fargo decided to partner with NREL after becoming involved in NREL’s 2010 Industry Growth Forum, said Ashley Grosh, manager of strategic environmental philanthropy for Wells Fargo.
Summer is within reach; school is almost out and many people are thinking about vacations and warmer weather. With a third of the year behind… read more
“We’re large energy lenders, and commercial building tech has always been interesting to us,” Grosh told BizWest. “We sat down and developed a strategy of how a large financial institution like ours and a national lab could think about collaborating and partnering. We experienced similar pain points where we noticed there was a lot of great technology that was falling into a ‘valley of death’ where they didn’t have the funding or resources to get into a commercial marketplace. We worked with stakeholders at both organizations to come up with a puzzle piece to fill the gap.”
The result was a small but growing incubator that focuses on any companies bringing sustainability into commercial buildings, whether that be HVAC, building management, lighting, or even water solutions. Now in its third year, 10 companies are in the current class.
In addition to getting about $250,000 in the form of a non-diluted grant, the incubator also doesn’t take any equity from the early-stage companies. But most importantly, companies are able to use Wells Fargo buildings to test out their products, getting beta-test experience that can be rare for early-stage startups.
“As an incubator, we’re focused less on business support that most incubators are focused on and more on providing technology support,” Richard Adams, director of NREL’s innovation and entrepreneurship center, said. “We’re run out of a national lab, and no other national lab is doing anything like this.”
The Wells Fargo Foundation’s new $20 million investment will go to expanding some of the success the IN2 has seen to other vertical markets. This year, Wells Fargo and NREL are looking at fields such as transportation, sustainable agriculture, energy storage and residential construction to see what markets in a smart, connected city might be the next opportunity for startup investment. In addition to continuing its commercial building program, by 2018 the incubator plans to announce a program for another vertical. By 2020, the plan is to have incubators for several fields.
Grosh said she hopes the incubator continues to grow not just through Wells Fargo and NREL, but by getting more stakeholders involved, including communities, other corporate partners, universities and investors. She also hopes to expand the geographic footprint of the incubator to other parts of the country or even internationally.
For Adams, the plan is to continue showing that this model of incubator — a major corporate foundation partnered with a national lab — works.
“We’ve built a model that is untried anywhere else in the world, and we’re very proud of this model,” he said. “We’ve really changed the dynamics of investments in this sector by partnering with Wells Fargo and other corporate sponsors and building a portfolio where we can test things in the field. We’re ensuring that we have a proven commodity before someone starts to buy it.”