The Challenge: Grow Massachusetts-Based Climate Technology Companies
Seed and early-stage climatetech start-ups face funding gaps that threaten their path to market. Access to capital is limited by both funding availability and high technological risk.
About the 2030 Fund
The launch of the $50M 2030 Fund signals to the market that Massachusetts is increasing its commitment to the commercialization of climate technologies. MassCEC invests impactfully and countercyclically in Massachusetts’ brightest climate technology innovators. Our investments support climatetech companies as they de-risk their technology, reach early commercial milestones, and attract growth funding.
Equity investments average about $500k in early-stage financings. MassCEC also offers venture debt, ranging from $100k to $1.5M.
MassCEC's strategy is to attract and leverage significant private capital alongside all our investments. We primarily invest under MassCEC’s focus areas, but additionally search for technologies with a significant impact potential outside of these areas:
- Clean Transportation
- High-Performance Buildings
- Offshore Wind
- Net-Zero Grid
MassCEC considers new investments on a rolling basis. The timeline from pitch to close of investment is typically three to five months.
Step 1: Submit your pitch deck to our team for review.
Step 2: If selected, the Investments team will reach out to schedule an initial team pitch.
Step 3: If MassCEC determines that your company is a potential fit for an investment, staff will request and review due diligence materials as part of an iterative diligence process.
Step 4: Pending a positive diligence outcome, pitch to MassCEC's CEO and other executive-level staff.
Step 5: Negotiate deal terms and begin initial legal documentation.
Step 6: Final approval
Step 7: Complete legal documentation and close deal.
Eligible applicants include Massachusetts-based startups whose products or services are consistent with the definitions of “clean energy” or “clean energy research” as provided in MassCEC’s enabling legislation, Mass General Laws, Part I, Title II, Chapter 23J, Section 1.
In addition, we typically require that at least three of the following four functions be based in Massachusetts. If only three of the below business functions are part of the Company’s operations, two must be continuously maintained within the Commonwealth. If only two of the below business functions are part of the Company’s operations, both must be continuously maintained within the Commonwealth:
- Company headquarters
- Primary research and development
- Primary sales and marketing
- Primary manufacturing
Is this program not quite right for your company? Check out the Additional Funding Opportunities described below.
What is the typical size of a MassCEC investment?
The average size of a MassCEC equity investment is $500,000, most commonly ranging between $250,000 to $600,000 (but investments have ranged anywhere from $100,000 - $1,500,000). Additionally, MassCEC reserves significant capital per company for follow-on investments and continued support. Our financial support is designed to decrease over time as later-stage investors become active in supporting the company.
What is the typical size of a MassCEC venture debt investment?
MassCEC's venture debt investments can be anywhere from $100,000 to $1,000,000.
How does MassCEC compare to a typical private investor?
As an industry-specific publicly-funded investor focused solely on cleantech/climatetech, MassCEC acts as a strategic, value-add investor. We seek to be actively involved in our portfolio companies through board or board observer roles in order to bring as much value to the company as possible. As a public agency deeply involved in the cleantech ecosystem, we can also offer a variety of resources to our portfolio companies beyond financial support by leveraging MassCEC’s other various programs and contacts.
Contrary to most traditional investors, MassCEC’s role as a public investor is particularly prominent in the early stages of a company’s development, and tends to lessen over time as the private sector increases its involvement in the company.
MassCEC makes its investments alongside other private investors, so we invest on standard commercial terms and seek to make a financial return with our investments. However, financial return is only one of several goals, and MassCEC seeks to optimize overall impact with its investments. Some examples of this impact include advancement of technology, job creation and long-term cost reduction to the ratepayer.
Finally, due to its funding structure, MassCEC can provide more “patient capital” than a typical investor. While we always seek investments with exit opportunities, we do not have stringent timelines for those exits.
What does the “significant Massachusetts presence” requirement mean?
Your company must have a majority of the following offices based in Massachusetts (as applicable) in order to have a “significant Massachusetts presence”:
- Company headquarters
- Primary research and development operations
- Primary sales and marketing office
- Primary manufacturing operations