What your membership meant in 2018/19

As Green Angel Syndicate celebrate our second-year anniversary and winning ‘Syndicate of the Year’ at the UK BAA Awards on 2 July, what a perfect time to review the progress we have made so far.

​Ultimately, we will judge ourselves on the success of the businesses that we will collectively have funded – and it is still too early for any meaningful track record, notably in terms of exits.

However, like last year, we wanted to report on our investment activity for the benefit of our members – including how many proposals we have received; how many investments have been completed and for what amount; and finally, how we have selected the companies that we have invested in and how they fit with our strategic mission.

A year in numbers

• In the past year, the community of Green Angel Syndicate members has doubled in size, proudly passing the 100 mark in the last quarter.
• 61 opportunities reviewed by our Associate members for pitch selection.
• Five pitch events, featuring a total of 25 pitches.
• Pledges in the range of £550-800k after each pitch event, doubled from last year.
• 10 investments done this year (including two that will complete this month).
• £2.6m invested (including two follow-on investments in existing portfolio companies).
• All sectors represented: energy transition (38%), recycling and the circular economy (19%), transportation (13%), buildings (13%), conservation (13%) and agritech (6%).

These figures speak to the hard work that we do and to the value that we add for Green Angel Syndicate members – but we are conscious that there is so much more than we must do.

We all know that humankind faces an increasingly pressing climate emergency, and Green Angel Syndicate’s mission is to fund and help innovative companies that contribute to solving this existential crisis.

Looking forward to our third year, we are certain that we can continue growing our activities, to accelerate on our mission and make an even bigger impact.
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Climate emergency - The need to act could not be more pressing
The very bad news of the past twelve months is that global greenhouse gas emissions have continued to grow, reaching all-time high levels.

One silver lining, however, is that global awareness that humanity is facing a very serious crisis has skyrocketed in the past six months – with widespread grassroots movements such as Extinction Rebellion and Greta Gunthberg-inspired student strikes across the world. This has certainly helped some governments to act – for example, recently, the UK’s law-enshrined commitment to ‘net zero emissions’ by 2050.

Global carbon emissions in 2018 hitting an all-time high of 37.1bn tonnes

Source: The Guardian

​The truth is that we are extremely far from where we should be if we want to limit global warming to 1.5°C, or even 2°C, as pledged by countries as part of the 2015 Paris Agreement. The chart below illustrates the huge gap between current trends in total greenhouse gas emissions and what must be achieved.

The need for a radical change in the greenhouse gas emissions’ trend

Source: UNEP

The need to find solutions to stop the world’s greenhouse gas emissions on a large scale could not be more pressing – and funding innovative technology companies that help achieve this bold but necessary target is at the very heart of Green Angel Syndicate’s mission.

A community of 130 members
In the past year, the community of Green Angel Syndicate members has doubled in size, members has doubled in size, proudly passing the 100 mark in the last quarter. Of course, a larger group of angels is great news because it enables us to make larger investments, and therefore have a greater impact.

​But this is not only about numbers: the particularly exciting aspect of the growth of our membership is that Green Angel Syndicate has continued to attract people not only with a very special interest in the green economy, but also with great expertise and experience in the relevant sectors, from renewable energy to recycling or smart cities. At the same time, our members are an increasingly diverse group, with, for example, more women and a wider range of age groups.

Source: Green Angel Syndicate

A deal-flow of 388 companies, leading to 10 investments
Over the past 12 months, 388 companies have entered our deal log. This is a slight increase on last year and it represents more than seven opportunities each week of the year, on average.
The average amount that these companies were seeking to raise was £1.95m, with an average pre-money valuation of £6.4m – although, like last year, the median for both figures was much lower.

​Of those, 388 companies, 61 were reviewed by our Associates, our active members who have volunteered to help selecting the companies getting invited to one of our pitch events.

The Associates selected 25 companies, so an average of five for each of the five pitch events that we have organised over the past 12 months – and, after the pitches, 13 investment opportunities proceeded to in-depth due diligence. As such, half of the companies that were invited to pitch did raise enough investment interest from our members to lead to a formal due diligence process.

​Finally, thus far, we have completed eight investments in the past twelve months, and two should complete in July. This means that in total, since mid-2017, we will have completed 16 investments.
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Source: Green Angel Syndicate

​This data also highlights that, in several cases, we have decided not to pursue the investment on the back of our detailed due diligence work, despite the significant amounts that were pledged by members. We believe that with early stage companies, it is inevitable that due diligence reviews can lead to positive or negative outcomes.

Our 16 investments so far represent 2% of the 729 companies that have entered our deal log since 2017. This 2% figure is unchanged in 2018/19 compared to 2017/18 – demonstrating that our selection process has remained equally stringent throughout these last two years, as it should be.

​Still, a key lesson from these stats is that a backing by our Associates, leading to a pitch, means a high probability of a successful investment taking place over the following months – further illustrating the highly value-added process that Green Angel Syndicate has put in place.

£2.6m invested in a year, showing rapid growth
Amounts pledged by the Green Angel Syndicate members after each pitch event have been growing steadily, reflecting our growing membership. This year, the amounts pledged after the pitch events were in the £550-800k range, essentially double the £250-400k range observed after the 2017/18 pitch events (except for the last one, in June 2018, which attracted higher pledges).

This growth was also reflected in total amounts invested, which reached £2.6m in 2018/19.

This figure includes the completion of some of last year’s deals as well as two follow-on investments, in Powervault and Rovco – but if we only focus on the investments relating to companies which have pitched at one of the five events in 2018/19, the total amount raised is £1.9m, up 50% compared to the £1.3m raised for those having pitched in 2017/18 – again a very significant growth.

Source: Green Angel Syndicate

Addressing our six focus areas
Where are greenhouse gas emissions coming from? The exact numbers vary by country and region, but the key culprits are well known: power generation; transportation; residential and commercial buildings; industry and agriculture.

Greenhouse gas emissions in the EU, 2016

Source: European Environment Agency, Green Angel Syndicate estimates

Given the urgency of the task – decarbonising the whole global economy over a few coming decades – we cannot afford to tackle these sectors one after the other. We must tackle them all at once, and this is why Green Angel Syndicate’s investments have focused and will continue to focus on the six following key areas:

Six focus areas - All must be tackled

1. Energy Transition
2. Transportation
3. Buildings
4. Agriculture
5. Recycling and the circular economy
6. Environment & Conservation

​So far, since mid-2017, of the 16 investments completed (or about to be), six (38%) relate to the Energy transition, four (19%) to Recycling and the circular economy; two (13%) to each of the following: Clean transportation, Buildings and Conservation; and one (6%) to Agriculture.

Source: Green Angel Syndicate

NB: we count each company only once, even when Green Angel Syndicate members have participated in several investments in different rounds.
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The table below shows how we have classified each of the Green Angel Syndicate investments since 2017, and how each of them fits into the six focus areas that we have identified.

Source: Green Angel Syndicate

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If you are interested in making investments in the Green Economy and would like to find out more about membership of Green Angel Syndicate please contact us.

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