- Concentro unlocks tax credit transfers for mid-sized clean energy projects, enabling developers to easily monetize transferable tax credits without high transaction costs and complexity.
- They take a differentiated high-touch approach, managing the entire end-to-end process from running diligence to providing full-wrap insurance, making it effortless and seamless for parties to transact.
- The team has closed a variety of transactions, including transacting with a Fortune 50 all the way down to closing one of the smallest transactions ($99k!) in the industry.
- The platform also provides CFOs & Tax Directors of corporations as well as individuals with the ability to purchase fully vetted and insured tax credits, helping them reduce their tax bill.
NEW YORK, Dec. 10, 2024 — Concentro, the clean energy financing platform, has closed a seed round of $3m, in an oversubscribed deal led by firstminute Capital, with participation from Silence VC, LifeX, Plug & Play, & Avesta Fund. Other participants include existing investors J Ventures, Contour Venture Partners, & Dorm Room Fund as well as various angels and VC scout networks. This follows a pre-seed round last year led by J Ventures.
Concentro is the fully-integrated financing engine for the clean energy middle-market. Despite the hundreds of billions of dollars invested annually in clean energy, accessing funds and financing projects remains highly complex, especially for mid-sized developers and projects who often struggle to get projects across the finish line.
One great example of this problem applies to tax credits, which account for over 30% of the financing stack of clean energy projects in the US. While the Inflation Reduction Act of 2022 allocated over $210 billion in tax credits to subsidize clean energy development in the US and unlocked transferability – allowing projects without sufficient tax liabilities to transfer tax credits to third parties – the “middle-market” of clean energy continues to struggle in leveraging this newly unlocked financing mechanism.
For example, a $1M Commercial & Industrial Solar project earning a $300,000 tax credit would find it difficult to transfer the tax credits. This is because typical “buyer tickets” start at $5M and tax credit insurance providers generally won’t cover projects smaller than this amount either. Additionally, the high transaction costs including legal and CPA all but ruin the economics of engaging in a transfer. As a result, only large developers are able to easily access the market, leaving smaller projects at a disadvantage.
This is hampering the US economy as well as efforts to fight climate change, given that these “middle-sized” (i.e., distributed generation) projects are typically located closer to where energy is being consumed, leading to a more efficient grid and avoiding (very long) interconnection queues that are slowing deployment. This is where Concentro can help. The Concentro platform takes a tailored approach, beyond providing a “marketplace”, to enable distributed generation companies to sell transferable tax credits, without the complexity and hassle of traditional tax equity financing structures. From the “buyer” perspective, it provides a “white glove” solution for US corporations to reduce their federal tax liability while accelerating renewable energy projects, making it also accessible for smaller corporations that lack the resources to navigate the opportunity.
Inigo Rengifo Melia, Co-Founder & CEO, says: “Today, there are billions of dollars sitting on the sidelines because many developers cannot access cost-effective financing. Lack of scale, high transaction costs as well as complexity to transact means that many developers find it hard to finance their projects, leaving a massive gap in the market for financing these projects. Concentro is leveraging technology to streamline the transaction and diligence process so that middle-market developers can finally access the financing they need to bring their projects to life.
Tao Mantaras, Co-Founder & COO, added: “The Inflation Reduction Act was supposed to provide all developers and their projects – large and small – with a more streamlined way to monetize their tax credits, but we feel more needs to be done to enable transferability for the middle-market. We’ve been busy closing transactions this year and our pipeline continues to grow so we feel we’ve hit a clear need in the market.”
Concentro was founded by Inigo & Tao, who met whilst at business school at Harvard. Both have previous founding experience as well as strong operational backgrounds, having worked at McKinsey, Goldman Sachs & KPMG. Concentro will use the funding to grow its team and expand its technology product enabling more transactions to close on its platform. Concentro is headquartered in New York, United States.
Sam Endacott, Partner at firstminute Capital, comments: “We’re incredibly excited about the recent regulatory shifts that have taken place in the clean energy tax credits market. The new rules enabling their transferability are primed to increase the market size of transactions to $40bn annually within the next 10 years in the US. Concentro – by being a trusted financial intermediary and software layer between developers and global corporates – is providing crucial infrastructure to unlock this investment and drive innovation in the renewables and decarbonisation financial markets.”
Companies interested in buying or selling tax credits can contact [email protected].
About Concentro
Concentro is a platform helping clean energy developers monetize tax credits through transferability, with a focus on DG assets. They take a differentiated high touch approach managing the entire end-to-end process from running diligence to providing full-wrap insurance, making it effortless for small-mid sized projects to transact. They have closed multiple transactions, have $300M+ in credits from 60+ developers and are backed by top-tier investors. To learn more, visit www.concentro.io.
About firstminute Capital
firstminute Capital is a $315m AUM venture fund, investing in seed stage tech companies. firstminute is sector agnostic and invests across the UK, Europe and the US. Backed by over 120 unicorn founders and founded by Brent Hoberman (founder of lastminute.com, made.com, Founders Forum) and Spencer Crawley (Goldman Sachs, DMC Partners) in 2017, firstminute has invested in over 100 companies. To learn more, visit www.firstminute.capital.
SOURCE Concentro, Inc.
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