As the only one-stop shop for the Infrastructure Revolution, Generate offers technology companies the money and services they need to rebuild the world. We provide custom capital solutions at different phases of our partnership with you—whatever is needed to help you grow and get projects built. We are an extension of your team, built from scratch to align with your entrepreneurial interests—because we understand what it’s like to be an entrepreneur. We have more than 400 customers who rely on us to solve their resource problems—and they probably need what you’ve got.
Our partnership starts with the non-dilutive growth capital and services that help deploy and scale innovative resource solutions. We are not a fund manager. We are not a bank. We have no time horizon nor constraints.
We understand that successfully building infrastructure requires owners to successfully manage these assets, too. We have to deliver—together—for our customers. They want reliable, affordable, resilient, and sustainable resources. They don’t want technology projects. They don’t want their current utilities.
They want better—and together, we can deliver.
We understand and underwrite emerging technologies like it’s our job … because it is.
When fuel cell manufacturer Plug Power won a $600 million contract with Walmart to replace the lead-acid batteries in thousands of forklifts with fuel cells, the $71 million company needed growth capital that would allow it to quickly and cost-effectively scale to meet the demands of its newest customer.
Generate provided Plug with debt (non-dilutive capital), which alleviated its working capital shortfall, and a series of project financings in which Generate purchased the fuel cells for projects that Plug manages and operates on behalf of Walmart. The project support substantially increased Plug’s sales, which significantly reduced the need for the company to raise expensive equity from the stock market. Generate also helped to improve Plug’s contracts with customers to reduce the cost of project financing, improving the company’s gross margins.
In 2017, Plug grew topline revenue 55% and increased the number of units under service or power purchase agreement (PPA) contract by 43%. The company added high-profile retailers to its customer base and began construction on a new 38,400-square-foot manufacturing facility to keep up with the growing demand. Working with Generate also allowed Plug to retain the 27% of equity it would have had to give up had it funded its initiatives with corporate equity. (Holding all else constant, Generate helped create about $300 million in enterprise value for Plug.) In addition, Generate brought visibility to a broader investor and advocacy community, enhancing Plug’s profile in the marketplace. Plug’s solution helped customers like Walmart reduce the footprint of its forklifts and free up significant warehouse space—to the point that the conversion paid for itself in just 33 days.
Despite lower fuel and maintenance costs than diesel buses, electric buses account for less than 1% of all buses in US city fleets. A major reason is their higher up-front costs, which are about 30% more than conventional buses. Furthermore, most traditional players are unfamiliar with the asset class, so they provide suboptimal financing solutions.
To mitigate the barrier to adoption, Generate and BYD, the world’s largest supplier of electric buses, developed the first large-scale leasing program for electric buses. With a $200 million commitment from Generate, the Green Transportation Leading (GTL) program allows universities and private fleet managers to shift to electric vehicles with only a competitive monthly operating payment. Generate provides the financing for the program, while BYD markets, supplies, and maintains the vehicles.
More than 500 electric vehicles will be deployed for these fleet applications between October 2019 and April 2021. That’s equivalent to removing 13,500 cars from the road and eliminating approximately 845,000 tons of CO2 over a 12-year period.
In advance of new competitors entering the rapidly growing storage market, Stem wanted to aggressively expand its leadership position. Stem’s storage systems, which are installed in commercial buildings and can reduce customers’ energy costs by as much as 30%, were used by several high-profile retailers and hospitality companies. However, prospective customers were often reluctant to make such a significant up-front capital investment and manage their own “power plants.”
Stem worked with Generate to create a business model that enables businesses to pay for storage on an Infrastructure-as-a-Service™ basis: Generate purchases Stem’s storage systems and leases them to Stem’s customers, and Stem services the equipment—removing the up-front capital purchase barrier that routinely slowed Stem’s sales cycle. Now Generate and Stem, together, can compete effectively with business-as-usual utilities by offering energy services on demand to the customer—just how the customer wants to pay for their energy.
Stem can now close deals and recognize revenue faster, secure more competitive pricing from suppliers due to higher procurement volumes, and redeploy its capital resources to support other projects. The company is the first behind-the-meter storage company to achieve “bankability” and access traditional capital markets. Today, Stem has more than 860 energy storage systems under management as well as the largest project finance pool among its peers, now over $650 million. In addition, the rigor with which Generate put together Stem’s evaluation criteria is still being used today by other financiers, confirming Generate’s role as an important catalyst in storage’s wider acceptance by other investors today.
Southern California Edison (SCE) is the primary electricity supply company for much of Southern California, providing 14 million people with electricity across a service territory of about 50,000 square miles. Under the state’s Local Capacity Requirement (LCR), SCE created a first-of-its-kind program called “Cool2Save” to help Southern California commercial and industrial (C&I) customers upgrade their cooling systems to cut their HVAC energy costs by up to 30% with no money down. Because LCR had never been done before, SCE was learning as it went, implementing ad hoc contracts—and the company needed help.
Generate purchased the contract from Evaporcool and assumed the main responsibility to work with SCE to develop, install, own, and operate evaporative cooling systems for C&I customers’ HVAC systems. These systems are manufactured and installed by Generate’s two technology partners, Evaporcool and Integrated Comfort Inc. (ICI). Generate and its partners had about two years to create a new market for this emerging technology in a specific area of SCE’s grid in the western Los Angeles basin and a portion of Orange County around Irvine. Generate brought in a professional sales force, Lime Energy, to accelerate sales for both companies. Generate will be responsible for the successful operation of these systems through the end of 2023.
For tech partners Evaporcool and ICI, Generate helped deploy more units than they had built to date in the United States. For SCE, Generate helped deploy more energy efficiency systems, reduce demand, and reduce strain on the grid infrastructure in a region where massive key generation has recently been decommissioned (for example, the San Onofre Nuclear Generating Station in June 2013). Approximately 23 MW of demand will be reduced in aggregate across about 160 contracts with end customers. SCE benefits through reduced demand and energy on the grid, and the end customers enjoy lower electricity bills from SCE through these energy efficiency measures. SCE would have spent $1 billion to upgrade its substations; instead, the company paid less than $200 million across all of the LCR contracts. For SCE’s ratepayers, such as Kaiser, Kohl’s, and Walmart, Generate provides reliable, affordable, and more efficient HVAC resources. These customers are reducing their energy bills during hot weather when their air-conditioning systems are running at maximum capacity.