Joule Assets and Quantum Origination have joined forces to launch the SmartCity EIS Portfolio.
Joule Assets, a provider of project finance solutions for the energy efficiency and demand response industries, running the successful ERA Fund in the USA, while Quantum Origination is a provider of strategic corporate advisory services.
The function of the SmartCity EIS Portfolio is to identify, invest in and support innovative companies within the Smart City technology sector. These innovative green technologies seek to optimise energy consumption across different sectors of a city's infrastructure, such as lighting, buildings, renewables, and transport in cooperation with real energy market values. In doing so, they create sustainable sources of economic growth for society and investors alike.
The team has identified potential investment opportunities and provides investors ground floor access to SMEs within the Smart City technologies and energy sectors. The investment objective for the SmartCity EIS Portfolio is to target lucrative returns with 30% growth from investments. Minimum investment per investor is GBP25,000. Unlike typical energy funds that concentrate on investment silos, eg efficiency or generation or storage, the SmartCity EIS Portfolio creates additional returns, through investing in companies which access synergies between sectors – for example installing building automation to increase the value of renewable resources.
"Typically, EIS funds in the energy sector have focused on funding asset-based investments which have benefitted from government incentives, such as feed-in tariffs in solar farms. Our objective differs in that we are seeking to fund UK innovation in the equipment and services that can impact energy efficiency. More specifically, we are also supporting new projects that will deploy these technologies, such as building energy refits, new property developments, and Local Authority Street-lighting, etc," says Jonathan Evans, Managing Director of Quantum Origination and Portfolio Adviser of the SmartCity EIS Portfolio.
"Uncorrelated investments which are entirely independent of financial market fluctuation have always been the holy-grail for our industry and that's the opportunity that the SmartCity EIS Portfolio represents," says Mike Gordon CEO of Joule Assets Inc. "This also delivers a lower risk product for investors because the Joule Assets debt vehicle funds these companies' direct costs of scaling their installed base. Therefore, their EIS investment goes toward growth rather than equipment installation."
"Investment via the SmartCity EIS Portfolio is the perfect investment vehicle for me to scale," said Sara Bell of Tempus Energy. "It provides operational experience to support my company's growth. Beyond that, Joule Assets' separate ERA investment fund means that I and EIS investors in the SmartCity EIS Portfolio both experience less dilution—it equates to better returns for all."
"The SmartCity EIS Portfolio has the potential to be a more lucrative investment opportunity than the solar-focused EIS funds that came before it in the UK," says Jessica Stromback, Chairman of Joule Assets Europe. "Now that solar EIS funds have outperformed expectations well enough to be crossed off the list of eligible EIS investments, this opens the door for like-minded investors with an appetite for high yield investment vehicles to enter the energy efficiency market that has the potential to surpass solar as a growth market."
