Episode 125 | Institutional Incubator | Wells Fargo
Financing for promising new energy startups can be overwhelming. Few institutions want to fund a prototype that may not work. I can speak from personal experience that seeking government grants can feel like an insider’s game.
Since 2014, Wells Fargo and the National Renewable Energy Laboratory (NREL) have been supporting startups through the IN2 (Innovation Incubator) program. Well’s Fargo’s lead, Ramsay Huntley, calls the program an “incubator of incubators,” partnering with over 60 incubators and accelerators around the country to find startups for IN2.
These incubators serve as the “validators” for a new technology, which reduces the risk that is so important to institutions like Wells Fargo. In addition, Ramsay says IN2 works differently from a grant from the Dept. od Energy.
“This is not a grant built by a particular ‘ask’ by the federal government,” he says. “Rather, we’re helping use the resources of the laboratories to solve the problems the companies themselves are identifying. It’s almost like the other way around.”
Another way Wells Fargo is able to participate early in the prototyping stage is that its investments come from the Wells Fargo Foundation, its non-profit arm. Ramsay says the grants carry out the sustainability mission set forth by Wells Fargo Corporate.
- Building Tech and grid-edge technologies
- Ag Tech
- Housing/Construction Tech
“We as a major Fortune 50 company have particular operational challenges we were looking to address,” says Ramsay. “We saw this as an opportunity to be a customer.”
Ramsay says companies in the IN2 program have gone on to raise $1.1B in follow-on funding since they joined the program.
“The reality is, this is beyond the capital pools that have historically provided capital here,” he says. “I think of [IN2] as one step in that validation process to get them one step closer to financial viability.”
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