Evergrow – an all-in-one platform for clean energy tax credits – announced the raise of a $7 million second round of financing. This funding round was led by existing investors, including First Round Capital, XYZ Venture Capital, Congruent Ventures, and Garuda Ventures. This funding round brought Evergrow’s total funding round to $14 million following a $7 million seed round that closed in late 2021.
Evergrow’s recent momentum has been enabled by the passage of the Inflation Reduction Act (IRA), which is the largest investment in clean energy and climate protection in American history. And the new law allocates hundreds of billions of dollars toward investment in clean energy. Nearly all of this funding comes in the form of tax credits. The developers of clean energy projects, including solar, wind, renewable natural gas, and storage, generate tax credits whenever they build a new project and these are then sold to fund costs. By buying these clean energy tax credits, Evergrow, and its partners provide critical funding for these projects, which unlocks the full potential of the IRA.
Last year, the tax equity market was estimated at $20 billion and is expected to double by 2024. And the demand for clean energy tax credits must also grow significantly. Otherwise, clean energy development could become slower, more expensive, or both. And by providing a platform for market participants to transact, Evergrow is helping to increase liquidity for clean energy tax credits and democratizing access to an entire asset class that has historically only been available to a handful of Wall Street banks and the very largest corporations.
What the funding round will be used for: Evergrow will use this additional funding for expanding the platform’s diligence, risk management, and transactional capabilities in order to accelerate the market for clean energy projects and tax credits. And the company also announced that it now has over $150 million worth of clean energy projects on its platform that is expected to come online over the next year.
KEY QUOTES:
“I started Evergrow to accelerate the development of clean energy projects in the United States. Clean energy tax credits achieve this goal while also providing a compelling financial return for our partners. We look forward to broadening access to this unique, growing, and impactful segment of the capital markets while also enabling the development of more climate-positive infrastructure.”
- James Richards, CEO and founder of Evergrow
“We have full confidence in the Evergrow team and we’re excited to deepen our partnership with them. The IRA is America’s largest ever investment in clean energy and carbon capture. We believe Evergrow will play a leading role in unlocking its full potential.”
- Bill Trenchard, Partner, First Round Capital
