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Electric vehicle charging firm Pod Point benefits from £200m
venture debt fund
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Point benefits from £200m venture debt fund
Wednesday, June 27, 2018 –
3:58pm
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The future of transport is electric – of that there is now
little doubt. According to one estimate, more than a million
plug-in vehicles will be using British roads by the end of 2022,
and all of those drivers will need somewhere to charge their
vehicles. That’s what inspired the creation of Pod
Point in 2009.
One of the UK’s leading electric vehicle (EV) charge providers,
Pod Point is at the forefront of creating the support networks that
will empower the mass adoption of clean, green vehicles.
“The amount of charging infrastructure we’ve got to build to
enable the mass adoption of electric vehicles is immense,” says
Erik Fairbairn, Pod Point’s founder and chief executive (below).
“It’s simultaneously the most frightening and most inspiring part
of what we do.”
And business is booming: demand for EVs has surged in Britain in
the past four years. New registrations of plug-in cars increased
from just 3,500 in 2013 to 137,000 by the first quarter of this
year.
Pod Point estimated in February this year that almost 30% of all
plug-in vehicles in the UK were using its chargers. Its Open Charge
network passed the 40,000 user mark in the same month, a 273%
increase on the previous year.
By some measures, the company is growing exponentially. In the
nine months from May 2017 to February 2018, it recorded a 1,000%
increase in charge cycles per month on its rapid-charge
network.
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Venture debt funding
High-tech companies in emerging sectors of the economy, which
may prioritise long-term growth over short-term profitability, can
sometimes struggle to secure funding.
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Fairbairn explains: “We’ve banked with Barclays since we founded
the business in 2009 so they’ve been with us the entire
journey.
“The venture debt product that we’ve started using recently is a
great example of Barclays coming to us and saying: ‘We’ve seen the
challenges you’ve got – perhaps this product would be of use to
you.’”
Pod Point has accessed funding through Barclays’ venture debt fund for
high-growth tech firms, which offers funding at an early stage in
an innovative company’s existence.
The first of the big four banks to offer such a fund – which is
partly guaranteed by the European Investment Fund and backed by the
EU’s Horizon 2020 research and innovation programme – Barclays
expanded it to £200m in 2016. In the past four years, the fund has
lent over £160m to more than 70 businesses.
“Venture debt is a fairly innovative solution in the bank
market,” says Dominic McCarthy, a relationship director at
Barclays, who has worked with Pod Point for several years. “It
allows companies like Pod Point that are disruptive and fast
growing access to bank debt at an earlier stage than might
otherwise be available.
“Fast-growing companies like Pod Point historically would have
found it difficult to access finance while simultaneously needing
to invest significant amounts in research and development, new
technology and marketing.”
Fairbairn praises venture debt as an “innovative product” which
is a match for his innovative business. He says: “I can go and
raise some money in the traditional sense, but then Barclays will
come along and just help me make a little bit more of that.”
Part of the team
A close relationship between the bank and the business is an
essential component to venture debt. Fairbairn says Barclays have
“really started to understand our business – even to the extent of
spending whole days at the business understanding what we do”. The
result is “they’ve become a part of the team”.
That kind of support is invaluable – especially when the stakes
are so high. “I dream of a world where travel doesn’t damage the
earth,” says Fairburn, “so we can drive around completely
guilt-free and we don’t have to worry about what’s coming out the
tailpipe of our car. It’s a silent revolution.”
Find out how Barclays Corporate Banking’s industry experts
are supporting clients to achieve their ambitions at barclayscorporate.com
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