Investment Will Light the Way to Carbon Reduction
Energy saving street lamps could soon be helping the UK meet its carbon emissions targets, thanks to support from angel investors Ewin Woodward Development (EWD).
Yorkshire Association of Business Angels members Neil Ewin and Mark Woodward are providing a £300,000 funding package to Sowerby Bridge-based start up Carbon Reduction Technology (CRT). The company has developed the ‘e-lamp’, an innovative LED street lighting system that uses up to 75 per cent less electricity than traditional sodium street lights.
Company directors, brothers William and Alan Robson, met their investors at Venturefest Yorkshire 2009 when they presented at the Investment Competition that Neil and Mark helped to judge.
Neil said: “William and Alan presented well and had a good business case. They were enthusiastic, capable and professional and although they didn’t win the competition, we realised we’d seen a potentially viable opportunity.”
The four exchanged business cards and later set up a meeting, where William and Alan again explained the product – plugging their prototype street light into a domestic socket so Neil and Mark could see it working for themselves.
Once both sides realised they got on well enough to work together, Mark and Neil put forward their standard agreement and business proposal to the CRT directors.
“The idea is to ensure there are no surprises later on; that the company is clear what general format any deal would take,” explains Neil. “Obviously as we get to know a company, the details might change, but putting forward header terms at an early stage seems to work best.”
Neil and Mark then began working with the brothers to develop a viable business plan. This had several advantages – it became part of the due diligence process, helping the brothers understand the business in greater depth and where there were areas of inexperience. It also identified how much funding was needed to take the business forward, and the investors could be sure these figures were correct as they’d helped to develop them.
“Having a business plan to suit all parties was very important,” agrees William Robson. “As the company is still at an early stage, the due diligence process was fairly straightforward. Alan and I had both worked in bigger companies handling acquisitions, so we knew the score.”
With a business plan in place, detailed negotiations on the deal could begin, and an agreement was reached based on a combination of investment, a loan and Neil and Mark’s time. The whole process took just six months, from the Venturefest presentation in February 2009 to a done deal by October.
