May 28, 2024
Some deals are meant to be … despite or perhaps because of the odds
Almost six months after a new €8m investment round for Taylor Technologies, co-founder Rein Westerdijk and Rubio’s Managing Partner Helmer Schukken reflect on the green-tech company’s whirlwind journey amid a raging pandemic, solar industry shake up, and an energy crisis. Together, they discuss the power of collaboration and the essential elements of genuine partnership in driving meaningful change.
Authored by impact expert and journalist Christian Nielsen, this interview with Taylor is the first of a new series of investor stories. These ‘real stories’ will uncover the heart of true partnership necessary for effecting positive change. Over the coming months, we’ll explore Rubio’s diverse portfolio, highlighting the individuals behind the deals, their expertise, and their shared commitment to making a lasting impact. Through founder narratives and insightful reflections, we aim to illuminate the realities of collaboration and offer invaluable lessons for investors and portfolio companies alike.
With business and deal-making blown to bits by COVID, Taylor’s co-founders Rein Westerdijk and Michiel Roelofs could have been forgiven for wanting to pull the shutters down on their hopes of building a smart solar panel solutions company. But fresh out of Eindhoven University of Technology’s engineering classrooms, they had no intention of letting that get in the way of their BHAG – industry speak for ‘big hairy audacious goal’.
20% boost in rooftop clean power generation
Rein had no doubts their novel solar optimisation technology could deliver a 20% boost in rooftop clean power generation. That the technology itself was yet to be proven on the market and still awaiting certification was immaterial to the entrepreneurs, working on the principle of “nothing ventured nothing gained”.
Their case was clearly strengthened by strong domestic demand in the Netherlands for renewables – their initial target market – and especially for solar and wind. For years, Netherlands has topped rankings in Europe for installed capacity, reaching what SolarPower Europe describes as the “remarkable milestone of more than 1,000 watt per inhabitant in 2022”, a whopping 28% growth from 815 W/capita in 2021.
A golden egg moment
So one night, perhaps spurred on by the spectre of lockdowns, they fed their proposal into what Rein describes as the equivalent of a “venture dating platform”, called Golden Egg Check. They pressed publish and crossed their fingers.
Around the same time Helmer was thinking it was high time after five years in business that Rubio invested in a solar energy company which could truly bring additional and systemic impact to the mature solar industry.
There was one hitch in this plan; the European solar sector was being shaken up by Chinese manufacturers asserting an increasingly dominant market position in solar photovoltaic (PV) manufacturing (IEA data), from whole modules to the individual cells, wafers, and polysilicon components.
As a civil engineer by training and having co-founded and run his own solar-tech business earlier in his career, if anyone in the impact investment world could work through the data and establish those credentials, or the potential thereof, it was Helmer. Though he is too modest to point that out himself.
Earnest search for solar-tech prospect
That realisation started an earnest search for a company to fit into Rubio’s portfolio, meet its exacting impact targets with a realistic timeline for 100% carry linked to those targets. A tough ask for an established ESG – environment, society, governance – business let alone a university spin-off like Taylor.
Despite the challenging circumstances, the company and its go-getting entrepreneurs appealed to Helmer when he was shown their Golden Egg profile. Being able to understand the technical as well as the commercial and financial side proved vital in making a decision to back what others might simply have seen as an untested prospect with a novel approach to marketing.
Essentially what he saw in Taylor were two enthusiastic and confident go-getters who had a genuine impact mission which was global from the outset, but grounded in its stepwise ambitions to establish turnkey international partnership deals with solar panel manufacturers.
Helmer was impressed with Taylor’s software and smart electronics, capable of making rooftop solar panel systems more powerful, safer and infinitely more insightful. He also remarked on the support system behind the young team, which included seasoned experts from the well-known ‘Brainport’ hub – counting Philips, ASML and NXP as cohabitants.
Showing grit earns a second tranche
After an uncharacteristic initial courting process, carried out online due to COVID restrictions, an agreement was struck that Rubio would fully back the entrepreneurs. But because Taylor was so early stage, there would be a not insignificant pre-condition!
“We took a cautious route in this,” recalls Helmer. “We said if you can land an off-take agreement and an outsourced production deal, then we’ll be happy to go for a full first-round investment.”
The plan then agreed in 2021 was to lay down a tranche of €600,000 to get Taylor on its way, and if Rein and Michiel managed to secure certification, Rubio would add the other €900,000 for a full first-round of €1.5m.
Challenge accepted. The young entrepreneurs showed true grit during a six-week tour de force, facing onerous travel and quarantine restrictions to emerge at the end with both ‘proofs’ proudly held up to the screen for Helmer to see during their next status update.
A spirit of partnership … and mutual trust
Asked what it felt like to secure their first investor, despite the tough circumstances, Rein recalls feeling a mix of gratitude and great responsibility. It was very early days in the relationship but because it started under such weird circumstances – and thanks to Helmer’s clear gesture of good faith – it set the scene for strong “mutual trust”.
A relationship that only grew and evolved with each consecutive follow-on round – headlined by a further €1.5m in July 2022 and €800,000 mid-2023. It also shifted somewhat, Rein and Helmer agree, as new investors showed interest when a much larger third round was mooted for 2024.
Yet throughout the four-year relationship, a sense of fairness permeated the negotiations and discussions, whether focused on strategic directions, expansion plans in Europe and North America, or more operational aspects.
Aligning business and impact … a KPI
Rubio always does its homework on new investment prospects and for every follow-on round. It is a best practice borne out of experience and a novel social impact performance model developed with the European Investment Fund. In Taylor’s case, the goal was and still is to set impact targets (whether monthly strategic ones or longer-term growth goals) that can also be measurable business KPIs, helping to streamline impact reporting obligations. This is doable because “business and impact are not a trade-off, but actually strengthen each other”, Helmer notes. That underwrites all Rubio investment decisions.
But is there room for instinct too? Yes and no: the gut can tell you something or try to warn you about an investment, he suggests, but it is no doubt informed by experience, data analysis and interactions (formal and informal) with the entrepreneurs themselves, their business plans, and indeed the sector as a whole. Which was the case for Helmer when doing due diligence on Taylor.
Ebbs and flows of the investment journey
Rein agrees that interactions matter at all stages of the investment journey. Transparent communication and a powerful sense of shared ownership in the process are important ingredients especially during negotiations: “Even during some tough discussions we never felt frustrated or uncomfortable with it because we trusted and respected each other’s roles and positions.”
Helmer sees the ebbs and flows of such interaction from another angle. Tension is natural in business. It can emerge during the initial scrutiny phase of an investment or subsequent funding rounds. And sometimes the stakes are more than financial. “There’s also an emotional investment in the venture as well as its people.”
Rein says he has learned a lot and is still learning every day from Helmer, PV partners, clients, senior “grey-haired” staff, etc. And although it has been tough going at times for the entrepreneurs, the final storyline is great.
“Taylor was my first job straight out of university. At 30 now, this whole experience has been a parallel business and life lesson, and the thing I’ve learned most is to believe, be proactive in everything, and transparent in how you communicate, especially with investors!” he adds with a smile.
Not the end of the story …
In January, Rubio announced it was happy to continue supporting Taylor’s onward journey by joining the latest round led by Pensioenfonds ABP to the tune of €8m, alongside fellow early round investor Brabantse Ontwikkelings Maatschappij.
The timing could not have been sweeter as Europe ramps up efforts to reach its Green Deal 2050 climate and energy transition ambitions amid the realpolitik of war in Ukraine – and the need to wean Europe off Russian oil and gas (REPowerEU Plan).
This is good news for Taylor, Helmer predicts, as it looks to grow the business in neighbouring Germany, Belgium, France and Luxembourg ahead of a European and, if all goes to plan, US expansion in coming years.
