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IPG

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IPG is replacing the diesel generator with a pollutant-free, low-cost, multi-fuel alternative.

100%
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Funded 23 Jun 2022
£1,000,000 target
£1,034,708 from 664 investors
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Business overview

Location London, United Kingdom
Social media
Website www.ipg.energy
Sectors Energy Non-Digital B2B
Company number 10044404
Incorporation date 4 Mar 2016
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Investment summary

Type Equity
Valuation (pre-money) £15M
Equity offered 6.28%
Tax relief

EIS

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Business highlights

  • £1m pilot project with National Highways and Cranfield University
  • In-kind support from a leading global generator rental company
  • Global diesel genset market set to almost double to $30bn by 2030
  • Compatible with Hydrogen, HVO, Biofuels, Natural Gas, and Diesel
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Key features

  • Secondary Market
  • Seedrs nominee min. £12.00 +

Idea

Introduction

We believe diesel generators are the dirty secret of the energy transition. From temporary power at construction sites and festivals to backup power for hospitals and data centres, on-demand, distributed power is essential.

Diesel gensets accounted for 53% of the distributed power market in 2019, with their value set to almost double to $30bn by 2030. We need a net-zero replacement for this industry giant, yet progress is slow.

Replacing diesel generators means businesses switching to hydrogen or biofuels. Yet, with no clear, single, fuel of the future, businesses cannot risk the switch to generators designed for just one fuel. But without this demand, fuel suppliers won’t invest in greater production – a chicken-and-egg scenario that could stall climate action.

The IPG Flameless Generator aims to break this cycle.

Our patented flameless combustion delivers pollutant-free power from any fuel, giving businesses confidence to switch to net-zero fuels today knowing they will always have clean power on demand.

Substantial accomplishments to date

IPG has received £1m to undertake a prototype project with National Highways and Cranfield University, having also received in-kind support from a leading global generator rental company.

IPG is building strong commercial traction with leaders in construction, generator rental, and mining. Key achievements include:

• In-kind support of equipment to the value of ~£57,000 from a leading global generator rental company.

• A letter of support outlining ambition to explore participation in product trials from the same leading global generator rental company.

• Commercial discussions with leading UK construction companies and international mining group for participation in product trials.

IPG has secured strategic partnerships with development and manufacturing experts, which is key to creating a fully-costed, stressed-tested blueprint for volume production of our product. Partners include:

• Chasestead - prototype and low volume production specialists

• Perfect Bore Manufacturing - precision grinding and boring specialists

• QSIL - leading producer of fused quartz and technical ceramics

• Rotrex - supercharger and compressor manufacturer

• SDE Technology - tier-2 automotive manufacturer

• Zircotec - temperature-resistant coating specialists

IPG has received multiple award wins and shortlistings, and has been featured in leading industry publications.

Monetisation strategy

We intend to sell and rent IPG Flameless Generators to B2B customers:

• The business model for our MVP pilot trial partners in our beachhead markets is already to buy, lease, or rent their existing generators.

• Direct and indirect sales revenues would reduce the capital intensity of our rental model and increase total unit demand, helping to lower manufacturing costs.

• Rental or Energy as a Service (EaaS) would secure recurring revenues and we believe would open additional revenue channels from renewable fuel supply, leveraging cost and carbon arbitrage potential from our fuel-flexibility.

• We "Contract Manufacture" our product to supply chain partners, which we believe creates a low-cost scalable blueprint for production that can be deployed in new territories to match anticipated growing demand.

• We are proving our value proposition in adjacent markets (EV charging, grid infrastructure) via innovation projects that validate our scaling potential.

Use of proceeds

We're raising to enable customers to replace their diesel generators. These funds will be allocated as follows:

Staff & New Hires - 50%
Product development & Trials - 30%
Overheads - 15%
Marketing - 4%
Patents - 1%

Our target timeline is as follows:

2022-23 – MVP trials
2023-24 – Commercial trials
2024-25 – Low volume manufacturing
2025-26 – High volume manufacturing

Key Information

Valuation

Please note the company valuation listed on the campaign is £15M as this is calculated on a fully diluted basis taking into account all future rights to equity including the employee option pool. Without taking this into consideration the valuation would be £14M.

Debt Facility

The company currently has a rolling debt facility with the Chairman which is secured against an R&D tax credit due to the company to the amount of approximately £420,000. At any time the company can borrow against this amount at 5% interest. The amount outstanding on this facility is currently zero.

Outstanding Commitments

The company currently have an outstanding project with Cranfield University as part of their National Highway’s Project. The work due on this project is at an agreed maximum cost of £120K. This work is still owed and has been factored into cash flow forecasts, the company believe the value of this work to be £80K.

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If you successfully purchase a share lot of this business, you will be granted access.

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Only shareholders can access this page

If you successfully purchase a share lot of this business, you will be granted access.

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Tax Relief (SEIS)

This business is eligible for SEIS relief - providing qualifying investors with income tax relief of 50% of their investment and certain other tax reliefs. Tax treatment depends on individual circumstances and is subject to change in future. Click to learn more.

Tax Relief (EIS)

This business is eligible for EIS relief - providing qualifying investors with income tax relief of 30% of their investment and certain other tax reliefs. Tax treatment depends on individual circumstances and is subject to change in future. Click to learn more.

Valuation (pre-money)

Valuation rounded from £15,000,000

This is the fully-diluted pre-money valuation of the business (i.e. before the new investment comes in and including issued options and other equity interests). In contrast, the post-money valuation is based on inclusion of the new investment in the value.

It is calculated as the pre-money valuation plus the amount of new investment. e.g. If Company A is ascribed a pre-money valuation of £1,200,000 by prospective investors investing £300,000, its post-money valuation is £1,500,000.

Pitch type

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  • Equity
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  • Fund
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  • Secondary

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Equity Offered

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When the amount raised is less than 100%, the equity offered is based on the target raise. Once the company has raised over 100% it is based on the total raised.

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If you invest in this Campaign, Seedrs will act as Custodian rather than provide our standard nominee service. This is due to the fact that the business is not directly involved in the share sale and Seedrs will not benefit from any rights under a shareholder agreement. As a result, Seedrs will handle administrative tasks as we do normally, but you will not have information or voting rights, updates from the business, preemption on future fundraising, or ongoing support about business trading activity.

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Secondary market

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Direct investment

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Business Involvement

This Campaign offers shares for sale in business that is not directly involved in this Campaign or the sale. As a result, the Campaign and post-investment experience, including investor rights, will differ from a business-led campaign on Seedrs. Most notably, the business will not engage with investors in the discussion forums both during and after the sale or provide any updates to investors.

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Payment options

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Drawdowns

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