Harvest Power, With $100M+ in Revenue, Raises $110M in Tough Cleantech Market
There’s something different about Harvest Power. While other cleantech companies have struggled mightily, the Waltham, MA-based waste-to-energy-and-soil firm keeps chugging along and growing.
Today the company says it has raised $110 million in Series C funding, led by True North Venture Partners and American Refining and Biochemical. Previous investors also chipped in, including Kleiner Perkins Caufield & Byers, DAG Ventures, and Generation Investment Management (co-led by Al Gore). That brings Harvest’s total equity financing into the range of $200 million.
Harvest started in 2008 and currently has about 350 employees (40 in the Boston area). In the past year, the company moved its West Coast U.S. office from Seattle to California (Bay Area and Central Valley).
The new money will be used to continue the firm’s growth in organic waste management, says CEO Paul Sellew. That includes the “final stages of completion” of two major plants in Canada, one near Vancouver, BC, and one near Toronto, ON. Those plants, which will take organic waste like food scraps, wood, and paper and produce natural gas (for electricity) and nutrient-rich soils and fertilizer, will become operational in the third quarter of this year, Sellew says. Around the same time, he adds, Harvest will break ground on a new plant in Florida. (Look for action in Massachusetts down the road, though no specifics yet.)
Harvest Power already makes money, mostly from its soil and fertilizer business—to the tune of “well over $100 million” in revenue, Sellew says. Once the waste-to-energy facilities are up and running, though, look for the energy side of the business to grow quickly. “When we have a mature business model, it’ll be relatively equal,” he says.
So how has Harvest managed to keep growing in such a tough climate for cleantech? “We have a business model that lowers cost. That’s a critical aspect, sometimes forgotten when you’re in the cleantech space,” says Sellew.
I asked him to elaborate. “The way I think about cleantech, you clearly want to improve the efficiency of a process while lessening the environmental footprint. And you want to lessen [the need] for fossil fuels, simultaneously while lowering cost. That’s embodied in the Harvest Power business model,” Sellew says. “At the end of the day, we have an economy. You need to be competitive in the economy we have, and not think [cleantech] is something different, and therefore you’ll be successful.”
As for government policy issues, Sellew says, “We built the company to survive in a subsidy-free environment. We have to stay focused on the marketplace right now. I’m a supporter of all clean energy, but at the end of the day I’m running a business.”
Of course, funding and revenues don’t ensure success in a volatile market. Harvest Power will enter into its most crucial phase this year as it operates its new plants and adjusts to scale and demand issues. One thing is clear: our society produces a whole lot of organic waste without much positive to show for it. “What we do is deal with something that has to be dealt with,” Sellew says.