Robart Brothers Seek “Unconventional” Funds for Energy Tech Startups
Houston—In a post-Surge Ventures environment, what’s the most viable way to invest in and support the growth of local, young energy technology companies?
That’s the question in front of Chris Robart, and his brother Alex, as they develop their investment firm Unconventional Capital. The brothers got their firm up and running just as Kirk Coburn, founder of Surge Ventures—which hosted a cleantech startup accelerator for four years—said he was closing up shop due to a dearth of industry support.
“I’m not going to say it’s impossible, but it’s hard,” Chris Robart says. “(Surge) made a good shot at it.”
Young energy tech companies need a lot of hands-on support, both in mentoring and capital. But sales cycles in energy are longer than for other technology sectors. A way to make those economics work is to increase the number of investments, but that reduces an investor’s bandwidth to work with their companies, Robart says. Also, while the “oil and gas market” is a big market, most startups’ products are applicable to much smaller market segments.
“It’s a scaling problem,” he adds. “You can only grow so fast and only so big.”
That tension has led the Robarts to try to find a different investment model, instead of a traditional venture capital fund that targets early stage companies. A private equity model tends to focus on companies a bit beyond the startup phase.
While they explore their options, Robart says the firm has made seed investments in a couple of energy technology firms, such as Corva, which provides predictive modeling and analytics in drilling operations; and Water Lens, which does real-time chemical analysis of water used at well sites.
Even as the energy industry continues to grapple with the impact of low oil prices, young companies that are able to use technologies to promote efficiency and … Next Page »