After participating in the Postcode Lottery Green Challenge, winners and finalists get the opportunity to apply for additional investment from the Postcode Lottery Green Challenge Fund, managed by DOEN Foundation. We talked to Daan Laméris, investment manager at DOEN, about how the fund can enable companies to grow and scale up.

What is the role of the DOEN Foundation in the Postcode Lottery Green Challenge?
“There is a difference in what it was and what it is now. Before, DOEN Foundation did the administration of the prize money, for example paying it in appropriate parts. At a certain point, it turned out that prize money alone wasn’t enough to get the startups to the next level. That’s why Rockstart was asked to develop an accelerator program to make them investor-ready in the months following the final.”

It also became clear that in the longer term additional capital is needed in order to let the start-ups scale up. In 2016, during the Postcode Lottery Green Challenge, the Green Challenge Fund was launched. This fund invests in promising winners and former finalists of the Postcode Lottery Green Challenge, to let them grow into successful companies that can really make a difference in the world. The current venture capital available in the market focuses mainly on companies that are already beyond the start-up phase, simply because it is too high-risk for many investors. The DOEN Participaties, the investment arm of DOEN,Foundation manages the Green Challenge fund. In addition to the financial support, we also connect the start-ups to the right parties in our network and assist them further with their financial plan.”

What is a notable difference between the prize money and the Green Challenge Fund?
“The Postcode Lottery Green Challenge makes it possible for sustainable start-ups to bring their green business idea from concept or working prototype to market. The prize money is the financial support that makes this happen. But once the service or product is on the market (new) funding is often necessary to realise further growth. That’s were the Green Challenge Fund comes in. With the fund we can make a significant investment that enables the company to scale up their business.”

In contrast to the prize money, the Green Challenge Fund makes investments. For example, start-ups can apply for funding to build a whole new factory or to launch another product. The Green Challenge Fund actually becomes shareholder of the company it invests in. The companies can apply for an investment after their prize money has been purposefully used. At that time, we look again at how the company has developed, what is the business status, what are the expectations? The added value of an investment from the Green Challenge Fund in this early stage is that it helps to convince others to do the same.”

Has the fund already been used to invest in any Postcode Lottery Green Challenge finalist?
“Since the launch in 2016, we have been able to invest in three amazing projects. Recently, twice as much money as last year was freed to put in the fund. Ecovative came up with a sustainable alternative for non-durable insulation and packaging materials that contributes to solving climate issues. Bio-bean also has a positive impact on the climate by recycling waste from the coffee industry into biofuels that help make our energy supply more sustainable. The third investment we made was in Land Life Company, a start-up that developed a technique that makes it possible to restore nature in inoperable parts of the earth, such as deserts. We are very much looking forward to have more former finalists of the Postcode Lottery Green Challenge apply for investments and help establish a greener society with less CO2 emissions.”