Enovos and Creos embrace corporate venturing

Capital V #9 | Interview with Nicolas Milerioux

Interview with Nicolas Milerioux, Investment Manager of the newly created limb of Encevo Group.

The group, composed of energy provider Enovos and grid operator Creos, is a regional energy leader and key player in Luxembourg’s energy transition. After other innovation‑driven initiatives such as enosmart or enosolar, the group now adds corporate venturing as a supplementary layer to accelerate the deployment of innovative solutions through hand-picked equity investments into European ventures during the expansion stage, usually referred to as the Series A funding round.

What type of companies are you looking for and what can Enovos offer to its funded companies?

We look for companies with scalable solutions, a clear innovation edge, first customers and working installations leveraging on key topics such as decarbonisation, digitalisation and decentralisation.

We are not aiming at becoming their main customer but see ourselves more as an active, strategic partner that will make an impact by providing, beyond funding, access to our brands, sales channels as well as in-house expertise.
Which are Enovos’ goals with this initiative?

This initiative is meant to assist the Encevo Group to keep track of evolution of market dynamics and technology trends and developments. New innovative products and solutions, if relevant to our structure and strategy, will enable us to participate in new market segments or business areas. Aside from the investment aspect, we will also scout and identify potential partners for specific projects or developments.
How many investments are you planning per year?

We plan two to three investments per annum, which is probably lower than traditional funds, but our idea is not to build up a large portfolio but rather to focus on getting the most of our investee companies.
How many companies do you have under your radar?

Nearly 200 companies have gone through our reviews and we are currently looking into more details of a limited number of them. I am quite happy with the pace we are ramping-up at, given that we did not make any marketing expenditure.
Do you expect to find good investment opportunities within Luxembourg? Are you doing anything specific to foster targets in Luxembourg?

We have seen interesting projects in Luxembourg that we follow closely. Our local and international ecosystem is gaining in maturity every year and we would be thrilled to foster our local entrepreneurs. We support local activities and initiatives for start-ups, e.g. by participating in Technoport and Nyuko, as well as related activities, like being jurors in pitches. We could rely on our excellent relationships with the local ecosystem if we were planning to organise a call for start-ups later on.

On the other hand, our investee companies from abroad will be able to rely on our network to operate in Luxembourg.

Do you expect the funded companies to be absorbed by Enovos at some point or you have a more open market approach? (co-investment with other investors)

Our size and regional footprint may not be sufficient to entertain an exponential growth that success stories require. As a consequence, spin-ins will be the exception.

Co-investment is our preferred route. We have already built a number of relevant connections, as our value proposition is complementary to both generalist and cleantech/energy funds.
Given that the Luxembourg Future Fund also targets cleantech, will there be room at some point to raise funds from LFF?

We are currently outside some key criteria of the LFF, which are aimed at investing in clearly segregated teams and structures.

However, we are currently evaluating several options for the medium term. Once the roadmap has been be cleared, we will certainly revert to the SNCI and EIF to see if the LFF or other programmes could be relevant.
Did you set a time frame for a first assessment of the impact of this initiative?

We have continuously measured the progress and impact of this initiative since day 1 but most foreseeable outcomes will take 12-24 months from the initial investments.

New innovative products and solutions, if relevant to our structure and strategy, will enable us to participate in new market segments or business areas.