GreeNEWit:

Financing to the next level

Submitted by Group 10
Akshay Sharma
Ramnik Walia
Ritik Jain
Anay Nadkar
Tarun Goyal
Aman Srivastava
 Current Scenario
 Energy audit firm in Columbia, Maryland started in 2008 helping households and businesses to reduce their
energy consumption
 Leveraged the respective strengths of each partner in residential energy efficiency
 Industry is expected to grow 5-6% from 2013-2016
 Greenewit is catering to different market i.e. businesses and households through diverse product lines
mentioned below
 Entry into Smart Grid industry will require significant capital investment. greeNEWit has utilized numerous
financing avenues
 In order to fund this rapid growth, now they require stable long-term financing source
 We will analyze various source of financing such as crowdsourcing, venture capitalist, debt and equity
 Currently, majority of revenue comes from home performance product but it is going to reduce significantly
next year and company is going to focus on commercial services

GreeNEWit

Home
Quick home energy performances with Commercial Utility rebate Energy Advisor
Checkups energy star energy Services analysis Training
audits
 Past and Future Financing
 greeNEWit’s revenues had grown exponentially in a short period of time, from
$17,250 to $4.1 million in just five years
 The firm’s revenues made their biggest jump from $387,900 in 2011 to $4.1
million the following year
 greeNEWit had a variety of sources for funding in the past—credit cards, then
friends and family financing, then bank lines of credit – short term financing
 First funding came from founders’ credit cards
 The credit cards carried interest rates from 4 percent to 12 percent
 Next funding came from family and friends
 After that they went for account receivables factoring
 The factoring firm gave greeNEWit 80 cents for each dollar of accounts
receivable, a $500,000, 15-month loan carrying an interest rate of 10 percent
to 15 percent, and A-rated because the firm’s customers were highly reliable
utilities
GreeNEWit’s Financials


Financing options analysis

 Crowdsourcing
Pros
 Low overall risk for a potentially high
reward
 Since, GreeNEWit can’t invest heavily
on advertising department,
crowdsourcing can provide the
exposure
 Crowdfunding will provide a
centralized communication for
established audience
 Crowdfunding will allow to give
rewards instead of giving up equity
 It will help in bringing new
opportunities to the company business
Cons
 Majority of Crowdfunding fails to meet
target. Kickstarter has only 39%
success rate.
 Loss of any competitive advantage.
GeeNEWit is already facing stiff
competition
 Small and scattered source of funding
from many places
 Very difficult to finance the entire
project just by crowdfunding
 Not a suitable option for a long term
financing
 Venture Capital/Angel Investing
 Large firms willing to invest cash in startup businesses
 Most venture capital firms are industry specific; a large number focus on renewable
/ green energy

Pros
 greeNEWit would obtain substantial
cash inflow to finance future
growth
 It is not a loan; no default risk
associated
 Venture Capital Firm wants you to
succeed as they are repaid by your
ability to generate profits
 Will gain a strategic partner with
industry knowledge if a green
technology firm is chosen
Cons
 greeNEWit founders would have to give
up equity stake in company
 Must give up portion of profits going
forward
 May settle for a valuation lower than
companies growth potential  Smart
Grid industry
 Small Business Administration
Pros
 greeNEWit can use loans to
provide: short and long-term
working capital needs and
purchases of
equipment/materials
 Would allow for the
establishment of new lines of
business  Smart Grid
 Offer lower fixed and variable
interest rates
Cons
 SBA loans must be secured by
all available assets, both
business and personal
 Increased leverage and default
risk
 Must adhere to certain
covenants  decreased
flexibility and agility
Thank you!!