Hometree closes $46m equity raise and acquires green home improvement financing platform as it positions itself to become the leading provider of residential energy solutions in Europe
London, 12 April, 2023
- Hometree Group, the residential energy services challenger brand, has closed a $46m oversubscribed Series B funding round, led by specialist energy & sustainability investors 2150 & Energy Impact Partners, alongside financial services giant Legal & General Capital.
- Hometree has seen over 3x growth in its core home services business over the last 12 months, both organically and through M&A, making it one of the largest providers in the UK.
- Hometree has also acquired BeWarm, a green home improvement financing platform offering green loans, leases and mortgage further advances.
As the energy crisis continues to paint a bleak picture across the economic landscape, London-based residential energy services provider Hometree has secured $46m in equity funding to help millions of homeowners enjoy sustainable living by offering low carbon energy solutions in the home.
The fundraise was led by specialist energy & sustainability investors 2150 & Energy Impact Partners, alongside Legal & General Capital – the alternative asset platform for Legal & General Group – the £1.4 trillion financial services & asset management giant. Returning investors Inven Capital, the energy fund backed by Czech Utility CEZ Group, Oxford Capital, & FJ Labs are joined for the first time by impact fund AENU and angel investor Frank Strauss – the former Deutsche Bank board member & CEO of Deutsche Postbank AG.
Hometree, now one of the largest challengers to British Gas and HomeServe in the UK home cover market, is primarily focused on helping customers protect their essential energy assets in the home from breaking down. To complement this service, Founder and CEO, Simon Phelan’s vision is centred on creating a brighter – and more sustainable – future for homeowners, introducing a services model that includes installation, financing and maintenance of renewable energy solutions in the home.
Simon Phelan, CEO of Hometree, said: “This funding round and acquisition of BeWarm marks a significant new chapter for Hometree, enabling us to deliver on our long-held vision of building the leading residential energy efficiency platform across Europe. The recent energy crisis has shown that we can’t remain reliant on foreign gas to heat and power our homes, and Hometree has a key role to play in helping homeowners transition to a more safe, stable and affordable energy system.”
Alongside strong organic growth over the last 12 months, acquisitions have helped bring significant national scale, plus access to a nationwide network of thousands of multi-trade engineers. Hometree believes it can scale its core business profitably at pace in the coming years, whilst using the majority of this new capital to accelerate its new renewable installation and financing business streams to help homeowners across the UK upgrade to renewables.
BeWarm, the latest business to be acquired by Hometree, was founded in 2018 by Rory Duff, ex Strategy Director at HomeServe and CFO of renewable financing business EcoVision, and Matthew Boyes, ex Founder of StreetLife, the UK local social network that was acquired by NextDoor in 2017. BeWarm is an innovative point of sale financing platform, which partners with local installers who use it to offer a range of financing plans to homeowners. This includes Heat Lease Plans, where homeowners can get a new energy efficient boiler or heat pump installed with nothing paid upfront, plus all the ongoing peace of mind included, arranging mortgage further advances at the point of sale to allow the purchase of green home improvements, and Green Home Loans.
Governments around the world are setting ambitious targets for decarbonising housing stocks, and technologies such as heat pumps, solar PV and batteries are increasingly making economic sense as the cost of energy continues to rise. Alongside needing further advances in these technologies, more Government incentives for homeowners, and a ramp up in re-training the existing installer workforce, Hometree believes innovations in financing will be essential to meeting these targets, and that the acquisition of BeWarm positions it very well to be a leader in this exciting new space.
John Bromley, Managing Director – Clean Energy Strategy at Legal & General Capital said “Legal & General Capital is investing in the energy transition to support the scale up of innovative businesses that deliver solutions to reduce carbon emissions throughout the economy, and over the past six years, our investments have focused on decarbonising power, transportation and the built environment. We are delighted to invest in Hometree as it enters this new chapter of growth, positioning itself as a leader in home decarbonisation solutions.”
2150 is one of the largest climate tech funds in Europe focused exclusively on decarbonising the built environment, backed by players in the built world ecosystem with over 425m square feet of real estate under management. Christian Hernandez Gallardo, Co-Founder & Partner at 2150 said, “Homeowners want to lower their energy bills while retaining comfort in their own home, but many don’t know how to get started. Hometree’s business model combines a low cost home cover insurance product to build a trusted relationship with advice, and now financing for each home to choose the right path for its own decarbonisation journey. We have known Simon and Hometree for many years and look forward to supporting this next stage of their growth and the impact it will have on millions of homes and our global fight against climate change.”
US-based Energy Impact Partners is one of the largest growth equity investors in the world (with >$3bn AUM) focused exclusively on the energy transition. Amongst their many relevant investments is Mosaic – the leading US residential clean energy lending platform, which offers financing for solar and home improvements. Nazo Moosa, Managing Partner at EIP said, “Consumers face the double whammy of higher utility bills, against the backdrop of a slowing economy, whilst needing to transition to greener forms of energy which require considerable capex. EIP is thrilled to back Simon and his team in building a leading residential energy efficiency platform in the UK.”
About Hometree Group
Hometree is a residential energy services company that exists to accelerate the transition to net zero homes. Hometree is on a mission to help millions of people decarbonise their homes and enjoy stress-free living. Until now, the company has operated exclusively in the home emergency insurance/ home cover market, helping people ensure their homes are running smoothly with emergency heating, plumbing and electrical repairs. Now, with its growing network of products and services under three business divisions (Home, Energy and Financial Services), Hometree is supporting the full lifecycle of sustainable homeownership, helping homeowners to install, manage and finance renewable energy solutions, enabling them to run their homes in a carbon neutral way.