Standard Bank backs I-G3N in pioneering local battery production amidst energy challenges
I-G3N provides high-quality energy storage units, which can be used in homes, offices, and electric cars – and are backed by Standard Bank, a leader in green energy funding.
The I-G3N story
Just two years after co-founders Tumi Mphahlele, Sydney Phakathi, and Jaques Buys launched I-G3N, a company that locally produces LiFePO4 (Lithium Iron Phosphate) batteries for energy storage, they found themselves crippled by Covid-19 and judged by investors for being newcomers.
But their story would soon change after receiving backing from Standard Bank, a leader in green energy financing.
"People at institutions found it difficult to understand the business and were reluctant to support the company. We were seeking funds to fuel our development, and despite being in a high-growth industry, our short time in business was a point of contention. The situation worsened when the Covid-19 pandemic struck in 2020," says co-founder Mphahlele.
The company received a soft loan of R1 million and a grant from Standard Bank, and it helped take the company to new heights.
Today I-G3N provides high-quality energy storage units, which can be used in homes, offices, and electric cars.
"The bank recognised our need for funds to gain traction and saw growth potential. We had several interactions with the Standard Bank team, who guided us through the business and investment process. This support allowed us to continue operations and develop our product line," Mphahlele explains.
With battery energy storage systems (BESS), the market is expected to reach between $120 billion and $150 billion by 2030. I-G3N has made significant strides in leveraging local production of LiFePO4 batteries to overcome challenges related to high material costs and import risks.
"Having a local source means that technical backup is readily available, and company specialists can visit customer premises to resolve issues," Mphahlele adds.
Support and Confidence
Since receiving support from Standard Bank, I-G3N has increased its revenue tenfold in the last financial year and now employs 40 people. The company is also empowering young individuals, with most of their employees being under 30.
"By November 2020, the first private equity firm was knocking at our door, wanting to invest. The support from Standard Bank and their confidence in us created a comfort factor that attracted other investors to take us seriously," says Mphahlele.
In a significant development, the company welcomed a second investor following an initial outside investment, bringing the total number of equity partners to two. Despite these new financial arrangements, the company maintains its banking relationship with Standard Bank.
The company is now looking to expand into building high-voltage batteries and has repaid over 80% of the original loan. Additional banking solutions have been implemented to bolster financial stability.
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