ENGIE Factory paves the way to a zero-carbon future through corporate venturing in Singapore

ENGIE Factory’s new ventures target decarbonisation opportunities which, on the surface, may not be financially viable for large corporations to pursue. Image credit: ENGIE Factory

ENGIE Factory is a prodigious corporate venture factory. Since 2019, it has incubated 7 new ventures and tested 10 low-carbon energy solutions from its regional headquarters in Singapore, with many more underway.

“We combine talented entrepreneurs, great ideas, and resources, shake the mix really hard, then create great companies from it,” explains Founder and Managing Director Mr Quentin Vaquette.

With a shared goal of helping businesses in Southeast Asia decarbonise more quickly and profitably, ENGIE Factory has chosen to partner with EDB’s corporate venture building arm, EDB New Ventures, to launch a portfolio of zero-carbon ventures over the next three years.

The two organisations are partnering to jointly incubate and co-invest in new ventures, leveraging expertise and networks from both sides.

What is the value of corporate venturing, and how does one find the right collaborators? We speak to ENGIE Factory about their strategies.

Tip 1: New ventures work best when aligned with corporates’ core strengths and growth priorities

In 2014, ENGIE Factory’s founder Mr Quentin Vaquette was living in Thailand and working on ENGIE APAC’s renewable energy projects. While holidaying in Maldives, he saw first-hand how the country’s diesel-fuelled energy system polluted its natural beauty, and leapt into action.

An engineer by training, Mr Vaquette worked the math out over the next six months and kickstarted ENGIE APAC’s hydrogen business, which now employs a hundred people.

But Mr Vaquette knew more had to be done. “Developing hydrogen infrastructure to decarbonise is a 10–30-year game,” he explains “We also need to accelerate current technologies like solar energy, the key challenge of which is adoption. It’s a business model problem, not a technological one.”

Convinced that combining ENGIE’s resources with an entrepreneurial eye for detail could meet this need, Mr Vaquette founded ENGIE Factory.

ENGIE Factory’s vision for a decarbonised world would later draw Mr Edwin Cheang, now Vice President of Strategic Partnerships and Chief Operating Officer, into the company fold.

With his consulting background and startup experience, Mr Cheang recognised the unique value of ENGIE Factory’s constructive approach and long-term vision for business model incubation. “We see these companies as securing the future of energy, not just a return on investment,” says Mr Cheang.

Tip 2: Recruit relentlessly for talent with entrepreneurial chops

Finding the right entrepreneurial talent wasn’t always so easy for ENGIE Factory. A lack of market awareness during its early stages meant that a wide net was cast.

Over time however, ENGIE Factory has developed a more systematic approach, and now relies on LinkedIn, word-of-mouth and specialist startup head-hunters to attract external talent. It also favours Gallup’s CliftonStrengths (formerly known as StrengthsFinder) as an assessment tool for candidates, who typically undergo a rigorous,  3-4 month venture validation process.

Thanks to its own expertise, ENGIE Factory doesn’t demand prior clean tech experience of its entrepreneurs. The team has observed, however, that serial startup entrepreneurs or candidates with strong subject knowledge of their intended market tend to have an advantage.

In addition, “founders who are comfortable with the amount of stakeholder management involved when working with corporates” are best equipped to go the distance, shares Venture Build VP Marie Cheong.

Tip 3: New frontiers require new friends

Although APAC’S burgeoning growth and energy consumption are ripe for decarbonising, seizing opportunities is no mere matter of money or entrepreneurial creativity.

“You need a champion, someone who can not only understand the region’s diverse cultures but also command a high level of trust and ownership among stakeholders,” says Mr Vaquette.

For ENGIE Factory, that champion has been EDB New Ventures.

ENGIE Factory has not only benefited from the agency’s industry networks, but also from its venture builders’ close involvement in its incubation sprints.

Mr Vaquette recounts the agency’s participation in its sprints, where EDB New Ventures’ venture builder was in virtual, 24/7 contact with entrepreneurs providing feedback and helping to fill knowledge gaps through EDB’s contacts.

As such, EDB New Ventures has become a trusted sounding board for ENGIE Factory, with both organisations regularly reviewing the venture pipeline.

Their zero-carbon collaborators will discover immense potential for expansion in APAC. Compared to markets like the US and Europe, a relative lack of decarbonising regulations leaves a gap for which “companies can provide an alternative, by incentivising people to adopt energy efficiency”, says Mr Vaquette.

“APAC is where we can be at the forefront of change, as opposed to being reactive; startups which gain traction here can influence how regulatory policies evolve,” he adds.

Tip 4: Examine market gaps that others miss

At the outset of every new venture, the ENGIE Factory team poses itself two questions.

“Can this company generate US$100 million in revenue within seven years? And can it achieve a 100-megatonne to 0.1-gigatonne carbon reduction at maturity?” asks Mr Vaquette.

Meeting such demanding criteria is no mean feat. To do so, ENGIE Factory’s ventures use technology to spot untapped opportunities which, on the surface, may not be financially viable for large corporations to pursue.

For example, while Singapore is assumed to have two gigawatts of solar capacity, ENGIE Factory estimates that there are six instead. However, the four remaining gigawatts are decentralised, and not cost-effective for large players to capture.

With ENGIE Factory funding, startup Solar AI used artificial intelligence and satellite imagery to identify overlooked solar sites.

It then used a reverse-auction platform to bulk buy equipment and provide installation and financing, all while achieving the same economies of scale as larger projects.

Launched in 2020 by Bolong Chew, formerly ENGIE Factory’s full-time Entrepreneur-in-residence, Solar AI is already on track to scale across the region.

The future of corporate venturing is in Singapore

ENGIE’s model of venture building in Singapore is structured to be openly collaborative with the wider business community and entrepreneurs.

Singapore’s safety, stability, and commitment to sustainable futures enable the ideal conditions for forward-looking new ventures.

“Join us to build the most impactful companies out there,” says Mr Vaquette. “Come talk to us and we’ll be happy to share how we do it,” adds Mr Cheang.

Interested in constructing your own ENGIE Factory-style incubator to build corporate ventures in Singapore? Feel free to reach out to EDB New Ventures at new_ventures@edb.gov.sg for a chat.