LACI Celebrates $2 Million Grant from Schmidt Family Foundation to Expand LACI Cleantech Debt Fund

First-of-its-kind Debt Fund Provides Critical Access to Capital for Cleantech Startups; Non-Dilutive Loans Offer Founder-Friendly Alternative to Venture Capital

LOS ANGELES, Aug. 7, 2025 /PRNewswire/ -- The Los Angeles Cleantech Incubator (LACI) is pleased to announce a $2 million grant from the Schmidt Family Foundation to help grow the LACI Cleantech Debt Fund (Debt Fund). The grant will allow LACI to expand its efforts to support early-stage startups with the critical working capital needed to deploy and scale groundbreaking cleantech solutions.

The funding grows the revolving LACI Debt Fund to $7.6 million in available lending capital, which offers two products: working capital loans and first customer financing. Since its inception in 2022, LACI has deployed $5 million in loans to finance first customer contracts and provide working capital for more than 20 companies in six states that represent multiple business sectors, including EV charging, metallurgy, and grid resiliency.

The Debt Fund offers a more affordable alternative to venture capital. Yet given early-stage startups can be seen as uncreditworthy due to their lack of assets and limited cash flow, equity financing is often seen as their primary option for working capital. This reliance on venture capital for growth leads to several challenges (e.g., founder dilution, inflated equity valuations due to multiple funding rounds, poor business practices resulting from excessive valuations). The Debt Fund provides an affordable, non-dilutive alternative to traditional venture capital, thereby paving the way toward equitable and sustainable growth in the cleantech sector.

Further, underrepresented Black, brown, and women entrepreneurs face numerous challenges to capital access, whether equity or debt. As the LACI Debt Fund does not require personal collateral or credit scores, it removes some of the key barriers and biases faced in the financial system.

"Thanks to the generous support of the Schmidt Family Foundation, LACI can better help cleantech founders access working capital, overcoming a key barrier to scaling their game-changing climate solutions," said Matt Petersen, President and CEO of LACI. This grant is also transformative as we begin to recapitalize our national cleantech debt fund over the next 18 months–we are committed to continuing and growing our fund to provide loans with founder-friendly terms to LACI companies and startups recommended by our 15 incubator partners across the nation."

"If we're going to get on track to meet our climate goals, we need more financial tools that help early-stage climate tech companies scale," said Patrick McGrath, program director for climate tech at the Schmidt Family Foundation. "The LACI Debt Fund is a promising model for how catalytic capital can fill this gap and strengthen the broader ecosystem."

The Debt Fund supports startups like Evolectric, an alumni company of LACI's Incubation Program that specializes in accelerating the transition to electric vehicle adoption by providing trademarked EV conversion kits for commercial vehicle fleets. The company has repaid their loan in full and continues to scale its fleet electrification solutions.

"The LACI Debt Fund came at a critical time for us, when we were in need of working capital and some additional financing to start scaling our business," said Jakson Alvarez, Co-Founder of Evolectric. "I'm excited that new funding from the Schmidt Family Foundation will allow LACI to deliver critical funding support to the next wave of cleantech startups."

"Through the LACI Cleantech Debt Fund, we seek to help founders—particularly underrepresented founders—to overcome the barriers to accessing capital without diluting the equity they hold in their startups," said Adrienne Lindgren, LACI Senior Vice President of Unlocking Innovation. "By working with our expansive network of partners across the nation, we are able to identify investible startups with founders from a diverse set of geographies and walks of life. I'm grateful to the Schmidt Family Foundation for supporting this critical work, which will allow us to fund larger loans between $500,000 and $1 million, to meet the working capital needs of startups."

About LACI:
The Los Angeles Cleantech Incubator (LACI) is unlocking innovation by scaling cleantech startups, transforming markets through catalytic partnerships with policymakers, innovators, and market leaders, and enhancing communities through workforce training, pilots and other programs. Founded as an economic development initiative by the City of Los Angeles and its Department of Water & Power (LADWP) in 2011, LACI is recognized as one of the top 10 innovative business incubators in the world by UBI. LACI has helped 506 portfolio companies raise over $1 billion in funding, generated $344 million in revenue, and created 2,626 jobs throughout the Los Angeles region, with a long-term economic impact of more than $733 million.

About the Schmidt Family Foundation:
Established in 2006 by Eric and Wendy Schmidt, the Schmidt Family Foundation works to restore a balanced relationship between people and planet. Through grantmaking and investments, the foundation partners with communities around the world in working for renewable energy, resilient food systems, healthy oceans and the protection of human rights.

Cameron Edinburgh
[email protected]
(213) 358-6500 Ext. 6623

SOURCE LACI