A memo on the Investible Climate Tech Fund’s investment in ZeroJet, a New Zealand-based maritime innovator building the next generation of electrified boats.
The decarbonisation of the boating and the shipping industry is as important as it is complex. Investible is thrilled to back a fantastic team tackling this challenge with a new electric jet propulsion system initially targeting tenders and smaller boats.
ZeroJet enables a critical step change in the electrification of the sector. By developing a custom jet propulsion system rather than the traditional propeller-based units, the team achieved multiple important benefits, including being more efficient, more practical, and much more fun. This is in addition to being environmentally friendly, and quiet.
Investible is pleased to back the incredible team behind ZeroJet, including the incredible founders Bex Rempel and Neil Mans as part of their recent Series A funding round, which included lead investors Movac, the NZX listed Booster Innovation Fund, high-net-worth individuals and family offices, and repeat investment from Impact Enterprise Fund and K1W1.
ZeroJet originally caught our interest due to three key factors.
Bex and Neil are proven pioneers in the space, having built the world’s fastest electric jetboard, which can reach a speed of 70km/hr. On the tail of this achievement, they turned their attention to, and converted the unique system to one that would work with boats. Along the journey they brought together an amazing team in New Zealand, renowned for its marine industry.
The team has also shown tremendous traction from large and prestigious manufacturers looking to develop electric versions of their boats. For early-stage companies, an ability to secure blue chip clients is an extraordinary sign of validation in the product. More on this below.
Finally, the regulatory and industry tailwinds in the space are now blustering. California has proposed an emission reduction plan for marine engines which could come into effect as early as 2027. Regardless of regulation, the decarbonisation trend is a top priority for a lot of corporates and customers in the space, and ZeroJet is well positioned to make a splash in the industry.
A new solution for the electric era
In order to achieve the great experiences that will motivate users to switch to electric boats, just replacing the petrol engines and fuel reservoirs with electric motors and batteries isn’t going to be sufficient. That’s why Bex and Neil developed a tailored solution that delivers the best user experience.
Some of the key benefits include:
1) being more efficient, particularly since the jet and the batteries get integrated in the boat in an optimised way
2) being extremely safe because there is no exposed propeller and in the case of tenders easier to bring onto a larger yacht
3) being much more practical with minimal draft allowing to go in shallow water and go directly on the beaches
4) being extremely quiet enabling unique applications (fishing, wildlife observation, military) as well as being a great solution for eco-resorts
5) compared with traditional combustion engines, being environmentally friendly, requires limited maintenance, is easy to start and is no heavier
It should be noted that combustion engine-based jet propulsion had a major drawback of needing the engine to run at very high RPM to achieve the required torque. The benefit of electric motors, is that immediate and constant torque—even at low speeds—creates a much more perfect combination.
Waves of traction in their wake
Customer traction is obviously one of the most compelling areas for the validation of a startup. ZeroJet started by supporting integration with a local manufacturer’s product and has been successfully selling through the channel, as well as directly to individual customers. The appetite and customer satisfaction speaks for itself. Having already established this critical external validation and demand is a stepping stone to the team’s broader ambitions to transform the industry.
At the same time several boat manufacturers have approached ZeroJet to integrate their systems into their own boat designs, often only requiring some small modifications to the hull. This B2B approach is really the core business model for ZeroJet which will enable the ambitious scaling the team is aiming to achieve.
The roadmap for the next year starts with the collaboration with and integration into 3 high growth and prestigious boat manufacturers. This will be more hands-on work which will in turn enable further refinements and product development whilst adding new features and patents to enhance their technical advantage and leadership position in the space. These customers will in turn drive an expected high ramp-up in sales for which the team will need to prepare in terms of production capacity, all of which this Series A raise will enable.
Beyond that, ZeroJet intends to make the integration into other boat manufacturers so easy that it will become a component they integrate in their models using design and specification sheets, as they would most other boat components or motors. This will greatly expand the universe of boat manufacturers and the speed at which they can integrate a ZeroJet system. Of course, as batteries get better and cheaper, the size and scope of their target market will naturally expand to larger boats and applications.
Investible, through its Club and broader ecosystem has relationships with boat owners and manufacturers which can hopefully enhance ZeroJet’s existing strong pipeline.
Passion and dedication
Investible’s purpose is to back visionary founders advancing humanity through technology. Whilst passion is not a sufficient element to turn a startup into a huge success, it certainly is a great contributor and one we love to see.
Combine this passion with dedication and domain expertise, like we see in Bex, Neil and the ZeroJet team, and you’ve got an ideal blend of ingredients. We look forward to working with ZeroJet to grow the business into a global electric boat propulsion leader.
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