Millionaires in four years – A venture capitalist bought the geothermal company of friends in their thirties

International infrastructure investment company Infrared Capital Partners buys the majority of Volta Lähienergia, which makes geothermal systems.

The transaction amount is not disclosed, but Infrared Capital Partners undertakes to finance the company’s growth with up to 75 million euros according to the transaction agreement.

According to Helsingin Sanomat’s estimate, the purchase price will rise to more than ten million euros. In deals like this, the final price depends a lot on how profitably the company grows.

The company’s founder, CEO, is making the deal Miikka Lemmety37, and CFO Richard Cawénista, 34, millionaires. They remain in the company as minority owners.

VoltaN Lähienergia was founded in 2020. It offers geothermal systems that reduce energy costs for large residential properties.

The business idea is to offer geothermal heat as a service to new buildings and housing associations at a cheaper price than district heating. Volta Lähienergia is responsible for the necessary investments, installation and operation itself.

Voltan has ten ongoing projects in Finland. There are about 50 contracts for new sites, Lemmetty says.

Lemmetty and Cawén were previously consultants to Boston Consulting Group (BCG).

Lemmetty says he has an engineering background, Cawé has a financial background. At BCG, they worked on, among other things, various energy industry acquisitions.

The business idea of ​​switching to geothermal heating began to take shape around 2019, when district heating prices started to rise.

“The prices were even higher than electric heating”, Lemmetty recalls.

According to Lemmety, the district heating companies were quite reluctant to reform at that time. District heating was and is still being done by burning something, while geothermal heat can be implemented without emissions. In addition to the price, it is a good selling point.

Lemmetty says that Volta Lähienergia typically offers energy at clearly cheaper prices than district heating.

“Pricing is subject-specific, so no exact figure can be given.”

Volta Lähienergia’s business idea essentially includes the fact that it makes the initial investments in geothermal energy on behalf of the customer. It then bills the customer for the supply of energy as a service with monthly energy payments.

“When we make the investments ourselves, we are a company with a heavy balance sheet. That’s why the financial side is in an important position.”

According to Lemmety, the construction of a geothermal plant for a medium-sized housing company typically costs around 200,000 euros.

Voltage From the beginning, Lähienergia has acquired its financing largely from private equity investors and investment companies of wealthy families, i.e. family officeiltaLemmety says.

Getting debt money, especially from Finnish banks, proved to be challenging from the start.

“Finnish financial institutions and banks are a bit rigid in the financing models of the green transition,” says Lemmetty.

“It is good that foreign financial institutions are actively offering financial solutions for the renewal of the energy industry.”

When Voltan’s core business is to sell energy instead of contracting, the company’s turnover is still quite small, around 200,000 euros per year.

The company started its operations by selling a service to construction companies for new projects, where the company did an energy analysis of geothermal energy and the implementation of a geothermal plant.

Now Voltan has also expanded operations to larger industrial sites and renovation sites where building societies switch from district heating to geothermal heating, says Lemmetty.

“More than half of Helsinki’s emissions come from district heating.”