H1 2025: MKB Portfolio & Market Insights

MKB Perspectives

It’s About Execution

Dear friends and partners,

As we seek to understand the increasingly complicated global geo-political situation, a paradigm shift in investor behavior is underway. Both the economy as a whole and the energy transition as an investment theme are cyclical by nature. After years of investments in the ideation and development of new technologies and business models, we are now moving into a cycle of realizing returns on those investments.

Capital markets’ willingness to fund earlier stage companies has waned in favor of more attractive risk-return profiles of growth and mature stage companies. Across global energy transition markets, growth investing grew by 37% from H1 2024 to H1 2025, while Seed through Series B investing shrank by 25% over the same period.¹

Companies need to generate an ROI on their R&D spend. From a finance perspective, the logic is straightforward. For leaders of innovative companies, that means they need to scale profitably to maintain capital market interest. Some must also contemplate synergies derived from consolidation as ways to strengthen market positioning and financial performance. This is easier said than done, but companies embracing this change in mindset are finding notable success and the winners are beginning to emerge. As an active investor, MKB is guiding this paradigm shift across its portfolio.

Energy Transition VS US POLICY

Uncertainty around tariffs has delayed investment decision making across several sectors and has generally slowed down economic activity. Yet most relevant to investors in the energy transition has been the passage of the One Big Beautiful Bill Act (OBBBA), which among other outcomes, rolled back many of the energy transition-related tax credits created or extended in the Inflation Reduction Act (IRA).

The OBBBA terminated tax credits for wind and solar projects unexpectedly early and it repealed the electric vehicle tax credits for new and used vehicles. While US market participants expected post-election Energy Transition headwinds, they have been surprised by its velocity and severity.  Nonetheless, some companies are prepared to weather the storm.

Despite the policy environment, load growth related to the proliferation of data centers and electrification will persist. It is creating demand for energy generation, transmission, and distribution related products and services, and it will increase power prices, expanding the need for efficiency and innovation. These load growth dynamics present opportunities for MKB’s existing portfolio companies, such as Palmetto, XNRGY and Sense, and for new investment themes such as grid-edge hardware and software platforms which harness mission-critical operational intelligence to better orchestrate power supply and demand.

On the transport side, MKB does not attribute EV and charging infrastructure market softness to current policy. In fact, the US is on track to add 16,700 public fast chargers in 2025, a 20% increase over last year.²  Charging 2.0 companies are heralding this trend, and our portfolio company Flo aims to do the same in Canada.  As was the case for solar, affordability will drive EV adoption.

OUR Portfolio Performance

In the first half of 2025, our portfolio companies delivered an aggregate revenue increase of over $1 billion compared to H1 2024. Portfolio companies with well-established product-market fit are focused on creating value through disciplined execution, while those that are encountering market adoption barriers felt the impact of broader economic belt-tightening more acutely.  It’s a dynamic we suspect others are experiencing as well.

Outlook

In the second half of 2025, MKB will continue to expand its portfolio with great companies and support them on the path to monetization.   Accelerating the energy transition and generating returns are our guideposts.

Sincerely,

Antonio Occhionero
Managing Partner
MKB

1 Sightline Climate, Climate Investment Data. Proprietary database; accessed August 15, 2025.

2 https://insideevs.com/news/767059/record-ev-charger-deployment-q2-2025