IRVINE, Calif.–(BUSINESS WIRE)–It’s a Happy New Year for Seatrec CEO and founder Dr. Yi Chao and his team, with the closing of a $1 million loan through American Lending Center (ALC). The loan is guaranteed by the State Small Business Credit Initiative (SSBCI).
This is the first state loan guarantee for ALC after working with federal programs in the past, according to John Shen, ALC’s founder and CEO. (The money for SSBCI originates on the federal level, but is administered by the state.) This infusion of capital signifies a step forward for Seatrec’s innovative initiatives as a Climate Tech startup, qualifying for the Climate Tech Finance Program.
In order to be certified as a Climate Tech startup, Seatrec went through a rigorous evaluation process conducted by the Climate Tech Finance Team led by the Bay Area Air Quality Management District (BAAQMD) to quantify the reduction of carbon emissions enabled by Seatrec’s clean and renewable energy solution that power subsea robots. BAAQMD’s evaluation concluded that Seatrec’s solution is both cost-effective and sustainable.
Seatrec is amongst the first startup tech companies to qualify for the Climate Tech Finance loan guarantee program administered by the State of California.
“This new funding is a critical piece of our growth operations in 2024. This will support the sales and production of our new product, the infiniTE™ float, which we launched in 2023,” Chao said. “The Seatrec team has a fairly aggressive goal for scaling sales and production, and this funding will be used for the advanced purchase of inventory and improvements to our manufacturing process.”
Chao founded Seatrec in 2016 after a career with the NASA Jet Propulsion Laboratory, where he developed the core technology for Seatrec. The technology converts temperature differences at different depths in the ocean into electricity, providing energy for subsea robots, especially in remote ocean locations where diesel-powered ships are extremely expensive to use and contribute to carbon emissions. The infiniTE™ float has broad applications for hurricane forecasting, soundscape monitoring, and seafloor mapping. Shortly after the product launched in 2023, Seatrec signed multiple six-figure purchase orders with researchers from universities and the U.S. Navy, Chao confirmed.
Funds overseen by Sunstone Management began pre-seed investing into Seatrec in late 2020, and have concluded three rounds of funding.
Sunstone’s Development Department helped connect Seatrec to ALC and the Climate Tech Finance Program, which is part of the State of California Infrastructure and Development Bank (iBank). ALC became a certified lender for the SSBCI program in 2022. The state Small Business Loan Guarantee Program also was part of the finance package.
ALC headquarters are in Irvine and a strategic partnership with the Small Business Development Corporation of Orange County was key to completing the loan guarantee, ALC’s vice president and chief lending officer, Scott Thompson, said.
This loan program provides an 80% guarantee through the state iBank. If a borrower ultimately cannot repay the outstanding loan balance, iBank will reimburse up to 80% of the original loan – making it easier to qualify for that loan.
“Great partnerships made this capitalization of an exciting startup possible,” John Shen said. “We’re a private company working with the government to support a high-tech entrepreneur – that’s a basic tenet for both American Lending Center and Sunstone Management.
“Dr. Yi Chao is super excited today. So are we!”
Seatrec designs and manufactures oceanic robots and energy harvesting platforms that generate electricity from naturally occurring temperature differences in ocean waters. This renewable energy can power oceanographic research equipment such as floats, gliders, and Autonomous Underwater Vehicles (AUVs), resulting in the most scalable, cost-effective deep ocean data collection possible. Seatrec originated at NASA’s Jet Propulsion Laboratory and the California Institute of Technology and was incorporated by CEO Dr. Yi Chao in 2016. Learn more about us at www.seatrec.com and follow us on @seatrecinc.
About American Lending Center: A Financial Times (FT) Americas’ Fastest Growing Company
American Lending Center (ALC) is a private nonbank lending institution and nationally recognized leader in small business lending. By the end of September 2023, ALC has fully financed senior loan products to 90 qualified EB-5 projects in 13 states, contributing to a combined construction and business expansion budget of over $1.5 billion. ALC’s lending practice has successfully created more than 15,000 new jobs nationwide since 2009. In 2022, ALC launched its new rural construction and development fund with capital available for construction of fixed assets of all types in rural areas including manufacturing, energy, infrastructure, hospitality, specialty use, multi-use and other project types.
About Sunstone Management
Sunstone Management is a diversified private capital management firm with headquarters in Southern California that provides a range of early-stage venture capital, real estate, and fixed income funds to qualified and accredited investors. The firm delivers new and exciting options for economic growth through innovative public-private partnerships, making use of its unique experience across government, education, and private sectors. Identified by Financial Times as one of America’s Fastest Growing Companies three years in a row. In the second quarter of 2023, PitchBook ranked Sunstone the seventh most active early-stage venture capital firm in the country, and 18th overall.
American Lending Center