The banking industry, deeply maligned by a spate of litigations and legal woes in recent times, has presently come up with a noble offer for the society. Wells Fargo & Company (WFC), in a first ever kind of initiative in the banking domain, launched the Innovation Incubator (IN2) program – a $10 million grant for the clean technology startups – funded by the Wells Fargo Foundation.
Notably, IN2 program is co-administered by the National Renewable Energy Laboratory (NREL), to foster the development of nascent clean technologies for commercial buildings.
The latest initiative by the major regional bank forms part of its $30+ billion commitment in Environmental Investments by 2020. The bank has committed grants of $100 million in community development apart from increased volunteerism for grassroot environmental initiatives by 2020. Grants should also support innovations by nonprofit organizations and universities, aimed at promoting clean technology and facilitating the smooth transition to a greener economy.
Due to strong market barriers, private sector financing is abysmally low in clean technology start-up companies. A facile transition of new energy innovations from the early-stage laboratory research to full commercial scale implementation requires funds, which are meager. Many promising technology firms have faced premature deaths due to this barrier. Given this backdrop, the latest initiative is indeed commendable. We hope that Wells Fargo’s effort will serve to motivate other firms in the banking industry to follow suit.
The IN2 program will aim at filling up the gap in the production process of early-stage clean technology companies. The bank’s expertise in clean technology and commercial buildings, along with its geographical diversity, will help the start-up energy technology companies to become commercially feasible and viable entities.
Under this program, Wells Fargo, in association with NREL, the country’s primary laboratory for renewable energy and energy efficiency research and development, will first select the promising clean technology start-up companies. These, thereafter, will be offered necessary guidance at laboratories and research facilities across the country. The first three batches of the selected companies are slated to be declared early next year. They will be offered research and testing support, along with necessary coaching and mentorship.
At the initial phase, the program will focus on sustainable building technologies that aim at saving costs and lowering overall negative impact on human health and natural environment. With time, IN2 will broaden its scope of clean technology sectors.
Currently, Wells Fargo carries a Zacks Rank #3 (Hold). Some better-ranked finance stocks include Great Southern Bancorp Inc. (GSBC), Western Alliance Bancorporation (WAL) and Meridian Bancorp, Inc. (EBSB). All these sport a Zacks Rank #1 (Strong Buy).
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