Cambridge Cleantech – a Clear Treasury partnership study
Chief Commercial Officer
The impact a strong partnership can have on a business shouldn’t be underestimated. We’ve partnered with Cambridge Cleantech since 2017 and in that time have helped many of its member companies with their diverse foreign exchange needs, saving them significant time and money in the process.
The power of partnerships
Partnerships work because they develop a mutual bond between businesses, organisations and charities where each benefits from the other. Working together improves relationships, establishes reputations, increases efficiencies, grows value and promotes new revenue streams.
In fact, partnerships are at the very core of Cambridge Cleantech’s success. A leading membership organisation, it brings together companies creating innovative cleantech technologies with the financiers, partners and customers who can bring their products and services to market – and in doing so help create a smarter, more sustainable future. Its members range from startups with smart ideas in sustainable energy, water and waste to multinational conglomerates working to reduce their environmental impact.
It’s an exciting, fast-growing and important industry that we’re proud to help grow.
Establishing a partnership
We first encountered Cambridge Cleantech at an Avitus Group event in 2017, helping UK businesses looking to expand into the US market, and discovered an immediate synergy.
Their CEO, Martin Garratt, had just delivered a compelling presentation and so one of our team attending the event approached him to make an introduction. It was clear our organisations could compliment each other as well as Cambridge Cleantech’s many member businesses, and so we quickly joined the network.
Naturally, we’re always looking for new partners and new businesses to work with, and Cambridge Cleantech has more than 200 active member businesses across the southeast – many with an international outlook. It also has an eye firmly fixed on expansion and recently opened the Oxfordshire Greentech business network, part of the OxFutures programme supported by European Regional Development Fund (ERDF). It has also announced plans in association with the Greater London Authority to open a London hub that will create a cleantech triangle covering the entire southeast.
With its busy roster of events and access to hundreds of UK based SMEs that have an interest or are already active in international business, it’s clear what we get out of our partnership with Cambridge Cleantech. But what about them? We can leave that to CEO Martin to explain:
“As the business support partnership driving the development of a world-leading cleantech cluster in Cambridge, we undertake many international projects on behalf of our members from within Europe to the Americas and Asia. We have found the Clear Treasury FX rates to be extremely competitive, saving us thousands of pounds in transactions.”
Cambridge Cleantech’s remit is to help environmentally-focused businesses thrive in both British and international markets – to promote cleantech sustainably and profitably on the global stage. Our business model helps support this in several ways.
Mitigating FX risk is something many SMEs don’t automatically think about. But if a sizeable part of your cash flow is coming from or going to another currency, fluctuating exchange rates can have a significant impact on profit margins – and thus long term sustainability. This is the case for many of the smaller businesses in the Cambridge Cleantech network, many of which have a very high FX turnover, with some approaching 100% of their entire turnover.
Alongside our extremely competitive FX rates, we also offer bespoke consultancy and finance services to help businesses plan their future transactions with spot, forward and options contracts. This helps them plan their FX transactions to minimise their costs over the long term.
While there were several FX businesses in the Cambridge area already known to many of the Cleantech members, Martin believed our business was best served to help them. As with any good organisation, Cambridge Cleantech doesn’t want to overwhelm its members with multiple commercial partners but rather offer a select group of high quality, vetted service providers they know deliver great value and service. This helps them appeal to potential new customers and, just as importantly, keep existing member relationships sustainable.
By introducing us directly to specific businesses Martin identifies as having an FX need we could help with, he’s fostering these relationships and fulfilling his remit to help cleantech businesses thrive – and we’re excited to be part of that process.
The FX partnership process – a working model
The partnership between Clear Treasury and Cambridge Cleantech has flourished over the last two years. Within 12 months of joining as a member partner, it appointed us as an associate founding member to strengthen our partnership further and provide its members with a dedicated, trusted and ratified FX service.
Let’s take a look at a working example of how we help cleantech businesses manage and carry out their FX transactions more effectively.
Founded in 2009, Cambridge Cleantech member Future Transport Systems (FTS) is a strategic and technical consultancy that focuses on managing the relationship between electric vehicles and the grid. It also develops and commercialises energy storage systems to support electric vehicle charging, vehicle-to-grid operation and managed charging systems.
The rapid rate of development in the e-mobility (electric cars and the like) industry across the world means that FTS has to base its consultancy on the best international knowledge and learning. As a founder member of the European Electric Mobility Consulting Group, it works across international markets from Europe and beyond to the US and China.
As such, FTS has a clear FX requirement with supplier payments coming in multiple currencies at irregular times. Martin introduced us to FTS through our Cambridge Cleantech partnership and once we’d established that we could help minimise its currency exposure and maximise currency profit margins, we started working with the team to understand the role foreign currency transactions played in their cash flow.
We mapped out an FX strategy and solution to answer their long term needs. With a business like FTS, which is an irregular buyer of different currencies depending on supplier payments, we take a proactive strategic approach based on our knowledge of where the market is going.
Having delivered our proposal, we gave them time to review it and then followed up after a few days. With a green light to proceed and compliance checks passed, we set FTS up with an account and access to the Clear Payments platform. This gives them the freedom to conduct any smaller transactions (typically up to £10,000) whenever they like quickly, easily and without the need to speak to one of our team.
For larger, more irregular payments that are more sensitive to currency fluctuations and thus pose a greater risk, we provide FTS with direct guidance from one of our expert team, who manages the process with them. Naturally, the bigger the payment the keener they are to know what’s happening, what their risk exposure is and how we can help ensure they get the very best price.
This two-pronged solution to FTS’s FX needs backed up by our long-term consultancy service has helped our relationship go from strength to strength.
A developing partnership
Cambridge Cleantech is not only our partner, but also now our client.
Since becoming associate founding members we have delivered FX services catering to their own European project needs where previously they were getting paid directly in sterling to their UK bank account. This left them exposed to a great deal of currency risk and subject to huge fees charged by their bank.
Working together commercially and in partnership represents the best possible outcome for both our organisations. It’s a great argument for the power of strong partnerships.
Become a Clear Treasury partner
We partner with a number of different businesses across many service areas to help facilitate better industry relationships. These partnerships help us:
- Provide exceptional service
- Be better value
- Become more efficient
- Develop new business streams
What Is A Forward Contract?
A forward contract is a foreign exchange agreement to buy one currency by selling another on a specified date within the next 12 months at a price agreed on now, known as the forward rate.
Goodwille – a Clear Treasury case study
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Mitigating currency risks for international businesses
Company growth can be defined in several ways. Most obviously, it refers to increasing revenues as a result of being in business, but it can also mean growing in terms of the number of people it employs, how many clients or customers it has or the number of offices or outlets it operates domestically and internationally.
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