InVenture (INV) Q2 2025: Excelsius Bookings Triple Pipeline, Accelerating Data Center Cooling Adoption
Excelsius’s bookings momentum and pipeline coverage signal a step-change in InVenture’s value creation trajectory. The company’s focus on advanced data center cooling is translating into rapidly growing production orders and deepening customer validation. With new manufacturing capacity and a robust capital position, InVenture’s model is demonstrating the ability to incubate market-defining businesses while navigating early-stage volatility.
Summary
- Pipeline Coverage Expands: Excelsius now has 3x bookings coverage for 2025 and 6x for 2026.
- Production Orders Gain Share: Shift from proof-of-concept to 75% production engagements expected in 2026.
- Manufacturing and Capital Readiness: Internal and contract manufacturing scale and recent capital raises support growth runway.
Performance Analysis
InVenture’s Q2 2025 results reflect a business in transition from proof-of-concept to commercial scaling within Excelsius, its advanced data center liquid cooling subsidiary. Revenue remained modest at $0.5 million, with Excelsius contributing $0.3 million and the remainder from the Inventus ESG fund. This low top-line is consistent with management’s guidance that most sales and bookings will be weighted toward the second half of the year as customer orders move from pilot to production.
Operating expenses were tightly managed, with general and administrative costs declining sequentially, driven by a mix of non-cash equity comp, professional service fees, and payroll tied to Excelsius’s growth. A large non-cash goodwill write-down, attributed to macro factors, dominated the income statement but does not impact liquidity. Adjusted EBITDA loss improved to $16.2 million from $21.8 million in Q1, reflecting early operating leverage as Excelsius ramps. The balance sheet was bolstered by $27 million in new cash from convertible debenture issuances, giving management confidence in funding near-term growth. Inventory build at Excelsius signals readiness for larger orders in the coming quarters.
- Bookings Inflection: Q2 Excelsius bookings exceeded all prior periods combined, with Q3 projected to be a multiple of Q2.
- Operational Leverage Emerges: Adjusted EBITDA loss narrowed as G&A fell and early revenue began to flow.
- Balance Sheet Fortified: Cash and equivalents rose to $12 million, with additional capital secured for future scaling.
Management’s commentary and analyst Q&A reinforce that Excelsius’s transition from pilot to production is the key driver for future revenue and margin expansion.
Executive Commentary
"Bayfield Engineering, a leading data center-focused MVP firm, just completed a study comparing our technology side by side with single-phase water and found an operating cost improvement over water of 28% to 40%, depending on the exact assumption set around infrastructure deployed. Our performance has been impressive. However, the technology is still new, and cell cycles for these relationships can sometimes span several quarters. Because of the compelling nature of the Excelsior's technology, we anticipate the sales cycle will shorten significantly as the technology gains traction in the field at scale."
Josh Kleiman, Chief Executive Officer, Excelsius
"We believe the company is equipped with a market-leading technology that positions it at the forefront of a seismic shift to two-phase directed-shift liquid cooling adoption. We also feel strongly that Excelsior's ability to attract top talent, like Eric Brown, is a testament to the work they are doing and how well established the company has become in such a short period of time."
Bill Haskell, Chief Executive Officer
Strategic Positioning
1. Excelsius: Building a Market Leader in Data Center Cooling
Excelsius, InVenture’s flagship growth engine, is capitalizing on the AI-driven surge in data center demand. Its two-phase direct-to-chip liquid cooling technology addresses the power and thermal constraints of next-gen workloads, positioning it as a critical enabler for hyperscalers and colocation providers. The company’s rapid engagement with top-tier OEMs, hyperscalers, and a 21-partner go-to-market network underscores its ecosystem reach. Early proof-of-concept wins are now converting to production orders, with a pipeline that is 3x covered for 2025 and 6x for 2026—clear evidence of both market need and customer validation.
2. Manufacturing Flexibility and Scale
Excelsius is executing a hybrid manufacturing strategy, combining a new 27,000-square-foot in-house facility in Austin with scalable contract manufacturing partnerships. This approach preserves quality and margin while ensuring the ability to flex production if hyperscaler adoption accelerates. Management expects to keep 25 to 30 percent of manufacturing in-house over time, maintaining control over IP and process optimization—a critical lever for margin and risk management in hardware-centric businesses.
3. InVenture’s Conglomerate Model Drives Optionality
Beyond Excelsius, InVenture’s operating model is validated by prior successes like PureCycle and the ongoing progress at Aeroflex and Raffinity. The company’s approach is to incubate only opportunities with $1 billion-plus enterprise value potential, leveraging deep partnerships and IP development. This diversified pipeline reduces dependence on any single business and provides ongoing proof points for the platform’s value creation thesis.
4. Capital Discipline and Active Management
InVenture continues to use external professional services to keep fixed costs low, but plans to internalize more functions as public company requirements grow. Recent capital raises and prudent inventory management reflect a focus on maintaining liquidity and readiness for scale, while minimizing dilution and balance sheet risk.
Key Considerations
This quarter marks a pivotal point in InVenture’s evolution from early-stage technology commercialization to scaling revenue and operational leverage. The following considerations should shape investor expectations for the next 12 months:
- Pipeline Conversion Pace: The speed at which proof-of-concept deployments convert to large-scale production orders will determine revenue inflection and margin improvement.
- Manufacturing Execution: Balancing in-house and contract manufacturing is key to meeting demand surges from hyperscalers without sacrificing quality or strategic control.
- Capital Access and Cash Burn: Continued access to non-dilutive capital and disciplined cash management are vital as Excelsius ramps and other portfolio companies mature.
- Competitive Differentiation: Excelsius’s data-driven approach and third-party validation (such as Bayfield’s study) are critical to winning customer trust in a nascent but crowded market.
- Conglomerate Optionality: Progress at Aeroflex and Raffinity provides additional upside and risk mitigation, reinforcing the value of InVenture’s platform approach.
Risks
InVenture’s reliance on Excelsius for near-term value creation exposes it to execution risk around scaling manufacturing, shortening sales cycles, and converting pilots to production. The nascent state of the two-phase cooling market, long customer evaluation periods, and the need for ongoing capital raises could introduce volatility. Macro uncertainty and competitive technology claims may also impact adoption rates and customer decision-making.
Forward Outlook
For Q3 2025, InVenture expects:
- Excelsius bookings to be a multiple of Q2 levels, with continued shift toward production orders.
- Initial hyperscaler proof-of-concept delivery and further OEM order ramp.
For full-year 2025, management reiterated that:
- Revenue and bookings will be weighted to the second half as production deployments scale.
Management highlighted several factors that shape the outlook:
- Growing average order sizes and pipeline visibility, especially for 2026.
- Continued capital discipline and readiness to scale manufacturing for large customer wins.
Takeaways
InVenture’s Q2 call signals a company on the cusp of commercial scale, with Excelsius’s technology and pipeline momentum driving near-term and long-term value creation.
- Bookings Acceleration: Excelsius’s bookings and pipeline growth provide a tangible indicator of market acceptance and future revenue potential, with production orders set to dominate in 2026.
- Manufacturing and Capital Foundation: New internal capacity and recent capital raises position InVenture to support demand surges without operational bottlenecks.
- Conglomerate Model Delivers Optionality: Progress at Aeroflex and Raffinity, along with a disciplined company launch pipeline, reinforce InVenture’s differentiated approach and risk-mitigated upside.
Conclusion
InVenture’s Q2 narrative is one of accelerating commercial validation and operational readiness in its flagship Excelsius business, supported by a disciplined capital and manufacturing strategy. As the pipeline shifts to production and the company leverages its conglomerate model, investors should watch for sustained bookings growth and the conversion of pilot deployments into meaningful revenue streams.
Industry Read-Through
The rapid adoption of AI workloads is fundamentally reshaping data center infrastructure requirements, with liquid cooling moving from niche to necessity for high-density compute applications. Excelsius’s traction with hyperscalers and OEMs, and the 28 to 40 percent operating cost advantage over single-phase water cooling, signal that the industry is entering a new phase of technology adoption. Competitors and adjacent players in data center hardware, thermal management, and power architecture should expect accelerated evaluation cycles and increased demand for next-gen cooling solutions. The pace of pilot-to-production conversion will be a key barometer for the broader ecosystem’s readiness to scale AI infrastructure investments.