Transcript Keeping Climate Change in the Forefront

Climate Change Investments
Walter Schindler
Managing Partner
SAIL Venture Partners
8th Annual European Summit on Corporate
Governance and Responsible Investment
Stockholm, June 8, 2009
The Market: Why 2009 is a Big Year
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Global credit crisis, capital constraints and volatile energy
prices
Competition for scarce energy, water and agricultural
resources
US political transitioning: Obama’s Agenda
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proposed $150Billion to invest in cleantech
Climate change is a top global priority
The increasing power of emerging economies as buyers
and users of clean technologies
Investing in Leaders
Climate Change Capitalism
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New opportunities to profit arise from cleantech:
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Inefficiencies in global markets for intellectual property
Creating greater efficiencies in energy, water and
agriculture
Rapid global adoption of new technologies
“Climate change is no longer a term associated
with economic stagnation, but rather economic
opportunity …the opportunity to profit from
improving sustainability.”
- Nick
Parker, Chairman, The Cleantech Group.
Investing in Leaders
Global Challenges
Energy Demand
Water Scarcity
Green Development
Investing in Leaders
Opportunity of Global
Challenges
Cleantech:
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Technology Innovation
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Remarkable Growth
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Optimize use of natural resources
Reduce ecological impact
Add economic value
World’s fastest growing investment category
3rd largest venture capital investment category: over 14% market
share in North America; 18% in Europe
Remarkable Profit Potential
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“Rapidly growing businesses in need of capital will create
opportunities for private equity funds to invest in situations that
are not leverage-dependent and which should have lower
valuations in the current environment”- J.P. Morgan
Investing in Leaders
The European Challenge
1Q 2009
 The 16 countries that use the euro
shrunk by a massive 2.5 percent
 Cause: global recession sapped
the industrial exports that Europe
relies on for growth and jobs:
 Germany -3.8%
 UK -1.9%
 Italy -2.4%
 EU-27, saw output shrink by a
quarterly 2.5 percent.
- Pan Pylas, AP Business, Euro zone
contracted by massive 2.5 pct in Q1
To reverse these trends, a strategy is needed
Investing in Leaders
Energy
Energy Demand
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+18% Europe
+63.6% Global
Average
The Lamp, ExxonMobil's quarterly shareholders publication. 2005
Investing in Leaders
Water
Investing in Leaders
Green Innovation
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Green Innovation includes:
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Agriculture
Natural pesticides
Organic and biodegradable consumer products
Materials science
Green Buildings
Pollution Control
Investing in Leaders
Clean Energy Investment
Approx.
€114 Billion
Clean Energy Trends 2009, Clean Edge
Investing in Leaders
Clean Energy Investment
2008 Cleantech Private Equity, Responsible Investor in association with Standard & Po
Investing in Leaders
Changes in EU-15 greenhouse gas emissions by sector
(1990-2005)
Copyright EEA, Copenhagen, 2007
Investing in Leaders
Climate Change Challenge
Investing in Leaders
Sustainable Growth
McKinsey Global Institute, McKinsey Climate Change Special Initiative, June 2008
Investing in Leaders
Global Cost Curve
Vattenfall, Climate Map 2030: Mission Possible
Investing in Leaders
Investing in Leaders
SAIL I: CAGR of 82%
SAIL II: CAGR of 110%
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Problem Solved: Eliminate peakpower requirements due to airconditioning by shifting energy
consumption to night.
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Problem Solved: stranded gas
(methane) from landfills, oilfields
and coal mines is a greenhouse
gas 23X stronger than CO2.
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Problem Solved: Efficient, safe,
economical storage of massive
amounts of electricity to buffer
wind/solar farms, replace peak
power plants, load shift buildings
from peak.
Investing in Leaders
Investing in Leaders
SAIL I: CAGR of 82%
SAIL II: CAGR of 110%
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Problem Solved: Low-cost, lightweight, high-performance batteries
needed for industrial and transportation
markets.
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Problem Solved: Thought
leadership in the cleantech sector
through building networks of
conferences, information, indexes,
advisory services and recruiting.
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Problem Solved: globally affordable
pathogen-free drinking water conveniently
accessible.
Investing in Leaders
Managing Risk
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Invest in cleantech companies that
focus on solving large global
resource challenges
Focus on the Largest Global
Markets: Energy, Water and
Green Innovation
Invest in several stages based on
objective performance milestones
Over time, increase capital
amounts as results are achieved
Maintain a strong buy discipline
with favorable entry valuation
Require strong management
teams and boards of directors
Identify and Exploit Global Market
Inefficiencies in pricing
Identify and Control Strategic
Outcomes: Customers, Strategic
Partners and Exits
Investing in the Sweet Spot
High Risk
High Return
Investing in Leaders
Low Risk
Low Return
High Return
Low Risk
Investment Strategy
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Pursue the largest global markets
Diversify by subsector within cleantech
Evaluate technology on a global basis
Seek out customer-driven companies
Co-invest with high value add partners
Exploit global market inefficiencies
Back Strong Management Teams and Boards of
Directors
Investing in Leaders
Climate Change Investments
For further information or inquiries
Contact: Walter Schindler
[email protected]
00+1 (949) 923-1629 (mobile)
www.sailvc.com