Showing posts with label Investment Funds. Show all posts
Showing posts with label Investment Funds. Show all posts
Tuesday, November 9, 2010
Wednesday, October 13, 2010
Craton Equity Partners (LA)
Cleantech Blog: Craton Barreling Ahead
Being a senior advisor to the firm, I attended last week’s annual meeting of Craton Equity Partners, a cleantech private equity fund manager based in Los Angeles.
While cleantech in its focus, Craton doesn’t take on much technology risk. Rather, Craton generally invests in companies that have largely proven their technologies – or frankly don’t rely much on proprietary technologies – and are already generating substantial revenues, requiring growth capital to build out their business models into sizable scale.
This was illustrated by the stories told by three of Craton’s portfolio companies:
Along with these three presentations by portfolio company CEOs, the Craton senior partners provided their perspective on the state of the cleantech investment markets.
Of note, the Craton partners believe that the collapse of the credit markets over the past few years has yielded good opportunities for its fund to invest equity in companies – some of whom are generating tens of millions of dollars of revenues, and already profitable – that really ought to have been able to secure debt during more normal times, thereby generating attractive risk-return profiles upon which Craton could capitalize. Clearly, Craton was fortunate to have been focused on later-stage private equity opportunities, rather than earlier-stage venture capital opportunities, where the credit crunch has provided no such opening.
The recent addition of Kevin Wall to the Craton team, possessing significant high-level contacts around the world, reflects Craton’s view that many of the best growth and exit possibilities for cleantech in the coming years will occur internationally. This is a sad but entirely legitimate commentary on the state of the U.S. cleantech marketplace: if you want to really do well in cleantech investing in the next several years, you’re going to have to focus a lot of attention overseas.
Consistent with my personal experience, the Craton team noted that the key success factor for their portfolio companies continues to be management quality. Fortunately, they are seeing (as I am) an influx into cleantech of a greater quantity of better talent in the past few years. Of course, this is in part driven by deteriorating economic conditions and opportunities in other sectors of the economy. But, I also sense it’s because many capable people are increasingly drawn to cleantech for other intangible attractions. (I was recently on the phone with an old friend of mine who made a lot of money in real estate and didn’t find it challenging enough – so he’s moving into cleantech. Five years from now, I’m sure this friend of mine will not complain that making money in cleantech wasn’t sufficiently challenging!)
On the whole, it appears that Craton's first fund is doing generally well, and the firm is beginning to prepare for raising its second fund. The question will be whether Craton's good performance on paper (no liquidity events yet) will be able to overcome a very tough fund-raising environment. Given their strong relationships in the California marketplace – where cleantech has the most traction of anywhere in the U.S. – Craton's progress in the coming 12-24 months will be a good barometer of the health of the cleantech investing thesis in the U.S.
Being a senior advisor to the firm, I attended last week’s annual meeting of Craton Equity Partners, a cleantech private equity fund manager based in Los Angeles.
While cleantech in its focus, Craton doesn’t take on much technology risk. Rather, Craton generally invests in companies that have largely proven their technologies – or frankly don’t rely much on proprietary technologies – and are already generating substantial revenues, requiring growth capital to build out their business models into sizable scale.
This was illustrated by the stories told by three of Craton’s portfolio companies:
- Propel Fuels, which is developing a critical mass of biofuel retailing locations – by leasing space at existing gas stations, installing necessary equipment for biofuels, managing fuel delivery logistics, and retail marketing via co-branding – across California, with a view towards replicating this model in other geographic markets in the U.S.
- Petra Solar, which has standardized a photovoltaic product for installation on power poles, thereby enabling utilities to meet renewable portfolio standard requirements while also improving the quality and management of power throughout their distribution grids.
- GreenWave Reality, which is aiming to extend the smart-grid “beyond the meter” and into the home, via a centralized radio-broadcasting gateway at the service entrance and a variety of intelligence-enabled radio-controlled applications throughout the home to manage energy usage.
Along with these three presentations by portfolio company CEOs, the Craton senior partners provided their perspective on the state of the cleantech investment markets.
Of note, the Craton partners believe that the collapse of the credit markets over the past few years has yielded good opportunities for its fund to invest equity in companies – some of whom are generating tens of millions of dollars of revenues, and already profitable – that really ought to have been able to secure debt during more normal times, thereby generating attractive risk-return profiles upon which Craton could capitalize. Clearly, Craton was fortunate to have been focused on later-stage private equity opportunities, rather than earlier-stage venture capital opportunities, where the credit crunch has provided no such opening.
The recent addition of Kevin Wall to the Craton team, possessing significant high-level contacts around the world, reflects Craton’s view that many of the best growth and exit possibilities for cleantech in the coming years will occur internationally. This is a sad but entirely legitimate commentary on the state of the U.S. cleantech marketplace: if you want to really do well in cleantech investing in the next several years, you’re going to have to focus a lot of attention overseas.
Consistent with my personal experience, the Craton team noted that the key success factor for their portfolio companies continues to be management quality. Fortunately, they are seeing (as I am) an influx into cleantech of a greater quantity of better talent in the past few years. Of course, this is in part driven by deteriorating economic conditions and opportunities in other sectors of the economy. But, I also sense it’s because many capable people are increasingly drawn to cleantech for other intangible attractions. (I was recently on the phone with an old friend of mine who made a lot of money in real estate and didn’t find it challenging enough – so he’s moving into cleantech. Five years from now, I’m sure this friend of mine will not complain that making money in cleantech wasn’t sufficiently challenging!)
On the whole, it appears that Craton's first fund is doing generally well, and the firm is beginning to prepare for raising its second fund. The question will be whether Craton's good performance on paper (no liquidity events yet) will be able to overcome a very tough fund-raising environment. Given their strong relationships in the California marketplace – where cleantech has the most traction of anywhere in the U.S. – Craton's progress in the coming 12-24 months will be a good barometer of the health of the cleantech investing thesis in the U.S.
Monday, September 27, 2010
Investment Managers Still Lagging in Response to Climate Change
Investment Managers Still Lagging in Response to Climate Change
California State Teacher's Retirement System (CalSTRS) $130 B
"As a long-term investor, CalSTRS wants to invest in well-managed companies that can address the physical risks of climate change and adapt to the changing regulatory and market realities of a carbon-constrained economy," said Jack Ehnes, chief executive officer of CalSTRS, the nation's second largest public pension fund, with more than $130 billion of assets under management. "Our asset managers need to ask the right questions and critically evaluate how companies are positioned so that we’re sure that our investments will produce outstanding risk-adjusted returns for our members."
The survey was done at the request of the Investor Network on Climate Risk, a network of 80-plus pension funds and other institutional investors who rely on asset managers to manage their investment portfolios. Eighty-four asset managers managing $8.6 trillion in assets completed the survey, including 66 in the P&I top 500 list and 18 others who responded at the specific request of INCR client members.
In summary, the survey found only a few asset managers – MFS Investment
Management and F&C Asset Management plc, among those – that are including
climate risks and opportunities throughout their investment analysis – in their
asset allocation, portfolio valuation, and corporate governance due diligence. Like
companies that are rethinking and retooling their business strategies in response to
climate change, these asset manager leaders are positioning themselves to capture
the opportunities and understand and manage the risks of climate change across
their portfolios.
The vast majority of respondents, 84 asset managers managing $8.6 trillion
completed the survey, including 66 in the P&I 500, are in the preliminary stages
of including climate risk in their due diligence.
California State Teacher's Retirement System (CalSTRS) $130 B
"As a long-term investor, CalSTRS wants to invest in well-managed companies that can address the physical risks of climate change and adapt to the changing regulatory and market realities of a carbon-constrained economy," said Jack Ehnes, chief executive officer of CalSTRS, the nation's second largest public pension fund, with more than $130 billion of assets under management. "Our asset managers need to ask the right questions and critically evaluate how companies are positioned so that we’re sure that our investments will produce outstanding risk-adjusted returns for our members."
The survey was done at the request of the Investor Network on Climate Risk, a network of 80-plus pension funds and other institutional investors who rely on asset managers to manage their investment portfolios. Eighty-four asset managers managing $8.6 trillion in assets completed the survey, including 66 in the P&I top 500 list and 18 others who responded at the specific request of INCR client members.
In summary, the survey found only a few asset managers – MFS Investment
Management and F&C Asset Management plc, among those – that are including
climate risks and opportunities throughout their investment analysis – in their
asset allocation, portfolio valuation, and corporate governance due diligence. Like
companies that are rethinking and retooling their business strategies in response to
climate change, these asset manager leaders are positioning themselves to capture
the opportunities and understand and manage the risks of climate change across
their portfolios.
The vast majority of respondents, 84 asset managers managing $8.6 trillion
completed the survey, including 66 in the P&I 500, are in the preliminary stages
of including climate risk in their due diligence.
Ceres and CalPERS Announce Initiative to Accelerate Corporate Action on Global Sustainability Challenges
Ceres and CalPERS Announce Initiative to Accelerate Corporate Action on Global Sustainability Challenges
Announced today at the Clinton Global Initiative, the collaboration catalyzes a powerful group of investors, corporate leaders and other key market players to propel 1,000 companies to embed sustainability factors into day-to-day decision-making, including operations, product development and global supply chains.
The initiative will include roundtables and forums in California and other parts of the country with companies and investors. Much of the activity will evolve around The 21st Century Corporation: Ceres Roadmap for Sustainability, a comprehensive Ceres report that outlines the urgency, vision and competitive advantages for companies to fully embrace sustainability and 20 key expectations for achieving such a goal.
The Ceres “21st Century Sustainable Corporation” report is a key tool for integrating sustainability into the DNA of business – from the boardroom, to copy rooms, and across entire supply chains. The roundtables and forums will help drive companies to implement key expectations outlined in the Roadmap, including:
Announced today at the Clinton Global Initiative, the collaboration catalyzes a powerful group of investors, corporate leaders and other key market players to propel 1,000 companies to embed sustainability factors into day-to-day decision-making, including operations, product development and global supply chains.
The initiative will include roundtables and forums in California and other parts of the country with companies and investors. Much of the activity will evolve around The 21st Century Corporation: Ceres Roadmap for Sustainability, a comprehensive Ceres report that outlines the urgency, vision and competitive advantages for companies to fully embrace sustainability and 20 key expectations for achieving such a goal.
The Ceres “21st Century Sustainable Corporation” report is a key tool for integrating sustainability into the DNA of business – from the boardroom, to copy rooms, and across entire supply chains. The roundtables and forums will help drive companies to implement key expectations outlined in the Roadmap, including:
- Make energy efficiency and renewable energy the foundation for company operations;
- Design and implement closed-loop systems so that air and wastewater emissions are eliminated and zero waste is produced;
- Require 75 percent of top tier suppliers to meet company sustainability performance standards;
- Dedicate 50 percent of R&D investment to developing sustainability solutions;
- Compensate and provide incentives for top executives and other employees to drive sustainability into the business.
Wednesday, September 8, 2010
CalCEF Angel Fund, San Francisco, CA
CalCEF Angel Fund, San Francisco, CA
Susan Preston and Paul Fox
What is California Clean Energy Fund and what is its interest in early stage investing?
The California Clean Energy Fund (CalCEF) is a nonprofit corporation formed in 2004 to accelerate investment in California’s clean energy ecosystem. Established as a result of the Pacific Gas & Electric (PG&E) bankruptcy, CalCEF seeks to promote the growth of companies developing a wide range of clean energy technologies that will bring economic and environmental benefits to California. CalCEF has a number of programs in place to provide financial and intellectual capital to promising clean energy companies at various stages of the investment life cycle. Of particular note, CalCEF is currently building a later-stage evergreen clean energy investment portfolio that combines thought leadership and investment capital to produce market-based returns and support California’s world-leading policy objectives. A core element of CalCEF’s mission is to identify and address gaps in the clean energy funding cycle. Given the wide and ever increasing gap in investment funding for seed and start up clean energy companies, the launch of an angel fund is a natural extension of CalCEF’s approach to the clean energy market. CalCEF’s domain expertise, its experience in building a clean energy investment portfolio and its relationships with investment managers and clean energy stakeholders position CalCEF to bring critical resources to the Angel Fund.
Susan Preston and Paul Fox
What is California Clean Energy Fund and what is its interest in early stage investing?
The California Clean Energy Fund (CalCEF) is a nonprofit corporation formed in 2004 to accelerate investment in California’s clean energy ecosystem. Established as a result of the Pacific Gas & Electric (PG&E) bankruptcy, CalCEF seeks to promote the growth of companies developing a wide range of clean energy technologies that will bring economic and environmental benefits to California. CalCEF has a number of programs in place to provide financial and intellectual capital to promising clean energy companies at various stages of the investment life cycle. Of particular note, CalCEF is currently building a later-stage evergreen clean energy investment portfolio that combines thought leadership and investment capital to produce market-based returns and support California’s world-leading policy objectives. A core element of CalCEF’s mission is to identify and address gaps in the clean energy funding cycle. Given the wide and ever increasing gap in investment funding for seed and start up clean energy companies, the launch of an angel fund is a natural extension of CalCEF’s approach to the clean energy market. CalCEF’s domain expertise, its experience in building a clean energy investment portfolio and its relationships with investment managers and clean energy stakeholders position CalCEF to bring critical resources to the Angel Fund.
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