Capital Series: Rob Day, Spring Lane Capital

Financial Services

Jul 5

This episode is part of our new Capital Series hosted by MCJ partner, Jason Jacobs. This series explores a diverse range of capital sources and the individuals who drive them. From family offices and institutional LPs to private equity, government funding, and more, we take a deep dive into the world of capital and its critical role in driving innovation and progress.

Rob Day is Partner and Co-founder at Spring Lane Capital.

Spring Lane Capital provides hybrid project capital with equity for small-scale systems and projects across food, water, energy, transportation, and waste markets. They also bring experienced tools and capabilities to help developers and entrepreneurs succeed with their project deployments.

Rob has been around the block in climate tech even before it got its name, and he’s learned a lot of useful lessons. Not to mention, Spring Lane has an innovative approach that plays in the capital gap, that so many people talk about between early-stage venture capital and project finance.

Get connected:
Jason Jacobs Twitter / LinkedIn
Rob Day Twitter / LinkedIn
MCJ Podcast / Collective

*You can also reach us via email at info@mcjcollective.com, where we encourage you to share your feedback on episodes and suggestions for future topics or guests.

Episode recorded on Jun 14, 2023 (released on July 5, 2023)

In this episode, we cover:

[2:36] An overview of Spring Lane Capital and the firm's origin story
[4:49] The large gap between venture capital and project finance
[8:05] Spring Lane Capital's broad approach to different areas of climate
[10:52] Capitalizing early-stage companies, scaling, and the role of equity and debt
[13:42] Advice for entrepreneurs thinking about different types of capital at various stages of a company's lifecycle
[16:06] Triggers for founders to understand when equity is optimal vs debt (Rob's Atlas Organics example)
[22:22] How terms vary with Spring Lane Capital's deals vs more traditional lenders
[24:43] Where first-of-a-kind (FOAK) projects fit in
[30:41] Spring Lane Capital's fund two and its institutional investors
[33:19] Skillsets required to be successful in Spring Lane's capital allocation
[38:23] Success milestones and Spring Lane's role
[40:46] Changing macroeconomics and their impact on Spring Lane's corner of the industry
[43:48] Spring Lane's process, key steps, diligence, etc.
[50:17] Issues with financing FOAK projects and Spring Lane's plans to address them

Jason Jacobs (00:00):
Today on the MCJ Capital Series, our guest is Rob Day partner and co-founder at Spring Lane Capital. Spring Lane Capital provides hybrid project capital with project equity for small scale systems and projects across food, water, energy, transportation, and waste markets. And they also bring experienced tools and capabilities to help developers and entrepreneurs succeed with their project deployments. I was excited for this one, because Rob has been around the block in climate tech even before it was called climate tech. And has a lot of lessons learned, and Spring Lane has an innovative approach that plays in the capital gap, that so many people talk about between early stage venture capital and project finance. But before we start.
Cody Simms (00:49):
I'm Cody Simms.
Yin Lu (00:50):
I'm Yin Lu.
Jason Jacobs (00:51):
And I'm Jason Jacobs and welcome to My Climate Journey.
Yin Lu (00:58):
This show is a growing body of knowledge focused on climate change and potential solutions.
Cody Simms (01:03):
In this podcast, we traverse disciplines, industries and opinions, to better understand and make sense of the formidable problem of climate change, and all the ways people like you and I can help.
Jason Jacobs (01:16):
And with that Rob Day, welcome to the show.
Rob Day (01:19):
Nice to be back. Good to talk to you again.
Jason Jacobs (01:23):
I forget exactly what number, but you were very early when you came on the show the first time. It had to have been 2019, and we were just chatting a bit before we recorded. But I'm in a much different place now. I'm sure you're in a much different place now. And the space is in a much different place now, so super timely to bring you back on and hear the latest. So thank you for making the time.
Rob Day (01:44):
Yeah, absolutely. And in fact, it goes back even further than that. And I don't know if you remember, but when you were first starting to shift into the sector at all, just starting your climate journey. When you and I had coffee down in the coffee shop Render below Cambridge Innovation Center, their Boston office. And you were just starting to hunt around then to figure out what you could do with all of your serial entrepreneurism and where you could take it. And I probably gave some pretty useless advice, but even then it was pretty clear that you were action oriented, had a real bias for action, and it's been just amazing. I had no idea that you were going to turn it into this important voice and community for the whole industry. So it's been awesome to watch as you've come along.
Jason Jacobs (02:24):
Thank you, Rob. That's really nice to say and I remember that coffee meeting well. For a refresher for me and for anyone that might not be familiar with Spring Lane, maybe talk a bit about the firm, the approach and how it all came about.
Rob Day (02:36):
Yeah, absolutely. So basically, myself and my partners have been working together now for well over a decade. Few years back we started Spring Lane Capital after having worked together at a single family office. And I've actually been investing into the sector for embarrassingly close to 20 years now, as a VC, growth equity and now getting into project finance. Basically, Spring Lane came about because through our work at the family office, and through our work with syndicate of family offices that we had helped grow the CREO syndicate, clean renewable and environmental opportunities syndicate.
Jason Jacobs (03:09):
I never knew that's what it stood for.
Rob Day (03:11):
I know. A recurring theme here too is that we're all terrible at naming things CREO, Spring Lane Capital, the family office was Black Coral Capital. It's all a bunch of not very distinguished naming for things that actually end up being pretty cool, and there's a longer story behind that as well. But basically the whole genesis of why we exist is we just kept seeing across all of these efforts to invest in innovation. And to help get innovation out there into the world, that there was among other capital gaps, a particular gap for the first two to three years worth of deployment, true commercial deployment of a lot of these solutions that had been successfully innovated, and commercialized from the sense of, "Hey, there's something that works." And particularly in the solar space, we and others were on the front lines of seeing how third party capital was able to help bridge that gap for rooftop and for community solar, and really unleash a revolution and explosive market growth there.
(04:04):
And we came to realize that the other 99% of the energy, food, water waste, transportation landscape needed a similar role. Not exactly the same capital, but a similar role. That's what we exist to do. We look to be the first two to three years worth of institutional deployment capital, and alongside it growth capital for platforms that are particularly doing things that are sub-utility scale, but that's a pretty wide range. And try to help them graduate as we think of it, to mainstream project finance after us.
Jason Jacobs (04:31):
Now, when you were seeing this gap when you were working in the family office, clearly it's a need from a company standpoint. But did you worry that maybe there was a gap for a reason in terms of it making return producing economic sense?
Rob Day (04:49):
Well, this is where taking the lessons from the solar example was really important. Small scale project finance. And so if you're talking about sub-utility scale. You're talking about everything from a $100 million worth of project capital required all the way down to six figures. Literally, have looked at stuff that's a 100K and smaller. And residential rooftop solar, the projects are quite often only tens of thousands of dollars in cost. You can't do that one at a time like traditional project finance has done things. Traditional project finance, you try to examine every single potential risk factor and you try to check the box on it and assess for it.
(05:25):
It's voluminous amounts of details. And the transaction costs just simply don't allow you to take that one by one approach down to that scale. That's why most traditional project finances, looking at projects that are hundreds of millions of dollars at the minimum, quite often billions of dollars because that's how they can afford the transaction costs. The breakthrough in solar, and like I said, we weren't alone by far in doing this. But the breakthrough in solar was realizing that it was as much about structured finances. Project finance, what I mean by that is you could take all of those details, but standardize them across multiple very similar projects. And then you could essentially underwrite and spread the transaction costs across multiple of the projects.
(06:03):
The gap existed for a reason because nobody had extended that to the other areas. It's not cookie cutter. You can't just take the financing structures of rooftop solar and turn around and say, "Great, now we're doing waste gasification systems using exactly the same deal documents and the like." So the reason it exists is because it is hard work. One of the things we've learned along the way, for instance, is we need to really focus on adding value to the teams, not just say, "Okay, here's some capital, make some good projects happen." So we get a lot more involved with the teams that we partner with, the developers as we termed them, even though they sometimes think of themselves as venture-backed entrepreneurs in many cases.
(06:35):
But to us they're developers because we're focused on projects. But in many cases they're strong executing teams, but they could still use more help. By definition, the role that we're playing those first two to three years, they are quite often having to do something relatively new to them. Even if they're experienced developers, it's a new platform or a new solution that they're rolling out. And like I said, all these things require details. And you really want to make sure that everything is executed as quickly as possible across all of those details. And so we have a whole team that we built out here at our firm now, which we call portfolio operations, which does value creation plans and tries to help these teams see around corners.
(07:12):
We put some money quite often into the company itself, not just into their projects as a means of not only creating some strong alignment with them, but also providing them some more working capital to help them move along. We just do everything we can to help make sure that they're going to be successful. Because that's really what we found is there's almost a real transition point at that two to three year mark. If you can show after two to three years that you've done several projects out of a platform, you've deployed several solutions out of the platform and it's worked well.
(07:40):
And you know how to do professionalized project development and deployment, you know how to do your asset management. I could go on and on and on with a list of things you need to be able to do, but you're really institutional grade. And that you've got a pipeline that could soak up hundreds of millions of dollars of capital over the next few years after that. That's when there's literally billions and billions of dollars on Wall Street and elsewhere, that's just eagerly waiting for that permission to jump in and take the baton from there.
Jason Jacobs (08:05):
So putting aside Spring Lane Capital for a moment and just looking at the space, climate tech is really a misnomer in terms of being a category because our entire global economy needs to get rewired. And there's mitigation, there's removal, there's resiliency and adaptation, there's climate risk. And I know I'm preaching to the choir here, but it's not a type of business, it's every type of business and no type of business. And so when founders are looking at scaling their businesses that are involved in some way in the clean energy transition, how do you think about a framework for understanding what types of solutions there are? I guess this is a Spring Lane specific question. After all, what are the key areas in the clean energy transition and then which ones do you plan and why?
Rob Day (09:02):
Yeah, I'll actually turn a little bit on a head. It's a good question, but like you said, I think this reaches very broadly across all areas of the economy, energy, food, water waste, transportation. Name one line of business that doesn't intersect with those if it's not even directly within those categories. Every service industry needs energy and creates waste, just to pick one example. And so we actually think from a climate perspective, you can have impact all the way across all of those different categories, and we purposely look very broadly. We look at stuff that you would traditionally think of as climate tech. Microgrids, utilizing solar plus storage. We're invested in a couple of electric vehicle related platforms for instance. We are also heavily involved in waste to value. And we've even looked at things such as indoor aquaculture. One time we looked at a platform for doing indoor growing of glass yields for selling to the sushi industry.
(09:58):
That ended up being a little too niche. We ended up thinking that was a little bit too small for us. But one of the things that's different about what we do versus a venture capital firm, for instance. A venture capital firm is typically looking for something that's winner or take all. And they're looking for something that's a very big market opportunity, where the winner is going to take over a billion dollars worth of that opportunity by themselves at very least. And there's so many opportunities here down the tail of energy, food, water waste, transportation, around all of these climate solutions, that number one might not be a fit for venture capital at all. But number two, maybe they're going after a niche, but these markets are so huge that it's a multi hundred million dollar niche. And if you can successfully deploy capital into commercializing those solutions, then you can have still a very meaningful impact without having to say, "Ah, this is the one water treatment technology that will rule them all." Because I personally don't believe that exists.
Jason Jacobs (10:52):
If I were a founder starting a new business in one of these areas. I'll try this again with putting Spring Capital aside. But watch, I'm going to come around and I ask another Spring Capital specific question. How should I think about capitalizing the company in the early stage and as it scales, and what is the role of equity, and what is the role of debt. With the understanding that just because something's optimal for me doesn't mean it's available to me?
Rob Day (11:20):
And the good news is that is not a Spring Lane specific question, so good work. So I'll answer your question, but let me take a little detour along the way. One of the reasons we exist in the first place at Spring Lane, but one of the things that really struck me years ago after having invested into the sector for a while, is that we really didn't have a robust capital ecosystem. And environmental economists by background I tend to think about such things in ecosystem terms. If you look at other sectors of the economy, you have these very robust capital ecosystems, even in traditional energy you saw this.
(11:50):
So I remember back in the pre COVID times, I was sitting at a traditional energy private equity conference. This would've been in the late 2010s, and they had a token green energy panel in the middle of the conference, and so they invited me to come speak. But it was great because it afforded me the opportunity to sit in the back of the room, and listen to these other more traditional energy PE folks talk about what they were doing. And I remember sitting in the back as one conference participant raised their hand and asked one of the energy PE folks, "Hey, with oil at blah, blah, blah," whatever it was at that point in time, "where should we be looking to place capital?"
(12:24):
The answer that struck me was the PE investor said, "Look, I could give you an answer right now. But the point is that at any point in the economic cycle, there's various ways that we can play. We can do upstream, midstream, downstream, end use, and then within that there are different geographies, different basins, and even within that there are totally different risk reward profiles and stages at which we can invest." So at any given point in the cycle there's somewhere that we can invest in. And at that point in time at least I was sitting in the back of the room saying, "Yeah, wow, we are totally missing that in clean energy." We have venture capital, and we have project finance, and we have a massive almost insurmountable gulf in between. And it becomes really, really hard if you're in the shoes of that entrepreneur to know how to manage that.
(13:05):
And in fact, one of my personal theories is that the collapse of the cleantech bubble in the mid 2000s was driven as much as anything else by the fact that out of necessity, people were pouring hundreds of millions of dollars of venture capital into steel in the ground, and just a horrible cost of capital mismatch there. Fast-forward to where we are today and I know I spent a few years talking about it, but now it's starting to come to fruition. You do start to see at least the beginnings of that much more robust capital ecosystem. You've got different flavors of venture capital obviously, although that hasn't really shifted that much in terms of its structure, nor should it. But supplementing that now you have much more active forms of venture debt, more creative venture debt.
(13:42):
You also have now early project finance, you've got project equity, you've got project debt. Obviously, growth equity, and then we saw a wave of even more larger capital forms. And now we're starting to see more majority transactions come into the space as well. What you would traditionally think of as private equity. Sometimes it's buyouts, sometimes it's just a majority investment that's not a buyout. The point being if you are the entrepreneur thinking about, "Okay, I have this idea." You need to be thinking about the different types of capital that you're going to require at the different stages of your company's life. In the early going, depending upon the gestation period of your innovation, you might not even want to go to venture capital at all. You might be looking more towards non-dilutive grants and perhaps angel investors who will be more patient, perhaps PRI investors, parametric related investments, depending upon how accessible those are. Once you're ready for venture capital, if you are going to be a venture capital type company, like I said, actually for many companies, venture capital is never the right fit.
(14:40):
But if you are going to do venture capital, you need to bear in mind that then you're basically promising, "Hey, my goal is to sell this company or IPO it within five to seven years." That's at least the goal, and you have to be okay with that. You have to be okay with ultimately you're going to be doing that, or at least doing your best to do it. But you want to minimize the amount of venture capital, because it is the most expensive form of capital out there that won't end up getting your kneecaps broke.
(15:03):
Venture capital is traditionally looking for at least 35% IRRs to give a sense of the cost of capital. And your goal is to figure out how quickly you can get, assuming you're doing something that is the deployment of physical assets. If you're talking about waste gasification, or batteries, or electric vehicles or anything. But eventually, you're taking physical things and looking to put them out into the world or you're looking to sell them to people who are. You need to either yourself or those deployment partners, you need them as quickly as possible to be able to access, like I said, the billions upon billions of project finance out there. Which to give a sense is probably more in that high single digits, low double digits cost of capital range in contrast to the 35% RRs of venture capital that I described before.
(15:45):
So that's really the name of the game. And what we saw in the solar space, and now we started to see it in some of the other sectors as well. Is when you can successfully navigate that sort of capital life cycle through the ecosystem, then all of a sudden you can really blow the doors off of what you're trying to do. And then you can start to have meaningful scale that actively impacts the climate problem.
Jason Jacobs (16:06):
So what are the triggers as a founder to know when equity is optimal and when debt is optimal? And then once I determine that debt is optimal for something that I want to build, I'll call it a project. You mentioned a number of different sources of debt, or actually you mentioned some sources of I think you called the project equity. How do I navigate within the non venture capital bucket what the best sources of capital might be for my project?
Rob Day (16:36):
Yeah, absolutely and great question. And it's one of the things that a lot of people don't really understand until they've had to live it, that there are such things as project equity and project debt that are separate from the corporate itself. So let me make it tangible, tangible example. We invested into a company that does composting, really prosaic stuff. So we don't have to get distracted here around technological innovation, because there's no technological innovation involved here. You're taking food and lawn and waste at municipal scale, you're diverting it from the landfill, you're chopping it up. You are aerating it correctly using literally just PVC pipes and blowers. You're moving it around using bulldozers and that's pretty much it. And if you know how to do that correctly, you're taking trash and you're making some really nice compost out of it. This is a real business we invested into called Atlas Organics, this was a few years back.
(17:25):
When we found them it was a young team that had successfully done a little bit of this, but only a little bit of this because it required more capital than they had access to. This is two entrepreneurs, Gary and Joseph, two self-proclaimed composting nerds like we all are. And they had started doing this literally out of their dorm room just managing some municipal scale composting plants. But just as an outsource service provider came to realize that if they actually owned and operated some of these municipal scale composting projects themselves, then that would be a lot more lucrative because they could get paid to take the trash away from the landfill. And then they could get paid for the compost that they could make. The problem is each of these projects was several million dollars, and while they could have done maybe a couple of them with venture capital, composting isn't the hottest venture sector in the world, number one.
(18:11):
And number two, they had aspirations to really roll this out at scale across multiple projects, and then you pretty quickly get to some pretty hefty amounts of venture capital. And so we came in and partnered with them. We provided them a bit of venture capital alongside some groups like Gratitude Railroad, that were also really strong supporters of the team. But we provided them the capital on the project side, to take it from a couple of smaller projects to then eventually being in eight projects across the US Southeast. So what does that look like?
(18:40):
They were able to raise venture capital, think of it as corporate equity in specialized form. They were able to raise a little bit of supportive working capital debt at the corporate level. So this is somebody like a Silicon Valley Bank lending working capital to Atlas Organics the headquarters. But meanwhile they're trying to build these projects and let's say it's a 10 million composting project, you quite often can't get a 100% debt on that. Almost never can you get a 100% debt on that. Debt is so incredibly risk averse, that they want to know there's somebody there who's going to lose money first before the debt loses money.
(19:12):
Once you get further along, you can get leverage, and maybe you can get more and more leverage as it's termed. But you'll almost never get a 100% leverage on one of these projects. In fact, in the early going, you often can't get any project debt at all depending upon the size of the project, and what the track record is of the platform. And so what you typically need is some form of project debt alongside some form of project equity. This has been solved a lot of times in the past, especially at the smaller scale, by effectively taking venture capital overfunding into the headquarters, into the actual company itself with venture capital. And then turning around and putting some of that in the form of so-called sponsor equity, to be the project equity to enable the debt.
(19:52):
So 10 million project, let's say you're really good and you can get 90% leverage, nine million of that can be project debt from maybe just Live Oak Bank or another type of project lender out there. You still need to find that other million dollars of equity. And like I said, traditionally, that had been solved by sponsor equity. But again, a project area project there, and all of a sudden you're carrying a whole bunch of project equity on your balance sheet. And if the projects are returning attractive project returns let's say like in the 20% IRRs for the equity IRRs. But your venture capital is expecting 35% returns, that's a losing proposition.
(20:26):
It may be a worthwhile investment, but it's a losing proposition just on the face of it. You're taking 35% return capital and you're turning it into 25% returns. How does that make sense? So that's where you need to think about, "Okay, well how can we access that project equity?" And like I said back in the 2000s the answer was, like I said, just more and more venture capital, let's finance stuff that way. And we all saw how that ended up. We exist because a million dollars, $10 million worth of project equity is just impossible to raise one at a time. It's so painful. We when were at the family office, we had entrepreneurs that we had backed as venture capitalists.
(21:02):
We'd come back to the board meeting and say, "Yay, I sold a $20 million project." And you're like, "That's great. That's awesome. Congratulations on selling a $20 million project. That's terrific. Where should we send the celebratory balloons and cake and stuff? Oh, thank you, thank you. By the way, now I need $20 million." I'll give you just another example of a company ours that we invested in Aries, these are experienced project developers. They had a waste gasification technology they were trying to roll out, and they came in seeking a 440 million round of venture financing. And we heard them out and we said, "Sounds cool what you're doing, but you shouldn't be raising $40 million of venture capital. Why are you trying to do that? And we're not going to do that?"
(21:40):
Well, it's exactly the story I just said. We actually need a series of sponsor equity checks to build these things. And we said, "Why don't you raise that as a sidecar pool of project equity instead?" And they said, "We knew that's what we needed. We would love to do that, but nobody will do that for us." So that's why we exist at Spring Lane. I did bring it back to Spring Lane, sorry, but that's why we exist to fulfill that role. But there's other folks, if you're doing more utility scale types of things, then you might need to figure out how you can bring in a corporate investor to be that project equity. Maybe somebody like a Breakthrough Energy Catalyst can help you with something like that now. And like I said, this is exciting times because we are starting to see this more robust capital ecosystem come together, to help solve those needs without always having to revert to venture capital.
Jason Jacobs (22:22):
And when it comes to the actual terms for these projects, it sounds like you're playing with these smaller projects where the processes of these bigger check, more traditional lenders would be too prohibitive, too costly for them to run for these smaller projects. So do the terms tend to vary with a Spring Lane deal versus say a more traditional lender and if so, how?
Rob Day (22:45):
Yeah, so they do tend to vary. We can quite often play that actual project equity role ourselves. So what we'll do to solve that is we'll partner with one team, one startup, one developer, however they view themselves. And then we'll say, "Look, we'll back a series of your projects." I describe it quite honestly to folks oftentimes as we're in the business of pain arbitrage, we'll partner with you on the painful first one. And then we're all going to benefit from the next few after that. And then we will also help you arrange the project lending, so we can spread that capital out and maybe overall reduce the cost. So that's how we do it. But yes, the terms will vary if you're thinking about more sort of eventual traditional project finance that you're going to get. And that quite often those traditional project financiers will want to provide pooled capital as well.
(23:29):
But for us, I just flat out tell people, "We're expensive project equity. If you already have access to project equity you probably don't need us. And that's fine, that's great, that's a great sign if you are to have access to it. But if you don't, that's probably where we can play." Oftentimes too, the companies need much more creative financing than just project equity too, so we can help provide development capital. Traditional project finance, you can really overstate into two terms. You got the phase of developing the project before it's ready to construct, and then you've got the phase of construction. The point in between is called NTP, Notice to Proceed. And traditional project finance really wants to step in at the point of NTP, or even come in after the project operating and purchase the project essentially then.
(24:09):
Whereas we can provide some of that development phase capital before construction in some cases as well, or we can provide so-called revolver working capital, but specifically aimed at deploying assets as opposed to the working capital to just help at the headquarters level. And so the smart entrepreneurs in this sector will need to get very facile with all of these terms, if they're doing anything related to the deployment of physical assets. Because it ends up being really important to understand how all of these different pieces can come together. It's a quite complex puzzle by the time you get to actual deployment.
Jason Jacobs (24:43):
We talked about the large gap between the venture capital and project finance. My sense, and correct me if I'm wrong is that Spring Lane plays in that intersection, but doesn't fully fill that gap. And as one data point recently, I think I tweeted and posted on LinkedIn that we had a survey for people to fill out that need, first-of-a-kind plants built. And people came out of the woodwork from all sides, including a laundry list of the logos of the most impressive companies in climate tech are certainly the most household names of them. So it seems like it's not a solved problem. So which aspects of it does Spring Lane address, and then what's left there that Spring Lane does not address, but still needs to be addressed in other ways?
Rob Day (25:29):
That's a great question and it's one that the entire industry is wrestling with right now. So you almost need to put first-of-a-kind projects in a special category and also define them really well. People even mean different things by that. Are you talking about a pilot? Or are you talking about the first commercial scale plant? Then you've got the issues around scale. Is this the first 10 million distributed wastewater treatment plant that you're putting out there in a commercial way. Or is this the first billion dollar sustainable aviation fuel plant that you're building? Those are two very, very different problems as well. For us we are at the end of the day traditional project finance. We're willing to extrapolate and come in a lot earlier than others. But at the end of the day we view the world through a project finance lens. And we and everybody else have really struggled at trying to figure out how to make good risk adjusted returns off of a true first-of-a-kind project.
(26:21):
Now what I mean by a true first-of-a-kind project, is here is the first time we are taking proprietary technology and putting it into a truly commercial scale plant. A truly commercial scale project. So to use that distributed wastewater treatment example. We've proven out the technology, we've done it at the bench scale, we've done even perhaps a pilot. This is the very first time that we are actually going to build a box that is going to go behind a cheese making factory, and treat their wastewater before it goes into the sewer. It's the very first time that we're going to not only do that to show that the technology works. But also sign a 20-year contract with that cheese factory, so that they know their wastewater is going to be treated. When I describe it that way, you can start to get a sense of the risks here.
(27:06):
It's not just the risk of will the technology work. I think you could probably look at those precursor bench and pilot facilities and say, "Okay, the technology works." But if you're truly trying to make good project returns, you need to not only know that the solution works, you need to know exactly within what specs it works, what uptime it's going to get, do you know how to actually construct the project? Do you know how to actually do it on time, on budget? Will your operating expenses be within parameters? And all of a sudden you're in the world of those voluminous details around exactly how that project will make the expected amount of money. And that entails a lot of unknowns, and unknowns look like a lot of risk. So you asked about the gulf between venture capital and traditional project finance. I remember vividly in the 2000s, in the heyday of the cleantech boom back then. Sitting in rooms full of much smarter venture investors than myself.
(28:00):
But just looking back on the... and just the gas at the amount of hubris, that we were all exhibiting back then. As there was this sense of, "Hey, all we got to do is just fund enough to show that the technology works, and then project finance takes it from there and then we're off to the races." It turns out that venture capital races to be the first to do something, whereas project finance races to be the 10th to do something. And so there's a pretty wide gap between there, and it all comes down to not just will the actual proprietary technology quote work. But does all of that stuff come together in a way where you can make very predictable returns. And de-risking from one to the other is what creates a massive gap between venture capital and project finance. So we try to address some of that gap to your question, but we're typically backing facilities number two through 10, for instance, to grossly over generalize.
(28:49):
But what I will say on the first-of-a-kind thing is while I think everybody's struggling with how to figure out how to make good market type risk adjusted returns off of them. Everybody in the industry sees it as such a massive problem, that there are lots of conversations going on behind the scenes right now, with lots of different very smart groups trying to figure out how to address that problem. Because we all see that gap, we all see the gap between, "Hey, I showed that I can build something that works," to, "Hey, now I've got 300 billion worth of Wall Street capital for the next 10 deployments of it."
Yin Lu (29:23):
Hey everyone, I'm Yin, a partner at MCJ Collective. Here to take a quick minute to tell you about our MCJ membership community, which was born out of a collective thirst for peer-to-peer learning, and doing that goes beyond just listening to the podcast. We started in 2019 and have grown to thousands of members globally. Each week we're inspired by people who join with different backgrounds and points of view. What we all share is a deep curiosity to learn, and a bias to action around ways to accelerate solutions to climate change.
(29:50):
Some awesome initiatives have come out of the community, a number of founding teams have met, several nonprofits have been established and a bunch of hiring has been done. Many early stage investments have been made, as well as ongoing events and programming. Like monthly women in climate meetups, idea jam sessions for early stage founders, climate book club, art workshops and more. Whether you've been in the climate space for a while or just embarking on your journey, having a community to support you is important. If you want to learn more, head over to mcjcollective.com and click on the members tab at the top. Thanks and enjoy the rest of the show.
Jason Jacobs (30:24):
Two different vectors I'd love to dig into. One of them is more along what we were just talking about, the general first-of-a-kind and best ways to address it, and the other is more Spring Lane specific. So why don't we start with the Spring Lane and then we can come back around. So just a practical matter, but what fund are you investing out of and what size is it?
Rob Day (30:41):
Yeah, so we're investing out of fund two. Our first fund was a little over 150 million. Fund two is still officially fundraising. So I can't talk about it in too many specifics, but should end up being about double the size of fund one. We've already done a number of first closes, and we're already investing out of it and we've already got several portfolio companies in fund two.
Jason Jacobs (31:01):
Got it. And what types of investors tend to invest in this type of fund, and how much overlap is there between the types of investors that would invest in a fund like this versus a more traditional venture fund?
Rob Day (31:16):
We are mostly institutionally investor backed, and that's one of the things that's a real differentiator. I described our role from the entrepreneur's perspective in helping to bridge that gap between being venture backed to being able to access traditional project finance. From the institutional investor role, they see that there is this whole revolution in decentralized climate solutions. And decentralized sustainability that they can't really tap into because of the size of the projects. If you're talking about true institutional investors out there, the pension funds, the endowments, the sovereign wealth funds, they oftentimes have minimum check sizes that make it difficult for them to get into smaller scale stuff. And so that's partly why we exist. We exist to open up that avenue for them to be able to access this opportunity, because everybody can see that the fastest growing areas of energy, food, water waste markets are the smaller, more decentralized types of solutions. And there are good reasons for that we could get into.
(32:10):
When we are providing them that access we're also saying, "Look, we're going to give you to the best we can, the types of risk adjusted returns on par with what you would expect." So yes, they are quite often invested as well into venture capital. But these are very large investors who also invest in a traditional real assets, invest into traditional project finance. And they think about things on a capital efficiency curve, and risk and reward, and asset allocation within all of those different buckets. And one of the things that has been I will say a challenge for us in fundraising is that we don't fit neatly into any of those buckets.
(32:48):
We do put money into companies in the form of venture capital sometimes. We put money into real assets if you think about it that way. We put money into infrastructure if you think about it that way. And so where we have found the right fit with institutional investors, it's generally those who know that they need to address climate as one of the major long-term megatrends. And they're trying to find smart ways to address that. Not necessarily sort of tick a box, "Okay, yes, let's go find 12 venture investors and 12 of this and 12 of that."
Jason Jacobs (33:19):
When it comes to the skill sets that are required to be successful in this type of capital allocation versus traditional VC, what are the main differences?
Rob Day (33:29):
Like I said in my background, I actually spent the first major part of my investing career as a VC. I used to own most of the cleantech VC URLs for instance. That's kind of how I learned how to view the world. It is very different how we need to view it. Now, there are some similarities. But one of the reasons why we ended up tackling this particular challenge from our team here at Spring Lane Capital is because we actually do have a unique mix of backgrounds, that lends itself well to the particular role we're trying to play. So my background and being able to assess a market opportunity in a pipeline of sales prospects and project prospects and things like that, that very much fits into the traditional growth equity wheelhouse when it comes to diligencing and pattern recognition. But then there's my partner Nikhil,, who has much more of a project and structured finance background, and you can see how that would directly apply to what we do.
(34:17):
And then there's my other partner Christian, whose background is really around management teams assessing high executing management teams and helping to augment and coach them, that really comes together. So ultimately, at the end of the day backing execution platforms, if we're looking at deployments. And you really need all three of those skillsets, so another way to ask the question you've asked is why can't venture capitalists do this? Or alternatively, why can't traditional project finance do this? Because that's the two directions and we get asked that question a lot.
(34:43):
Venture capitalists honestly not only don't have the project finance skillsets to understand this, oftentimes it's even like a massive cultural difference. Venture capitalists give the advice to entrepreneurs, move fast and break things. Well. hen you start deploying projects, you better not be moving fast and breaking things. You better be moving carefully and not breaking things. Just understanding all of the ins and outs of even the contracts that you need, the contractual structures that you need, to be able to leverage to do this in a way where traditional project finance, when you are ready to hand it off to them will say, "Yes, all right, great. We understand how that works. We're ready to take the baton from you and just carry it from here." That's something that in my experience, almost no venture capitalists quite understand, and that included myself until I had to start doing it.
(35:25):
Traditional project finance not only is there that scale problem, that means they have a hard time stepping in. But also, like I said, it's hard for them to extrapolate. If we're stepping in and doing projects two through 10, we're able to step in with more of that sort of growth equity mindset and leverage. Independent engineers and a whole lot of expertise and a whole lot of our portfolio ops teams, time and the like to step in and say, "Okay, we are satisfied that this will work if we roll up our sleeves and help make it happen." Traditional project finance is not prone to saying, "Great, let's roll up our sleeves. Let's get involved in the nitty-gritty."
(35:57):
It's more like, "Okay, show us that you've got just a box that you've proven if you put money on the top of the box, and you turn the crank on the side of the box, then more money comes out the bottom of the box. That's all I need to see. I don't even really care what's in the box." And so that's a very different skill set of being able to step in at these relatively early growth stages. And appropriately assess the opportunities and work with those teams in partnership to make those first few deployments successful. That's just generally not a skillset set that traditional project finance has either.
Jason Jacobs (36:25):
If you get brought an opportunity and there's traditional venture on the cap table already, does that make it a stronger prospect, weaker prospect or irrelevant?
Rob Day (36:37):
Depends on the VC, but, no, we actually love being part of a syndicate with good value added VCs. As being longtime investors in the space, and through our activities with CREO and everything else. We have a really good network of folks within the venture community. And what we've seen happen over the last few years is a lot of those folks understand now like, "Oh, okay, this is how we can leverage the kind of capital that Spring Lane and others are bringing." And make it where we don't have to plan to carry forward this whole company through to exit by ourselves with venture capital.
(37:08):
And that's great. And along the whole line of thinking that I was talking about before with a more robust capital ecosystem, we're not trying to replace VCs, we're trying to augment VCs. And so what that means is if a VC is looking at an opportunity that they've invested into, but they're starting to realize, "Hey, we're going to need a $100 million to actually put this thing in a position to exit." Because we're going to have to deploy a bunch of asset projects or whatever along the way, then you don't have to think about, "Geez, how are we going to raise a $100 million dollars with a venture capital into this platform?"
(37:37):
You can think instead, "Hey, maybe 10 of that, 20 of that is venture capital, but maybe there's other options for the deployment of those assets that we can leverage that we can tap into." We actually, there's a strong VC around the table already. We love that, these companies are going to need all the help they can get. I'm an old school investor. I remember back long ago to when venture capital was acknowledged around the table as it's really hard to successfully grow a company from scratch, and get it to being relevant in the world to getting to Main Street. And it's going to take all of us working together collaboratively to do that. I think sometimes a little bit of that spirit has been lost in the commercialization of venture capital over the past few years, but we still feel strongly about that. It's going to take all hands and different perspectives to make these things be successful.
Jason Jacobs (38:23):
What does graduation look like in terms of if you do come into one of these rounds, what is typically the next success milestone? And then what is spring lane's role directionally at that milestone and beyond, if any?
Rob Day (38:35):
Yeah, so one of the things that is really core to us at Spring Lane is thinking about alignment. One of the watch-outs for these young companies as they start to engage project finance is quite often the relationships get very oppositional very quickly. Because ultimately, at the end of the day, the company is going to try to get as much of the returns off a project as they can. Meanwhile, the project finance wants to get as much of the returns off of the project as they can. And you could see where if you don't really think about alignment up front, you could get at loggerheads with each other. We know from having been on all sides of the table ourselves how important alignment is. And so without getting into the nerdy details, we actually structure our transactions to create a lot of upside for the teams that we partner with even on the projects themselves.
(39:17):
And then, like I said, we quite often put money into the company itself as well so that we're putting our money where our mouth is. And then the biggest thing is just we just have a firm philosophy, a very shared goal of obsoleting ourselves. Let's help get you to mainstream project finance and then not only with our blessing, but with our help let's bring that in as attractively as possible for you. So I had mentioned Atlas Organics, the composting guys. That is a perfect example of how this worked out, after we had helped them expand across the southeast with that number of projects is composting. Not what you traditionally think of as being like a hot exit area. The projects were humming and you could see a nice pipeline, and a bigger project finance firm came in after us and said, "We love what you're doing and we'd love to put a couple of hundred million dollars behind taking this nationwide."
(40:04):
That was a really good fit for Gary and Joseph and what they wanted to do. It involved actually buying the platform itself, buying the company itself. And then allocating a whole bunch of dollars, like I said, to additional projects. That ended up being a very nice outcome for Gary and Joseph, and we were glad to see it. Our projects that we had backed were doing very well in order to attract that kind of attention from folks downstream of us. And that particular case too, they ended up buying out our existing projects when they did that transaction, but it doesn't have to be that way. Very happy to be just the owners of well humming projects for the long term, if that's the right fit as well. Puts us in a position of welcoming in the new capital behind us and saying, "Great, now we're going to sit back and look at an even stronger platform running our projects." That's awesome too.
Jason Jacobs (40:46):
And if you look at the changing macro over the last, I don't even know how long at this point, six months or a year. How have you seen that affecting your corner of the industry? We've seen for example, that if you are a DTech company that is going out for a B and you're not commercial yet. You could be working on the most disruptive, exciting, potentially game-changing thing in the universe with an exceptional team and good early execution, and you're going to have a real tough time. What are you seeing out there as it relates to project finance and other forms of lending?
Rob Day (41:20):
It's really a tale of two cities right now, and even within that two you got to think short term, medium term, long term. Right now, there's so much dust in the air from various things, just what's been going on with the Fed and inflation, what's been going on with commodity pricing cycles and just overall capital markets. A lot of people are just pencils down very short term right now across all the categories. And I expect that to be very short term, but I think we've seen these market transition phases in the past. And they tend to just have people just go quiet for a quarter or two and then they're like, "Okay, well now we understand the new normal and whether it's attractive or not, now we can at least get back to work." In the medium term, there is that question of, "Okay, well, is the new normal attractive or not?"
(42:00):
And continue to see all sorts of talk about how people are expecting recession to hit and not necessarily be in a attractive low, cheap capital market like we were in over the past decade too. And so not necessarily back to boom times right away. That's where I talk about the tale of two cities, because I think a lot of people out there are really excited about investing. And I'm talking about institutional investors and then therefore downstream of them. The people who take money from institutional investors like venture capitalist, private equity infrastructure. They're all very excited about the long-term megatrend around investing into climate solutions, investing into energy transition, decarbonization. A lot of them now have mandates to do that, and so they're actively looking for that while at the same time, and this capital market situation we're in, that's generally pulling back capital allocations too. So we see a lot of push and pull in that medium term where some of the platforms, some of the asset categories. There's lots of capital for instance with infrastructure, there's actually a massive capital overhang. There's so much dry powder out there in the infrastructure industry.
(43:02):
We see them still actively trying to come into the sector with big checks, and that's where you see a lot of these big announcements from a platform saying, "Hey, we got BlackRock for $200 million," or something like that. So there's still a lot of that happening, but if you are smaller, if you're more sort of venture, because venture is particularly hurting right now Like you were talking about those earlier deep tech startups, that's going to be tough for 2023. And then over the long term though, it's very obvious that this is the next industrial wave. I would put it up there alongside the other darlings right now of AI and the like. It's just very obvious to everybody that this is going to require trillions of dollars of capital to address. That it's going to come about in various ways, and across all of these different asset categories, this is going to be just a real megatrend.
Jason Jacobs (43:48):
One more spring lane capital specific question, and then we can switch gears to that last topic I mentioned around first-of-a-kind. I'm wondering if you can just give me a hypothetical or even a real case study of from time of introduction, what does your process look like? What are the key steps and what are you really after from a diligence standpoint? And I understand that to get the real answer, it would take a lot more than the time we have allocated for this show. But even just a summary cliff notes version I think would be super interesting for me and for listeners.
Rob Day (44:17):
Absolutely. And in fact, one of the things that we've started to do, because this is such a mystery to a lot of entrepreneurs out there. There's like a thousand different accelerators and training programs and the like, aimed at helping entrepreneurs figure out how to use and get access to venture capital. Name one that's out there currently that exists to help entrepreneurs understand and access project capital. Just one. And really, there aren't any. So we've started to do that. We have launched a series of events that we call Developer U. We bring together for each one of them, a couple dozen entrepreneurs that are getting close to that transition point, and then it's a full two-day seminar in person. We bring in outside experts, our own internal experts, and we go soup to nuts through everything you just asked about. So that's two days worth. So I can't possibly address all that right now.
(45:04):
But it's not intended to at the end of two days, "All right, now you are an experienced project developer. Perfect, you know everything you need to know." But instead it's like, "All right, now you at least know what you didn't know." Now you know how you're going to need to build out your team to be able to accommodate this. Now you're going to know what kinds of questions you're going to need to be able to answer. Even things like figuring out your contracts correctly, so that you are underwriteable from a project finance standpoint. And so that gives a little sense as to these are not series B transactions. When we start talking with, we would call them a developer or maybe they call themselves a startup. Maybe they call themselves a business. But when we start talking with them, it's a lot of first just, "Hey, is there a mutual fit here at all?"
(45:44):
Because we're not trying to be all things to all people. We're trying to play a particular role within a particular capital gap that's out there amongst all the different things. And like I said, I tell people all the time we're expensive project equity. If you already have access to that you probably don't need us, and that's great. First there is the sort of like, "Who are you? What do you do?" Mutual conversation both directions as people are learning this. That pretty quickly though, if there is a potentially good fit, we get into everything from project modeling to understanding the actual technology and solution itself. We will eventually bring in independent engineers, for instance, to be able to get down into not just the, "Hey, will you give a thumbs up or thumbs down? Does this technology work?" But actually what are the underwriteable specs that we can expect to be able to build into our financial modeling here to figure out if this is an attractive project?
(46:28):
We spend a lot of time on team. We have a whole approach, like I mentioned, my partner Christian's background to doing deep dive interviews, to understanding strengths and gaps across the senior management team members of one of these top cos. And then everybody's got strengths, everybody's got gaps, then come up with a plan of, "Okay, well, where are we going to need to continue to build out the team over time?" Because there are gaps. Obviously ,a ton of thinking through the master contribution agreement, the operating agreement. There's just a whole lot of then structural details that have to come together. And that usually involves a lot of conversations too. Because unlike venture capital with project finance, there's so many different levers that you could play around with to create the mutual fit and alignment. It just takes a lot of talking through the details on that.
(47:10):
Do you guys as the entrepreneurs, do you want more upside or do you want more guaranteed returns? That is just the simplest form of that trade off. A lot of talking with customers, a lot of looking into the market, stuff that would be more traditional, like growth equity type of diligence as well. So these are typically three or four month cycles to get an actual deal papered and done. It's actually two transactions at once because like I said, we quite often end up putting money into the company themselves, but we also want to be assessing a first project. We don't go around and just say, "Okay, well here's some venture capital dollars. Please bring us projects down the road. We typically want to see at least one project that we can invest into simultaneously." So we got to diligence that as well. Where are your permits?
(47:48):
Everything that gets into the real world details about actually putting steel in the ground. These are series Bs. But this is what that team needs to get used to if they want to access billion dollars worth of project capital down the road, because that's exactly what that looks like at that scale as well. And we're actually much more accommodating and flexible and willing to roll up our sleeves, and work with folks and explain stuff because that's our job, that's what we're supposed to do. And so that gives you a sense there as to how those projects and transactions work. I'll give you a real world example. We just partnered with a company called Spring Free EV out on the West Coast. They are basically a financing marketplace for all of these small and medium-sized commercial fleets that are out there, starting with the ones that are more sedans and focused.
(48:31):
So think about ride-sharing and taxi fleets and things like that, matchmaking those potential electrified fleets as they try to go electric with capital that's eager to be put to work in the EV revolution. In partnering with them, we're providing the first slug of that capital ourselves to enable that. But we're also taking a really active role in working with that team saying, "Okay, great. Well, how can we best prepare you for being able to access lots of capital after us? How can we help really hone you as essentially a FinTech platform in terms of getting to very predictable metrics, very predictable outcomes, what's your conversion rate, how's your utilization of vehicles, et cetera, et cetera, et cetera."
(49:11):
And all of that had to be thought through, of course, even before we were able to pay for the deal with them. But this is a long time entrepreneur in the sector. Sunil Paul and just an all-star team, and they've been phenomenal to work with. Sunil himself said, "Look, I get it. What you guys are trying to be is the Anderson Horowitz of project finance in the cleantech space." It's like, "Yeah, that's aspirational, but that's at least where we're trying to go."
Jason Jacobs (49:33):
And you mentioned that you're not the first-of-a-kind firm, but more two through 10 or two through 12. I forget what you said. But getting back to that first-of-a-kind, you mentioned that there's a bunch of smart minds trying to figure it out. Because even though on an island it might not be a great place to get proper risk adjusted returns, it is such a detriment to the overall category that people that are putting money to work, in other places up the capital stack are exposing themselves by not addressing this problem. So given that context what's your take on some of the more promising or more logical ways to address that gap to the extent you thought through it?
Rob Day (50:17):
You will see us get involved in that. I think it probably won't be out of our main funds. And like you're saying it's such a clear unmet need out there in the marketplace, that is holding back the commercialization of a lot of really promising innovations, it needs to be addressed. And you see folks like Breakthrough Energy Catalyst addressing it, but only for their specific few verticals. You see Prime Coalition now looking to address it as well in some interesting ways.
(50:41):
You're going to see some others as well, and you'll probably see us get involved in it as well. Let me first start by illustrating the problem, and then I'll use that to talk about some other ways that you can potentially address it. But there was a really promising recycling technology. I won't name names here to protect the innocent. But there was a really promising recycling technology a few years back that had been proven out at a demonstration plant, but not quite fully commercial scale. But still this wasn't like in a lab or anything, been proven out.
(51:06):
It was actually moving stuff around and sorting it and recycling it. And it got invested into by a project finance firm for their first commercial scale plant. They'd had an off tick agreement, basically their agreement with a local municipality to host and to pay them to take the trash and everything was hunky-dory. Except then we got a call a half a year later, this plant was supposed to be about $30 million in cost. And we got a call half a year later from one of the investors like, "Would you guys be willing to put 10 million into this plant to our? 'Why?' Well, we've kind of hit some snags." And it turns out that translating even demonstration scale to full on commercial scale just involves engineering challenges that were unforeseen. They even got the diameter size of pipes wrong, even really basic stuff like that, that meant that all of a sudden they face significant time and cost overruns, and that just blows up the economics of a plant.
(51:59):
So if you want to put $50 million into building the first of something, you can accomplish that, you can build it. Can you make good risk adjusted returns off of it? That's where I think the struggle is. That plant if it ever got fully built, I'm sure it's working and it's recycling stuff, happily, just the people who invested into it made no money off of it, and that's a loss. Especially, if you're project finance oriented and you went out there saying... Unlike venture capital, which is like, "Hey, six out of our 10 in the portfolio failed, but those other four made up the whole fund." That just doesn't exist in project finance. You cannot have a failure rate like that. And a failure is not just a zero, a failure is failed to get to the promised returns. And so that gives an illustration of how first-of-a-kind is just really devilish.
(52:40):
And like I said, you're working with entrepreneurial teams who typically haven't actually built the thing or worked with EPCs, contractors before or dealt with the kind of contracts, or all the engineering challenges of scaling it up before. You may be having to step into know commercial situation because of the early stage of it, where you can't get the kind of underwriting you would like to see. And you can't say, "Hey, you promise to pay us a fixed amount for taking your trash every single year, even if we don't actually need it because that's the only way we can get project finance, because they need to see the secure revenue."
(53:09):
Instead you're more likely for your first time to be sort of like, "Hey, we'll take the risk. You pay us when we actually do it, but we'll take the performance risk." And so it's just really fraught with the kinds of trip up, that can easily turn what would already in many cases be okay, mid-teens type return in the first place. But then you throw in six months worth of cost overruns, and all of a sudden you're looking at a money loser, and that's just not what project finance is supposed to do. Several ways to address it. One of the things we did in one case is we had backed a platform with two technologies. We had backed it because of one proven technology.
(53:41):
Of course, the first project they brought us was the other technology, which hadn't been successfully proven out yet. We looked at it and our initial instinct was to say no. But when we looked very carefully at the project, we realized, "Okay, that one proprietary part is like 10% of the overall project. If it fails, we can cut it out of the system and put in a non-proprietary substitute. We'd get lower returns, but we actually have that as a backup plan. And the upside if it does work is attractive, so let's do that." So you can get somebody who is able to look through the details, and if they're creative and willing to extrapolate early enough, then you can find somebody who's willing to do something like that.
(54:18):
And that's still technically a first-of-a-kind, but it's not a full on first-of-a-kind technology risk I would say. Another thing that has been talked about is first loss capital. So if you could be able to pull together, whether it's project equity and project debt, or just project equity out of a more traditional investor. Or at least a more market returns focused investor. But on top of that you put essentially a layer of capital that is philanthropic, that doesn't even necessarily have to take concessionary returns. But is willing to take that first risk position of, "Hey, when there's a cost overrun we're the first one to take a zero."
(54:52):
That can sometimes be enough to push one of these first-of-a-kind projects over into penciling out. Then I have talked with some venture capitalists who are just like, "Just raise a billion dollars and go do first-of-a-kind projects." And it's like, "Okay, well, what you're really saying is we don't really care about returns." But if you can raise a billion dollars of philanthropic capital, like what Breakthrough Energy Catalyst is doing and you want to put it to that, there would be great societal benefit if you target it at the right things. So that's something that can address a few billion dollars within these opportunities.
(55:19):
But I think we're all still scratching our head as to how to address billions of dollars worth of these, because for the past couple of decades we've seen so much innovation. And so much innovation yet coming as well, that's very exciting to see. But how are we ever going to see these technological innovations start being deployed at scale within the next decade or two, when project finance doesn't tend to move that quickly. And I'll tell you what, all the innovation in the world won't matter on the climate challenge unless we can actually take these solutions and roll them out at scale. So this is a very worthwhile thing to be wrestling with.
Jason Jacobs (55:51):
Love it. It's great to get your thoughts on the latest rumblings and ideas people have, and my hope is that this episode is also a thought starter for listeners. And maybe can foster some other dialogue and collaboration. And maybe even some funds or companies or accelerators or initiatives get put into motion that wouldn't have otherwise if you hadn't made the time to come on the show.
Rob Day (56:13):
I really appreciate it. Great to catch up. Once again, I love what you and the My Climate journey team have been doing. Been watching it from afar and just a big fan of your work. So thanks for having me on. And I hope I wasn't too confusing with all this project finance jargon.
Jason Jacobs (56:27):
No, it was great. Thanks again, Rob. And best of luck to you and the whole Spring Lane team. And maybe we will find some ideas that we can collaborate as well, because certainly within our portfolio this is a hot button topic. And to your point, it's not just capital, it's also education. So having people like you as part of the discussion, and as capital allocators is super important.
Rob Day (56:48):
Always happy to talk with folks, especially before they're at the point where they need project capita, because that's when some of the important thinking happens. So again, thanks for the platform.
Jason Jacobs (56:56):
Thanks again for joining us on My Climate Journey Podcast.
Cody Simms (57:00):
At MCJ Collective, we're all about powering collective innovation for climate solutions by breaking down silos and unleashing problem solving capacity.
Jason Jacobs (57:09):
If you'd like to learn more about MCJ Collective, visit us at mcjcocollective.com. And if you have a guest suggestion, let us know that via Twitter at mcjpod.
Yin Lu (57:22):
For weekly climate op-eds, jobs, community events, and investment announcements from our MCJ Venture funds. Be sure to subscribe to our newsletter on our website.
Cody Simms (57:32):
Thanks, and see you next episode.