What impact investor Nancy Pfund is thinking about
This article is adapted from the Energy Weekly newsletter, running Thursdays. Subscribe here.
Nancy Pfund, founder and managing director of DBL Partners, is a trailblazer in impact investing. Her firm’s philosophy is right in the name: DBL stands for Double Bottom Line, referring to its strategy of combining competitive financial returns with enabling social, environmental and economic benefits.
DBL portfolio companies include some of the biggest names in cleantech — from SolarCity to Tesla and Advanced Microgrid Solutions. It’s no wonder Pfund has landed on lists of influencers, from the inaugural VERGE Vanguard to Fortune’s World’s Top 25 Eco-Innovators and Fast Company’s 2016 List of Most Creative People in Business. I’m also proud to have her on my team as an adviser this year to VERGE Energy.
As DBL looks for opportunities to transition the world to a low-carbon economy, I had a chance to chat with Pfund to discuss where she thinks the next big breakthroughs and solutions will be. Her thinking spans the gamut of sectors, stitching together agriculture to draw down carbon and ways to decarbonize transportation (which happily tracks with the four conferences within the larger VERGE event). The following are excerpts from that conversation, edited for length and clarity.
Sarah Golden: What are you most excited about right now?
Nancy Pfund: I’m excited about the electrification of everything and how we’re turning appliances dependent on natural gas into electric versions.
Also finding ways to monetize conservation and forest protection as investment opportunities. A few years ago, we did a big investment in this space with Better Place Forests, which monetizes forests with cremated remains. You buy a tree in a forest as a way of creating a land trust to honor the legacy of your loved one. It came out of stealth last month and landed on the front page of the NYT Style section.
Golden: What breakthroughs are on the horizon?
Pfund: The emergence of space tools for imaging and mapping for climate purposes. Satellites are able to image the earth on a daily basis and provide more data about what’s going on across the planet.
Also the role of big data and its applications in terms of farming and organic farming. Big data can enable us to understand where organic farming could be beneficial to the farmer and the climate, as well as help traditional farmers increase their earnings potential through more transparency and data-based decision making. Our portfolio company, Farmers Business Network, is pioneering this and building a very scalable platform.
Golden: Which ideas or topics aren’t getting the attention they deserve?
Pfund: Ability to trade energy in small amounts, instead of large ledgers. That is enabled by AI and blockchain. Our portfolio company, Advanced Microgrid Solutions (AMS) is rocking this.
The investment areas to address climate change that go beyond traditional clean energy, such as food and ag, and preservation of forests — these are earlier in their lifecycle curves.
Golden: What technology, idea or company do you think is getting too much attention?
Pfund: Nothing comes to mind. I generally think, the more the better.
Golden: What’s the biggest obstacle you see in mobilizing the investment needed to transition to clean energy?
Pfund: I think people aren’t thinking broadly enough about the scope of the opportunity and sometimes create an artificially narrow set of possibilities. People really need to open up and understand that there are ways to combat climate by investing in all industries, not just in traditional renewables and electric vehicles.
For example, food and ag, conservation, space, appliances, circular economy. It goes on and on. We just had an IPO in the circular economy space — The RealReal — that people hadn’t even thought of as a circular economy company until recently.
Golden: What’s keeping you up at night?
Pfund: That we’re not working fast enough, and we’re not investing enough to move the needle in the time frame we need to do so.