Podcast Transcript: Jeff Eisenberg, investing in earth's future.

Dave Anderson (00:00):

Welcome to the Solar Podcast. I'm Dave Anderson, your host, and I'm very happy to have Jeff Eisenberg who is a long-term friend, but also someone that I would consider somewhat of a mentor. He is a partner at Ecosystem Integrity Fund which is an investment firm based out of the San Francisco Bay area, but they do strategic investments in impact companies around the country. And we're really thrilled to have Jeff on the call with us today.

Jeff Eisenberg (00:28):

Well, thanks Dave. It's a pleasure to be on the podcast. I'm a huge fan of yours and Complete Solar. And you guys have been doing amazing work for a really long time, so it's an honor to be here.

Dave Anderson (00:41):

Maybe if you can talk a bit about yourself, the Jeff Eisenberg origin story and how you ended up in the Bay area.

Jeff Eisenberg (00:47):

Yeah, sure, happy to. Actually, I'm originally from Boston, Massachusetts. Grew up in a little town called Newton, right outside. Big Red Sox fan and a Patriots fan. I hope that doesn't make me any enemies on your podcast here. I know they're not always the favorite teams in the world.

But I went to college in New England and got out and went into traditional finance. So, I was working at a big mainline investment consulting firm. And while I was there, I had one of those, call it "epiphany" moments, that I think a lot of people have in their early 20s when I realized I had skills in the financial realm, but I wanted to use my skills to do something better for the world, and specifically focused on climate change and sustainability.

It was always a passion of mine, but I recognized, I think, at the age of 25 that I should try blending the two things together, a passion for sustainability in the environment and climate change with my investment skillset. So, that set me off on a lifelong journey, I guess. And I think the biggest next step there was when I met a guy named Jamie Everett, whom Dave, you know.

When I was about 27 years old, I met this guy who talked about investing in sustainability in a way that I wish I had come up with, I wish I had thought of. And he had clearly been thinking about it and working on it for a very long time. And I think we met once, and I asked him if I could go work for him on his research team at a boutique investment bank out in San Francisco.

And that was in 2008, which was a great time to start a new investment job in the world, if you know your history of financial markets. Then, our third partner in EIF, Devin Watley, joined later that year in 2008. So, the three of us have been working together on sustainability-focused investments for 15 years now. And there aren't a lot of people who have been working together for 15 years. Dave, maybe you and Will are getting up there in years like that.

But it's been an amazing ride. My wife and I drove out to California in 2011, in our car with whatever we could pack in there and we couch-surfed for a month, and somehow made it work. And we've been doing the Ecosystem Integrity Fund in San Francisco now for 12 years. We spun it out of that investment bank. So, it's been a heck of a journey.

Dave Anderson (03:28):

Yeah. You mentioned Jamie. Jamie, he possesses a rare form of altruism that I think is pretty unique, particularly in the investment circles. I didn't realize that you and Jamie worked together before Devin, who is the other managing partner over at EIF, actually even joined.

Jeff Eisenberg (03:45):

Yeah. Not for very long. It was maybe nine months, but I think I was Jamie's first hire, and I've basically been working for him my entire career. And you're absolutely right, I think that sense of altruism is something that is common with everyone at our firm. And frankly, when we hire people, it's something we look for is a commitment to this mission. And I know it's a mission that you guys share, which is a focus on trying to do something to stem climate change and fix the damage that we've done to the planet.

And I think everyone comes to that from a slightly different place, but at the end of the day, we've got one home, we were charged with taking care of it, and we're not doing a great job right now. So, I think we all wake up in the morning just with an internal drive to do something about it, and this just happens to be the area where we have some skills where we can put it to work, and that's our mission.

Dave Anderson (04:39):

Yeah. And I think one of the things that's interesting about what EIF and what Complete Solar and what others do, but specifically talking about EIF as an impact investor, you have to go out and convince people to spend money or to invest their dollars into companies that are going to make a meaningful impact, but there has to be some sense that there's going to be a return.

If you can talk a bit about what unique challenges that impact investors have and maybe some of the benefits that you have as well when you go out to raise, and I'm talking pretty significant dollars, to help, in some instances, fledgling companies, but in other instances, more established companies to really further their cause to make an impact. And you've talked about some of those things, but maybe you can go a bit more into what it really means to be an impact investor and why that's a critical thing right now in the world today.

Jeff Eisenberg (05:31):

It's an interesting question, and it's a tough one to answer because it's such a broad category. There are impact investment funds and impact investment-focused vehicles that are focused on things like medical technologies or educational technologies or financial inclusion or DEI. And they each talk about the change that they're trying to affect in the world, their theory of change, in the way we talk about wanting to fix environmental problems, but they're talking about trying to fix other problems.

And I think, at its core, impact investing focuses on trying to solve a problem that is beyond financial. Part of impact investing is not just the impact, it is the investing part. So, to your point, part of getting in, we call them "limited partners" or "institutional investors", to entrust us with their financial assets for long periods of time, they need to be convinced that we're not just focused on the impact, but also on the financial side, on the investing side.

So, we came to this game with a commitment to being just as committed to being excellent investors as to having impact or making meaningful contributions to sustainability. I think that we, and this really comes a lot from Jamie's thinking, that the two have to be intertwined, the impact in the investment side, in order for there to be real large scale systems-wide change.

You can't just set out to have impact. You need to set out to have financial returns and above market financial returns, because that, essentially, gets the rest of the financial world involved, just as impact investors probably can't have meaningful economy-wide impacts. But if we show other investors that, actually, there are outside returns to be had here, then they will come to our space and they will start investing in these types of technologies.

And I think you guys have seen that at your company where it started out with sustainability, clean tech, climate-focused investors like us, and now you have just traditional private equity firms looking to back your company. And I think that's a big component to the impact investing world is making sure that you're an excellent investor so that you can have impact at scale.

Because it's like anything else, we can't do anything ourselves. It relies on great entrepreneurs like you guys, but then other investors, they have to believe in the companies that we're backing. Then, there have to be later-stage investors that may not be impact investors, but also start to see what we see and start to see the attraction from a pure financial standpoint, and investing in the kind of companies that we're investing in.

So, I think it's part of building an ecosystem, it's part of changing hearts and minds around what makes sense from an investment standpoint. I think that we have also, in the climate environmental sustainabil