Design For Good – feat. Clim8

We caught up with Duncan Grierson, Founder & CEO of Clim8 as part of ‘Design For Good’.

Clim8’s mission is to move billions of pounds of investments into clean energy and truly green, sustainable companies.

The purpose of our ‘Design For Good’ series is to shine a light on how creative innovation can be a driver for positive change. We feature those that are making it happen, those with grand potential. Truly inspiring businesses that are shaking up their sector. We capture and share the stories behind the name. We collate authentic peer to peer real-talk while celebrating the growth and success thus far and gather a glimpse of what’s ahead.

Jake @ ADLIB: Hi Duncan, great to meet you. Can you start us off with an introduction to yourself and Clim8?

Duncan: I’m Duncan Grierson, the CEO and founder of Clim8 which is a digital platform for investing in companies that are having a positive impact on climate change.

Our mission is what we describe as “pure-play”, to move significant chunks of money into companies that can really have an impact rather than companies that are transitioning to having greener costs. We’re a digital platform to allow anybody to have a genuine impact with their savings.

Jake @ ADLIB: Would you be able to tell us a little bit about the platform and how it works in practice?

Duncan: We’re currently at pre-launch but nearly ready to launch. It’s an easy to use app that allows anybody to make choices according to risk appetite and the amount of money, to invest in curated portfolios.

We provide diversified portfolios of companies with a mixture of themes including clean energy, smart mobility, clean technology, sustainable food, clean water and recycling. These are companies that are offering products or services that are ‘moving the needle’ if you like. You invest in companies that are making a difference on climate change rather than companies that are trying to be greener.

Jake @ ADLIB: Would you be able to tell us about the journey that Clim8 has been on so far and how this has led up to your current crowdfunding campaign on Crowdcube?

Duncan: My background is a mixture of venture capital and building companies in the sustainability space. I had a lightbulb moment last year, did some market research, and was surprised to see that nobody had already built a pure-play investment platform that is focused on sustainability.

I put together a thesis, brought together a great team of 12 people in West London, and raised an initial seed round last November of £600k. We have a fantastic team of Engineers, Product Specialists, Marketers, as well as the investment team of course.

We have just completed a crowdfunding round which went super well. We went into “overfunding” after the first week, and we closed on a total of £1.5m from 1,400 investors plus a venture capital fund, 7percent Ventures, whose previous investments include Virtual Reality company Oculus acquired by Facebook for $2 billion. We have now raised £2m, a good chunk of money to extend the team and add functionality to the platform.

There are a few Fintech companies that are offering certain features where you can invest in things like Green Tech and Clean Energy, but it only seems like a bit of side product.

Jake @ ADLIB: How are you different from apps like that?

Duncan: We’re quite different because it’s our focus and the team is deeply knowledgeable about investing in the space. Sustainability is not a sub-theme for us, it’s what we do. Our deep experience in the space gives us a unique, in-depth knowledge of which companies are genuinely making a difference.

Also, other platforms tend to use exchange-traded funds (ETF), which are passive trackers. We don’t think that’s good enough for this space. If you really want to make a difference, in particular with green companies, we think that active management is the way forward and knowing exactly which companies you’re putting people’s money into.

Having diligence on companies and in-depth research is better than relying on third-party filters around “ESG” (environmental, social governance,) – this is a marketing hook for certain wealth managers, asset managers, and digital platforms. We don’t think those filters are good enough. We prefer a bottom-up analysis.

Jake @ ADLIB: Why would someone invest in a Green Fund? Is it profitable?

Duncan: Absolutely and if you think about it, there’s a logic. If you’re investing in companies whose products or services are focused on making a difference in climate change, then you are investing in high-growth businesses as consumers move towards more sustainable products. People are voting with their wallets & purses, by putting more and more money into products and services when they have a green mission. There are therefore likely to be growth stocks. We hope and expect that over time our portfolios will outperform the market.

If you look at a lot of stocks in the space, they have tended to do very well in the last few years as the world is working more and more on the challenge of climate change. There has been a lot of coverage of the climate strike and other demonstrations that have raised the profile of climate change, with influential people like Greta Thunberg. People are becoming more aware that we have a huge challenge facing us. We are currently in the midst of a crisis with COVID-19, but we face a bigger challenge with climate change.

Jake @ ADLIB: I agree that it’s a massive problem that not more people are interested in finding ways of solving the problem. I live in Bristol and saw Greta in her yellow raincoat, and thousands of people showed up and marched through Bristol recently.

How will Clim8 ensure that the portfolio is truly sustainable?

Duncan: As mentioned, we don’t use ESG filters but instead rely on in-depth research into each company, bottom-up analysis, to ensure that we invest in companies that are genuinely making a difference.

A good example of where ESG filters don’t really work is if you look at Alphabet, Google’s parent company – this is a fantastic company with amazing products that we all use, however, it’s not what we would call a green stock. However, it will sit in a lot of asset managers’ sustainability & ethical portfolios because it scores well on filters like social and governance.

Yes, Alphabet is buying a lot of energy for their energy-hungry data centres from green energy companies, which is great, but it’s not a pure-play green stock, it’s not proactively moving the needle. We want to put people’s money into companies that are trying to make a positive impact. Alphabet will, at best, be a carbon-neutral company.

What we are offering to the market is a range of companies whose products and services are proactively having a positive impact on the problem.

Jake @ ADLIB: When you launch what are the typical size of companies and investments that you’ll be looking to invest into?

Duncan: At launch, we will focus on mid to large-cap stocks which are relatively low risk, well-established companies. Over time we will add more and more companies into the portfolio and extend into small caps.

Jake @ ADLIB: In terms of Potential, what’s the ultimate ambition for Clim8?

Duncan: The big ambition is to have a genuine impact on climate change. For us to succeed, we need to build a user base and a community of hundreds of thousands, if not millions, of people. We want to inspire people to move some of the money, savings, and later pensions, so they can sleep well at night, knowing that at least some of their money is genuinely having a positive impact on this massive problem.

Jake @ ADLIB: When are you launching?

Duncan: We’re launching this summer.

Jake @ ADLIB: Anything else that you’d like to add?

Duncan: I just would encourage anybody to take a look at our website clim8invest.com. You can learn more about what we’re doing and also get early access to our app. We already have more than 5,000 people who have put their names on the waitlist – we’re hopeful that these people will become super users and share our mission with their friends and family.

Great, thanks, Duncan!