Navigating the green investment frontier: Insights from the Clean Tech Stars Conference 

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Rama Variankaval: Hello, everyone. You're listening to What's the Deal, the investment banking series, here on JP Morgan's Making Sense podcast channel. I'm your host, Rama Variankaval, head of JP Morgan's Corporate Advisory and Sustainable Solutions business. I'm excited to be joined by my colleagues, James Janoskey, also known as JJ. He's the Global co-head of our Energy, Power Renewables and Mining Banking practice, and Chuka Umunna, Head of Sustainable Solutions and Green Economy Investment Banking lead for the EMEA region. And we are having this conversation at the conclusion of our time at event in London called Clean Tech Stars, where we brought together close to 50 rising stars in the climate space and many investors. Thank you, Chuka and JJ for joining us on this episode.

Chuka Umunna: Great to be here.

James Janoskey: Thanks a lot, Rama.

Rama Variankaval: So, why don't we kick off with brief intros. JJ and Chuka, I'd love to hear both of you introduce yourself briefly. Perhaps, JJ, you could kick us off?

James Janoskey: Sure. I've been based in London for 24 years. I joined JP Morgan nine years ago, and as Rama said, I co-head, globally, our business that covers energy, power, renewables, and mining clients. Within that is obviously everything around energy transition, energy de-carbonization. That is part of the broader spectrum, all those companies. So, that's hydrogen, renewables, battery storage, critical minerals. And in Europe, the transition and the green economy started a number of years ago. We've been spending time with these clients over the years. So, we've been able to grow up with them. It's quite an interesting combination of covering the larger companies and then these growth companies that are key to the transition.

Rama Variankaval: Fantastic. Chuka?

Chuka Umunna: I'm a bit of a baby, I suppose, in JP Morgan terms, but I've been here for three years. I started off life as a corporate lawyer. I served in the UK House of Commons as a Parliamentarian for a decade, and then I did a bit of a stint in consultancy and sitting on a few boards before landing here at JP Morgan. And I have a couple of, I suppose, key roles. One is, I lead the Sustainable Solutions practice here, which advises corporates on how to meet their sustainability and ESG-related demands of investors when they're raising capital. We're principally involved in strategic transactions of IPOs, EPPs, M&A transactions. But I'm also working very closely with JJ and others in the EMEA region. I help coordinate what we call our green economy investment banking outreach, and I tend to focus a bit on the other areas beyond the energy, power renewables space into some of the other sectors. And so, our aim, amongst all the different groups this, is to make sure that we've got the whole of the green economy covered here at JP Morgan, which is very much part of the inspiration for the conference. I also happen to oversee what we're doing as a house, JP Morgan, in EMEA, where this is just such a huge topic for our stakeholders, for our regulators, and others.

Rama Variankaval: No, it's great to have both of you and the diversity of experiences and expertise you bring to the table on this very important issue. So, moving on to the Clean Tech Stars Conference, what are some of the key themes that emerged this year? This was the second edition of the conference, so if you wouldn't mind, JJ, first, and then Chuka, also point out any differences you noticed from the themes from the previous year.

James Janoskey: Rama, as you said, it's our second annual one. We did the first one last March. We had 32 companies attend. This year, we expanded it to 44 companies that joined us. One big difference that we did, compared to last year, was we had a much broader spectrum of companies. It was across energy transition, industrial de-carbonization, but it was sustainable ag, it was the circular economy, it was carbon management. Because if we think about the transition, and if we're gonna achieve goals by 2050, it's just not the energy transition. It's across all sectors that have to decarbonize. So, we were lucky to have some stars across all those different sub-sectors, which was quite positive. A few things that are different than last year, I would say last year the investors weren't as up-to-speed and educated about the technologies and the specific companies. This year, they were much more focused about the sub-sectors, they were much more focused about how the companies were progressing, and asking more detailed questions, which ties to what the companies have been focused on, which is execution. This is all for them, now, about how do they scale and grow their businesses. It's not proof of concept, it's how do they get to the next level. And I think the other thing, which is people were realistic about the challenges on raising capital and working hard to think about alternative ways to raise capital to partner with industrial companies, and to make their business plans more investor-friendly. The confidence that these companies have that they can deliver, in one way, despite the headwinds they're facing is high, but I think they have much more confidence, because they understand the businesses and the challenges much better, and they're all committed to making a difference. So, it was exciting to have them. We had a really great success, thanks to everyone's efforts. We're already planning a third one for 2025, but in the meantime, we're gonna do the first one in the US on September 19th, focused on US companies. 

Rama Variankaval: That's exciting, and we look forward to that. Chuka, I'd love to hear your perspective as well, and maybe you could address the makeup of the investors. Was it global, European, was it venture, growth equity, public investors, or was it all of the above?

Chuka Umunna: It was mainly private capital. So, private equity, growth equity, down to VC. I think one of the interesting things, for me, was that if you look at where has private capital gone, particular the VC to PE space over the last couple of years or so, around a third of it has gone to low carbon energy and renewables, around 41 percent, 40 percent, has gone to transport, so EVs, battery charging solutions. And what I detect with a lot of investors is that they are looking more broadly, at the other sectors to contribute to emissions that also need investment, but have the right risk return profile and a credible investment proposition. So, there is really an appetite for more than the sectors I've just mentioned, which is why we deliberately sought to go a bit broader this year with the companies that were represented. So, beyond, obviously, transportation and low carbon energy, we had food and ad tech businesses, we had some of the sustainable finance space, some clean energy mobility solutions, clean tech, efficiency technology, lots of companies in that space because there's a real appetite to go beyond the sectors where a lot of private capital has gone so far. Secondly, I suppose, you asked in terms of the nature of the investors. I think those with a global and in a European mandate tended to dominate, I would say. And principally, the mandate was global or European.

Rama Variankaval: Got it. Chuka, you mentioned public policy and the IRA. So, tell us a bit more about is the public policy in the UK and EU, at this point in time. Sufficiently supportive of the green transition or the gaps that, if you were giving advice, you would point out?

Chuka Umunna: Oh, definitely there are gaps. First is actually quite similar to the complaints we get from clients in the US, which is the whole planning and permitting regime is a nightmare overall for some of these big green infrastructure projects. One of the reasons, I suppose, China has been able to race ahead both of the US and Europe is because when it delivers stuff and plans for means, it just does them, whereas it takes far too long. We're simply not going to be able to meet our targets, unless that is addressed. And all public policymakers talk about this, but nobody seems to really have a solution to these things. And I think the other thing, actually, is that how you can effectively use public sector balance sheets to be additional and fill the gap of funding, if you are developing first of its kind technology as a company you often fall between that space [inaudible 00:09:38] green economy company where you don't neatly fit within the profile of a tech company. So the traditional tech funding models that you see in VC land is not necessarily appropriate for a green economy company, which tends to be a bit more capital heavy in the early stages, and asset heavy. But then it's not so capital intensive and so long term as, like, an interim investment, and so that, the intra funding model is not necessarily appropriate. And I think this is where you could use public sector balance sheets, building on the kind of principle line, the big contrast, the difference, and the rest of it, to actually help provide funding, a cap structure, a cap stack that works for those kinds of companies. And I think that that's where actually if you're gonna use public money, that's where you could really efficiently do it without spraying money around by means of [inaudible 00:10:27], but actually being quite specific and focused and targeted in a way while will make a difference.

Rama Variankaval: Got it. And then JJ, you mentioned COP28 as providing a tailwind to the climate conversation. And then you also talked about the optimism you have at the conclusion of the clean tech stars event. From what I've seen, we are still in a macro environment that's not entirely benign, we are in the 2021 area of capital raising being quite easy for all sectors, including climate. So tell us a bit more about what you see these tailwinds to be? And what is the reason for your sense of optimism?

James Janoskey: To build on one of the points Chuka made, which was quite interesting, is speaking to the companies, I think last year the point was, as you said, Chuka, people were assessing, "Can Europe ever be competitive with the US? Do I have to go to the US to make investments if I'm a company, because of the IRA?" The view today is, "That's not necessarily the case," because there's enough demand and there's enough support in Europe and the UK in addition to the US, so it's not either/or, it can be both. The issue is from a lot of companies have said the policy is supportive, it can be better. But actually the implementation of the policy into regulation, what does it mean in terms of economic terms? For instance carbon capture in the UK, there's projects that have been approved, but nobody knows exactly what the financial framework is. What's the rate of return you're gonna get? What's the RAB base? Those types of issues make it very hard to make investments and to bring in capital, 'cause nobody knows. So I think it's partially policy, but it's also partially the regulation to support policy implementation. I think that's quite key. The other thing is we recently just announced before the conference a capital raise for one of the company's that joined us. They raised growth equity capital. And quite an established company, it was kind of a more advanced round. They already have cash flows, they have a big backlog. That equity unlocked a loan that was critical from the EIB that was a development capital. But to Chuka's good point, the EIB didn't wanna put money in just to chase something. So they said, "If you get equity from third party investors, and a certain amount, we will help fund some growth capital through debt." Those types of solutions, quite bespoke, that are hard, but those are ways to enable companies also to grow. But their program needs to be a bit more broad, and a bit simpler to execute. I think on COP obviously tripling renewables, the discussions about how do you get capital to all these companies, whether it's traditional or renewable companies, these clean tech companies, sustainable companies, whatever it may be? And we've seen different commitments from people, so those tailwinds are quite good. The headwinds are still there, right? How do supply chains develop? We need interest rates to come down. We need geopolitical risks to come down. We need this point about regulation. They're all not gonna happen overnight, but you kinda see how people are chipping away at them. And some of these will just naturally happen as rates come down. It just is a very different discussion you have with most of these companies, is they're very realistic about the challenges. I mean, you hear some very passionate founders and management teams, that are like, "Listen, I'm gonna plow through this. It's gonna be hard, but we're gonna get this executed." And that's where people are, in the mode of, "Let's work on this." There are challenges, let's be realistic. Let's go through one by one how you solve them. And particularly a lot of people spoke about, "How do I make sure these supply chains are viable and can scale up?" And working with banks and financial investors and institutions about, "How do you make projects in companies bankable?" Which is, I think, one of the key themes that came out of COP28, if you guys agree, is people talk about, "I have to make projects for companies bankable in some way. So let's work through with all stakeholders around the table to figure out what does bankable mean? And then how do you get capital to companies?" And capital's one aspect of it. We're a bank, we're gonna be more focused on that, right? But I think those are the things that as we sit here today I think are positive. It's not gonna happen tomorrow, but as look forward into '24, I do feel '23 was probably where the hurricane was, and now we're coming out of that a bit for the clean tech space.

Rama Variankaval: I would agree with everything you said, JJ. And a couple observations, you know, we are a bank, we think about capital, that's fair. But also a lot of these newer technologies tend to be capital intensive, so the cost of capital is in fact a big part of the overall cost of building the company, so I think it's fair to think a lot about cost of capital. And then, the point you made about interest rates needing to come down, the risk premiums needing to come down are absolutely important levers everyone's waiting for. Good news clearly that this has cyclical issues, but both fiscal and monetary policy support, that's more of a secular support. And consensus we started to form, global consensus around a pragmatic approach towards energy transition at COP28, that seems to be also quite secular. So, like you, I also remain cautiously optimistic.

Chuka Umunna: What's your sense of what's happening over in the US, Rama?

Rama Variankaval: I think quite similar, it's not different at all from what you're seeing in Europe, but there is a sense of optimism. Capital raising is difficult, there is no doubt about it, but there is just a lot more interesting conversations going around on how do you make projects bankable? And the notion of bringing public capital and private capital to come together and work together, to capitalize innovation and to capitalize some of these technologies to go from pilot stage or early commercial stage top truly scaled companies. There's a lot of interest, attention on the topic. So not different at all from Europe.

Chuka Umunna: It's quite interesting as well, at the conference we had Ambassador Majid Al Suwaidi, the COP28 Director-General actually come and give a bit of a talk about a post-COP. And I think we talk about US and Europe, of course, how we decarbonize the global south was one of the big topics at COP28. And he told us a little bit more about the new Alterra fund that the UAE has created, their new $30 million catalytic climate investment fund, where they've partnered with TPG, BlackRock and Brookfield, all of whom were involved at the conference, which is very much focused on that. He's the CEO of Alterra fund as well.  And I think it does show that those tailwinds that JJ was talking about coming out of COP28 are very real.

Rama Variankaval: Yeah. And look, that fund is, I think is a good example of a clever way to put capital together in a way that you will achieve certain policy objectives, but also attract commercially minded investors.

James Janoskey: And I think we're also seeing some of that. And you know, you've seen it a bit in some of the things we've been working on, is the companies are also getting more creative or smarter, as opposed to saying, "I'm only gonna raise equity at the TopCo company level. How do I maybe raise some financing at the project level? I put some equity in, I get a third party. I can get some project finance 'cause I have an offtake. Or you have something that's maybe a bit more structured and you can give a bit of downside protection for investors. But you keep some of the upside. Those are the things that I think 12 months ago they were very simple structures, probably more than these. This is good way to bridge for some people to get capital. And I think our sense is All these companies need capital scale up, by definition, right, where they are. Unless you really need to get it, most of them are waiting right now and staying close to investors, like our conference, staying in dialogue. But formally push the button to go do a capital raise is probably later in the year than sooner, just to have some of these tailwinds get a bit stronger. And the headwinds to ease a bit, right? So that's why I think we will see more and more capital raises as we go forward.

Rama Variankaval: And look, again, I think the time-tested phenomena, right, when money is cheap or practically free, as it was for the last several years, then there is really no interest in doing complex structures, right? You do the simple thing, because, again, cost of capital is low. But we are clearly not in that world, I doubt we will ever go back to that world again any time soon. So the appetite for complexity has to go up. And I think that's perhaps an area where someone like us, JP Morgan, can be helpful. Is that a fair statement? And I'll ask both of you, what is it that JP Morgan can do to help our clients in the climate space?

James Janoskey: So I think it's a combination of helping obviously, one, just access a very broad side of investors. I think the other thing is when we say investors it's very important to expand it. It's just not financial investors, it's strategic and corporates, investors that could be partners. Because we've seen a lot of the big companies be part of these private rounds, or partner with these companies 'cause they want access to the technology capabilities, and is helping to use our network and access to make sure these companies are in front of them. The second thing is using our global platform. And as we do these transactions, as we're talking with investors, as we get things done, some things don't get done 'cause they're hard. But we're able to use that market knowledge to help companies shape what business plans they go out to market with, or help them understand what investors are gonna be looking for so that they can tailor. As opposed to being too aggressive about how much capital you needed to raise, how do you maybe think about steps of capital raising, from that standpoint? And thirdly is we train the different teams. Chuka, your team and everything you're doing around the infrastructure advisory as we think about the corporate bank, the commercial bank, how do we think about where we can lend capital? What are the different ways that we can help these companies get access to capital that's just not equity from third party investors? Those types of activities are gonna be important for us to provide almost a holistic toolkit.

Chuka Umunna: I mean, the only thing I'd add to that is just the sheer breadth of the JP Morgan platform that we can put at the disposal of our clients. And so there's not just our product sect within investment banking, but if you are wanting to build out your US business and you need various different bank accounts, payment provision, payment services, that's something that we can do that often others can't if you're running a African subsidiary and you've got your hold co in the US, but you need FX solutions just into... You know, there's nothing that we don't do in that respect. And your contact at JP Morgan who looks after you and provides the services, they are literally conducting an enormous orchestra and putting it at your disposal. And I think it's unparalleled, it's unmatched.

Rama Variankaval: That sounds like a fantastic place to wrap up. Thank you, Chuka. Thank you, JJ. And congratulations to both of you on, again, a successful edition of Clean Tech Stars. I know it takes a lot of work, a lot of effort, but the kinds of things that come out of it are truly moving the needle. So thank you both. And thanks to all our listeners for tuning into another What's the Deal? episode. I hope everyone enjoyed the conversation.

James Janoskey: Thanks, Rama.

Chuka Umunna: Thanks, Rama.

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What’s The Deal | The Power of Clean Technology: A Conversation with Marc Borrett

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David Rawlings: Welcome to JP Morgan's podcast, What's the Deal? I'm David Rawlings, one of the show’s hosts. I'm excited to be joined by special guest Marc Borrett, CEO and co-founder of Reactive Technologies. Great to have you here, Marc.

Marc Borrett: Thank you, David.  Great to be here.

David Rawlings: You've had an interesting journey. After graduation you started in the corporate world before it sounds like starting your first business in the semiconductor space. And then of course today working in energy and renewable energy. Can you just tell us a bit more about that journey?

Marc Borrett: Yes, of course, David.  I think the journey has been characterized by innovation. Hewlett Packard was truly inspiring for me. And the first startup I did, that was a very interesting start. We were messing around with electronics; we came up with some very novel ideas, presented them to what was the toy industry at the start. And we developed a remote tag technology which ultimately Hasbro used to win the Star Wars franchise. But, actually, we'd built one of the world's largest implementations of RFID, which we didn't realize at the time.

David Rawlings: So, can you talk to us about how you got into the semiconductor industry next?

Marc Borrett: A Nokia exec bought the toy in a Target store in the states. Took it apart, figured, hmm, this could be interesting for mobile handsets. Contacted us, said, "Could you put this on a single chip? 'Cause I think this could go into a mobile handset for contactless payment." And that became the start of near-field communication. And from that we turned into a semiconductor company. We licensed our IP to 80% of the world semiconductor companies. And then Broad Comm bought the business. And innovation was the thing that had driven me in that business. And having then exited to Broad Comm I wanted to find another industry that was gonna go through a lot of change. And there was some very interesting parallels in the energy sector. And it felt like an industry that was really about to take off from an innovation perspective. And I think a lot of the colleagues and the organizations that I'd met in the semiconductor journey, felt like there was a skillset that we could apply to some of these new challenges in a new industry.

David Rawlings: Basically, you're saying you were one of the early people in Star Wars. Then near-field communications, then semiconductors. And now here you are in energy. And really, I think, providing some groundbreaking work in that space. And trying to keep the world address net-zero. I'm gonna give the listeners just my quick descriptions of what I think you do. Which is every grid wants to add renewable capacity. But it's hard for them to measure what you would say is inertia. So your business now helps a grid get smarter about its stability so they can add more renewable to the grid. Does that sound about right?

Marc Borrett: That's exactly right. And like a lot of these things, it's a bit like peeling back the skin of an onion. You eventually get to the heart of the issue. And as we look ahead and we see more and more renewables getting built out, which is great for net-zero, we start to see uncomfortable realities also emerging. Which is grid operators curtailing those renewables. Actually stopping them. And in place of stopping the solar farms, producing solar energy, and wind farms, they actually also pay gas peakers to fire up and give them stability that they think they need. And the reason I say think they need is because they use models. They don't measure the stability of their grid. Because they don't have the ability. It hasn't been possible up until now, until we developed our technology that allows us to create that real time accurate view of stability, of an entire power system, or a part of a power system. And that starts to become a really valuable tool in the control room to help them safely incorporate and use more renewables, rather than reaching a point where they feel they have to curtail them.

David Rawlings:  And Marc, how do you measure the impact?

Marc Borrett: From our data start to see that actually we can measure somewhere in the range of 10 to 30% additional capacity of stability in the power grid than their models would otherwise indicate would be available to them. And that obviously is quite a disruptive benefit to net-zero because now there's additional capacity that allows more renewables to connect and be used safely.

David Rawlings: So let's spend a little bit more time on the technology. How are you able to do this and what have you heard back from the utilities and other people you are doing business with?

Marc Borrett: The way it works is that it's something very similar to sonar. We're not sending a sound wave or an ultrasonic wave into a power grid. But we are sending a burst of power. So we build an asset, it could be a battery, it could be a big capacitor. And we get that asset to send a signal or a pulse of power into the grid. We have measurement devices that we install around the country or the part of the grid that we want to measure the stability in. And those measure exactly how much of an impact that pulse of power has had. So, we treat the grid as a black box and everything is very accurate. So we know exactly the moment we send the signal into the grid or the power wave. And then imperceptible to the grid operator, we can pick that tiny, tiny disturbance that we've created in the grid out of all of the noise that is caused by all the other things that are operating on the power system. And that gives us a very precise measurement because we've stimulated the grid with a known input. And we've measured how much that input has actually been able to move the grid slightly. And that gives us a precise measurement that we can give into the control room. And that tells them where the limits of their grid are at that moment in time. That means they can safely absorb as much renewable energy up to those limits because there's been a physical measurement created.

David Rawlings: It sounds so logical. But was this always the intent when you started the company? Did you know 12 or 13 years ago that this is where you'd end up?

Marc Borrett: I would love to say yes, but that would be a complete lie. The truth of the matter is it came about like often with innovation from a place where we weren't expecting it. So when I started up Reactive, we brought together some engineers from the semiconductor world and they had a design to try and use the power system as communications channel. National Grid in the UK went with that idea. They humored us, really. They didn't really believe that it was gonna be possible. But we sent a data signal through the entire grid in the UK and we had these receivers put around the whole of the UK, and our signal got through to all of them.

David Rawlings: Then you had to flip the model on it's head.

Marc Borrett: Yeah. What we realized is, that it didn't happen at exactly the same time as it should. So, you know, energy travels at the speed of light. And the UK isn't that big. But there were these differences in timings as to when our message actually was received by our devices. And we looked into it, and we thought, "Well, there's something inhibiting our message traveling across the UK. And the more we looked into it, we realized there was some phenomena at work. We discussed this with National Grid. And we said, "We think the phenomena is the stability of the grid. And we think we could actually switch this thing on its head and use the technology in a different way to actually measure the stability. Would that be of interest to you?" And they said, "Well, that's never been done before. You can't measure stability." They said, "Well, if you wanna go and do it, try it. And then we'll mark your homework." We did a measurement campaign by turning the technology around. We've provided them the data. And their response was, "Okay, we think you can measure stability in real-time. We're interested to take this forward as a full service."

David Rawlings: What's also amazing is a company like National Grid was willing to work with you here.

So can you talk about that as, you know, you're an inovation company. You obviously had success in something else. But here you have to convince this operator that you can help them. Talk us through that.

Marc Borrett: I think we appeal to the curious side of an engineer. All these kind of organizations have got a very strong engineering DNA. But, again, we were coming at this from a very different perspective. Still from an engineering one, but from a very different one. We weren't power engineers, which the industry is typically characterized by. We were communications engineers. And we were offering them a view into a realm of engineering that frankly they hadn't really been exposed to very much. And some of this sounded semi-plausible. And overall, I think it was the curiosity part that really won them over. But you're right it's not often and it's not easy as well.I think innovation funding really helped them having access to that. But equally there's still hurdles to get over to turn what is a promising idea into actual commercial service. So they stuck with it. Once we showed the promise, they really did stick with it because equally they saw the value and it remains an incredibly positive partnership with with National Grid.

David Rawlings: So here you are. You've got this relationship with them. There's the global initiative to get to net-zero.

So how does this develop for you? How does this develop for the industry over the course of the next few years?

Marc Borrett: Well, we're very excited about the next couple of years. National Grid are a very well-respected  grid operator internationally. And the UK in that sense has been a very interesting early market for us, because being an island, we're not very well connected with Europe, unfortunately. And so a lot of the phenomena that are actually gonna happen to grids are very evident in National Grid's grid early on. So that what we are seeing there is actually very applicable to every grid around the world. This is back to the fundamentals of a power grid. It's the same wherever you are in the world. As you start to take off big generation, which has got big spinning turbines that produce energy through those big spinning turbines, those provide a huge amount of stability. And that large generation mass is taken off and it's replaced with much smaller invertor-based generation like solar and wind, that stability is automatically reduced. And I think the fact that we're now seeing more and more investments going in at scale in many regions around the world for more renewables, those challenges that National Grid had maybe 10 years to identify and think about how they might solve are gonna play out much quicker in many other markets around the world. So we can see a very exciting path ahead of us to provide the same kind of services to every grid, hopefully, that is really going down this net-zero transition.

David Rawlings: It's such a amazing compliment to this goal of net-zero. Let's just shift for a second. So you've obviously had lots of experience over now 30 years, building and developing companies almost 40 years. What advice do you have for other entrepreneurs and growth companies, whether it be from talent to strategy? Just what have you learned that you'd love to share with us?

Marc Borrett:  I think I've always wanted to find that very tight fit of need and technology solution. The businesses that I've been involved with we've always had a very strong focus on patents and R&D. So in Reactive we now have a patent portfolio of over 230 granted patents around 34 countries. So we've really wanted to try and do things in a different way, because then you have a differentiator. And I think that is always the key thing when you're trying to raise funds, or you're trying to sell your service. The world is a crowded place and you need to have a clear way of showing that you have created value in a different way. And you can protect that value, especially from an investment perspective. So having a strong IP base investing in R&D. So we have had, I would say, the first 10 years of our life has been doing genuine blue-sky R&D which is hard. You know? That means that you are sort of always looking to the future. And actually you have to make some investments that don't necessarily pay back instantly. But then you're building a foundation and a set of services that really can stand the test of time and be viable in the market for tens of years rather than one or two years which you find in more consumer markets.

David Rawlings: Well it's amazing this technology-first mindset, and what you're able to do, and what other companies with the same mindset have been able to do. So I congratulate you on that. And if you get, like, really excited and you think about the 2030, 2040, 2050,  what impact do you see your company having on this march to net zero?

Marc Borrett: Well, we hope we will have a genuine impact because by offering grids the potential to have more capacity to absorb more renewables and equally, at the same time, not have to use gas peakers as much, there is a genuinely material carbon offset that we can create. We had to do quite a lot of analysis in our last investment round when Breakthrough Energy Ventures invested. And we can see there's a pathway to save in the order of half a gigaton per year in offsetting carbon, which is a significant number. So for a very small, incredibly niche part of the net-zero transition, we think it's got a very disproportionate positive benefit to heating and enabling net-zero to happen in practice.

David Rawlings: Great. We're gonna start to wrap up the conversation, but I think one of the final questions I'd like to leave you with, you know, it's a complicated time in the market. So on one hand you're seeing this incredible demand for renewable energy, you're seeing policies and legislation like the Inflation Reduction Act in the United States. But it's offset by a tougher capital environment, rising interest rates, inflation. Just summarize for us what conversations are you having with your investors and with your board today, balancing some of these positive and negative factors.

Marc Borrett: We're certainly not immune to the wider macroeconomic environment. But I would say if you just step back and you look at what net-zero is gonna take, so, broadly speaking, the same amount of money that will be deployed to build renewable energy, solar and wind, at scale will be needed to invest it in the grid, to actually improve the infrastructure, build more capacity, develop and install more tools, more capabilities to manage an increasingly more complicated grid to keep safe and reliable. So that is the long-term view. And we are taking a long-term view, we are seeing that the investments we continue to make are going to ensure that we will have the right product suite for the full energy value chain. Because of that longevity of the data service that we provide, we're still thinking that we can make long-term investments in growing the portfolio, broadening out the customer base on an international footing.

David Rawlings: Marc, this has been such a fascinating discussion. Congratulations on all the great work you're doing. I've really enjoyed spending time with you and just wanna thank you for joining us on What's The Deal.

Marc Borrett: Thank you, David. Great to be here.

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