Metrics in Social Impact Investing<br />International Transactions Clinic<br />University of Michigan Law School<br />E+Co...
E+Co Overview<br />Mission<br />To positively impact climate change and reduce poverty through investment in small and gro...
 Market-based & Entrepreneur-centric
 Six regional offices (Costa Rica, South Africa, Tanzania, Ghana, Thailand, China)
 Affordable, Available and Appropriate Technology
 Solar, Hydro, Biomass, LPG, Wind, Cook Stoves
 Finance Continuum
 Services
 Seed Investments
 Growth Investments</li></li></ul><li>The Energy LadderTransitions in Fuel Use at Different Stages of Economic Development...
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E+co | Metrics in Social Impact Investing

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This presentation was delivered to the International Transactions Clinic at the University of Michigan Law school on 12 April 2011. Ted London is the Director of the Base of the Pyramid Initiative at the William Davidson Institute at the University of Michigan.

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E+co | Metrics in Social Impact Investing

  1. 1. Metrics in Social Impact Investing<br />International Transactions Clinic<br />University of Michigan Law School<br />E+Co: Clean Energy Enterprises<br />April 12, 2011<br />
  2. 2. E+Co Overview<br />Mission<br />To positively impact climate change and reduce poverty through investment in small and growing clean energy enterprises.<br /><ul><li> Investments in >250 enterprises in 21 developing countries
  3. 3. Market-based & Entrepreneur-centric
  4. 4. Six regional offices (Costa Rica, South Africa, Tanzania, Ghana, Thailand, China)
  5. 5. Affordable, Available and Appropriate Technology
  6. 6. Solar, Hydro, Biomass, LPG, Wind, Cook Stoves
  7. 7. Finance Continuum
  8. 8. Services
  9. 9. Seed Investments
  10. 10. Growth Investments</li></li></ul><li>The Energy LadderTransitions in Fuel Use at Different Stages of Economic Development <br />Cost, Cleanliness, Efficiency<br />Electricity<br />Gas, LPG<br />Kerosene<br />Charcoal<br />Firewood<br />Crop Waste/Dung<br />Income<br />
  11. 11. E+Co Triple Bottom Line Returns<br />*After write-offs and before operating expenses<br />
  12. 12. Toyola Energy Ltd.<br />Fuel Efficient Cookstoves in Ghana<br /><ul><li>Toyola Energy manufactures and sells energy efficient cook stoves in Ghana
  13. 13. In 2010 E+Co approved its third investment in Toyola for $542,000
  14. 14. Served over 35,000 households
  15. 15. Sold over 100,000 cook stoves
  16. 16. The operation has created over 200 jobs
  17. 17. Offset over 140,000 tons of CO2 emissions</li></li></ul><li>IO<br />IO <br />FA <br />Fin Mgr <br />RM<br />Perform Due Diligence and prepare environmental checklist<br /> Prepares Fact Sheet and Investment Recommendation<br />Creates code for Time tracking <br /> Assign Funder<br />Approves Fact sheet and Recommendation<br />FM<br />Comm.Team<br />Updates Funder in GMS and Forecast File<br />Prepares IC Meeting Minutes<br />IO<br />RM<br />IO<br />SM<br />CIO/CEO<br />CIO<br />IC<br />CIO<br />CIO<br />CIO<br />IO<br /> Start EDS<br />Prepares Intro Sheet<br /> Approves Intro sheet<br />Review and advise on Intro sheet<br />Review and Approves Fact sheet and Recomm.<br />Submits investment for IC approval<br /> Approves Investment<br />Reviews & Uploads IC Meeting minutes and investment history in GMS,<br />Marks inst approved in GMS, enters approval date, uploads Fact sheet and print for file<br />Consolidates Intro sheet comments and uploads to GMS<br />Enters Lead in GMS<br />InvestmentManagement - Approval Process<br />Lead Identified<br />Ent Training Reqd.?<br />No<br />Yes<br />Invoke Term Sheet Approval Process<br />Process complete<br />6<br />
  18. 18. IO<br />Re-evaluate (EDS, if needed)<br />Disbursement Processing – <br />Legal Documents Approval<br />IO<br />IO<br />Lawyer<br />IO<br />CP met in short term?<br />Reviews and approves legal documents, prepare legal review checklist<br />Prepare Legal Documents, Incorporate Terms in Term sheet<br />Send term sheet to Lawyer <br />Prepares repayment schedule in an excel<br />Investment Approved<br />Yes<br />No<br />IO/Leg C<br />Ent<br />CIO<br />IO<br />RM<br />Sends docs to CEO for signature<br />Perform Quality control on legal documents<br />Reviews and approves legal documents and signs checklist<br />Signs final documents, sends docs to IO/legal counsel<br />Sends legal documents to Entrepreneur for signature<br />Lawyer<br />CEO<br />Fin Spec<br />Fin Spec<br />Lawyer<br />Handle post signature requirements (e.g. collateral registrations)<br />Signs final documents and informs Fin Spec<br />Returns signed docs to lawyers<br />Files copy of documents (physical copy)<br />Send final registered copies to Reg. Office/Fin Spec<br />Process Complete<br />7<br />
  19. 19. E+Co Investment Process<br />Client Identification<br />Prepare Introduction Sheet<br />Provide Business Development Services<br />Undertake due diligence<br />Prepare Term Sheet<br />Present Investment Recommendation <br />To E+Co Senior Management up to $100,000<br />to E+Co’s Investment Committee $100,000+<br />Execute Legal Documents <br />Disburse funds<br />
  20. 20. E+Co Legal Support<br /><ul><li>Local Lawyers have vetted E+Co’s Loan documents.
  21. 21. E+Co staff sends Term Sheet to Lawyers once the investment is approved.
  22. 22. Lawyers prepare legal documents and communicate with client’s lawyers.
  23. 23. Lawyers oversee execution of documents, including registration of collateral and signed agreements.
  24. 24. If client defaults, E+Co engages local legal counsel to assist with collection.
  25. 25. E+Co Headquarters works with Weil, Gotshal on a pro bono basis for other matters</li></li></ul><li>Thank you!<br />Anne Murray<br />Senior Development Officer, E+Co<br />www.EandCo.net<br />

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