Investment Memo for AMDP

TO:                 Clark Hansen, C.E.O., Anima Mundi Development Partners (AMDP)

FROM:            Annie Huang, Research and Development Team

DATE:             June 30, 2021

SUBJECT:      AMDP Investment Proposal: Carbon Lighthouse

 

As a member of the Research and Development team at Anima Mundi Development Partners (AMDP), I have identified a social enterprise in the environmental industry that we could invest in. Carbon Lighthouse provides cardon-reduction solutions for commercial buildings, real estate building portfolios. In this memo, I will discuss the following:

• Standards for AMDP Investments
• Overview of Carbon Lighthouse 
• Carbon Lighthouse Market Reputation  
• Investment Recommendation 

 

 

Standards for AMDP Investments 

TRIPLE BOTTOM LINE

Triple Bottom Line is one of the most important criteria that we at AMDP consider when investing. It includes Profit, People and Planet.

• Profit: First and foremost, we would like to invest in a social enterprise that is profitable or be able to grow in the future. The company has the momentum to continue expanding. 
• People: Our investing philosophy emphasis on investing in a social enterprise that cares about its consumers, employees, and even the neighborhood around the company. 
• Planet: Our investing philosophy is not limited to the profit and people level. We want to invest in companies that are environmentally conscious and be able to help mitigate and stop climate change. 

 

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Corporate Social Responsibility (CSR) is another standard we value at AMDP. CSR initiative at large corporations is a department that support environment and earth and communities around the company by leading actions to reduce carbon footprint, energy waste, and make a different at a powerful leverage. 

 

 

SOCIAL ENTERPRISE

Social Enterprise is one of the main target company field we look to invest at AMDP. Social Enterprise is a business that serves to solve social, environmental related issues as the main purpose founding the company. A social enterprise can be specialized in renewable energy, water quality solutions, etc.

 

CARBON FOOTPRINT

Carbon Footprint is another aspect we evaluate when investing in a company. Carbon Footprint is the amount of greenhouse gases (CO²) that released into atmosphere by human being or human related activities. It is important to realize that climate change is hugely related to the overly release of greenhouse gases. Companies that can bring solutions to reduce carbon footprint would be attractive to take a further look. 

 

Overview of Freight Farms 

BACKGROUND

Carbon Lighthouse is a San Francisco company found in 2010 that aims to stop climate change by making it easy and profitable for building owners to cut carbon emission caused by wasted energy.

Carbon Lighthouse’s Efficiency Production service and patented AI technology platform, CLUES®, reduce carbon emissions and improve operational efficiency in commercial building portfolios. The software draws from over a decade of data across more than 100 million square feet of buildings to find and guarantee energy savings opportunities for commercial real estate (CRE) owners across the United States. 

 

People

Carbon Lighthouse employees all have same mission to save the planet by erasing carbon emission from commercial buildings. Senior management team is very approachable and willing to support the employees to help grow the company. While Carbon Lighthouse is taking care of its employees by proving a friendly and open work environment, it also concerns about the consumers and clients it served. Carbon Lighthouse is always trying to bring more optimized solutions to clients to help achieve their ESG goals. 

 

Planet

According to a Wall Street Journal article, due to Coronavirus pandemic, office buildings have difficulty trying to reduce carbon emissions, Landlords and property managers are pumping more outside air into buildings in order to reduce the likelihood of workers getting the virus. However, this practice leads to significantly higher energy bills and increase in carbon emission. Through Carbon Lighthouse’s software solutions (IoT sensors and AI-powered software), Carbon Lighthouse is able to unlock hidden returns in existing building mechanical systems and turn energy efficiency into tangible long-term savings. To date, Carbon Lighthouse has helped reduced carbon emissions by over 280,000 metric tons for clients.

 

 

Profit

From 2010 to now, Carbon Lighthouse has raised a total funding of $67.1 million including 2 seeds round and 3 venture rounds. The estimated annual revenue for Carbon Lighthouse is about $14.7 - $18 million and with the expectation of continue growing the client base in the future. According to Verdantix research, the global market for Environment, Health & Safety Software (EHS) is expected to grow from $1.35 billion in 2020 to $2.2 billion in 2025. The forecasted compound annual growth rate (CAGR) over the next five year in the industry is about 10%.

 

 

Carbon Lighthouse Market Reputation  

HAWAIIAN AIRLINE

Mark Berg, Managing Director of corporate real estate for Hawaiian Airlines mentioned their collaboration with Carbon Lighthouse. “As Hawaii's airline, we are headquartered in one of the most beautiful places on the planet, and so we are mindful of the impact that both our flying and ground operations have on the environment. We are always looking for ways to minimize our carbon footprint, and we anticipate the Carbon Lighthouse pilot will provide us with an opportunity to contribute even further to a more sustainable Hawaii.”

 

ALEXANDER & BALDWIN

Kit Millan, Senior Vice President in Asset Management commented on the partnership with Carbon Lighthouse. “Operating our business in ways that are sustainable and benefit the community is an important part of our commitment to being ‘Partners for Hawaii’. We view Carbon Lighthouse as a valuable partner in that effort.”

 

Investing Recommendation

Overall, Carbon Lighthouse fits into all the investing criterion we have for the investment. The business itself centers around reducing carbon emission and it utilizes advance technology to help make an impact. 

Company is growing quickly right now and would need more financing to help develop more advanced technology and more accurate service that can be provided to clients. With our investment, Carbon Lighthouse would be able to gain more momentum in the long term.