The first week of Dec has already passed and we are fast approaching the festive highlight of the year – Christmas and New Year that is 6 days apart. Everyone in the office is clearing leave and not feeling like working so hard now.
The last 3 months passed by so fast for me since I started my new job in Sep. In the past years, not having worked full time since 2018, I had to find things to do to occupy my time. I would set targets and goals for myself to accomplish, like lifelong learning and completing full-time and online courses while I formulate my KPIs for the new year.
Since Sep, we had to rush to complete several milestones to meet our stated timelines. We had just gotten In-Principal Approval from MAS IN late Aug with a to-do list that we aimed and succeeded in completing by early Oct. MAS finally gave us the CMS license approval 3 weeks later.
Then I had to settle a major manpower issue when one of our critical staff suddenly decided to quit on us. Nov was also the discussions with our external legal on the formation of the VCC (Variable Capital Company) setup. With less than 10 people in the whole office, I also decided to kickstart and organize monthly TGIF drinks on the first Fri of the month for all of us to get to know each other better.
We also had multiple video calls with external vendors. We want to sign up for several services that are critical to support our lean team going forward. It was fortunate that we had decided to set up a systematic internal assessment process right at the beginning. Each of us would individually provide our scores on 10 key measurements of each vendor after we had met them. The scores were then consolidated by the COO who would tabulate the average score so that we can effectively rank all the vendors for each service.
We are into the last month of the year now and everyone is going on leave. As per our plan, we aim to do an intensive 3-month road show in 1Q’24 to introduce ourselves. It is also to gather feedback so that we can fine-tune the funds’ offerings. Given the short Feb month and Chinese New Year, it will be challenging to try to line up as many calls as possible but we will give it our best shot. In March, we plan to do an official ceremony to launch our FMC as our company sponsor wants to celebrate our MAS-approved license in a big way.
Next, we plan to launch our first Solar PPA fund in Jun and then another Green/Clean Tech fund in Aug. These Private Equity structured funds will target Accredited Investors and we hope to raise at least USD 50 M in committed funding.
There will be a lot of legal documentation we have to complete from Mar onwards. Concurrently, we need to build up the Solar project pipelines for investments while screening through companies and doing due diligence for investment possibilities for the 2nd fund. The Board of Directors and Investment Committee to approve each investment must also be set up. There will be a lot of balls to juggle for a small startup team like ours for the next 12 months.
Into the first week of Dec so far, we have been busy preparing the groundwork for 2024. We have drafted and reviewed the first cut of all the policies as required by an FMC under the purview of MAS. We have nailed down the top 2 external vendors we would want to engage for Compliance, Professional Insurance, Internal/External Audit, Fund Administration, Corporate Services and Tax Advisory.
Our 2024 timeline and milestones need to be more detailed to ensure that we do not miss out on crucial steps and encounter delays. An introductory deck is currently being developed to be used from Jan as we connect with investors to explain to them our mission and objectives as a Green fund.
We plan to use social media extensively to broadcast our name to the targeted audience for maximum impact. LinkedIn and an official company website will be our main tools plus a lot of personal industry contacts. I believe that there is a niche for us now, given the reality of climate change and more aggressive efforts by governments all over the world to arrest the trend of rising temperatures for the good of future generations.
Increasing costs of going from carbon-negative to zero goals will force companies to reassess new ways to reduce their Carbon Tax bill. Governments like S’pore have already announced that the tax per tonne of emission will rise from $5 now to $80 by 2030. There will be a huge demand for carbon credits and we can supply them via our Green funds.
Energy costs for industries are set to rise as electricity producers mainly use gas in S’pore and the price of gas is expected to increase next year. Renewable energy like Solar will become critical to the overall cost consideration.
Traditional Impact funds into the Social part of ESG only require a reasonable return eg. 2% above Libor. Our Green funds aim to provide an IRR of 10 to 20+%. We will show that it is possible to invest in funds that champion sustainability as its main goal yet produce high-quality returns. Investors can then claim that part of their portfolio is indeed placed in the ESG space for the greater good of planet Earth. Investors, after a disastrous year of Greenwashing, will demand greater transparency which our funds can provide. We can have our cake and eat it too.
There are still many more uncertainties and moving variables ahead of us. But we will try our darn best to push ahead into 2024 to develop and launch our funds. They are aligned with the bigger goal of helping the world slow down climate change, a win-win solution.
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