Just over two years ago, after a 25-year executive career in the film & television business in North America, Europe and Asia, I decided it was time to make a meaningful change, not only for myself but for humankind. It seemed to me that if we keep going down the path we’re heading, we might not have a planet on which to watch films anyway!
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Most people (notwithstanding “climate deniers”) have become aware of the facts: our globe’s atmosphere now has the highest carbon dioxide (CO2) concentration in nearly a million years; the estimated number of climate refugees by 2050 is 250 million people; the rate of global sea level rise in the last two decades was double that of the last century; and the list goes on, and on …
Another concern I’d been grappling with for years is social inequality. How can it be that in the 21st century, while some of us spend millions on cars and yachts and private jets, others just around the corner still use charcoal and dung to cook their evening meals (that is if they have food to cook to begin with)? There isn’t anything wrong with capitalism, but there is something wrong with such massive wealth discrepancies.
How can it be that in the 21st century, while some of us spend millions on cars and yachts and private jets, others just around the corner still use charcoal and dung to cook their evening meals (that is if they have food to cook to begin with)? There isn’t anything wrong with capitalism, but there is something wrong with such massive wealth discrepancies
At the Abu Dhabi Sustainability Week in 2018, I was fortunate enough to meet two like-minded souls.
Alex Alzamora was a renewable energy engineer who has designed and built more than a hundred plants across Europe, including Europe’s largest geothermal cogeneration plant.
James Spence was a financial expert and wealth manager who also happened to be an early investor in cryptocurrencies, and therefore understood well the business cases for using blockchain technology.
Three basic problems
Together we identified three basic problems that had to be fixed for a universal sustainable clean-energy model to succeed, along with three solutions:
PROBLEM #1: The traditional model of raising funds to finance renewable energy infrastructures was expensive and outdated.
SOLUTION: Adopting a Blockchain solution would facilitate disintermediation — the reduction in the use of intermediaries, and therefore the reduction in the cost of raising capital.
PROBLEM #2 Businesses that concentrate uniquely on profitability as the bottom-line will become irrelevant.
SOLUTION: Only a business that offers financial, as well as non-financial, returns can be sustainable in the long run.
PROBLEM #3: The market segments that worry the most about the plight of the planet, and who are susceptible to investing in order to make a difference, are the Millennials and Post-Millennials. Yet they are the ones that can least afford the expensive ticket prices of your typical Impact and Green Funds.
SOLUTION: To democratise access to impact investing, by digitising our future assets on a blockchain platform, which would allow us to price a digital security at a price affordable to anyone who wants their investment to make a difference to the world.
So, we decided to tackle these real-life problems and created our own company, Libra. Our primary mission is to finance, design and operate renewable energy plants, using efficient and affordable clean-technologies such as Biomass, Waste-Heat Recovery and Solar.
Still today, nearly a billion people around the world don’t have access to electricity. This is obviously not only a huge social problem, but contributes massively to global warming, since these people have no choice but to burn polluting fossil-fuels to live.
Our secondary mission is to make impact investing affordable. To this end, we have turned the fund-raising model upside down as we prepare to launch one of the first Digital Securities Offerings in the US and out of ADGM (Abu Dhabi Global Market).
Impact investing
The biggest challenge for impact investment companies in the Gulf region is not the technological aspects, but convincing local investors that the future of sustainability is through impact investing, a financial asset-class which looks at financial as well as non-financial returns.
Typically, impact start-ups derive their seed capital from investors in Europe and North America, where Triple bottom line is becoming more widely accepted as the key to future sustainability. TBL (triple bottom line) is an accounting framework with three parts: social, environmental and financial.
As shareholders become more aware of the impending consequences of irresponsible investing, an increasing amount of organisations have adopted the TBL framework to evaluate their performance in a broader perspective to create greater business value.
We already attracted angel investors from the UK, France, Holland, the Czech Republic, the US and Canada. We’re hoping to attract at least one local investor before we close our seed round at the end of January next year.
Having an Emirati on our Board of Directors would not only have a symbolic significance but would justify our decision to base the company’s operations in Abu Dhabi.
— Hans Fraikin is the CEO and co-founder of Libra Project.
