JM: So I guess the first thing to ask Warren is can you give us a very brief overview of SDCL?

WP: The firm was established in 2007/2008 by Jonathan Maxwell, our Founder, and Group CEO. The group will have been originally set up as a specialist financial adviser focused on various environmental infrastructure sectors, in advising governments, corporates, and large asset owners on their long term investment activities in clean energy, water, waste, and sustainable transportation.

Energy for us is clean energy, so offshore wind, onshore wind, solar pv, and waste to energy. With water and waste, we look for an energy aspect, so for waste it’s waste to energy and for water it's about creating energy savings. And for transport it's really around the electrification of transportation within both public and private sectors.

 We do this globally, as the group was set up from the outset with offices in London, New York and Hong Kong - now further expanded into additional offices in Singapore, Madrid and Dublin. 

The group has maintained the same core focus on environmental infrastructure since its founding 12+years ago, however we will have evolved as an organisation, as we worked to establish a private investment platform in and around 2012. The private investment side of the group has grown rapidly in investments made, capital committed, and team added.  

Where are we today? We are some 40 plus professionals across both platforms. Our private investment platform has approximately $1bn+ in committed and invested capital across various projects around the world, and our investment banking group continues to serve governments, corporates, and large asset owners on their investment activities within the environmental infrastructure markets.  

JM: Excellent, so taking a step back to 2019, this time last year what would you say had been SDCL’s key achievements?

WP: Looking back on our investment banking side, it was a good year for the sectors we work in, for many of our clients, and therefore for us as well. The year 2019 will have seen record equity and project finance flows into energy and water infrastructure with flows starting to materialise into sustainable transport as well, specifically into the electrification of transport.

On our private investment side, we had a first in completing a London Stock Exchange listed vehicle, a great achievement for the private investment group, as the vehicle has gone on to secure capital sponsorship of £450m+ in total capital raised, importantly with material investment being made into core environmental infrastructure – a great outcome.

JM: Congratulations!And what were the challenges from last year? 

WP: I’d say our biggest challenge last year was resourcing, we probably outperformed our own internal forecasts and projections for the group, so in an effort to deliver we really stressed our team and resources.  We have taken time through the Covid period to set further resources in place and I think we were going into this fiscal year with the expectation that we would at least have a performance equal if not exceeding last year's gains.

JM: Can I just quickly ask what is the split on staffing between your investment banking and the private investments teams?

WP: Our private investment group is the larger of the teams, with some 35 investment and supporting professionals. Our investment banking side shares central supporting team members, however, there are some 10 professionals and supporting team members on our investment banking side. We have a well placed board of directors that complements senior management.  

JM: Staying with 2019, what had been the forecasts for this year, in terms of market share, revenue generation, human capital growth, what were the plans for 2020 before the pandemic hit us all?

WP: I believe for us we had a very good year which technically finished in April 2020. We finished materially up from our previous year, as much of our industry were pushing across our markets.  We didn’t necessarily expect to continue at the same pace going into this year, however we thought we would maintain our levels. 

JM: How has some of President Trump’s decisions like redrawing from the Paris Accord affected your U.S opportunities? 

WP: No real impact, the U.S is not driven at the national level, however rather more at the state level. If you take just one state for example, California, they are already meeting all the commitments that would have been made by any one Country regarding the Paris accords. You can almost go state by state and look at this. I mean Texas, a historically conservative, and republican state, has got more wind and solar resources installed than most, if not all other states in America. So, when we look at the U.S markets, while the Presidents have a view, there are so many checks and balances at the state level, within municipalities that there is quite a bit of autonomy.

JM: And moving into 2020, can you tell me how Q1 has manifested against your assumptions and forecasts?

WP: We will have gone into Q1 2020 on a good footing. We took up a new head office this year and added key new team members to both sides of the business. Our sectors have received continued positive policy support across global markets, with positive investor sentiment following, so business has been on track.

JM: And broadly speaking in regards to Covid, how has this pandemic affected your business development, expense, revenue and your talent acquisition & retention strategies?

WP: Given the various constraints on international travel, I would suggest expenses have been adjusted accordingly. Revenues remain in line, though we do see shifts across quarters as the second wave of Covid (and the associated lock downs and economic disruptions) hits all sectors.

Regarding talent acquisition, we were adding personnel in support of existing business and the new business we had planned on. Now with Covid and the accompanying economic dislocation that it has brought, what we are seeing and continue to see is not dissimilar to what we saw post the financial crisis. Governments, in an effort to keep the economy going, keep society moving forward, have really doubled and tripled down on renewable energy and sustainable transport as green job creation help boost an economy.  

You would have seen that a few weeks ago when Boris Johnson announced his 10 point plan for the green economy further recommitting to offshore wind and adjusting the deadline to which you will have to convert from a conventional vehicle to an electric vehicle – in bringing the target date in from 2035 to 2030. All of that is tied to the UK, however other countries are following the same path and are rolling out their own commitments to a sustainable economy. Particularly the EU which remains a core market for us. 

JM: It seems like the future then might be EU focused for SDCL, are you likely  to continue here in London or review your options to relocate into Continental Europe... maybe Germany?

WP: Our EU office will remain in Dublin. We have been there for the last 4- 5 years now. We also opened an office in Madrid, primarily for our investment activities, and we believe that should be more than enough for our current EU scope.

JM: And just jumping back to the talent side of things, over the years what would you say is your preference between your own networks and working with search firms. Which has brought more positive results? 

WP: As you know, we are not a large firm, so for us search firms are important to our business. And I would say that they do an excellent job finding talent. However I believe an area for further growth and focus for search firms is in supporting the retention of said talent and helping businesses of our size work on coaching and development. Small firms need additional support post placement.

JM: Absolutely, I think that is still an area for development, although some of the bigger search firms do have dedicated talent retention teams. I know that was something we were keen on establishing here at Diversitas. The advice on retaining both new and old talent, outpaces just financial incentives and needs attention to focus on things like job satisfaction, progression, benefits package, ongoing career development.. I could go on and on!

Now in terms of next year can we start with what lessons you have learnt from this year that you are going to be taking forward to 2021?

WP: We are always learning, always developing. In our sector, the ‘learnings’ this year are more about ‘rememberings’, given the energy sector is currently going through a transition from subsidized to unsubsidized energy markets. To a degree, energy markets are going back to the way they were before there were subsidies for renewable energy generation – which is this year’s main learning.

JM: Ok and what does growth in 2021 look like for you guys? 

WP: I believe if you look at the last 10 years in our sector, growth has been very positive, maybe 25% year on year. So we don’t see much changing in that regard as most governments are still pushing transitions into cleaner energy, more sustainable transport, and where available more energy savings within the built environment. 

Given the positioning originally set in place by our group’s founder and CEO, Jonathan Maxwell, I believe we remain very well positioned, if not set right in the middle of this exciting sector.

JM: What is the strategy for next year, am sure  you are going to continue doing what you're doing, it's obviously been very successful but is there a particular idea/ plan that you are thinking of implementing for next year?

WP: Two areas we are looking closer at, and see potential, are in energy storage where we see increased maturity and the beginnings of institutional investment, and then in the electrification of transportation, where we are seeing material policy statements/commitments being made, and more importantly industrial focus and investment.

JM: Sorry to interrupt, but is that public transportation or private? I presume there is already a robust private market with so many electrical and hybrid cars available now.

WP: It's happening at the same time.  In public transport, it is affected by long term contracting structures and politic features. In private transport, for commercial or industrial, it is affected more by investor pressures on corporates to move in the direction of electrifying vehicle fleets.  And in personal transport, it is driven more by pure consumer demand, which has a number of influences.

For us these are the tipping points we notice, discuss internally and make sure our investors are aware of.

JM: And then moving on to social issues, how has 2020 and the pandemic affected you personally?

WP:  Covid has affected everyone through this past year.  Some in the most important of ways though the loss of friends, family, or close colleagues. Although fortunate in that regard, we have not been affected as many have given the change in way of living and working.

JM: Sure and can you tell me about a cause or social issue that you are passionate about?

WP: I would say sponsoring diversity, within society and corporate organisations. We are an international firm in terms of our staffing, in working across international markets, and working with clients, partners, and counterparties from around the globe. It is important we continue to learn how to maximise the benefits of diversity, both within our own work environment and for our clients and their organisations. 

JM: Warren, thank you so much for taking the time to talk us through the adventures of SDCL this year and we wish you all the best for 2021.