R20 Foundation / Pegasus / Capital Advisor / Gold Standard/ IUCN /

Green Climate Fund

We are also have a vision around building and driving impact economy where financial and
social returns are valued and we deploy catalytic funding at the initial stage, where we try and
build the pipeline of investable opportunities, whether that be through, grant or social investment
capital, we tried to get that to scale through three routes, the government partnerships and
blend of finance.

So blended, finances, really core to what we do and underpinning, it all is really our work on
impact, transparency and standards. So why are we very well placed to do work in blended
finance, where links to a wealth manager where we have access to philanthropic capital. That
can be dear, risk structures, but we're also able to work with our colleagues and asset
management and the investment bank to structure some of these solutions.

So maybe then to the point about becoming really concrete, I want to give you examples of
where we've done blended finance into aspects. One is outcomes contracts and you mentioned
impact on, so I'll come back to that. And two is some examples and nature-based solutions
because we feel like there's a lot of potential in that space for blended fin, So starting with
outcomes contracts, so you gave an introduction.

So I won't go into what they are. But what we try to get out of outcomes, contracts is a way to
make sectors that are traditionally less investable investable. But also to make sure that we're
actually linking financial returns to social and impact on the ground So that direct correlation.

So we've been trying to build pipeline and track record in these types of instruments, The quality
education, India did that we've been involved with small initially. So 10 million in size, working
with four different providers to deliver improved learning for children in India After four year
period. It actually delivered over-delivered on its targets.

Improving learning from different children and delivering an eight percent return for investors.
Similarly, on the health side, the quality, the uterus maternal and newborn health, and impact
bond was around. Improving quality standards for small clinics in Rajasthan. Again, very
successful in a lining incentives. We had USAID large donor merch, a large corporate on the
outcome funding side and investors that we pulled to deliver on that.

By building on that track record, we then partnered with our asset management colleague to
deliver a blended finance structure where philanthropic capital came in. It's a hundred
millisecond structure philanthropic capital to as a first loss to then attract more commercial
investors. So the first let's say global landed finance structure.

Focus on one example, Moving to night nature based solutions, as a second example, we've
really feel that that's an area or blended finance can help the scale project and support the
pipeline of investible opportunities, maybe a very concrete examples of a project that we're
supporting in Indonesia. So fair ventures social forestry, they put concessions with degraded
land back to use by conserving high value, forests generating, revenues from carbon credits
and also establishing timber and cash crop plantations.

On degraded land to actually with generate lightweight looks income. So building on model to
then create a blended finance structure with different types of concessions, throughout
Indonesia to attract in our shop that I'll give a happy to go into more details. Am I? That is
absolutely. I could that's a perfect perfect setup and I'm gonna come past I'm gonna come to
you in a second in terms of a couple of things, what you've, what you've had so far, but
importantly, Maya and Melkia both reference that performance component, whether it was the
humanitarian impact bond, which I think was paid back in July that you referred to, or in terms of
the, the performance built into those different structures, the importance that.

But if you'll come in, from the Pegasus side, which I, I guess is the, you know, private private
and the non-pegasus for a while at the end of the fantastic work you've done, what are you
hearing? And then on that performance piece that seems to be. So, important part of the floor is
yours.

Thanks for, so, let me add a little bit of introduction to what Pegasus is doing. So, Pegasus is an
impact fund manager, within around for a little over 25 years and we were started in 1995. So,
or that time you're invested nearly two billion dollars across the variety of sectors, but
increasingly, sustainable, and health indolences.

And as part of this journey, we have recently launched two blended finances. And I said in one
of them, which is the sub-national climate one. And this one effectively focuses on the green
economy in developing countries. And what I mean by that is we focus on four. One is
renewable energy and your efficiency waste management and water urban solutions and
privacy and it is a blended finance one.

So I sit on the investment side and Pegasus is the investment manager. And my colleagues on
the R20 and IUCN and goal standard side said on the technical assistance, so it touches upon a
lot of asset having at r20, might not just just in terms of the acronyms and things sure.

Bring people to a baseline in the room. I have this obsessional hatred. Yeah, I think it'd be really
useful. So it's, it's reasons, 20, it's an organisation based engineer. It's been around for a period
of time, and it was started by almost worth maker IUT, and I won't kind of steal that hundred.

I think they're right here. That's good. That's cool. That's good. And go standard. I think you
you're all aware of it's in an impact methodology nonprofit that originally started working on
carbon markets, but now it's also looking at fun certification. Perfect. Thank you. So in terms of
where we are, I think what STF is aiming to do is is touching upon a lot of the things.

So on the technical assistance side, we are funding early state studies environments and in
social reports and really providing capital that can build projects in two to three years from now.
Now, all of them result in actual projects, maybe, but the idea is to provide funding at this stage
so that they become real.

I think one example, I'll give you is, there is a market, we're about to publish a study. So it's on
the black soldier, fly market. Now, we looked at an investment opportunity, late last year and
that kind of prompted us to analyse this market a bit more in detail.

Now, it's a very nice insector. It's a sector that actually starting the Netherlands. Back in 10
years ago, It's largely focused on US, Canada and Europe. But there is a market for these
insects that can consume anything in emerging markets. And we're looking at it to see if there
are investment opportunities that could come a few years down the road, But that's an funding
early stage pre-fisibility studies to kind of put on the capital side.

Now, coming to the investment window side and how these two sectors kind of blend together
is, in addition to the black soldier, ply study, we've also looked at the commercial industrial
growth market and a number of countries. And we are actively looking at opportunities and
considering having quite detail in countries such as South Africa in Indonesia, where there is a
lot of existing great runs on thermal capacity and we effectively investing in rooftop solar
platforms that can invest and convert the existing customers that basically all take their power,
90% through thermal coal to renewable, power to mobilise investments into these spaces.

Because the way we are structured as a fund is for every investment that we do, we need to
need to be as easy. And in these sectors, it's fairly straightforward because the impact of we're
creating in these opportunities, But we take impact and what we are doing here quite seriously.

I mean, there are a number of opportunities that we have considered that we have passed on
because it doesn't fit our funds impact and stands up really well. So, when we look at
opportunities on the investment side, it's on three pillars. One is the impact filler second is, does
the business case stand up and the third is to the return centre.

If those three checkboxes, then we take the proposal to our arts and initial investment
committee and then obviously to do diligence. And then if it, if it works out, then we'll make the
investment. But let me pause here. And kind of give you again a test upon a couple of concrete
examples, and I'm happy to take questions in this regard.

Oh, just a very quick rider and I'm coming to devise from you next and then Dorothy from IU,
Sen you'll sweep in and give us that international organisation view, okay? Path. In terms of the
the performance piece, right? Just very fancies the performance piece that a couple of the
speakers are referred to.

But also the sort of crowding, outfit just very brief on both and then we'll go to the bias. So on
the, on the performance piece, I think, what I would say is on the impacts of in touch is that we
are actually an article nine fun within the UXonomy.
And we are along with gold standard, creating a set of impact standards that are fun, will kind of
achieve. So our fund will be certified both when an expanded basis as well as on a post and
devices to kind of make sure that the performance we deliver actually signs up to the impact
methodology, we agreed to on day, one.

So go standard is actively involved. And when we look at opportunities to make sure that they
will comply with that performance, initially they'll be viewing a lot of our investments and then
over a period of time, they'll do a sample selection, So that's on one side. And I think on the on
the crowding outside, I would say is that we do need more private sector capital to come into
emerging markets and effectively.

SCF is a fun created for that. I mean, we have 150 million dollars of first loss, catalytic capital,
from the UN green climate fund, and that is meant to be leverage on a 4-1 basis. So, yes, I think
I think it is meant to be trading any more industries into these areas.

And to the point on whether we compete with MDs I and and other pools of existing the advisor.
I think one advantage that funds like ours have in this space is think of us as effectively like a
private sector DFI. We achieve the same impacts and methodologies because we are
complying with IFC performance standards.

But two we move at the speed of a private equity bond, Okay? So actually the point that that
again another perspective will yes or no answer and only yes or no You have one choice It's a
binary And was it easy and efficient to get money from the green climate funds?

Yes. Or no, I think it's a process. That's two entities. Yeah, You failed on that one? Sorry part.
Listen, Thank you for that input to buy smile from Swiss reinsurance. The floor is yours in terms
of a what you've had coming from. The bigger institutional side. Perhaps what you're taking in
terms of blended finance?

Thank you. Let me just say. So I work for Swiss Read global insurance and reinsurance
company. And what I'm going to say is doesn't only apply to Swiss three, but I operate any
market if you will that combined, that blends private capital and multilateral capital. And so I'll
give you two examples.

One was a recent commercial loan to a government of a sub-Saharan African country who were
going to use the proceeds of this loan, a billion dollars to improve the water systems around
their capital. And so you have a consortium of banks who are interested in making this loan and
providing this financing in principle you should imagine this is like a project finance transaction,
right?

15 year 10 or that type of thing. But the only reason that they're willing to lend to a sub-Saharan
African solvent two years into the into the pandemic is that a multilateral provides what's called
a partial credit guarantee? So they'll say listen, if this government doesn't repay you, the bar,
the excuse me, the lenders, then we'll make you whole, right?

So this money would not flow period without this instrument And where I come in is that these
lenders and say, well, so 50% of my loan is covered by this multilateral which has AAA rating
the preferred credit or treatment, which completely mitigates, the sovereign risk because these
governments have no interest on defaulting on anything provided by multilateral.

But I want to cover my loan up to, you know, 95% and then they enter into the insurance
market, where companies like mine, provide, what's called sovereign non-payment insurance.
And so that the borrower, the, excuse me, these commercial banks, it's a consortium, you know,
they effectively buy insurance, combine it with this, blend it with this multilateral instrument.

That really only an MDB can provide and that unlocks this. The alternative would be no
financing, no improvement of diswater system or that they simply get a loan from a multilateral
which they obviously do. But they're always reasons by multilaterals cannot finance and
everything themselves In the second model in which, which I actively engage in all the time.

Is sovereign governments have following years of technical assistance to better understand

their own sort of contingent liabilities, that arise from climate risks. So, think about Caribbean
islands, who face hurricane risks, the Philippines heavily exposed to earthquake in and tropical
cyclone risk and so forth. These countries receive technical assistance from the multilaterals
and others on how to quantify that think about that and create maps.

You know, better understand these phenomenons. And a subset of these countries ultimately
try decide to transfer a portion of that risk to the market. So it effectively they buy sovereign
insurance, if you will right. And it's not the only measure they do. They typically also send up
separating day funds that they can tap into following such an event, but the reality is they need
search funding.

When a strong earthquake comes along when when a hurricane devastates, in the Caribbean
islands and so forth. And so in the trance, in the execution of such transactions whereby a
sovereign government effectively buys insurance simply, not an insurance instrument but it
doesn't matter. Those transactions not only happen because they have received technical
assistance to better understand this and take this very calculated step, but the transaction is
also intermediated by a multilateral.

In other words, you have two contracts, You have one contract between solving government
and the multilateral wherever they are be they in Washington or or wherever and the second
contract between that multilateral and the market, right? And so C3 is one of the players who
can ultimately absorb that type of risks and many times we simply structure these transactions
and they are syndicated in the capital markets, where they are an interesting asset class that is
not correlated with the economic cycles device.

Perfect Dorothy. I'm going to put you in a second, but I'm putting the audience on the watch is
everyone in the room and absolute expert on blended finance, you know, everything and you
understand everything which has been said showtimes, that's good. Because that means you're
gonna have questions, okay?

If not the experts, the rest. So I'm putting the audience on watch in terms of if you're What's the
word for it? No, it's not polite word. But if if there's anything that you're not tracking, here we will
come in a short while to the the pan in the keynote right to your own watch as well.

I'm just trying to set up a little bit attention here and it's always good and everything. And so
think of your questions and let's have them delivered ruthlessly with a smile, okay. And I'm
going to come across a Dorothy Dorothy. Thank you for your patience and for waiting, but I left
you as an international organisation, not yourself IUCN, the last intent of coming at coming in in
some ways from a hundred thousand feet but you've got real we had a conversation before this
meeting, you've got real expertise on the ground in terms of how you deliver funds and what
mechanisms can work between public and private and how we can scale those.

So what have you here heard what has given you joy? What has given you concern? Are you
see out? The floor is yours. Okay, thank you so much for and I'll actually take the challenge for
the GCF. No, it has not been easy, so we can elaborate on that.

It certainly a big piece of the puzzle of blended finance. Yeah. No, and interesting, and ICN for
those. And my thunder is the international union for conservation of nature. We exist since 1948
and our membership organisation. So we have governments entities NGOs. More recently also
indigenous peoples group, as well as sub-national government as our members, and we have
an four-yearly Congress where sort of big conservation agenda by diversity.

And so forth is being set by by the global community. And of course was recently. And what we
see in in big reports is that public finance philanthropic finance for conservation is not enough.
So of course we look our ultimate goal is that we want to conserve protect restore nature
sustainably manager, our natural resources.

But how do we make that happen if there is a shortage of the public and philanthropic money?
So of course we go also work or look much more to the capital markets and I think here that
there is a wealth of opportunity. Of course, there's also risks in, I mean, there is, you know, bad
pressing in that sense as well in terms of green washing and so forth.

So we shouldn't and negate out, but I think we have as IUCN. I think really an opportunity to
work with the the various financial players specifically on the impact side. So we don't all not
only work for example, with the sub national climate fund. We are managing the technical
assistance around feasibility studies capacity building, we work with gold standard on the
metrics.

I to is to risk to buy capacity. So climate infrastructure has likely some negative impacts and by
diversity. So how do we deal with that? But the flip side is, how do we integrate nature-based
solutions? And that was already mentioned by my colleague from from the US foundation. So
there nature-based solutions very quickly.

It's about the conservation restoration, actively of ecosystem for societal challenges that climate
change by diversity, food security, and so forth. But that's easier said than done. So I think we
heard also from the colleague from cycle, TA take time, they take a lot of time and I think there
we need to be realistic if we do it right, specifically.

Also, with the private sector, they have really huge opportunities, but I think what we see is you
know for years in the conservation world has been a certain mentality of also why people work
in the conservation community they speak a certain language not the same language that's
been spoken here.

I've been trying to do this finance work for the last five years and I've sometimes do like I don't
understand that can you please explain it. And I think that is what we as I said I also trying to
build our bridges with the finance community of how we bring by the best conservation and sort
of the financial and side together on quickly on the example.

Sorry if I took out a bit longer there. So we have, as we said before we, we're working with with
Pegasus and our colleagues from our 20, gold standard on national climate fund to really
identify those projects where and an ideal world, we have an infrastructure like renewable where
we can add nature-based solution actively in the business model.

So not just as a side effect of a CSR sort of corporate social responsibility type investment but
actually see how that will work in practise And quite frankly, the verdict is out how that will work
in the long run A smaller stuff. There's a smaller effort that I'm engaged in.

As you can see, I'm coming from the ocean side, We we are running also smaller technical
assistance where people ask me, why is it incubator isn't accelerated. Only, I don't care. I want
to help the people that the project developers to social enterprise on the ground and that's
where we always say just seems to be type private capital, but I'm always saying what these
people And taking a lot of ris to sort of try and come up with these, you business on, really,
integrating nature-based solutions from the Gekko and I'm trying to help them along the way to
attract different type of capital.

We had a fantastic project in Belize where the core is tourism. It engages also, with carbon
credits, It's around. It's in a very protected area. So we went in with a grant money through the
blue natural capital financing facility, which is backed up by government money and for example
to sustainable ocean fund put in alone.

So we were able really through that sort of means to, to fund efforts of that project development
phase, that sustainable ocean would not have done, We have projects in the Philippines. Again,
the business model running around seaweeds farming, they have plastic recycling carbon as
well, in an MPA, with local communities, creating new jobs.
And they I think that's also the reality where I'd like to hear from our colleagues, from from the is
got hit by a hurricane, where typhoon in this case, And the sort of the seaweed farms wiped out.
So how do we deal also, it going forwards, you know, with we know is specifically in the coastal
zone, these climate change impact will happen.

How do we build that also into this new business was because we know there's a lot of bars and
talk about nature space solutions. So how do we move brilliance from over there to the, you
know, currently one to five million project deals? And I think that is also the, you know, the
discussion, we need to have of this.

Bridging. How do we bridge from the billions down to the current projects on the ground?
Dorothy. Brilliant. We're going to the audience. I'm going two or three quick questions. There are
no statements, there are questions. And if you can introduce yourself very briefly and ideally tag
it to one of the panel or one of the keynotes that would be super.

So can I have any hands? The gentleman, the light loses shirt followed by the gentleman in the
jacket that and then another gentleman. There's not much gender ISD but they put the hands
up. Okay, so first question and we'll take the questions, please tag it to a panel member.

Sure, my name is Elco. I do board work and I work with love at entrepreneurs. When I connect
to the last comment of Dorothy about, how do you breach billions to millions? I come across
many entrepreneurs who have sol, there are four profit solutions. They are a billion ideas.

They got two teams that even close revenues many times. They're looking for seeds, maybe
series A at the same time, you see foundations and VCs which sit on a lot of dried powder. The
money is not flowing with respect, for all the great examples that we've heard. The money is not
flowing, They are very frustrated.

How do we get money flowing to those entrepreneurs who are as a poor profit doing great
projects and and we shouldn't be stuck as they start and think like policy discussions, big
tickets. I just spend an hour recently with a large investment manager. So in the end after an
hour, we only do takes a 50 million.

And I say, listen, we're looking at one, two, three, four, five million deals that I'm pitching for. It's
very frustrating to a lot of entrepreneurs Alcohol. Well, I picked up on on the comment of
authority, but I'm also looking at the lady from UBS. They found us heads up a foundation.

Maybe others have also solutions to my work. We'll come to you on that first question in a
second. We'll take the second question in the gentleman in the jacket here, and so, my other
tasks for you, the first question, I was pointing. Yeah, Jeff gets on unusual in this conference for
then anyway, The sorry, Paul McIntosh from AJ asset management magazine.

This is specifically addressed to what Dorothy was saying about risk, but it's not necessarily to
put her on the spot because it's for the whole panel solutions about quantifying risk for these
kind of opportunities because this is surely the way to unlock those capital flows by providing
actual really in a quantifiable risk metrics that investors who do have fiduciary responsibilities
such, you know, that they criminally prosecuted.

If they expose their investors to too much risk, I mean the pension funds and other, you know,
others in our owners of the money, they need to have risk, you know, quantifiable risk metrics
so that they can start deploying all these cat, all the capital into these projects, what kind of
solutions and what kind of metrics, do you see being developed that are most credible to do
this, okay?

You know what, two really good questions. So, we're gonna take the response and then I'll
come, we don't the lady on the right. I shouldn't see you. So we got another three questions, but
Maya, if you want to take the first one and does anyone before I nominate, does anyone want to
take the second question, on risk metrics, I'm looking for eyes Melkia.

I'm afraid I'm coming to you on that one and my other floor is yours on the, on the, on the first
question for a relatively brief response. Okay sure. So, thanks for the question. And and I think
it's about finding the right parts of capital that are willing to give those smaller ticket sizes.

And it is with the foundations or also the angel investors through accelerators incubators that
will provide that early stage capital they will not be. I mean, I think you can give you, you know,
we provide that early stage capital to entrepreneurs in our areas of focus. There are certainly, a
lot of other foundations that do the same and that there, I think I'm taking my ad because, you
know, actually entrepreneurs begging on their knees.

They go round and round. And the answer is, it doesn't feel the high location policy, you know,
come back, when you got a million revenues come back, when you have a lead investor, I can
give you five more answers of what you get. So I hear what you say and conceptually that's all
right, but on the ground, it's not happening enough.

And this isn't always more that we can do we partner with other foundations, that think along the
same lines, I can mention the amidier foundation. I can mention. We work, talk a fellow. And
then we all so these these incubators that also provide funding for early stage to bridging with
bridging philosophy, come in on alcohol's question.

But look, I we're capturing a really good theme there in terms of it's about the transmission and
delivery at speed with minimised bureaucracy and actually getting the money into the pockets of
the entrepreneurs who are doing on the ground. That's the ideal but it's in your mind alcohol not
working far from perfectly but that's that's a conversation.

We've got to focus on and begin to dig out those details. I will come back with a personal
example later on which absolutely meshes with yours. So mya. Thank you. Another pay
attention a little bit on the floor. Dorothy, come on in. Yeah, just adding to that one. I mean, we,
we act as a tier with the grants, but I think the way we we function is that we run call for
proposals.

You know, came up in the and introductory marks as well. And we have obviously more
requests than we conserve also with, with the money that we have backing up spacing, right?
So, it's also about how do we grow certain mechanisms? That that can help that. But we have
seen.

I mean we levelled our expectations from we started just five years ago, we had this great ideas
and we would get our return when the deal is closed except etc. Well that didn't happen. We just
took it very quickly off the table because we ultimately wanted to help the developers.

So we said they have enough to do. Let's give them to grant. Let's revisit his model in in five
years but it took just some of the project really two to three years to close this deal that we
wanted that. We have helped them on the road and I think there's really to to look at what type
of I mean, we've been working with some of the publicly backed investment funds that are quite,
you know, smaller in the conservation world.

But that I think again, I don't know which type of the temperatures interpreter you're looking for.
But that's the model I've seen working Dorothy and Maya this is quickly. There are also
increasingly bilateral governments that are also you know providing funding for smaller scale,
investors a smaller scale entrepreneur.

So I think it would be interesting to have that conversation in terms of what are the
entrepreneurs there's a dialect direct back up, bilateral conversation afterwards. Look thank
you. Welcome to you in the second but we're taking that third question so I can actually think on
my feet and tag it to someone very quick said question and mail care on metrics and also I think
Christians could have said thank you very much.

Crystal took a burger professor of things and I think investment yeah the risk, ideally issue
shouldn't be change, more from dearest language, to shared risk because what you said also
from IUCN, I mean the people on the ground had already huge respect this year daily. So your
comment on that.

But so from Swiss because you are the risk manager, and the second is the question of
acceleration again of decision. Making there was the type in the past, the governments are
slower and the private sector is fast. It's no more as simple as this, but I think we all have the
challenge how to accelerate decision making when I hear it, takes years and years and it's also
my experience from a first proposal to really an investment.

How can next arrange that? So please can acceleration, okay? Perfect, thank you. So malki
we're coming to your own risk metrics. I'm going to tag that third question, both to Christian but
also to path in terms of the app specifically the acceleration piece. So now here on the risk
metrics and maybe touching on that issue of going from de-risking language to shared risk, So
and I I don't know, you have any really answer to your question but the sub national climate firm
is a perfect example and how we can deal risk and attract a senior money with that junior
commercial of global climate fund.

So, of course, there is a, there is a gap between financing and value flow, and we need to pick
up progressively and that will be a bit. The role of the R20 foundation, R20 is a huge network of
certain national entities and the foundation could attract millions of beings in asking other
Chattanooga to turn around in countries and saying, okay, let's let's showcase the foundation is
ready.

Now to screen those deals with a specific metrics and things like that but there are not enough
capital so far. So I think it's it's it's a long road. We need to attract more juniors in order to be a
risk and to make aware pentry fans, a big family officers endowment that there is a proper risk
return and impact metrics into those new investment.

But of course, so far we are overcrowded by ideals and it's difficult to follow. Thank you for
thank you for the view from the market Christian. Yeah, maybe a point or two points on
quantifiable risk metrics. I think this is really a critical point because this would be a systemic
contribution to lowering probably the cost of capital for for the private tax between less in
emerging markets.

And I think one, one point is that we that we have on on our radar is that the global emerging
market database, that the multi electron institutions have to this should be made more
accessible for everyone. So it's it's partly but I think it needs to be more broadly accessible.

And I think it's it's exactly that kind of systemic contribution that that we need. And second I
think one point is also that the track recorded some, some funds need to build up and
sometimes it just takes a lot of time yesterday. We discussed that the private infrastructure and
group that we support the for instance that the emerging African infrastructure funded now
exists for 20 years.

So this is a track record that is established that also allows for for a rating. And and so once it's
rated and has this track record, it becomes more attractive for institutional investors and I think
again in some cases we need to to also establish that track recommend. See like when do we
do, we hit do we hit that these?

These critical thresholds Christian. Thank you, I'm going to come to path in about 10 seconds.
Look analysts, right? I'm of Irish, Kelsey origins. So I don't like too much structure. And what I've
got here in the audience is a problem of too many people asking questions, which is wonderful.

That means I have to work so putting it back on your basis. If you want to jump in, rather me
tagging people, you could have put your hand up, okay, and jump in. So that's one where we
can we can deal with technical issues all of that. Could we get another mic?
So these okay, all right before, so what we got? Okay. All right, put your manage won't you, I'm
sure optimist will manage the right situation work. So where are we? Good part. You're gonna
come in now and it's that issue in terms of separation of from the party. The acceleration of
money into the market into the entrepreneurs, who are delivering the social environmental value
and economic return.

But so let me touch upon two points because I don't also want to touch up on the seed question
that came earlier. So because I sit on the investment side and I look at proposals pretty much
every day and see which ones I'm going to take forward on the acceleration of investment.

It really depends on the entrepreneur and the company on how prepared they are. If you just
come with a concept to a fund and expect funding in six months, it's never going to happen. So
the question is, are you ready for investment? And that takes time, you have to have a team,
you have to process.

And look, I am not a seated investor. I come in, I'm an infrastructure. Adjuster. So typically
infrastructure investors, do both green field and brownfield investments, and that's what I do.
But if I'm thinking, if I'm talking VC language because has become the norm in the last 10 years,
we effectively come in at series being above, we come in at a stage where our minimum ticket
size is 5 is all the way up to 75 million dollars And our thesis is we are helping companies
institutionalise themselves.

So they have raised a little bit of money to have a little bit of track record. We're not asking all of
them to be profitable about the stage because we understand there is a bell curve, but in that
journey that they take with us, we are investing in assets and I'll give you a good example.

We are looking at actively looking at CNI company in Southeast Asia. They really that has
raised a bit of capital has put some assets on the ground, but we are going to come in and help
institutionalise their business become help them transition from being in pure developer to an
owner operator.

And we think there's a good investment case for that from making that happen. But we also
going to inject some TA capital for their super early stage projects to fund pre-visibility studies.
So there are opportunities to fund in two to three years from now at a larger scale. But this
investment is going to take, you know, it has taken a long time to get there because it is
complex to kind of structure these things.

But as I say, the company has to be ready In my experience, I've been doing this for now for a
while. But in the one year that I've been with Pegasus and with the climate fund because there's
some national pilot found only really started operations in male 2021, The limitation has not
been our speed of execution.

The limitation has been does, the sponsor, does the company have enough information?
Thankfully, most of the time they don't. So it's not that the funder here is of limitations. Usually, I
am chasing people, if I find a good opportunity on where their information decks are where their
flows are, is their data room.

Ready, Can they attract investment And that takes time? Well, let me jump in, that's at that, in
some ways is there's a TA part there in terms of and it's always been around entrepreneurs on
the ground, with good ideas being prepped and actually targeting the type of investor and the
stage and phase, there are comment.

Yes, if, if by GA we mean, but just like your project preparation at an early stage. Sure. But, but
there's a slight difference, right? Because if you are just looking for a seed investors or early
series A investors, that's a different. You just have a deck and idea and a couple of guys and
they want to execute on something.

But when you come to investors like ourselves that are coming, ineffectively a series being
about, you need to be a bit more prepared But let me just do this culture. There are sectors
where we do a little bit earlier. Why? Because the sector doesn't exist. I mean our classic
example is in the immobility space that we are.

Looking at in the space is only three four years old, If I want series be investments. I mean, I'm
gonna have to wait another five years. So, Paul, having castigated, you early, I'm castling
myself ETA, technical assistance, Good and path. CNI company. What's a CNI company? I
can't disclose the name, okay?

But what I should be, what is CNI commercial and industrial good. That's great. We're based on
everything. Okay, am I missing any response? I don't think so. There is, there's a quadrant in
this room which have just absolutely not did at the park. And if I'm facing that way, the bottom
four, here, I've all got questions.

So, the other quadrants in the room, I love this. Slight needle, five. I'm not gonna do the ball. I
think we've gotta come so I'm gonna bang short sharp questions, ideally tagged. But if one of
the robust panel sports to jump in, that will be great. So the gentleman the second row on the
left and then we'll go to the lady on the front row.

Thank you, and the time is flown. Does the panel feel the time is moving quickly? That's good to
keep your question from Gerard show from the Australian development of foreign affairs and
trade Christian group to work with the Swiss on pitch and convergence. Fantastic and lovely to
be in Geneva message for, I guess, Maya and path, the path.

I have a place for you to put your worms in Indonesia. So I'm based at the embassy in
Indonesia. I work on infrastructure and want to sanitation we do roads. Also the question is for
water. Particularly one of the key bottlenecks keys challenges for us to for investibility, are the
complex regulations and policy around water sector in Indonesia.

How best can we work with you guys on the environment? Okay, let's take the the second
question and then we'll answer those two. So the the lady on my far right? Thank you. And so
and sorry for missing you and thanks a big patient. I live in Australia, I've got my own business
in blended finance.

A question is to bath specifically if you can give examples, more enzymes investments, and
what is the return and then the equation was for Russian in terms of how much would you
charge for the rent? That insurance perfect questions, partly very popular and so I'm I'm gonna
come to you first and then across to Tobias wants to come in on one aspect of this.

And so we'll take those two questions first and then the remaining two and the fifth in this, same
question mind, my problem. Okay. So pop over to on the water policy question, look, I think
water and emerging markets. Generally don't just taking Indonesia, but it isn't is a nice and
sector.

When, if you look at water, a lot of the investments have happened in the desalination side, a
little bit has happened on the wastewater side, I mean Africa, which a bit more from there with.
It's a classic example, where, you know, in in the last 10 years you can count on your one hand,
how many private sector water projects have actually happened in the in the whole continent.

I mean that's 54 countries that we're talking about here, maybe a bit higher, a couple more
games but that is one thing. But I think one area where I have seen movement is if you can
make the water sector, as investable as it's on the IPP side, or on the exercise and it has to be.

Where can you actually attract private sector investment? Is it on D cell? Is it on wastewater?
Because if you expect the private sector to come in and to lay pipes, and I think that's difficult,
because that means right, over the issues line, acquisition issues, that is the job of the
government, and the state utility that has to pull that off.

But if the private sector can basically do a ring fans investment, whether that be in a wastewater
treatment plant, or if rights are ways have already been acquired and you want to the private
sectors of their pipes that's doable, but the private sector is not in a position to kind of do in go
out and do say they could win land acquisitions who lay pipes to give part of water to
communities.

So I think it's on identifying pieces where you want where you think the private sector can
deploy capital on the second point, I think I got very poor okay. On the second question. I only
got the returns. What was your first part of the water? Sorry. Give me that.

I got the question was around. How much does a sovereign? Non-payment insurance cost? So
there is no answer to that. Well, would you expect there to be an answer to that? Okay, it
depends obviously on factors like maturity and underlying use of proceeds and the government
itself and so forth.

The much more broader point for me is that we're talking about large amounts. So these are not
small, tickets sizes, 10 typically, and the appetite in the market and not, I don't think some office
is free. I'd say to some of the insurance market is in many instances, particularly over emerging
markets, created by sharing that risk, with the multilateral, who completely mitigates, this risk,
and that also brings down the price of the.

So if you were to say, how much does it cost to ensure, you know, making yourself in a
monologized, just, I have to give you an example. South Sudan, soccer, non-payment
insurance, there is no market for it period. But if you were to say, well, how much is it, if the
IBRD where Ida, you know, covers the first 50% of that?

Then maybe we can get to a price, right? Because insurance will say, well, if they don't repay,
what am I going to do? I'm going to take, you know, the government of x to court in their own
country. It's hopeless, right? So there's no sort of, there's no impact that we have, but in a
multilateral, say, excuse me, government of x, you still own us, you know, x y, z, and that has a
completely different reaction and that unlocks the market that I operate in perfect.

Does anyone else want a Christian? Maybe quickly things you wanted to have your Celtic
nature? I go back to one of the questions before and on BC and office Swiss structure. That's
what I'm saying. Chris, if they are in the Twitter unbeatable together, we go on. I think it just
generally.

I agree that there's certainly a lot of work still to be to be done in that area, but just to mention
two quick examples. I'm not sure if they would fit with what you're looking for. But one is that the
Seiko startup fund that provides loans to up to half a million Swiss francs.

The constraint is a bit that the that some assets are in Switzerland, the beat of the company or
of the, of the person because it's a public contract and we need to be able to reinforce it. And
the second example is from our colleagues from SDC on social impacts incentives, to think that
they did a quite interesting work with roots of which kind of supports startups to keep their
mission with the social and social performance kind of alive because often we see them
emission drifts to to becoming two commercial and leave the social or environmental.

The public could aspect. So to speak a sign and this support is actually an incentive and a
performance orientation. That, that allows the orbits this mission drift and keeps them and the
startup, maybe. Okay, everyone in the room. Take a deep breath. It's all right. And the panelists
as well because this is already a rich conversation, there's a lot to unpack.

So we've got about 25 minutes before the end. So we need a big sort of arrow so we can you
know focus down and doesn't become become what's the word fragmented, right? But there's a
lot already here. The three additional question. You're gonna have to be patient and we're
gonna hold for a moment.

So what I'm speaking to the panel now, but everyone's taking a deep breath. We've got 25
minutes left, I'm gonna save the world but we'll get her there. Okay. Now, I think in terms of the,
this sort of cross-cutting themes coming out here in my mind and I must be for more from you.

This there's obvious to speed of delivery of funds into them, into the ground, into the there. Is
this sort of, in some ways that elaborate nature that looking up, as an entrepreneur from the
ground, in terms of I've got a good idea. I've got a business, the switch and the Australians but
the donors, the grants to find the philanthropists.

All of that, that ability to help entrepreneurs do what paths said, which is prepare know, the
investors that you're going to is the phase of your company and make it kind of efficient. I
believe this huge amount of work to become back, okay. So speed preparation of the
entrepreneurs, in terms of I think and you referenced in your opening comments that in terms of
multilateral development banks that need to move from originating to distribute model which is
joy to more years and just let me throw on the table.

One comment and it's a bit. Is anyone from a multilateral developer back right? So I'm going to
just go that's good actually So South African investor not investor engineer He put more
infrastructure into Africa than I think any human being right over many decades and his
economy which he made to me a few years ago and resonated was multilateral development
slow little bit arrogant expensive but they are the devil we have to deal with now it's not my
words that's the commentary in terms of the multilateral development bank so that the eth.

So for the panelists let's just take a few minutes out here with some brief thoughts and
comments. In terms of those are the themes. I'm picking, but what are you individually? Singers
issued a very complex space in terms of, if you woke up on Christmas morning or whatever.
Holiday youth.

You celebrate at the answer. What would be the ask? So I'm going to just go bias across. Okay,
it's a little bit false but it helps it all take a breath agreed. No, you could have a big profit.
Agreed. Yep. What's the thing I'm going to take the liberty, not to so much.

Answer your question. I'd like, that's what I can observation which I think is is important. One
analytical level. Is that lended, finance, means different things in different contexts We have,
when you say blender, you really haven't said so much yet to be public money. Private mining. If
you've done this money and so forth And we're also talking about very different challenges or a
very different sectors and I think a bit of nuances is important.

So the gentleman had questions about what sounded like private equity or a private debt. I'm
talking about, you know, sovereign financing. So you know, let's we we use this term. This
category blended finance and we all touch it and work sort of in it and claim it to be working in it,
but it's very different things in different contexts.

And so there may not be that one. One answer to the questions that you that you write, But it
was, it wasn't a question in that way. If you wake up on Christmas morning, what would be
solved, right? And it's in your own institutional context. I'm coming back at you and then we
move to Christian, but you take a thing, Christian, and it's a very simplistic child, I think.

But you're right the labyrinth and blended finance. It is a nightmare Christian. I said, I'm well,
okay, I think I go in going back to the the multilateral development banks. I think that that's really
a discussion that we probably, and I'm talking us as Christian maybe now and hopefully, this is
not live stream.

I don't know. Actually, I think as I mentioned before, now, I think that the TA part of multilateral
banks that should really continue to to be seen as keys or the whole work on policies and
systemic issues, always tackle this first. I think that there should be an agreement about this
that we should first focus on on framework conditions on policies and systematic issues, which
are going to include.

Also the work on on data and transparency, etc. And then, on the, on the original hallways, this
distribution all. I think there we need to continue working because we can leverage the
multilateral development banks, much more. I think going forward but it probably needs some
adjustments in terms of governance and and incentives internally and they're all all
shareholders of multi-development banks and emotional development.

Banks, that themselves are kind of accountable for to wake up a new AC and say, right?
Actually we have it done and I think that's certainly agenda for the common years. Thank you
for your view and welcome back to device because I think we're almost landed milk. Yeah. Of
your your own stop using Christmas morning is dreadful unless you want to have it so yeah,
Christmas tree.

The good is a good example for what I would say. I will speak another supervision of David that
we have to honey on the the dream and the vision of our 20 foundation because I think that
foundation can really drink very significant gap. So, the foundation is now a fundraising for
additional donors money for helping a life for the SCF.

And with IUCN to enhance quality inflow and make them close to be invincible. So we have
another interest of the nurse say, okay. Let's let's do that. And then the challenge will be to be
able to connect to be connect of seven national enhanced glue global deep blue.

To connect with the capital market players. Very black hole has a project that blue orchard is
launching infrastructure. Base of the pyramid found. So there are plent to meet our quality flow,
but the cursed of structuring those, the engineering those to be paid by the country market
mechanism. So our vision is really to tap into our money And for enhancing technical assistance
facility and then you hate thousand of very interesting deals.

The French government approaches in. Grant us the nation for thinking about a speciability
study for a fund and many times many that are in regions, That's an example. So, there are
plenty of dollars able to, to build up that dream and, and Christmas celebrate. Now, we are
perfect. Now, the challenge, because we've got a few couple of questions, but this is the way
we're going to do it.

So we're going back to device very briefly. Then through the three myer, Dorothy a path will try
and be really even take a couple of the questions, if not, all of them People call with that good.
Okay. So the fires you're on the microphone for a quick answer and we have a choice.

No. So you know, at the risk of something abstract, which I don't want to it's going to be
conceptual. I think my answer may not be for this Christmas either, maybe for the next one, but
you're thinking ahead you're organised. That's good right? You know generally working at the
intersection of public and private where I work in which the results.

And what we've done once it happens called blended finance. Effectively you observe that both
sides are inevitably stuck in there, you know, in their industry and their terminology and their,
they have reflexes, right? And so somebody like me is constantly kind of trying to counteract
those reflexes or or sort of provide information.

Why perhaps in this case it could be done a different way. But when they saw from government
just to go back to that. Original example, when did government of Jamaica last year, for
example, decided to place hurricane risk in the so-called insurance market, right? They don't
wake up one day and say, hey, let's do this and then they call us and then is, you know, I mean,
you know, that's not how it works.

It takes a long time and that means that a lot of people who provide technical assistance,
provide guidance. Maybe there's a broker involved on our side have to kind of think about this.
You know, the ultimate objective here. And how are we gonna get this done? And how do we,
what do we have to change for this to happen from, you know, from from a more traditional
transaction, right?

When the other end is not a minister of finance. Who is inevitably going to be under super high
scrutiny for how he allocates money and why they take the choices? You know, that they that
they have to take and so forth and on their side. I think it also and I'm not talking about the
governor of Jamaica at all, but just the general counterparties, they have to at least conceptually
allow for this idea that somebody is going to price, whatever, they're investing in or whatever
risk they're taking in.

In a way that in the long run, probably yields a profit to buy studies perfect. And appreciate the
thought into that and Maya, PBS optimist foundation over to you. Thank you. So I think I want to
come back to comment that you made to be as is like blending for the sake of blending.

What are we blending for? And I think here on actually on this panel, I don't think we're all on
the same page in terms of why we're blending. And so I think one of that I would like, and what
was the big ambition is? Well, what what are we trying to achieve in terms of impact standards
and and set of common?
Baseline of what are we trying to achieve with, right? So the piece around impact measurement
and impact standards and impact benchmark, I think is critical for this whole ecosystem to work
And I don't think we've cracked that net. There's a lot of fragmentation around, you know,
different sectors and different bodies doing that, but I don't think we've cropped that in that and
not and the other.

The other two pieces that I want to mention is on on the investable opportunities and the lack of
cycling and back to the gentleman's point around different types of funding providers. That can
accompany that pipeline along its life cycle and the other piece that I think is critical, is having
funding to help structure deals bringing the right people around the table with the right type of
expertise.

And so that is making sure that you have the experts on the ground. Like IUCN. You have the,
the fund manager, that that knows how to deploy the money. But how do you bring that all
together? So that there is a Catholics. Ultimately We're wanted to If you want to deliver on
impact, you need to have that collaborative group of people and and if someone that has their
own expertise in all those areas.

And I think that is still my absolutely spot on and Dorothy. So SDG 17 collaboration should be
SDG one, right? Do we all agree good because collaboration is the only way to get to the rest of
the SDGs but I'm not going to overhaul. The multilateral system in this seminar.

So Dorothy my thank you for those comments. Really bad and hitting it on the head Dorothy
over to you then path we will take at least one question so you can have a fight at the moment
for now in terms of movie goes on deck okay sorry. Well. Absolutely what?

But Maya said on on the impact side but I would go with a very well. I'm not sure if it's simple but
this sort of speeding up the translation between nature and finance. I think that that for me is still
a very big as I said bridge to to build and actually sitting in meetings and in order to accelerate
some of the progress we want to see is that really from the conservation side, my financial
actors that we are much quicker to speaking the same language and a bit of.

Where are we on? The are we on the same page? And what those are. Unfortunately still,
Thank you for the gravity path. So look, I think I think to think about my point. I think the reason
why at least in our view blend finance exists and we are blended.

Finance fund is for three reasons. One. And first, and foremost is to attract private sector capital
into developing countries to mitigate effects. I mean, in your private sector investor investing in
developing countries. A lot of your returns are wiped out by effects because you are dollar
investor or and the third is to invest in more needs and sectors in these.

And this is what we are trying to achieve at SCF. So I would say, if I had one Christmas wishlist,
it would be that more appetite to invest in emerging markets and developing countries and the
structures that have been created. And I'm sure there'll be other structures that they can be
created to increase appetite.

Because I think that's the only way. This approach is scalable fantastic. Wearing the last five
minutes and this is where we were going to finish so I'm going to choose one question but the
other two, we don't get the question. I would suggest you approach the panelists to the end
because this gentleman here is watching so okay which is and game and thank you for all the
technical important all the assistance who to choose.

I'm gonna continue, I know, but I want you to choose which person is the Australians. Okay, you
got about four seconds over here. Yeah, first, thank you. We finished and do tag the question.
Then we're gonna close this continue for hours and hours. Now, as in years, and I think we
could use it as a platform going forward and building bridges to unpack a very rich
compensation.

So, please, if thank you a lot of pressure for the last question. So, my name is the food and I
work for something called Cameo which does market research on the, the street as well as one
of those fragments working on impact management and reporting. And we talked a lot today
about kind of the demand side but I would like to ask a question on the supply side from
investors.

We have seen time and time again through blended vehicles as well as private structures. That
impact vehicles are not losing money. They're doing quite well. We touched very rarely on
decoration on the long run. They've been quite well, They have positive returns and yet we still
see a lot of people saying, oh, it's too risky to invest in emerging markets and we have fiduciary
duty and so on and so forth.

So what kind of is the real bottleneck in terms of increasing investor appetites in this sector?
Like what information is missing that investors are asking for that they don't yet have or that
they are maybe using as an excuse not to invest and is a great question. Thank you very much,
Any takers.

Okay. Part briefly and then real close. I mean I can't speak. I can't speak for the investors. Each
investor has their own producer responsibility and beauty of, but I think returns, I mean, just
making a general, very strong, 10 to 15 years and if you can make very strong returns in
develop markets where you understand the jurisdictions and there's no effects.

This you need a premium above and beyond that to kind of les and taking effects and other
potential. And and the reality of the day is that when you go to emerging markets, the returns
are not going to be like 50%, right? So you make 20% in US. You're not going to make 50%.

That doesn't exist. So the question is, do you have appetite?

We all claim this space, the returns are what they are for the underlying assets and blended
vehicles can structure and help mitigate these risks. But they are the underlying return. Perfect
My, including impacted. I think that's hopeful. Did you see the Ronald Cohen in terms of the the
ESG impact quagmire of social media nightmare which is if we can if we can bring the two
together and it's a clear link into the produced, big piece that will help us, not all that some of the
problems go away.

So before I thank the panel, I'm going to just if I may add a couple of very, very brief
observations before Oliver closes me personally, down, and again, thanks to yourself and the
technical booth for everything. It's been and Cecilia said in wonderful job. Setting up, organising,
Thank you for that.

Look, I I have my first startup in Bangkok in 1991 called the Environmental Business Group.
Some people say got my timing wrong, I was actually late. Okay, in terms of the, the way the
clock is ticking on climate change and my observation is, there's two positive top positive things
Look.

It was one of it's one of those rare wins in an entrepreneur sense. But last week we signed after
two years paper to take a last-mile distribution company from Western Kenya, where we've had
the holding for eight years into talking's, province in Brazil and the way we did, it was with a
large sanitation company.

And the reason they brought into it was that the regulation in Brazil changed on sanitation, that
any sanitation company has to provide the same service across all this public mandates. Now,
that's easier if people are on grid for sanitation, if they're offering, it's really difficult. What's the
would you believe in Kenyan?

Last mile distribution company. So my point there is corporate venture, I think is a really
important part of the blended piece, which is often not very often talked about that's a personal
experience, but it was from business standpoint, it was really quite satisfying final point, a
normally based in Nairobi, I spent 50% of my time now London with a law firm, it's called
Michanda Reya who are building a sustainability practise.

Why have I done that? Why am I interested in that the North and specialises in working with
private entrepreneurial families worldwide. So, typically I might take a family up to the point of
IPL and all the needs there and all the different people things, but that for me, captures the
essence of, I think the private money, the private entrepreneurial money and the ability Christian
for it.

It's be given the entry to the markets. What we're seeing is huge, generational, shift in private
entrepreneurial and private money. In terms of the next generation they don't see sustainability
is an add-on. They see. It is the business of the future. I've been a little bit cliche, but I think it's
really important in terms of the product money.

So look, let me finish by saying device. Thank you very much. Christian say go swister out. Who
has done phenomenal work of a many decades to actually make it, whether it's on the the
microfinance side or moving any of the big vehicles and sustainable finance. So the pig take to
our teeny and see.

Thank you. Optimus foundation. UBS my great great contribution. But again what you're doing
and what you're actually delivering on the ground is a normal. Dorothy IUCN, you swept in? You
organised it all, you defeated the Irish like a structure, the Swiss then last shown to that. And
and Paul thank you for bringing your view Pegasus in terms of, you know, the challenges and
the need for the the entrepreneurs to prep understand where they are in the investment chain,
who they're asking, and how they're asking.

But I like you all to put your hands together and apologies but you can please approach
someone with your question. Although I think we're just about a time. Is that right? Thank you
again. To everyone who's organised and I think it was a rich conversation. I want plea wood.

Let's bring this back to building bridges. Let's unpack it in. As you've said to us, you know,
deliberate the terminology blended, some wonderful, doesn't it right? But it's it's complex and it
needs a bit more structure in some ways. Let's put our hands together. Thank you very much.