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Mosaic's Rosen on Lending Money to Solar Homeowners (Audio) · Bloomberg Intelligence

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  Speaker 1: Broadcasting live to New York, Bloomber to Washington, d C,
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  Speaker 1: bloom to Boston, BLUEMBERG twelve to San Francisco, Bloomberg nine
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  Speaker 1: to the countries General one, and around the globe the
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  Speaker 1: Blueberg Radio Plus app and Bloomberg dot Com. This is
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  Speaker 1: taking stock, coming up how to make money in this
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  Speaker 1: solar industry, but lending money to those that want to
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  Speaker 1: put solar panels on their roofs. For example, right now,
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  Speaker 1: Solar a growing number of customers are choosing to buy
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  Speaker 1: their systems through loan contracts at declining cost of solar,
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  Speaker 1: along with established reliability simply makes the loans a better
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  Speaker 1: option in most cases. We'll be speaking with Dan Rosen.
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  Speaker 1: He is the co founder and the president of Solar Mosaic.
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  Speaker 1: law SMP five hundred index down three to seventy nine,
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  Speaker 1: a drop there of two tens of one percent. I'm
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  Speaker 1: Charlie Pelton. That's a Bloomberg business flash. You're listening to
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  Speaker 1: taking stock with bim Box and Kathleen Hayes on Bloomberg Radio.
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  Speaker 1: Using the sun to produce electricity, No, that's not new,
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  Speaker 1: but lending money for the systems to do so, that
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  Speaker 1: is an innovation. And here to tell us more about
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  Speaker 1: it is Dan Rose and he is the co founder
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  Speaker 1: and the president of Mosaic Solar Mosaic. They can be
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  Speaker 1: followed on Twitter at Solar Mosaic and Dan joins us
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  Speaker 1: from San Francisco. Dan, thanks very much for being with
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  Speaker 1: me today. Can you just, first of all, UH define
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  Speaker 1: the sort of areas in which you operate, because you've
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  Speaker 1: got the modules those are the panels that are most
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  Speaker 1: widely viewed on homes, home roofs or on installations. But
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  Speaker 1: then you've got the whole system, the back end storage
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  Speaker 1: and making that electricity available. Tell us how that works
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  Speaker 1: into the world of mosaic. Sure, good afternoon, Thanks and
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  Speaker 1: thanks for having me. So if you think about uh
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  Speaker 1: the uh you know, how someone goes solar A lot
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  Speaker 1: of people have thought about it in the past, UH
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  Speaker 1: as being sort of a technology question, which is exactly
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  Speaker 1: what you said about panel, the inverterers and battery UM.
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  Speaker 1: Now that a lot of that technology UM is very
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  Speaker 1: proven and you know, we have panel that are still
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  Speaker 1: working thirty years later that we're installed in the in
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  Speaker 1: the in the in the eighties and seventies. Uh. You know,
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  Speaker 1: really the big challenge is, UH, that there's an upprom costs.
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  Speaker 1: Our average loan size is about thirty dollars, and so
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  Speaker 1: what most is we lend money to people who are
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  Speaker 1: buying those solar systems. So we finance UM the whole
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  Speaker 1: solar system UM, and the loan product is structure, and
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  Speaker 1: we try to help customers save money every month so
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  Speaker 1: they when they go solar UM, they're not only saving um,
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  Speaker 1: you know, carbon and doing good for the environment and
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  Speaker 1: improving their their home value, but actually every month we're
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  Speaker 1: hoping that they save money. Can you give us some
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  Speaker 1: figures for a two bedroom house, how much would it
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  Speaker 1: cost to do the installation? Tell us about financing costs
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  Speaker 1: as well, which so UM, every house is different and UH,
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  Speaker 1: and you know every system is different in different states
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  Speaker 1: as well. And you know solar UH the resources are
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  Speaker 1: different in different areas. But on average, our average system
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  Speaker 1: size is about thirty thousand bucks. And I think you
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  Speaker 1: see that as low as ten and you see systems
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  Speaker 1: that are very um you know, as high as we
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  Speaker 1: are alone go up to a hundred thousands. So it
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  Speaker 1: really depends on the on the system um our, our
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  Speaker 1: loan products range and pricing and tenor um you know,
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  Speaker 1: everything from to nine nine all the way up to
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  Speaker 1: six nine nine and um in terms of interest rate. Okay,
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  Speaker 1: so just under three to just under yeah, depending on
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  Speaker 1: you know, the credit profile and the risk of the
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  Speaker 1: of the customer. What about the collateral, that's a that's
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  Speaker 1: an important question. So what Mosaic does is we do
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  Speaker 1: not take a second position on the home. We take
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  Speaker 1: just a lean on the system. So we're able to
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  Speaker 1: turn off the system or get the system if someone
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  Speaker 1: doesn't doesn't pay. But you know, usually people understand that
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  Speaker 1: the system is creating value for them. Um, it's increasing
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  Speaker 1: the value of their home, it's helping them save monthly.
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  Speaker 1: So we have a very uh, very small uh for
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  Speaker 1: for the for the as the class that it is.
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  Speaker 1: It's it's incredible how small our levels of the false
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  Speaker 1: are be because we're creating, we're creating so much value
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  Speaker 1: for the customers, how many loans? How much? How much
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  Speaker 1: in dollar terms have you have you generated in loans?
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  Speaker 1: Were not? I apologize to avoid the question of we're
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  Speaker 1: not yet public about about those numbers. But where we
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  Speaker 1: are now I think the largest lender in home solar
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  Speaker 1: loans in the in the US. All right, but we
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  Speaker 1: can disclose what that You've recently raised two and twenty
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  Speaker 1: million dollars in funding. Yes, we raised a growth round
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  Speaker 1: from Warburg Pinkis, which is an incredible team and private
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  Speaker 1: equity firm that that sees the opportunity and sees us
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  Speaker 1: going uh and see the growth path of this company. Now,
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  Speaker 1: this money is not to be used to make loans,
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  Speaker 1: correct um. We're we're able to opportunistically use it how
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  Speaker 1: how we see fit. Um. Some of it will go
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  Speaker 1: into loan funding in terms of the different structures that
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  Speaker 1: we're that we're putting together, but as also will be
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  Speaker 1: used for operating capital and and and growing the business.
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  Speaker 1: So um, it's not it will be used for both
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  Speaker 1: loan funding and for UH and for operating capital. But
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  Speaker 1: in short, we uh, you know, with the amount of
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  Speaker 1: capital and lending that we're doing, we need to increase
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  Speaker 1: the really strength in our balance sheet. And Warburg came
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  Speaker 1: in with the two million dollar investment and and uh
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  Speaker 1: and and helped us do so. And this makes it
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  Speaker 1: easier for us to access the capital market. Where where
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  Speaker 1: you get access where are you accessing the money to
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  Speaker 1: make the loans currently? Currently we have um different working
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  Speaker 1: capital facilities with different banks, off takes facilities with insurance
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  Speaker 1: companies and also banks, and we're working on our Also
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  Speaker 1: we're working on securitization. So we're working on the first
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  Speaker 1: solar solely solar loans securitization UM. So that'll be exciting
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  Speaker 1: and so that and so those the goals accompanies at
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  Speaker 1: this point is to raise, you know, to be able
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  Speaker 1: to act as um as much capital as possible for
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  Speaker 1: for the business because we just see so much growth
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  Speaker 1: in front of us. Thanks very much. Dan Rosen is
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  Speaker 1: the co founder and the president of Mosaic. You can
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  Speaker 1: follow them on Twitter at Solar Mosaic. They're based in
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  Speaker 1: San Francisco. I'm Kim Fox. This is Bloomberg coming up
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  Speaker 1: on taking Stockron Sanchez, chief investment Officer Fiduciary Trust, helping
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  Speaker 1: to manage more than seventy four billion dollars. What should
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  Speaker 1: you do with your money. We'll find out