Latest / Second Nature / E174 Ed Thorne & Greg Robson: Relationships Can't Be Automated

Transcript

E174 Ed Thorne & Greg Robson: Relationships Can't Be Automated · Second Nature

• 0:07
  SPEAKER_03: It's a beautiful opportunity for you to tell people out there who you guys are and what you do.
• 0:12
  SPEAKER_03: Can I go first?
• 0:13
  SPEAKER_02: Great.
• 0:14
  SPEAKER_02: So my name's Ed, Ed Thorne.
• 0:17
  SPEAKER_02: I'm one of the uh founding partners of Sand River, alongside Greg over here.
• 0:22
  SPEAKER_02: Um, and we are investors in uh companies that are uh directly valuing, protecting, and restoring nature.
• 0:29
  SPEAKER_02: Um so we look for the uh the enabling technologies, uh the innovators and the entrepreneurs uh with ideas to build the economy of tomorrow.
• 0:42
  SPEAKER_01: I mean, it's captured it pretty well.
• 0:44
  SPEAKER_01: Um we started Sand River three years ago, and really it's a I guess a child of uh our separate journeys coming together.
• 0:56
  SPEAKER_01: Um we both came from operational business backgrounds.
• 1:00
  SPEAKER_01: I'd been an entrepreneur, and then I'd run my family business, which is a mixed industrial group, and Ed had been commercializing startups, and both of us had sort of wound our way towards wanting to do more impact-focused work and that's particularly around uh the environment and you know nature.
• 1:23
  SPEAKER_01: And this was our way of applying our previous uh skill set with a mission that we were excited about.
• 1:31
  SPEAKER_01: So we didn't have a we didn't have the next great ideas to like how to save nature.
• 1:36
  SPEAKER_01: If we had, I think we would have founded a business.
• 1:38
  SPEAKER_01: What we did have is a bunch of quite broad skill sets in the business sphere.
• 1:43
  SPEAKER_01: And I think we both work well as partners and as advisors, supporting other people.
• 1:51
  SPEAKER_01: And we'd done that with various teams and various industries around the world, and we thought let's just apply that in a focused approach for those people who do have you know great ideas about how to change the economy to a regenerative one.
• 2:02
  SPEAKER_03: Just touch on that partnership element for a moment.
• 2:04
  SPEAKER_03: So co-founders and that like partnered collaboration is becoming much more in vogue at the minute in terms of getting the best out of each other.
• 2:11
  SPEAKER_03: What do you think each of you brings to the party?
• 2:15
  SPEAKER_02: I I love that question.
• 2:17
  SPEAKER_02: Um I think we didn't know this when we when we started, but uh or we didn't know exactly what each of us would bring to the party when we started.
• 2:26
  SPEAKER_02: But we we we started Sand River uh with a bit of kind of introspection reflection.
• 2:34
  SPEAKER_02: And we thought really about two things.
• 2:36
  SPEAKER_02: One is, you know, where can we be useful?
• 2:38
  SPEAKER_02: Um, where can we add value?
• 2:40
  SPEAKER_02: Uh and the second one was what do we really care about?
• 2:43
  SPEAKER_02: Um and when I think about the, you know, where can we be useful um piece, having been operators, having come from, you know, having uh direct commercial experience in quite different capacities has been incredibly valuable in the work that we're doing, both in building our own business, but also working closely with the entrepreneurs that we're we're supporting and the funders that you know we want to bring into this space.
• 3:09
  SPEAKER_02: Um so you know, what when we were talking about this yesterday, one of the things that you won't find on Greg's CV is that um he was the junior debating champion of South Africa.
• 3:22
  SPEAKER_02: Um so you know when I think awesome claim to fame.
• 3:26
  SPEAKER_02: Yeah, which is which is a great claim to fame.
• 3:28
  SPEAKER_02: And when I think about you know, what is it that makes someone a great debater?
• 3:33
  SPEAKER_02: Um it's the combination of excellent communication skills, um, but also formal logic and clear thinking.
• 3:40
  SPEAKER_02: And so bringing those two things together is something that Greg does in a business context much more effectively than anyone I've had the opportunity to work with.
• 3:49
  SPEAKER_02: Um so that has been lovely.
• 3:51
  SPEAKER_02: Yeah.
• 3:51
  SPEAKER_03: It's your turn to say something nice about England.
• 3:54
  SPEAKER_03: What does he bring to think?
• 3:58
  SPEAKER_01: No, I mean, Ed and I we um we we've done we use the Enneagram personality profiling tool.
• 4:07
  SPEAKER_01: We use it's it's really excellent.
• 4:10
  SPEAKER_01: Um it's the best I've ever come across, in fact.
• 4:12
  SPEAKER_01: It's like Myers Briggs, except so much more powerful.
• 4:15
  SPEAKER_01: What we like about the Enneagram is it mainly plots like what your drivers are, like your innate like tendencies or inclinations and drivers.
• 4:22
  SPEAKER_01: And we're the same number out of the nine numbers that you have.
• 4:25
  SPEAKER_01: We're seven, which we are sort of enthusiastic visionaries according to that uh little table.
• 4:31
  SPEAKER_01: But we present really differently when you look at like what actually is going on underneath the surface of that.
• 4:37
  SPEAKER_01: So I think we we share a lot of enthusiasm and a lot of drive and a desire to like work with people.
• 4:48
  SPEAKER_01: Um and yet we execute that in very different ways.
• 4:56
  SPEAKER_01: And I've I think what I like about working with Ed is that he can get onto the same page as me instantly.
• 5:02
  SPEAKER_01: I've never had to explain myself less to someone in my life.
• 5:06
  SPEAKER_01: But when Ed expresses his ideas to other people, uh he can build a deeper underlying sense of trust with them.
• 5:14
  SPEAKER_01: Not that I can't, but Ed comes across as extremely, which he is, calm, thoughtful, extraordinarily well read.
• 5:22
  SPEAKER_01: And the same project through my eyes, I'll be focusing on you know what can it be, and trying to put together all the pieces of it.
• 5:31
  SPEAKER_01: And um, he'll be sitting behind that going, okay, how do we make this work?
• 5:36
  SPEAKER_01: And between us, we can, I think, yeah, progress projects in a way that I've never been able to do with anyone else.
• 5:43
  SPEAKER_01: And he's fun to work with.
• 5:45
  SPEAKER_01: I mean, we we still have a really good time together as a partnership.
• 5:49
  SPEAKER_01: Been doing it for three years.
• 5:50
  SPEAKER_01: I can't think of anyone else I want to do it with.
• 5:53
  SPEAKER_01: We holiday together, like you know, our partners get on with each other.
• 5:58
  SPEAKER_01: Um, we laugh a lot, and yet we're willing to hold each other to account, you know?
• 6:03
  SPEAKER_01: You're being a bit lazy.
• 6:05
  SPEAKER_01: This work is below standard.
• 6:06
  SPEAKER_01: Why did you take so long to introduce yourself like that?
• 6:10
  SPEAKER_01: And it comes without judgment.
• 6:12
  SPEAKER_01: So it's the partnership is really the if someone asked me what the core strength of Sand River is, it would be our partnership is number one.
• 6:23
  SPEAKER_01: And then our mission alignment and our sort of core skill sets behind that.
• 6:28
  SPEAKER_01: But the partnership is very solid.
• 6:33
  SPEAKER_02: And it it's it's only really in retrospect that we've been able to using tools like the Enigram, unpick why some of the features of partnership works.
• 6:42
  SPEAKER_03: But I think Because you guys didn't know each other that well before you started, right?
• 6:45
  SPEAKER_02: Yeah, I I mean we didn't know each other well, but we knew each other's context very well.
• 6:51
  SPEAKER_02: So I've known Greg's parents for many, many years, better than I knew Greg, and Greg's known my parents for many, many years.
• 6:57
  SPEAKER_02: And our dads met at university in the 70s.
• 7:00
  SPEAKER_02: So there's there's a kind of lifelong connection.
• 7:04
  SPEAKER_02: But so we've understood each other's context, but we actually haven't known each other until COVID.
• 7:08
  SPEAKER_02: We got thrown together living in in uh South Gloucestershire.
• 7:13
  SPEAKER_02: Um, and it was from there that we kind of started to talk just broadly about our interests and you know what we were excited about.
• 7:21
  SPEAKER_02: And naturally a lot of that was the kind of work that we were doing.
• 7:24
  SPEAKER_02: And that kind of slowly got us onto this path of thinking actually, you know, there's an opportunity to go and build something here together.
• 7:31
  SPEAKER_02: But that just came from a position of really enjoying hanging out and, you know, having, as Greg says, very effective communication, but our processing is different.
• 7:41
  SPEAKER_02: You know, the way we think and the way we problem solve is different.
• 7:45
  SPEAKER_02: So problem solving with Greg is a great joy because we can talk about the thing really efficiently, but when it comes to understanding how to unpick the thing, you know, we come at it from different angles.
• 7:56
  SPEAKER_01: Yeah, I still phone in for advice before calls that really matter to me.
• 8:00
  SPEAKER_01: Um and I used to sort of just arrogantly march into those calls, assuming that you know my toolbox was enough.
• 8:06
  SPEAKER_01: But now I really enjoy having you know consulted first.
• 8:10
  SPEAKER_03: Do you do you understand how big a compliment he means when he says that?
• 8:15
  SPEAKER_02: Um I I I I think I do now.
• 8:18
  SPEAKER_02: Um, but it's interesting to hear it.
• 8:20
  SPEAKER_02: Yeah.
• 8:20
  SPEAKER_03: He doesn't need the advice.
• 8:21
  SPEAKER_03: Like he he knows how to deal with those conversations better than anyone else, anyway.
• 8:25
  SPEAKER_03: So the fact that he asked for the advice is like the biggest compliment he could give.
• 8:27
  SPEAKER_03: Yeah.
• 8:28
  SPEAKER_03: That's you guys are great.
• 8:29
  SPEAKER_03: That's super cool.
• 8:30
  SPEAKER_03: Um give me the um give me the origin story, the name, because I love it.
• 8:34
  SPEAKER_01: Okay, Sand River.
• 8:35
  SPEAKER_01: It's a river, um, an actual river, and it runs um, it's a tributary of the Sabi River that runs through the Kruger National Park, and it's one of the key rivers in that nature reserve.
• 8:48
  SPEAKER_01: And um I grew up spending a lot of time on the banks of that river, and it's it's a very biodiverse river, 42 species of fish in it, um, although not very wide.
• 9:00
  SPEAKER_01: Shout out to our environment team here with the fish anecdote and um yeah, and it was really on the banks of that river that I started to understand something about conservation.
• 9:12
  SPEAKER_01: And we um we still have a place there.
• 9:16
  SPEAKER_01: And Ed and I, after sort of talking about what we wanted to do, um I said, let's do a working holiday down at the game reserve.
• 9:26
  SPEAKER_01: And he enthusiastically agreed.
• 9:28
  SPEAKER_01: And we were flying into the into the reserve in a small plane that was sort of bumping along over this beautiful landscape.
• 9:37
  SPEAKER_01: And we'd been talking about names on the flight, and we had a whole list of them.
• 9:42
  SPEAKER_01: And one of them was some of them were based on the places that we spent our time understanding the thing that we love, uh the natural world.
• 9:51
  SPEAKER_01: And mine was mine was Sand River.
• 9:54
  SPEAKER_01: And Ed said, you know, we're about to fly into this place.
• 9:59
  SPEAKER_01: We don't have a name.
• 10:00
  SPEAKER_01: I really love the way the name sounds, and it's on the list.
• 10:05
  SPEAKER_01: So and I think we like the idea of a, you know, a river is really a great indicator of the health of an ecosystem.
• 10:12
  SPEAKER_01: And the arteries of the environment.
• 10:14
  SPEAKER_01: Exactly.
• 10:15
  SPEAKER_01: And you look, you know, no such thing as an unpolluted river in Europe anymore.
• 10:18
  SPEAKER_01: I think there's one, isn't there?
• 10:20
  SPEAKER_01: And yeah, Albania, maybe.
• 10:22
  SPEAKER_01: Yeah.
• 10:23
  SPEAKER_01: And uh and also the uh we like the idea of a sand river, the idea of the sands of time, you know, that we had to there was an urgency to our project.
• 10:30
  SPEAKER_01: There's such a feel to it, right?
• 10:32
  SPEAKER_03: When you get a brand or a name or uh even the the imagery of stuff, when it's right, it's not a numerical algorithm, it's a feel, and it just fits.
• 10:41
  SPEAKER_03: It feels like it fits perfectly.
• 10:42
  SPEAKER_03: And I can just imagine that conversation where you're like, we're looking at it, this is the answer.
• 10:46
  SPEAKER_02: Yeah, we were like we were sitting there, the sun was going down in the distance, we could see a group of elephants sort of silhouetted by the sunset in an incredible, staggering setting.
• 10:55
  SPEAKER_02: And it felt like exactly the right name.
• 10:57
  SPEAKER_01: Um that little thumbprint on our logo is actually a tiny snapshot of all the tributaries that flow into the sand river, and it looks like a fingerprint, but it's actually the drainage lines that create the sand river.
• 11:10
  SPEAKER_01: And and going back to what you said about that maybe us getting together as a partnership, that instinct that you're talking about, that really interests me.
• 11:19
  SPEAKER_01: Because I think that's when we are deciding things with our nervous system rather than intellectualizing them, which is not actually a huge part of our brain.
• 11:29
  SPEAKER_01: And I when I met Ed, I was five years older than him, and I probably was about 21, 22 when I met him.
• 11:35
  SPEAKER_01: So he was in a totally different phase of life from me, you know, being five years younger in high school, and I was already, you know, finishing university.
• 11:42
  SPEAKER_01: Um, I just had a good vibe from him.
• 11:44
  SPEAKER_01: And we ended up like throwing a ball outside at his parents' house, you know, and I the first time I'd met him, and he had five siblings that I could have been friends with, four siblings that I could have been friends with, but actually it was him that I, you know, just got on with best.
• 11:56
  SPEAKER_01: And then when we met again, that instinct that we want to work together.
• 12:00
  SPEAKER_01: And if you look in nature, again, going back to these places that we learned to love it, lions don't have some long verbal conversation, you know, or a personality profile test to decide who they can trust in a hunt or in a pack.
• 12:12
  SPEAKER_01: Pride, case of lions.
• 12:14
  SPEAKER_01: Um, and I think when humans are in touch with that nervous system animal instinct, we make better decisions.
• 12:21
  SPEAKER_03: So while we keep on the brand and the sort of um appearance of the business, you guys have actually caused our marketing team a massive problem.
• 12:33
  SPEAKER_03: The costs.
• 12:34
  SPEAKER_03: I'm obsessed with your sandpit sandbox on the on the website.
• 12:38
  SPEAKER_03: So uh can you describe to people what it is and why everyone loves it?
• 12:42
  SPEAKER_02: Um well, this the sandpit is an incredible way to lose 10 minutes of your life.
• 12:47
  SPEAKER_02: It's ridiculous.
• 12:48
  SPEAKER_02: It's ridiculous.
• 12:48
  SPEAKER_02: I dread to think about how many people have you know come to my website and lost 10 or 15 minutes moving this thing around.
• 12:54
  SPEAKER_02: But the I the idea of it is is um that it's a playful take on biomimicry.
• 13:00
  SPEAKER_02: Um and you can just move the cursor around and it has the effect of what either a magnet on sand or dripping water through sand or you know, blowing wind on sand.
• 13:11
  SPEAKER_02: You can think of the different fractals, but it it has the effect of uh, you know, something that is just really enjoyable and pleasing to do.
• 13:19
  SPEAKER_02: And you know, to Greg's point just now, like there's something just nice about things that are fun, things that you enjoy, you know, running your hand across the surface of some water, you know, things like that, you know, playing in the sandpit.
• 13:31
  SPEAKER_02: These are just tactile.
• 13:32
  SPEAKER_03: In a world where everyone's falling over themselves to be uber serious, like every not every, most fund-related financial service adjacent business is just we're more serious than you.
• 13:45
  SPEAKER_03: You guys are throwing in some some playful creativity there.
• 13:48
  SPEAKER_03: I I just love it.
• 13:49
  SPEAKER_03: Was it yours?
• 13:50
  SPEAKER_03: Was it the designers, the website builders?
• 13:52
  SPEAKER_03: Where did the concept come from?
• 13:55
  SPEAKER_01: Collaboration.
• 13:56
  SPEAKER_01: We were describing we had great designers.
• 14:00
  SPEAKER_01: Um and I'm gonna forget their name right now, which is going to be a pity because I can't shout out to them.
• 14:06
  SPEAKER_01: But wow, they really took on a they took on the I the project to get to know us.
• 14:14
  SPEAKER_01: And that was and it really, really understand us.
• 14:18
  SPEAKER_01: And so when they started to design, the work that came out was extraordinary.
• 14:22
  SPEAKER_01: All those pencil drawings uh, you know, on the website, they're all done by one of the two designers, you know.
• 14:27
  SPEAKER_01: And then um the the other designer got a bit jealous, and then he sketched a few.
• 14:31
  SPEAKER_01: And you know, they they really started to buy into the Sand River story, and and we said that we want it to be partly fun.
• 14:38
  SPEAKER_01: And that is because we venture capital is serious.
• 14:45
  SPEAKER_01: You know, you're taking other people's money with a mandate and you're putting it into high-risk, long-term uh technology.
• 14:55
  SPEAKER_01: That's you know, the path is as yet not that well understood.
• 14:59
  SPEAKER_01: So you have to be serious.
• 15:00
  SPEAKER_01: But it's also a relationships game.
• 15:02
  SPEAKER_01: You're working with these founders for upwards of five years, and that's a human relationship.
• 15:07
  SPEAKER_01: Whether you're sitting as an advisor or you know, board member or just cheering from the sidelines, it's very human.
• 15:14
  SPEAKER_01: So, you know, we you have to kind of run the whole gamut gamut of what it means to be human in order to be good at building those relationships is not enough to do a good financial model or to, you know, uh have an excellent process for selecting uh your initial investments.
• 15:31
  SPEAKER_01: You also have to be in that game with them.
• 15:33
  SPEAKER_01: And I think that for us, we particularly want to bring that uh to our area of venture capital because the people who are going into this field are doing it out of a deep passion for trying to shift the way the world is.
• 15:51
  SPEAKER_01: And what they need is like real advocates and partners and supporters.
• 15:55
  SPEAKER_01: So that human element, that's everything.
• 15:57
  SPEAKER_01: So if the sandpit makes us feel a bit more human and a bit more like we are, well, that's our brand.
• 16:03
  SPEAKER_01: Yeah.
• 16:04
  SPEAKER_01: Very competent.
• 16:04
  SPEAKER_01: We are still competent.
• 16:05
  SPEAKER_03: The the sweet spots, uh and I think that's why it lands so well.
• 16:09
  SPEAKER_03: Because if um a playful thing overplayed, becomes gimmicky and does turn people off, but uh a fun, engaging, warm piece really attracts and engages with people.
• 16:20
  SPEAKER_03: So the the balance is really difficult to strike.
• 16:22
  SPEAKER_03: And I think you guys nailed it.
• 16:23
  SPEAKER_03: I think the way you present the business is is fantastic and does give a window into to both of you.
• 16:29
  SPEAKER_03: Um well, we look forward to what's coming on your website.
• 16:32
  SPEAKER_03: Yes, no, no pressure, L.
• 16:34
  SPEAKER_03: No pressure.
• 16:35
  SPEAKER_03: Um for people who when they first meet you, um, how do you describe your investment thesis or philosophy?
• 16:45
  SPEAKER_02: So I mean our investment thesis is is uh relatively simple.
• 16:51
  SPEAKER_02: You know, we want to identify companies that in their business model, you know, when they create when they create revenue, they're also directly contributing to value and protecting and restoring nature.
• 17:04
  SPEAKER_02: And we also want to identify that there's a link between those two things.
• 17:07
  SPEAKER_02: There's a positive correlation.
• 17:08
  SPEAKER_02: So the more revenue, the more positive outcomes for nature.
• 17:12
  SPEAKER_02: So on one level, that's simple, but on another level, it opens up to a really quite sort of profound and uh wicked challenge.
• 17:22
  SPEAKER_02: And when we talk about that profound and wicked challenge, is we we we look at the human economy today, um, and we try and articulate a little bit a little bit of this on our website.
• 17:36
  SPEAKER_02: We look at the human economy today as sitting outside of the limits of the biosphere.
• 17:40
  SPEAKER_02: So there's this dislocation between the uh activity uh that humans are undertaking in the market economy and the biosphere, which is relatively delicately balanced, and we're exploiting the resources uh that we have available to us.
• 17:58
  SPEAKER_02: Um, and we're doing so in a way that we know we're on a trajectory to depleting and tipping the balance of the biosphere past certain thresholds.
• 18:09
  SPEAKER_02: Um which, you know, after we've transgressed those thresholds, very, very challenging to reverse.
• 18:14
  SPEAKER_02: So this is the the challenge that we're looking to address is how do we identify the business models that can start to enable a transition where we pull this economy back into the limits of the biosphere?
• 18:31
  SPEAKER_02: And you know, we could call the today's economy an extractive one, and that journey, the journey towards a regenerative economy, which is producing outputs that are sustainable and taking inputs that are available within the limits of the biosphere.
• 18:46
  SPEAKER_02: Um, so that's the long you know challenge.
• 18:49
  SPEAKER_02: Um how do we articulate that in investment thesis?
• 18:53
  SPEAKER_02: Is we're looking for the companies that are at the leading edge of building the technology uh and the data stack uh in order for us to get there.
• 19:05
  SPEAKER_01: We want action now.
• 19:07
  SPEAKER_01: So we also are not trying to make market bets.
• 19:12
  SPEAKER_01: We a lot of the people who um invest in um nature come into the field full of enthusiasm.
• 19:22
  SPEAKER_01: And they either, whether they're if they're an entrepreneur, they sometimes come up with an idea and they say, this is a great idea, and everyone will adopt it because it's so logical that we should be treating our planet in this way.
• 19:34
  SPEAKER_01: Or legislation will change in this way because it's obvious that it has to.
• 19:38
  SPEAKER_01: Um, but unfortunately, the timing of those changes, even if they are logical, are not up to us.
• 19:45
  SPEAKER_01: So we particularly are looking for those companies that can deliver that change and that shift towards a regenerative economy now, so that the data they're producing today has a demand for it because it's solving an existing risk, for instance, or they're producing something in a more sustainable way that can outperform an incumbent such that it's adopted because it's excellent performance, not because there's a green premium that they're expecting.
• 20:12
  SPEAKER_01: So I think that immediacy of action is something that we're also really focused on.
• 20:17
  SPEAKER_03: Um I'm fascinated by your decision-making process and how much the intuition plays a part in it.
• 20:28
  SPEAKER_03: So when um and I'll ask you both this separately, but when you're considering an investment, what proportion is based on your feel and view of the founder versus the business proposition and what you can see in a spreadsheet?
• 20:40
  SPEAKER_03: How do you balance those two things?
• 20:43
  SPEAKER_01: Actually, we come across this, we've talked about this a lot, and we actually appro uh approach this differently as people.
• 20:49
  SPEAKER_01: Um I am strong instinct first, and then I spend a lot of time trying to dismantle like my my instinct, or sorry, that's not true.
• 21:05
  SPEAKER_01: I strong instinct first, and then I try and justify that instinct in looking through the data.
• 21:14
  SPEAKER_01: And Ed is you know, strong instinct, and then he tries and destroys his instinct with sort of counter counterpoints to that instinct, and we kind of meet in the middle somewhere.
• 21:25
  SPEAKER_03: Um that's really interesting.
• 21:27
  SPEAKER_03: I I would have read that with you in terms of decision making.
• 21:30
  SPEAKER_03: My hypothesis was actually that you would build, that you would hold back a decision till later and you'd look to build, build, understand, understand, understand, and then reach a decision rather than make a decision and test it.
• 21:42
  SPEAKER_03: So when I recruit, I recruit very much like you.
• 21:46
  SPEAKER_03: I will I will make a judgment very quickly, and then I'll use the rest of that time period to test my judgment and my decision and to almost unpick it.
• 21:53
  SPEAKER_03: In fact, it's actually how we choose estates to buy as well.
• 21:56
  SPEAKER_03: So we do a huge amount of data screening ahead of time now.
• 21:59
  SPEAKER_03: We've got a proprietary.
• 22:00
  SPEAKER_03: Model that scans a hundred different data layers before visiting an estate.
• 22:04
  SPEAKER_03: And when we go, I go to find reasons not to buy it because we know it fits all the metrics and the criteria ahead of time.
• 22:10
  SPEAKER_03: So that was interesting.
• 22:12
  SPEAKER_03: Yeah.
• 22:14
  SPEAKER_02: And I mean it the the way yeah, Greg and I certainly process those decisions in different ways.
• 22:22
  SPEAKER_02: Um there for both of us, there's a strong, strong instinct piece.
• 22:27
  SPEAKER_02: Um, but maybe I try to inform myself of the market context before going into a lot of these discussions.
• 22:35
  SPEAKER_02: So by the time we're having a conversation, I'll probably already have an opinion on the product, uh, the mark is, uh, on the um uh the readiness of the markers, and maybe an opinion on the team, on the founders.
• 22:54
  SPEAKER_02: Um, but it's only over time that I can, you know, once I've let's say stress tested each of those criteria that I'll be happy with getting to a decision.
• 23:04
  SPEAKER_02: And I like the process of stress testing the all of those different criteria and kind of whittling them down.
• 23:12
  SPEAKER_02: And if you know there's a positive outcome from that, then I have very high conviction that we want to get ahead.
• 23:18
  SPEAKER_02: And so Greg and I have this positive tension where Greg's already kind of reached conviction.
• 23:24
  SPEAKER_02: He doesn't always express it outright, but there's you know, there's a semblance of conviction there already.
• 23:29
  SPEAKER_02: And then we'll be throwing stuff at the wall just to try and identify how long it'll take us to get on the same.
• 23:34
  SPEAKER_03: I can totally see how that makes your decision-making process better.
• 23:37
  SPEAKER_03: I can totally see how it complements in those debates and discussions.
• 23:41
  SPEAKER_01: Yeah, and we really give a lot of room to other opinions.
• 23:44
  SPEAKER_01: So we have a lot of great advisors around us.
• 23:46
  SPEAKER_01: We have an exceptional um associate, Gabby, on our team, who's just grown leaps and bounds, and she's definitely like a voice in the room now.
• 23:56
  SPEAKER_01: And we're we're open to all of these um other voices.
• 24:01
  SPEAKER_01: So we we have a formal advisory board or these informal relationships that use across your networks?
• 24:08
  SPEAKER_01: No, I mean we're busy talking about like how do we formalize it, but we do use them in a formal manner, in the sense that we present every investment to a certain group of people.
• 24:16
  SPEAKER_01: Um so we maybe been saying let's formalize it in some way or another, but it it is formal in in our process already.
• 24:24
  SPEAKER_01: Um I I think which we talk about the decision decision-making process.
• 24:29
  SPEAKER_01: On a first call, we'll know whether we are open to investing in a company.
• 24:35
  SPEAKER_01: Always.
• 24:36
  SPEAKER_01: And we'll both feel it.
• 24:37
  SPEAKER_01: And we've never invested in a company where the first call hasn't been a possible yes.
• 24:44
  SPEAKER_01: And and then we give each other and we give the process room to evolve without being too attached to that first instinct.
• 24:54
  SPEAKER_03: And over the um so you've been doing this three and a half years now?
• 24:58
  SPEAKER_03: Three, yeah, three and a bit.
• 24:59
  SPEAKER_03: Yeah.
• 25:00
  SPEAKER_03: What what were you most wrong about at the start?
• 25:03
  SPEAKER_03: What views and perspectives did you come in with that you're like, we totally got that wrong and you've changed your opinion on?
• 25:09
  SPEAKER_02: I think it's something Greg alluded to earlier.
• 25:12
  SPEAKER_02: Um, is what jumps to mind for me is this piece around market bets.
• 25:16
  SPEAKER_02: Um the idea that you know, a market will manifest because it's a good idea, uh, we have started to really dismantle our assumptions around there.
• 25:29
  SPEAKER_02: Um and, you know, for example, when we first started investing in the space, there was a lot of talk about the emerging biodiversity markets and the idea of this market as a synthetic market developing in the form, in the model of the carbon markets.
• 25:46
  SPEAKER_02: Um, and you know, here we are three years later, and that clearly hasn't happened.
• 25:51
  SPEAKER_02: Um, but there is, you know, emerging demand for biodiversity as an output.
• 25:56
  SPEAKER_02: But the way that that is bundled up is not in a you know synthetic market that looks and feels like the carbon markets.
• 26:03
  SPEAKER_02: So we've been it we've become increasingly cautious about looking at something and saying, we hope this will happen because we believe it's a good idea.
• 26:12
  SPEAKER_02: Aaron Ross Powell or because it's ethical.
• 26:14
  SPEAKER_01: Yeah.
• 26:14
  SPEAKER_01: Some people come in and they're crusaders, they say, like, well, this has to happen.
• 26:19
  SPEAKER_01: Look at what we're doing to the environment.
• 26:22
  SPEAKER_03: But it that uh I I had the same conversation with a group of CEOs in the natural capital space who their their view to the government not hearing the message that the environment's precious and needs to be protected and restored was to bang the table louder and tell them how much more they were offended.
• 26:41
  SPEAKER_03: It's like that hasn't worked for decades.
• 26:44
  SPEAKER_03: W why do we think it will work by just making the volume louder?
• 26:48
  SPEAKER_03: And also as an environment sector, we like to lobby DEFRA on the belief that they have any decision-making power in what actually happens with the environment and refuse to even acknowledge that the decisions are all made in the treasury.
• 26:58
  SPEAKER_03: And actually, you have to articulate the economic argument about regenerative and restorative um economy and capital, as opposed to just saying you're a terrible human being.
• 27:08
  SPEAKER_03: No one's ever been persuaded by you being yelled at.
• 27:11
  SPEAKER_01: What we're quite excited about is many of the businesses we're looking at are those businesses that are developing technologies and platforms to link the performance of companies, particularly around risk management, with excellent land management, where actually you can prove that you if you manage land in a in a healthy way, um, you're managing your risk at a corporate level in a much better way.
• 27:41
  SPEAKER_01: And and that's a compelling argument because it's got nothing to do with ethics or what we you know, our love of nature, or all these other things that drive a lot of the people in our space.
• 27:52
  SPEAKER_01: It's just good business.
• 27:54
  SPEAKER_01: And good business is good land management, it turns out.
• 27:56
  SPEAKER_01: We just didn't have the data to prove it until recently.
• 28:00
  SPEAKER_03: Um I think also we're improving the language we have to articulate it as well.
• 28:06
  SPEAKER_03: So we did a roundtable podcast on BNG last week with um Emma Tolve from the environment bank, Alexa Culver from RSK Wilding and our managing director of conservation fee.
• 28:18
  SPEAKER_03: And they could articulate over the last five years, you couldn't even have a conversation about a habitat type because without the metric and the registry and the responsible bodies, one local authority to the next couldn't consistently, coherently talk about the environment.
• 28:33
  SPEAKER_03: So actually, finding that language has been really important.
• 28:36
  SPEAKER_03: Um, I I'm a big sports guy.
• 28:39
  SPEAKER_03: You think about cricket, you can describe a cricket stroke by saying it was a cover drive.
• 28:44
  SPEAKER_03: You can't describe football in the same way.
• 28:46
  SPEAKER_03: There isn't the nuance of language in detail to communicate exactly what's happening.
• 28:50
  SPEAKER_03: And I think over the last five years, as well as the data, we are seeing a language that allows us to have better conversations.
• 28:56
  SPEAKER_03: That's definitely true.
• 28:58
  SPEAKER_01: And and yeah, I think um that shared language is it's it's crucial and it's developing quite quickly.
• 29:08
  SPEAKER_01: But interesting for us when we leave the echo chamber of our investment space, how new this field really is.
• 29:17
  SPEAKER_01: Once you're in the field that we're in, it is so patently obvious that the whole world's economy will shift in the direction that we want because it's good business and because ultimately our health as a species is determined by the health of the ecosystems in which we live.
• 29:34
  SPEAKER_01: And that is a fact.
• 29:36
  SPEAKER_01: But our understanding of that and the path to get there is not as widely held as you'd expect.
• 29:45
  SPEAKER_03: I think the sound analogy is beautiful because it's a bit like everyone else is in is just surrounded by the volume of life, almost like a jackhammer on a street with cars going past and everything else.
• 29:57
  SPEAKER_03: And you wonder why they're not hearing the signals we hear in the echo chamber.
• 30:00
  SPEAKER_03: Well, because we're locked off to everything else, we do hear that and understand it and have access to education and resources and information that others don't have.
• 30:09
  SPEAKER_03: Um, but but I agree it's obvious when you can see it, but equally I can understand why so many people don't, and we are the absolute minority.
• 30:16
  SPEAKER_01: It's it's absolutely not a criticism coming from me, it's just a fact.
• 30:19
  SPEAKER_01: And it's something that it's a journey that I'm I've got such incredible reward from deciding that I want to do something with purpose and being more honest with myself about my deep passion for the environment and for um the ecosystems that support us.
• 30:38
  SPEAKER_01: And having gone down the rabbit hole of getting to know it and to understand myself as part of that ecosystem and understand myself as an animal.
• 30:47
  SPEAKER_01: It's been it's changed my whole world and my whole understanding of the world in such a strongly positive way.
• 30:53
  SPEAKER_01: And it's it that's a journey that's not, shouldn't just be accessible to me.
• 30:56
  SPEAKER_01: It's actually accessible to everyone.
• 30:59
  SPEAKER_01: The natural world is Earth's great inheritance and everyone inherits it.
• 31:04
  SPEAKER_01: And I keep thinking in my head, how do we bring that journey and that experience to more people?
• 31:12
  SPEAKER_01: Because that's really what's going to drive change.
• 31:16
  SPEAKER_01: I mean, we we're we're preparing the groundwork.
• 31:18
  SPEAKER_01: I think of our work as preparing the groundwork when people need it.
• 31:22
  SPEAKER_01: You know, we're preparing the groundwork.
• 31:23
  SPEAKER_01: We're like, here's a sustainable way to produce something.
• 31:27
  SPEAKER_01: Here's the data that you need.
• 31:28
  SPEAKER_01: But you also, on the back of that, need advocates and people who are excited about that and people who understand what we're talking about.
• 31:36
  SPEAKER_01: And that's probably something that's on my mind a lot.
• 31:38
  SPEAKER_01: I don't know an answer for it, but it's like, how do we invite more people into this journey?
• 31:42
  SPEAKER_02: So I I think one of the challenges, bring it back to language there, is that the deeper you are in the echo chamber, the easier it is to speak in a new lingo.
• 31:50
  SPEAKER_02: Yeah.
• 31:51
  SPEAKER_02: And then the more othering it becomes.
• 31:53
  SPEAKER_02: Um yeah, full of acronyms.
• 31:54
  SPEAKER_02: But actually, a lot of the work that we're doing is engaging with funders who maybe aren't swimming in the same water that we're swimming in and having to use really simple, you know, very clear language and address them on their own terms as to why there are opportunities in the space that you know we think is very exciting, but maybe is new or you know, unfamiliar to them.
• 32:16
  SPEAKER_03: The biggest one of those I had where uh occasionally I'd hear the narrative that voluntary carbon credits are just a license to pollute.
• 32:26
  SPEAKER_03: And it would make me really angry.
• 32:27
  SPEAKER_03: I would like, what are you talking about?
• 32:29
  SPEAKER_03: Of course it can't be.
• 32:31
  SPEAKER_03: You literally, you have to plant a tree and you have to demonstrate that within every inch of that tree's life, or you have to restore people, and that's incredibly hard to do.
• 32:39
  SPEAKER_03: And it took me stepping back and going, Oh, these people are talking about regulated carbon credits.
• 32:46
  SPEAKER_03: They just don't recognize the distinction because they're not in the echo chamber every day.
• 32:49
  SPEAKER_03: And actually, a regulated carbon credit is literally a license to pollute.
• 32:54
  SPEAKER_03: They are factually correct.
• 32:55
  SPEAKER_03: Nothing is happening.
• 32:56
  SPEAKER_03: You are paying a tax to pollute.
• 32:58
  SPEAKER_03: But I was instead of listening and really understanding, I was getting offended that they were criticizing voluntary carbon products, but they weren't.
• 33:05
  SPEAKER_03: We were just talking about a different thing and um ended up writing a piece that I think might be in book two, but it's it's equating the difference to water coming out your tap is one thing.
• 33:13
  SPEAKER_03: A beautifully hand-blown glass bottle that turns up on your table at a restaurant with um sparkling water in it is also water.
• 33:21
  SPEAKER_03: They're two fundamentally different things.
• 33:23
  SPEAKER_03: You can't get the second out of your tap, but they go by the same name.
• 33:27
  SPEAKER_03: It's so interesting how being so close to it, I didn't recognise it.
• 33:30
  SPEAKER_03: The fun bit was though, that the guy that gave me that feedback, I ended up having the opportunity to loop back and go, I'm so sorry.
• 33:37
  SPEAKER_03: I didn't explain this properly.
• 33:38
  SPEAKER_03: Let me walk you through it.
• 33:39
  SPEAKER_03: And he was like, Oh, yeah, I didn't never realize that.
• 33:41
  SPEAKER_01: But I like I like what you're saying there because I think you you you're you were recognizing uh how to bridge the understanding that he had and you had, and you didn't let your ego get in the way of of closing that loop.
• 33:57
  SPEAKER_01: I I I should have learned I should have realized it faster.
• 34:00
  SPEAKER_01: At least you did, and at least you went back.
• 34:02
  SPEAKER_01: Um I think that we are very pro uh bringing the parties together on on nature.
• 34:11
  SPEAKER_01: We if you look back at the history of how people have supported nature in the past, it's often strong advocates for nature, and then sometimes the view is that other people or polluters are against nature.
• 34:26
  SPEAKER_01: And I just don't think that that's correct.
• 34:29
  SPEAKER_01: There are more than 50 shades of grey in between.
• 34:32
  SPEAKER_01: And most people want to do the right thing, they're just not well informed, or as you say, don't have the data, they don't have the language, they don't have the mandate, or the bandwidth, or the bandwidth.
• 34:40
  SPEAKER_01: And and really, I think that you know, for all of us in our field, I I love the work of the activists in our field, but we need people who are bridge builders, and really all of us should be bridge building, because as I said, nature is everyone's.
• 34:54
  SPEAKER_03: I asked um, so we recorded with Tim Kristofferson, the amazing uh vice president of nature at Salesforce and author of A Generation Restoration, the book, fantastic book.
• 35:05
  SPEAKER_03: I asked him if um he talks about the impact of lobbying globally by fossil fuel companies and traditional industrial um agricultural groups.
• 35:18
  SPEAKER_03: And um we had the hypothetical if we were going to invest 100 million in either another significantly iconic conservation project or a hundred million in lobbying for natural capital businesses, which would be the more impactful?
• 35:33
  SPEAKER_03: And he said, sadly, I think the lobbying would be I agree strongly.
• 35:37
  SPEAKER_01: We talking about that on conservation, like landmark conservation is not going to get us there.
• 35:43
  SPEAKER_01: I started life as a conservationist.
• 35:44
  SPEAKER_01: You know, that was my sort of DNA, and that's what I was passionate about.
• 35:48
  SPEAKER_01: But when you start to understand the pressures on a piece of conservation land, um, a whole bunch of not very comfortable truths become apparent.
• 35:59
  SPEAKER_01: One is that there have always been people who have loved pieces of land as much as you do, and they've always been willing to put philanthropic or personal funds or government funds sometimes into protecting those places.
• 36:12
  SPEAKER_01: Um, but that hasn't actually stopped the extraordinary decline that we've seen in biodiversity and in the health of our ecosystems.
• 36:20
  SPEAKER_01: And that's because it takes really a systems view of the entire economy and the way we live and the values by which we live by, for us to start to actually make an impact, because that conservation piece of land is part of a wider system.
• 36:34
  SPEAKER_01: And if that system is under extraordinary pressure on all sides of a piece of land, it doesn't matter how well-meaning or how rich or how powerful the person who controls a piece of land is, the river that runs through it will be polluted.
• 36:47
  SPEAKER_01: The animals within it will be depleted because they won't have access to the wider ecosystem.
• 36:52
  SPEAKER_01: Um, it will be subject to worse weather patterns, et cetera, because of global warming.
• 36:57
  SPEAKER_01: So in the end, I think today to be a conservationist is to look beyond the borders of a piece of land.
• 37:03
  SPEAKER_01: And you understand that very, very well.
• 37:06
  SPEAKER_01: And, you know, I think you're trying to integrate conservation with its wider system and using data to do that and making everyone aware of the value of these pieces of conservation land, which actually will have them not as private assets, but seen as assets that deliver these services beyond their borders.
• 37:25
  SPEAKER_01: Um, and I think that you know, we're on the other side of that.
• 37:28
  SPEAKER_01: We're trying to look at everything around these places that we love and say, how can all of this be done differently?
• 37:34
  SPEAKER_03: So one of my phrases that I've come across in the last few months, because we're we're recording this at a let's say a particularly unique point, but they're all unique.
• 37:42
  SPEAKER_03: We're in the time of AI now, right?
• 37:44
  SPEAKER_03: It is rapidly accelerating in an amazing and scary and wonderful and challenging way.
• 37:52
  SPEAKER_03: One of my lines I've hit lately is the more digital the world becomes, the more reliant we are on nature.
• 37:58
  SPEAKER_03: What I mean by that is people talk about cloud-based software.
• 38:01
  SPEAKER_03: They're not in clouds, they're in massive data warehouses that have huge footprints physically, that have huge environmental demands in terms of energy and water.
• 38:09
  SPEAKER_03: They are anything but digital.
• 38:11
  SPEAKER_03: They are physical infrastructure assets.
• 38:14
  SPEAKER_03: And I think it is making us more reliant on nature to provide for those things.
• 38:18
  SPEAKER_03: What have you seen in your world that as a result of AI and as the change towards that is an industry, is a tech that just wasn't there when you started?
• 38:29
  SPEAKER_02: I I I love I love your example.
• 38:32
  SPEAKER_02: And I think almost what one of the reflections I would make of what we've started to see in the last sort of 12 to 18 months with the proliferating opportunities of applying AI to the problem of our current economy, is almost the opposite of what you're saying, which is that we're now just starting to understand how dependent we were on nature, and we're starting to be able to throw some data at that.
• 39:00
  SPEAKER_02: And it was just something that wasn't visible to us before.
• 39:04
  SPEAKER_02: And so if we take supply chains, for example, we now have the opportunity to look at supply chains using a combination of geospatial inputs, uh, machine learning, uh, AI modeling to really understand down to the plot level where tropical soft commodities are coming from.
• 39:24
  SPEAKER_02: One of our portfolio companies, Epoch, is doing this at a tiny fraction of what it has cost to send ecologists to location in the past.
• 39:32
  SPEAKER_02: Even a tiny fraction of what it would have cost to process this data in the past.
• 39:37
  SPEAKER_02: And identifying the fundamental relationship that the end consumer has, the person who buys the bar of chocolate that was produced by Nestle, to the land steward who is, you know, in a part of the tropics and the global south, producing cacao.
• 39:53
  SPEAKER_02: Um and just the ability to have visibility into the data that exists is giving us the understanding or our economy the understanding of the intricate dependency that we all have on nature.
• 40:10
  SPEAKER_02: Um and that dependency, you know, historically in kind of formal economics, has just been either taken as infinite or taken for granted, you know, taken as free.
• 40:20
  SPEAKER_02: Um and now that we have the visibility, the application of the risk understanding or and the fundamental exposure of those economies is starting to change.
• 40:34
  SPEAKER_02: And for us, that's I think one of the most exciting things that we've seen.
• 40:39
  SPEAKER_02: And you know, it's really only being enabled in the last 18 months at scale.
• 40:44
  SPEAKER_04: Yeah.
• 40:44
  SPEAKER_01: I want to go further because as you say, nature is certainly going to bear a huge cost as we grow compute power.
• 40:54
  SPEAKER_01: But nature is the unexpected beneficiary of AI.
• 40:58
  SPEAKER_01: Yes, 100%.
• 41:00
  SPEAKER_01: Because we've never been able to have sophisticated enough models to really understand these exquisite systems.
• 41:09
  SPEAKER_01: And it's only with the advent of AI or incredible geospatial tools or mapping DNA of like non-human genomes that we can start to understand the system.
• 41:21
  SPEAKER_01: And to know something is to love something and also to be able to appreciate what it does for us.
• 41:29
  SPEAKER_01: So I think that we're at this exciting watershed moment for nature.
• 41:33
  SPEAKER_03: I yes.
• 41:35
  SPEAKER_03: You are the only other person I've heard advocate that yet.
• 41:38
  SPEAKER_03: Everyone else has been like, AI is terrible for the planet, it's going to be all the exact opposite.
• 41:42
  SPEAKER_03: I think the exact opposite and have published on that fact.
• 41:45
  SPEAKER_03: And and also I think I think the hyperscalers know.
• 41:50
  SPEAKER_03: So if you look at the sentiment surveys on people's perceptions of AI, especially in the US, it's hated.
• 41:56
  SPEAKER_03: Okay.
• 41:57
  SPEAKER_03: There, and the things that'll get thrown at it by the next generation are energy, our water, our environmental impact first and foremost.
• 42:04
  SPEAKER_03: Okay.
• 42:05
  SPEAKER_03: And you're also going to have these companies who are going to have cash surpluses in the hundreds of billions, like only Google and Tesla have before.
• 42:14
  SPEAKER_03: They are going to be, and not philanthropists, but they're going to be the equivalent of philanthropists historically.
• 42:20
  SPEAKER_03: And they are going to invest in real physical assets because, in the absence of that, how else can they diversify?
• 42:27
  SPEAKER_03: They are already fully exposed to everything tech, everything deep tech, everything physical infrastructure associated with tech.
• 42:33
  SPEAKER_03: The only thing they've got left is nature in the environment to genuinely diversify away from where they've got.
• 42:40
  SPEAKER_03: We are going to see OpenAI and Anthropic and everyone else invest heavily in real assets that relate to the environment.
• 42:48
  SPEAKER_01: I hope that that's correct.
• 42:49
  SPEAKER_01: And I I know less than you, so you know I'm it's exciting to hear.
• 42:54
  SPEAKER_01: But I think it's one of the things we're saying to some of our investors is we say if you look today at what you can be confident about in the change in the global economy, you can be confident that AI will transform every industry on earth.
• 43:10
  SPEAKER_01: And the second thing is that you can be confident that a shift to regenerative behavior will transform every business on earth.
• 43:17
  SPEAKER_01: Those are the only two things you can really be confident on.
• 43:21
  SPEAKER_01: And maybe the third investment, you know, arena that everyone gets excited about is longevity and human health.
• 43:26
  SPEAKER_01: But, you know, so much of what we're doing in longevity and human health is making up for deficiencies in healthy ecosystems.
• 43:33
  SPEAKER_01: So actually, they're a joint project too.
• 43:36
  SPEAKER_01: And longevity is tied to nature too, because what the hell is the point of living longer if you're living in an increasingly unhealthy and unpalatable world?
• 43:46
  SPEAKER_01: All our poetry and writing and movies and music, to some extent or another, has been built off our love of being alive in this natural world as an animal.
• 43:59
  SPEAKER_01: So If that's in a steep decline, do we really want to live that much longer?
• 44:04
  SPEAKER_03: It's it's why I am So our product is positive environmental and social impact expressed through carbon credits and BNG units and nature credits in time and every other form of iterative natural capital product, be it flood risk management, be it pollination, all those things are are yet to come.
• 44:21
  SPEAKER_01: Say that again, the first part.
• 44:23
  SPEAKER_03: Our product is positive environmental and social impact.
• 44:26
  SPEAKER_03: Okay.
• 44:26
  SPEAKER_03: Yeah.
• 44:27
  unknown: Right.
• 44:27
  SPEAKER_03: Without creating that, we have nothing.
• 44:29
  SPEAKER_03: That that's what we acquire land to do, to build, to develop and and produce.
• 44:35
  SPEAKER_03: But I realize to solve the threats of climate change, we are going to need a technological solution.
• 44:41
  SPEAKER_03: That will require the scrubbing and mechanical removal of carbon from the atmosphere.
• 44:46
  SPEAKER_03: But I also want a world to live in when we figure that out.
• 44:49
  SPEAKER_03: And without nature-based solutions and conservation, we'll live in this mechanical dystopia that just in the last minute has figured out how to catch a carbon.
• 44:57
  SPEAKER_03: Well, there'll be no planet that's worth living on.
• 45:00
  SPEAKER_01: Well, I mean, I want to take that further.
• 45:02
  SPEAKER_01: Let's say that you believe the techno-optimist view that you can plug holes in these increasingly broken ecosystems with technology.
• 45:09
  SPEAKER_01: I don't think that's correct because, as I said, we've only just started to understand the complexity of these systems.
• 45:15
  SPEAKER_01: And we're still really not there.
• 45:17
  SPEAKER_01: So it's incredibly arrogant for you that we can techno-optimistically like plug holes in broken ecosystems.
• 45:22
  SPEAKER_01: But also, it factory requires a lot of resources.
• 45:25
  SPEAKER_01: So if you look, we're going to spend trillions and trillions of dollars plugging holes in systems that already work or could be working with marginal interventions today.
• 45:36
  SPEAKER_01: And what will that stop?
• 45:37
  SPEAKER_01: Well, that will stop our progress as a species.
• 45:39
  SPEAKER_01: So all of that resource going into plugging holes in these broken ecosystems could have gone towards reducing inequality or changing levels of education globally or freedom, or, you know, just expressing ourselves as a species in a different way.
• 45:53
  SPEAKER_01: And instead, all that resource will be going to plugging holes in stuff that we've messed up.
• 45:57
  SPEAKER_01: We're like the child that like, you know, wastes his inheritance and then has to go and like, you know, get a job to like not quite rebuild, you know, the same thing that he got and he squandered.
• 46:09
  SPEAKER_01: It seems much easier to me to kind of just inject a little bit of care in these incredible systems that we have.
• 46:20
  SPEAKER_03: Um when you when you meet the founders now, what are the behaviors, the traits that you've learned that you guys really look for and go, that's someone I want to work with?
• 46:34
  SPEAKER_02: Um the first the first sort of thing that we need to assess is does this person believe and do they care?
• 46:44
  SPEAKER_02: Um and this is fundamental to our our theory of change and fundamental to our investment hypothesis is the first thing we need to identify is is this company directly linked to positive outcomes for nature?
• 46:57
  SPEAKER_02: Um and so sitting down and just hearing somebody's story, hearing their why is very, very valuable.
• 47:05
  SPEAKER_02: And the more we get into their why, the more they're interested in our why and the more natural chemistry there is.
• 47:10
  SPEAKER_03: So do you ever have it where they genuinely believe their why is their why and it's connected, but actually you start pulling it's like we're not sure it is.
• 47:21
  SPEAKER_02: Yes.
• 47:21
  SPEAKER_02: You know, we've suddenly seen people who are talking about something that they might have just thought was a good idea, and now they're articulating it in the interest of jumping on a bandwagon.
• 47:31
  SPEAKER_02: But you know, those those DD processes don't last very long.
• 47:34
  SPEAKER_02: Um and they they're sort of uh I I'd say there's a sort of uh self-fulfilling philosophical engagement with the human, with the with the why or the team and you know, why they've why they've come into this thing.
• 47:47
  SPEAKER_03: And I think you can you can often learn something from most conversations.
• 47:52
  SPEAKER_03: I used to say all.
• 47:53
  SPEAKER_03: Now I say most conversations.
• 47:55
  SPEAKER_03: You can pick one or two things.
• 47:56
  SPEAKER_03: Even if it's not an investable thing, you can learn something about you or about them or about the sector or something that helps add to your Yeah.
• 48:03
  SPEAKER_02: And so we're we're we we love having those those early conversations, but we need to understand that there's a a philosophical alignment.
• 48:09
  SPEAKER_02: And that philosophical alignment we have since learned, since we've been investing and working with the portfolio that we have now, is of great value to the portfolio because we care about what they're doing, they care about what we're doing, and there's a sense of a shared mission.
• 48:23
  SPEAKER_02: You know, we are also a startup, you know, we're building uh an organization to fund other organizations to go and do important things.
• 48:30
  SPEAKER_02: And so we're kind of we're all in this together.
• 48:32
  SPEAKER_02: So that that philosophical piece really, really matters.
• 48:36
  SPEAKER_02: The other trade that we absolutely look for in all of the founding teams, and it it's got to be in most founders, but it absolutely has to be in the founding team, is that they have to have commercial experience.
• 48:48
  SPEAKER_02: Um, and they just have to have a sense for how do you operate in a commercial, in a business context.
• 48:56
  SPEAKER_02: Um, because there's a risk in our space that a lot of the people coming into nature or with ideas that are playing in nature have either come from one of two archetypes, and this could be academia, where they've done a whole load of RD and research and they've identified something that is incredibly promising, and they've applied a market logic to this and said, it's so promising that it will work.
• 49:20
  SPEAKER_02: And the actual sort of transfer of that technology from the academic arena into the commercial arena is fraught with difficulty um so if you know we we love deep tech and we love deep tech where there is a commercial partner involved in scaling this from the lab into reality.
• 49:40
  SPEAKER_02: Um the other archetype that we're cautious of is the campaigner, you know, or the activist, um, who has been, you know, arguing something for a long time, but really fundamentally believing it, and has said, okay, I've actually decided that the market is a way for me to express my belief system maybe more efficiently than what I was doing before.
• 50:01
  SPEAKER_02: Um, and is doing that without a clear commercial context.
• 50:05
  SPEAKER_02: So those are two archetypes that we're very cautious of.
• 50:08
  SPEAKER_02: Um we actually quite like those archetypes when they're coupled with excellent commercial experience, but we have to test that.
• 50:16
  SPEAKER_02: And that's rare.
• 50:17
  SPEAKER_01: It's rare, yeah.
• 50:18
  SPEAKER_01: The commercial piece is part of our theory of change.
• 50:22
  SPEAKER_01: So we we want to be one of those organizations that proves that doing good for nature is good business.
• 50:32
  SPEAKER_01: And and that we want to therefore attract more vanilla capital to this field.
• 50:36
  SPEAKER_01: Because there, as I said earlier, there have always been philanthropists, they've always been governments, and they've always been NGOs putting money and interest you know into nature.
• 50:45
  SPEAKER_01: And that just hasn't been enough.
• 50:46
  SPEAKER_01: And it hasn't worked.
• 50:48
  SPEAKER_01: So we need new forms of capital coming into the space.
• 50:51
  SPEAKER_01: And the only way that's going to happen is through the creation of a bit of a track record of businesses that are good for nature being good businesses.
• 50:59
  SPEAKER_01: So that commercial story is one that we are intently focused on.
• 51:04
  SPEAKER_01: Um, of course, to to make money for our LPs, but more than that, to make sure that lots more money flows into this field and that it's not so hard to get pension money or government money or, you know, just really vanilla capital looking for diversification to put money into nature.
• 51:24
  SPEAKER_01: I I think the other thing in founding teams, maybe just to add last thing to add, is uh I I really like people who are stubborn um but not uh so attached to their own myth that they can't take feedback.
• 51:38
  SPEAKER_03: Um strong opinions loosely.
• 51:41
  SPEAKER_03: Yeah.
• 51:42
  SPEAKER_03: Um in the UK, so um you guys ever met Jonathan Dix?
• 51:46
  SPEAKER_03: He's the chief investment officer at Octopus Ventures, Octopus Capital.
• 51:51
  SPEAKER_03: Super, super bright guy.
• 51:53
  SPEAKER_03: He's he's great.
• 51:54
  SPEAKER_02: Someone was telling me about him the other day.
• 51:55
  SPEAKER_02: Yeah.
• 51:56
  SPEAKER_03: He um he's rare in the UK, I think.
• 51:59
  SPEAKER_03: But he almost takes a US-based um hello JD, by the way, he'll be on soon.
• 52:03
  SPEAKER_03: Um, he he likes to have seen a founder that's failed.
• 52:08
  SPEAKER_03: Whereas in a UK context, we're terrible at that.
• 52:11
  SPEAKER_03: If someone fails with, oh, they're terrible, move them aside.
• 52:13
  SPEAKER_03: Whereas in the US, almost they're like, oh, you haven't failed yet.
• 52:16
  SPEAKER_03: Oh, well, you're gonna have one, so come back when you have.
• 52:18
  SPEAKER_03: So I love that about how do you guys think about the people who have tried and misstepped and pivoted and adjusted?
• 52:24
  SPEAKER_01: I love failure.
• 52:25
  SPEAKER_01: It's been my greatest teacher.
• 52:27
  SPEAKER_01: I mean, I'm we only started Sand River because I failed to get a significantly strong mandate from my family to actually, you know, change the business.
• 52:35
  SPEAKER_01: So I effectively lost my job.
• 52:37
  SPEAKER_01: You know, and um and also I when I joined my family business, it was in quite steep decline because of the markets it was in.
• 52:44
  SPEAKER_01: So I was sort of fighting fires while the profits were dropping for the first few years until we turned it around and got it on the right trajectory.
• 52:51
  SPEAKER_01: But those periods of failure because something that you dreamed about happening doesn't come right for you, or because you are fighting fires rather than, you know, I don't know, going up a beautiful rosy path.
• 53:06
  SPEAKER_01: You it tests you and it pushes you to places inside yourself that are very uncomfortable.
• 53:12
  SPEAKER_01: And it makes you more empathetic with the tasks that are difficult with that others in your organization are performing.
• 53:18
  SPEAKER_03: Was that the hardest chapter of your career when you didn't get the mandate you wanted for change?
• 53:22
  SPEAKER_01: Yeah, almost certainly.
• 53:24
  SPEAKER_01: Um I had so much of my identity was built as you know this person who is going to, you know, with love and affection, um, take an organization that was quite old and nurture it through its next phase.
• 53:42
  SPEAKER_01: And to not be able to do that in alignment with my values was very hard.
• 53:47
  SPEAKER_01: You had to sort of divorce yourself from yourself and go, okay, well, what really matters?
• 53:52
  SPEAKER_01: And I'm still super, super grateful for that time that you know I was part of the family business.
• 53:57
  SPEAKER_01: It gave me such exposure to such different industries and um different markets, and I love the people I worked with, and uh that was a great, great chapter and huge learning.
• 54:08
  SPEAKER_01: But it's very interesting to restart your career at 38.
• 54:12
  SPEAKER_01: I wouldn't have it any other way, and it's landed me in a position where I can say that what I do is also what I love, and that's a rare privilege.
• 54:22
  SPEAKER_03: We um one of the things we spoke about earlier was how everything's relative to something else.
• 54:27
  SPEAKER_03: Well, I quite like the the hardest thing you've ever done is the hardest thing you've ever done.
• 54:31
  SPEAKER_03: And that's relative to the individual.
• 54:34
  SPEAKER_03: And I think when when we've got this amazing influx of young talent at the back, because uh if you're interested in natural capital and data and tech, there aren't that many places you can work at the moment in the UK.
• 54:46
  SPEAKER_03: We're fortunately one of them.
• 54:48
  SPEAKER_03: So we have hundreds of applicants for every role, which is awesome.
• 54:51
  SPEAKER_03: But we've got people who are coming who've only ever succeeded.
• 54:54
  SPEAKER_03: They've been the top of their class, they've won at sport.
• 54:57
  SPEAKER_03: The CVs are just ridiculous.
• 54:58
  SPEAKER_03: You look at them, it's like, oh, you you narrowly missed out on the Olympics and you got a first, and I do think so so they're amazing.
• 55:04
  SPEAKER_03: But the thing we say is, okay, you've been the best person in your small pond.
• 55:08
  SPEAKER_03: You are now coming, and everyone's like that.
• 55:10
  SPEAKER_03: How are you gonna cope with that challenge and where do you find that resilience?
• 55:14
  SPEAKER_03: Is that something you assess founders for, whether they can exhibit that resilience?
• 55:18
  SPEAKER_02: Yeah, I think there's something interesting in what you're saying, because as as we were talking earlier, I was thinking failure comes in in you know many different shapes and sizes.
• 55:25
  SPEAKER_02: And for some people, failure is being stuck in an organization where they might be doing something that just isn't aligned with their with their worldview, um, even if they've got a CV of a winner.
• 55:36
  SPEAKER_02: Yep.
• 55:37
  SPEAKER_02: Um and I certainly relate to that.
• 55:38
  SPEAKER_02: I remember, you know, I had a great job in my early 20s, and I remember going into the office after about three years and being like, fuck, is this it?
• 55:47
  SPEAKER_02: You know, am I just going to be going to an office for working for somebody else for the rest of my career?
• 55:52
  SPEAKER_02: Like, is that is that how it happens?
• 55:55
  SPEAKER_02: And, you know, inadvertently, somewhere, that planted this idea in me that I needed to go and do something different.
• 56:01
  SPEAKER_02: Um, and you know, that was a form of failure.
• 56:03
  SPEAKER_02: I was failing to express myself in my career in a way that was really interesting to me.
• 56:08
  SPEAKER_02: And so, you know, I I went when our our trend in terms of investing in founders now is investing in slightly later career founders, you know, slightly older founders.
• 56:21
  SPEAKER_02: And I think that's just because there's more relatable life experience and you can identify some of that relativity.
• 56:27
  SPEAKER_03: In this year's we've run three different intern programs.
• 56:30
  SPEAKER_03: That's a misnomer.
• 56:31
  SPEAKER_03: They're not intern programs, they're development pipelines.
• 56:34
  SPEAKER_03: So we bring people in for three month periods.
• 56:36
  SPEAKER_03: We have, I think, 10 people now who are in the business permanent that have come through that route.
• 56:41
  SPEAKER_03: So we're a demanding place to work, right?
• 56:43
  SPEAKER_03: I am not a reasonable person.
• 56:44
  SPEAKER_03: My expectation and he's nodding like that's accurate.
• 56:47
  SPEAKER_03: That's accurate.
• 56:48
  SPEAKER_03: Um, but we don't lie, we're like, we are a high performance place.
• 56:51
  SPEAKER_03: Everyone is, if you want to be here, you're welcome.
• 56:53
  SPEAKER_03: If you don't, that's cool.
• 56:54
  SPEAKER_03: Um, but we've had like 10 people that have come through that route.
• 56:57
  SPEAKER_03: And this year, the third year of intake we've had, actually, some of the really successful ones have been mid to late 20s.
• 57:03
  SPEAKER_03: Whereas actually the previous year they were straight out of university.
• 57:07
  SPEAKER_03: And I think year on year it gets a harder bar, a hard we had 2,000 applicants in a fortnight for what was five or six roles.
• 57:14
  SPEAKER_03: So actually, I think inadvertently I've taken a similar route this year in terms of recruitment.
• 57:18
  SPEAKER_01: I think there's also I think one of the other things that is really helpful in the area we're in is some form of systems thinking and uh applied systems thinking more than theoretical.
• 57:30
  SPEAKER_01: So you have to have seen a couple of things to sometimes have an appreciation for like how your product fits into the wider problem area that you're part of.
• 57:41
  SPEAKER_01: And sometimes experience matters a little bit with that.
• 57:44
  SPEAKER_01: On the failure thing, the one thing we don't need though is people to be have had so much failure that it defines them.
• 57:51
  SPEAKER_01: So you need people who have a bit of stupid bravery to go out and do the things we're doing.
• 57:56
  SPEAKER_01: And I think that's one of the roles we can play as a funder.
• 57:59
  SPEAKER_01: So we did a founder feedback session recently, um, where we asked all of our founders for some goods and bads about us.
• 58:06
  SPEAKER_01: And one of the things that came out is that our understanding of their project and the conviction that we reached early often enabled them to act differently because they felt that they had a funder on board who understood them, really understood the project, and said to them, We're here to support you.
• 58:23
  SPEAKER_01: We'll invest in you, we'll help you raise funds even from others, we'll advocate for you.
• 58:29
  SPEAKER_01: And it allowed them to go, okay, you know, I'm not going to run out of money tomorrow.
• 58:32
  SPEAKER_01: I can maybe just go a bit more aggressively or, you know, go a bit harder.
• 58:36
  SPEAKER_01: So I think that adds sort of confidence to the founders to have specialist investors who really understand their journey.
• 58:46
  SPEAKER_03: Systems thinking is is really interesting.
• 58:48
  SPEAKER_03: I I was listening to a a US podcast with um Andreessen Hawitz on the other day, and the comment was uh they expect every founder to understand the history of the sector they're working in, otherwise they'll inadvertently try and recreate something that's been tried before without picking up that um sort of past learning point moving forward.
• 59:10
  SPEAKER_03: Have you come across that?
• 59:13
  SPEAKER_02: We haven't expressly hunted hunted that out.
• 59:16
  SPEAKER_02: Um but I like the I like the thinking behind it and I like the context.
• 59:20
  SPEAKER_02: And you know, one of the one of the things that informs a lot of the work we're doing is that change happens very, very slowly and then suddenly very quickly.
• 59:32
  SPEAKER_02: Yeah.
• 59:33
  SPEAKER_02: So, you know, we don't know forward looking, we can't anticipate when what change is going to happen.
• 59:39
  SPEAKER_02: We can just be we can just anticipate and be ready for that change.
• 59:43
  SPEAKER_02: Um and in doing so, we want to be working with the brightest minds, the most flexible, the most creative, the most commercially astute who can take advantage of those opportunities when they manifest.
• 59:55
  SPEAKER_02: But even if those opportunities don't manifest, they're gonna go and build something great.
• 1:00:00
  SPEAKER_03: Have you met the founders in current businesses that you're like, we don't think that business is gonna work, but those founders are on a list for you because you know they're coming back because the individuals, you're like, you're gonna find something.
• 1:00:12
  SPEAKER_03: Absolutely.
• 1:00:13
  SPEAKER_03: Yeah, we've seen a lot of those.
• 1:00:15
  SPEAKER_01: And we have we we we met early on in our um journey, we met a founder who we just said this is a man who will found many businesses and will be successful at some of them.
• 1:00:29
  SPEAKER_01: But he's just innately entrepreneurial and innately competent.
• 1:00:34
  SPEAKER_01: Uh we have a wonderful advisor who was one of the founders of Planet A before he left because he's had a late in life large family um uh Christian.
• 1:00:44
  SPEAKER_01: And he's a repeat entrepreneur.
• 1:00:46
  SPEAKER_01: I mean, I can't remember in his first introduction to us, he said he founded 30-something businesses.
• 1:00:50
  SPEAKER_01: Yeah, at least at least 20 businesses.
• 1:00:52
  SPEAKER_01: And he said many of them have failed, but you know, some of them have really not failed, and you know, hence he can retire very early and support first-time fund managers in their journey.
• 1:01:03
  SPEAKER_01: And that determination, that ability to go again and again is is fabulous.
• 1:01:09
  SPEAKER_01: And it a part of the privilege of our job is that you admire the people you invest in.
• 1:01:14
  SPEAKER_01: You admire them.
• 1:01:15
  SPEAKER_03: And how do you find them?
• 1:01:16
  SPEAKER_03: And how do they find you?
• 1:01:18
  SPEAKER_03: Because when you first started, it's like, okay, we want to do this.
• 1:01:21
  SPEAKER_03: Yes, you've got to raise some capital, yes, you can bring some of your own to bear, but how do you begin to find these unicorn people?
• 1:01:30
  SPEAKER_01: He totally looked across to you and was like, well, because I mean, I don't he runs sourcing and I don't.
• 1:01:35
  SPEAKER_01: So I mean, I've found some of them, but that's by accident.
• 1:01:39
  SPEAKER_02: Transparently, in the early days, you know, this this was extremely organic.
• 1:01:44
  SPEAKER_02: Um, and we used our network and our interest and our curiosity to go and meet people and engage with them.
• 1:01:50
  SPEAKER_02: And sometimes this would be through a family office that we had a connection with, or sometimes it would be through, you know, going to events and you know, reading about stuff, or identifying that there was a gap that we were interested in and then looking at that gap until we found something.
• 1:02:03
  SPEAKER_02: Um, but actually it's become a lot more systematic.
• 1:02:06
  SPEAKER_02: That was in you know the first six, maybe twelve months.
• 1:02:08
  SPEAKER_03: Just on that first chapter, we we have a lot of young people listening to the podcast who want to come into the sector, especially with the prevalence of AI and lots of things converging to a norm.
• 1:02:20
  SPEAKER_03: Your network, your your time spent with people is still an area I think if you commit to gives you such a point of differentiation.
• 1:02:29
  SPEAKER_02: Absolutely.
• 1:02:29
  SPEAKER_02: And this was, you know, this is before the age of AI.
• 1:02:32
  SPEAKER_02: This is three years ago, you know.
• 1:02:33
  SPEAKER_02: None of us had none of us had these tools on our phones.
• 1:02:35
  SPEAKER_02: Um so we were just going out and having conversations with people and meeting them and telling them, you know.
• 1:02:40
  SPEAKER_02: It's the best time.
• 1:02:41
  SPEAKER_02: No, it's panning for gold, but it's so rewarding.
• 1:02:44
  SPEAKER_02: And we were telling them in crude terms, all of the stuff we've talked about today.
• 1:02:47
  SPEAKER_02: You know, we're here to invest in companies that are good for nature.
• 1:02:50
  SPEAKER_02: And, you know, and and and there the conversation begins.
• 1:02:53
  SPEAKER_02: And from that, you know, enthusiasm, energy, whatever you put out into the world and stuff comes back.
• 1:02:59
  SPEAKER_02: So we started to find the types of organizations and the types of businesses that we'd want to invest in.
• 1:03:06
  SPEAKER_02: We also started to identify some of the themes that we didn't want to invest in, which we've touched on already.
• 1:03:10
  SPEAKER_02: Um, but that's become a lot more deliberate, a lot more structured.
• 1:03:15
  SPEAKER_02: And bring it back to an earlier conversation.
• 1:03:17
  SPEAKER_02: You know, we thought long and hard, you know, it it the the the branding and the website that we have given birth to um was a real project.
• 1:03:26
  SPEAKER_02: And we were very deliberate and very careful about building a brand that A represents us, but B, that we think will draw to us the type of partners that we want to work with.
• 1:03:37
  SPEAKER_03: Everything matters.
• 1:03:39
  SPEAKER_02: One of my mantis, how you do anything is how you do everything.
• 1:03:42
  SPEAKER_03: It it all matters.
• 1:03:44
  SPEAKER_02: Yeah.
• 1:03:44
  SPEAKER_02: So and and now we have you know a sourcing engine.
• 1:03:48
  SPEAKER_02: You know, we have Gabby going to loads of events.
• 1:03:52
  SPEAKER_02: We have Greg and I talking at uh selective events.
• 1:03:55
  SPEAKER_02: Um, we have a funnel of inbound that we're processing all the time.
• 1:03:59
  SPEAKER_02: You know, the funnel's open now.
• 1:04:01
  SPEAKER_02: If you have an exciting opportunity, then send it our way.
• 1:04:04
  SPEAKER_02: Um and you know, we're able now to surface the most promising, the most aligned from that.
• 1:04:10
  SPEAKER_02: Um and yeah, we have we have uh you know plenty more things to look at than we're able to invest in.
• 1:04:17
  SPEAKER_01: I think and and interestingly, I think that sourcing in the age of AI won't be as much of a differentiator because everyone will be on the same platforms, etc.
• 1:04:27
  SPEAKER_01: It'll be more what you do when you start to connect with those people.
• 1:04:31
  SPEAKER_01: You know, how what relationship are you really offering them as their funder?
• 1:04:36
  SPEAKER_01: How much do you understand them and their business?
• 1:04:38
  SPEAKER_01: We just secured a deal that I'm very proud of and we secured it ahead of a very large, very successful, globally important uh VC fund.
• 1:04:52
  SPEAKER_01: And it's not a competition because actually we want everyone to be investing in the space.
• 1:04:57
  SPEAKER_01: But the reason we were chosen to um co-lead this deal was because of our depth of understanding of the founding team and their objectives and our aligned mission alignment.
• 1:05:09
  SPEAKER_01: So it's not that's where I think we feel that we can offer something differentiated.
• 1:05:17
  SPEAKER_03: How far into that process did you go from listening to selling?
• 1:05:22
  SPEAKER_03: Because with recruitment, I often find it you're you're meeting someone amazing and you go from, oh wow, now I'm selling them on how great the business is rather than listening to whether they should be part of it.
• 1:05:32
  SPEAKER_01: So we I think we've really been we've been beneficiaries of watching bad acting in others.
• 1:05:39
  SPEAKER_01: We it's a privilege to be pitched to.
• 1:05:42
  SPEAKER_01: And if you don't behave like that, you don't deserve to be pitched to.
• 1:05:45
  SPEAKER_01: And so I think we never come in with uh humor sell yourself to us.
• 1:05:51
  SPEAKER_01: We come in that we we we both respect that they're looking for funders that suit them and we're looking for investments that suit us, and we even Have our criterion and hopefully they match.
• 1:06:03
  SPEAKER_01: And if you come in at that peer-to-peer relationship, then it's a different experience.
• 1:06:11
  SPEAKER_02: Um it's also one of the most exciting parts or the most interesting parts of our DD calls is when we say, and what are you guys looking for in your investor group?
• 1:06:20
  SPEAKER_02: You know, what do you want from us?
• 1:06:23
  SPEAKER_02: Um, because then we start to get under the hood of their expectations.
• 1:06:28
  SPEAKER_02: Ideally, they have really thought about these things.
• 1:06:30
  SPEAKER_02: You know, ideally, they've really articulated to themselves the type of cap table, the type of players, the type of activities that those different players are bringing, bringing to the to the fore.
• 1:06:41
  SPEAKER_02: And, you know, we want to work with the founders who have kind of processed and have enough wherewithal to have thought about what is the organization that they're going to be managing in five years.
• 1:06:50
  SPEAKER_02: What does it feel like to work in that organization?
• 1:06:52
  SPEAKER_02: Who do they who do they want on their team?
• 1:06:54
  SPEAKER_01: And the best founders, they also know some of their value.
• 1:06:58
  SPEAKER_01: So, you know, they're sitting across the table assessing you as much as you are them.
• 1:07:03
  SPEAKER_01: And you're very naive to think otherwise.
• 1:07:05
  SPEAKER_03: The way you articulate the privilege of listening to the pitch is gorgeous.
• 1:07:10
  SPEAKER_03: So on the first page of our recruitment documents, it opens and it says, um, this is about the candidate, not about you.
• 1:07:18
  SPEAKER_03: Make this a special experience for them.
• 1:07:20
  SPEAKER_03: And the emails I love the most are the ones, and we get a lot of this through the intern programme because we we ask a lot of the people who come in, but our intent is we're almost giving you uh an elite sporting training camp when you come with a view that you will go away learning more about you and better as a result of that process.
• 1:07:37
  SPEAKER_03: I got rejected for lots of jobs early in my career, but I got better every time I applied.
• 1:07:41
  SPEAKER_03: So when we get the email that comes back, it says, you know, sorry I haven't got the job, but wow, I enjoyed the process.
• 1:07:46
  SPEAKER_03: Thank you so much.
• 1:07:47
  SPEAKER_03: I've learned this, this, and this.
• 1:07:48
  SPEAKER_03: They're the ones that make me really proud.
• 1:07:50
  SPEAKER_03: Because the people that get a job, they're happy anyway, but the ones you you reject that don't.
• 1:07:54
  SPEAKER_03: Um, you took us on to valuation, which I think is a fascinating part of things.
• 1:07:58
  SPEAKER_03: You mentioned about the best founders know their value.
• 1:08:00
  SPEAKER_03: You are trying to value businesses and technologies that are so early.
• 1:08:05
  SPEAKER_03: How do you start thinking about that valuation process?
• 1:08:08
  SPEAKER_02: Yeah, valuation shouldn't be a negative selection criteria.
• 1:08:13
  SPEAKER_02: Um, we've got to have selected positively to invest in this company.
• 1:08:17
  SPEAKER_02: Um, and if the negotiation falls down on valuation, then that's a pity.
• 1:08:24
  SPEAKER_02: Because ultimately building an early stage company is a multi-year price discovery process.
• 1:08:29
  SPEAKER_02: Um, and there is a massive issue in overvaluing yourself too early because it just makes it harder to raise funds later.
• 1:08:37
  SPEAKER_02: Um, and there is you know sometimes an issue undervaluing yourself because you start playing in the wrong field.
• 1:08:43
  SPEAKER_03: Have you had that where you've had to say to a founder, you you're way under where you should be on this?
• 1:08:50
  SPEAKER_01: Uh yeah.
• 1:08:51
  SPEAKER_01: Uh I've helped a couple of other founders outside of our portfolio um bump up their own valuations by saying to them, look, you really if you just doubled your valuation, you'd attract different funders.
• 1:09:06
  SPEAKER_01: They're like, doubled.
• 1:09:07
  SPEAKER_01: Like, okay, maybe not doubled, but just push it up a bit and see who you get.
• 1:09:11
  SPEAKER_03: You know who Rory Sutherland is?
• 1:09:13
  SPEAKER_03: He's um he wrote the book Alchemy, and he um was the chief marketing officer at Ogilvie, but he's a psychologist taking on a marketing view.
• 1:09:22
  SPEAKER_03: And he said, Oh, you're struggling to sell something, double the price of it.
• 1:09:25
  SPEAKER_03: Like he said, counterfactual people think it will reduce that, but actually it makes it scarcer.
• 1:09:30
  SPEAKER_03: Brilliant logic in terms of how he approaches the sort of um cognitive dissonance of thinking in terms of those scenarios.
• 1:09:37
  SPEAKER_02: Yeah.
• 1:09:38
  SPEAKER_02: And I mean, uh a little a little bit of the work that we're doing when we first engage with founders is kind of challenging some of the norms and expectations in the VC market.
• 1:09:47
  SPEAKER_02: Um, and one of those norms and expectations is that you need to raise a certain amount of money in in order to be, you know, viewed in a certain way.
• 1:09:55
  SPEAKER_02: And well that you have to have certain people on your cap table in order to become a successful entrepreneur.
• 1:10:00
  SPEAKER_02: And the conversation that we often have is how much money do you need?
• 1:10:04
  SPEAKER_02: You know, what are the milestones that you're looking to achieve?
• 1:10:07
  SPEAKER_02: And what are you going to use it for?
• 1:10:08
  SPEAKER_02: Yeah, what are you going to use it for?
• 1:10:09
  SPEAKER_02: You know, how much money do you need?
• 1:10:10
  SPEAKER_02: What are you going to use it for?
• 1:10:11
  SPEAKER_02: Where does that get you to?
• 1:10:13
  SPEAKER_02: And once you're there, how much money will you need at that stage?
• 1:10:16
  SPEAKER_02: And you know, once you've played that through, you might well come out at a much lower number and you don't need to go on a raise and you don't need to val yourself at some crazy number.
• 1:10:23
  SPEAKER_02: And, you know, that's there are just many ways of making a successful enterprise.
• 1:10:28
  SPEAKER_02: Tends to be that the ways of failing are, you know, aggregated.
• 1:10:32
  SPEAKER_02: There are groupings around failure, but there are many ways to succeed.
• 1:10:35
  SPEAKER_01: Evaluation, like all the other terms of any deal we invest in, is also just sometimes an indicator of mindset of the founding team.
• 1:10:44
  SPEAKER_01: What are they how how are they corraling these other investors?
• 1:10:47
  SPEAKER_01: How do they think about their own business?
• 1:10:49
  SPEAKER_01: What do they want from a board that they're structuring in this way?
• 1:10:52
  SPEAKER_01: So it's also an investigation into their mindset.
• 1:10:55
  SPEAKER_01: Yes.
• 1:10:55
  SPEAKER_01: And into how and and into how they negotiate.
• 1:10:58
  SPEAKER_01: If they're a pushover with me, then they're probably going to be a pushover with other people unless I know that they're a pushover with me and they can own why they are, because they want me, you know, as an investor.
• 1:11:08
  SPEAKER_01: And yet, and if they're and if they play silly games with me, they're probably gonna play silly games with a customer that's not going to enjoy that.
• 1:11:16
  SPEAKER_03: Do you know where um So y you read emotional intelligence really quickly?
• 1:11:24
  SPEAKER_03: Do you know why you do?
• 1:11:26
  SPEAKER_03: No.
• 1:11:27
  SPEAKER_03: Interesting.
• 1:11:28
  SPEAKER_03: Um I wondered if it came from the debating side of things.
• 1:11:31
  SPEAKER_03: Because I I assume in that scenario you knew what the other person was going to say before they said it.
• 1:11:35
  SPEAKER_01: Sometimes.
• 1:11:35
  SPEAKER_01: Yeah.
• 1:11:36
  SPEAKER_01: I I'm I'm I I really love uh the layered assumptions on which we build our belief systems.
• 1:11:45
  SPEAKER_01: And I can kind of see those quite quickly.
• 1:11:47
  SPEAKER_01: Like what belief systems are driving the conversations that people are having, um, even with themselves.
• 1:11:53
  SPEAKER_03: The um the reason I went to that question was when you were saying about whether the the person was ad was demonstrating that they were a push-over negotiation because they really wanted you.
• 1:12:02
  SPEAKER_03: The unspoken bit of that is you can read whether they mean it or not.
• 1:12:06
  SPEAKER_03: You can read whether it's a line or whether they actually mean it.
• 1:12:08
  SPEAKER_03: Yeah.
• 1:12:09
  SPEAKER_03: Um sniff a dog for lie detection.
• 1:12:11
  SPEAKER_03: Yeah.
• 1:12:12
  SPEAKER_03: Have you come across um James Cameron, the investor, not the um director?
• 1:12:18
  SPEAKER_03: He he um launched the first ever uh carbon investment company in like 2012, I think.
• 1:12:24
  SPEAKER_00: Yes.
• 1:12:24
  SPEAKER_00: Yeah, I was know him.
• 1:12:26
  SPEAKER_03: I was sat on a panel with him and he described as hyper vigilance in terms of emotional um intelligence, and he can do it.
• 1:12:32
  SPEAKER_03: He can read people super, super.
• 1:12:34
  SPEAKER_03: He was also a um uh a practicing barrister who had to defend General Pinochet in in his case and things.
• 1:12:41
  SPEAKER_03: So very, very good at reading people.
• 1:12:43
  SPEAKER_01: Probably a bit neurodiverse.
• 1:12:45
  SPEAKER_01: You know, I think if the world's a bit complicated to you as it was to me when I was younger, then you are paying uh a different type of attention to what's going on around you because it doesn't make the same fluid sense that it seems to to your siblings or to your friends.
• 1:12:59
  SPEAKER_02: This is where I I think I'd say that Greg has, as I said earlier, quite a unique skill set in this respect.
• 1:13:06
  SPEAKER_02: It's super fat.
• 1:13:06
  SPEAKER_02: And seeing it play out in quite you know challenging, sometimes contentious business contexts and being able to navigate it in a uh in a way that brings all parties on sides and reaches a kind of coherent and positive resolution is incredible.
• 1:13:24
  SPEAKER_02: Um and it's a joy to be exposed to.
• 1:13:26
  SPEAKER_02: And I can also see how Greg might have worked on, has worked on that over quite a few years in a business setting, and that actually it's also based on some trial and error, and there could have been some examples where that didn't work as nicely.
• 1:13:40
  SPEAKER_02: Yeah, definitely.
• 1:13:41
  SPEAKER_02: Definitely.
• 1:13:42
  SPEAKER_01: But but I think like all people who have sort of something that's uh an extreme on one side, is you have other areas that are really poor.
• 1:13:52
  SPEAKER_01: And so I I spend a lot of my time looking for people who um excel at things that I find really difficult.
• 1:14:00
  SPEAKER_01: And sometimes those things might appear quite basic.
• 1:14:02
  SPEAKER_01: And I sort of get excited about you know, other people who can do those things that, you know, I just find frankly impossible.
• 1:14:10
  SPEAKER_03: We talked about the valuation side of things.
• 1:14:12
  SPEAKER_03: Let's go to the exit side of it.
• 1:14:14
  SPEAKER_03: So um, when you do meet that business, how important is it to you to see a logical exit route?
• 1:14:19
  SPEAKER_03: And what sort of time domains do you think about if you're looking at that?
• 1:14:23
  SPEAKER_02: Yeah, I mean I mean, uh realistically, most of the founders that we're engaging with haven't had an exit in the past.
• 1:14:29
  SPEAKER_02: Um and they're you know, stretching out their thinking beyond year five is often very challenging.
• 1:14:37
  SPEAKER_02: You know, they're talking about playing in a market where there are certain milestones that they can see in year one, two, three, maybe up to year five.
• 1:14:43
  SPEAKER_02: So the exit piece is an area where you know we recognize that founders need a lot of support.
• 1:14:50
  SPEAKER_02: Um, and we want to be part of bringing them a network who can, you know, help them in that part of the journey.
• 1:14:57
  SPEAKER_02: And we're also working to kind of beef out our advisory capacity so that we have some people who we can, you know, have off the record conversations with who have, you know, real hands-on experience of VC exits.
• 1:15:12
  SPEAKER_01: So whether that's entrepreneurs or investors.
• 1:15:14
  SPEAKER_01: Yeah.
• 1:15:15
  SPEAKER_01: Because we haven't exited.
• 1:15:16
  SPEAKER_01: I mean, I've sold businesses, but um it's different.
• 1:15:21
  SPEAKER_01: And I think it's I think what we need to see from them is that their business model encompasses an understanding of what might make that company valuable at a certain point.
• 1:15:34
  SPEAKER_01: So it's not that they have to have defined that this is going to be a trade.
• 1:15:37
  SPEAKER_01: In fact, I th I often think it's a waste of time for them to tell me who's going to buy their business.
• 1:15:41
  SPEAKER_01: They just have to give me a couple of types of people who might see value in their business and why they'd see value in their business and what problem they're solving that can't be solved by others.
• 1:15:52
  SPEAKER_01: So it comes down to the kind of quality of the underlying kind of business that that defines whether it can be and I think then also their shareholding structure.
• 1:16:01
  SPEAKER_01: If they have a cap table that's super complex, or they you can see that they'll want to run this business forever themselves, then you have to have a different conversation with them.
• 1:16:09
  SPEAKER_01: What constitutes complex on a cap tabling?
• 1:16:13
  SPEAKER_01: Maybe a lot of uh not enough founder stock.
• 1:16:18
  SPEAKER_01: So that as you start to bring in new investors, the founder keeps diluting down past a certain point.
• 1:16:24
  SPEAKER_03: Where would be a de minimis that when they'll come into you like it's too too late?
• 1:16:27
  SPEAKER_01: It depends on the round.
• 1:16:29
  SPEAKER_01: So it's it's hard to say.
• 1:16:30
  SPEAKER_01: But sometimes it's just obvious.
• 1:16:32
  SPEAKER_01: You know, they're they're raising a seed round of three million, and the founder's already at 10% or 12% of the business, and you're like, that's just you know, we're gonna have to open up big eSops for you, and how do we incentivize this and how do we bring in others?
• 1:16:44
  SPEAKER_01: And so we're all gonna be diluted at this point, and you know, why have these people still got so much stock?
• 1:16:49
  SPEAKER_01: And why do you give these rights to these early people that makes it harder for you to be investable?
• 1:16:53
  SPEAKER_01: You know, the that's and sometimes we just uh we we're just really open with the founders and we say, like, if you clean up your cap table, we're interested.
• 1:17:00
  SPEAKER_01: And we that often gives them the tools because once if we give them a term sheet or uh we nudge another investor to give them a term sheet that has the requirement that they clean up their cap table, they can go to their investors and say, Are you gonna fund this?
• 1:17:14
  SPEAKER_01: And if the investors say no, then they say, Well, if you want funding, these are the terms.
• 1:17:19
  SPEAKER_01: And so we have to do something about this.
• 1:17:21
  SPEAKER_01: So it's an enabling tool for us to be clear on what's required.
• 1:17:27
  SPEAKER_02: And we see two value accretion opportunities in the companies that we're investing in.
• 1:17:32
  SPEAKER_02: One of those is the company developing a business model which has a clear there's a clear need for the product or service, and they can do it at price parity or undercutting the cost of the incumbents.
• 1:17:44
  SPEAKER_02: That equals good business.
• 1:17:46
  SPEAKER_02: The second value accretion opportunity is when the dimension of natural capital that they're playing into starts to become valued by the market and is kind of incorporated in the true cost decisions in that market.
• 1:18:02
  SPEAKER_02: That second piece is a fool's game to try and time.
• 1:18:05
  SPEAKER_02: So we focus exclusively in our due diligence on identifying the first piece.
• 1:18:10
  SPEAKER_02: But when the markets do start to develop, it then becomes a really interesting timing challenge about how long do you hold on to this business for?
• 1:18:19
  SPEAKER_02: You know, how long should the founder be running this thing for before they bring in the strategic investor, before they sell to a buyer, before they decide to go enlist.
• 1:18:28
  SPEAKER_02: And, you know, we can't sit here today and make realistic, reasonable calls about that.
• 1:18:33
  SPEAKER_02: But we do believe in holding on, participating in those markets until that second value accretion opportunity.
• 1:18:41
  SPEAKER_02: And so, you know, it may be 10 years, it may be seven years, it may be that, you know, at 10 years there's fundamental shifts in the markets they're playing into, and it would make sense to hold for longer.
• 1:18:52
  SPEAKER_01: Well, I mean, we can give a practical example.
• 1:18:54
  SPEAKER_01: Um you guys are a client of one of our businesses in in Rhizocore.
• 1:19:01
  SPEAKER_01: And Rhizocore's when we were looking at the investment case, we were assessing Rhizocore based on their effectively forestry enabled their business that services the forestry for carbon markets.
• 1:19:16
  SPEAKER_01: And they're using particular technology to support tree planting and better yield returns.
• 1:19:25
  SPEAKER_03: Um organic microbial um way of dealing with that that allows you to effectively achieve the results of fertilizer in an organic, fully natural.
• 1:19:35
  SPEAKER_01: Exactly, replacing synthetic fertilizer.
• 1:19:37
  SPEAKER_01: Um and and that's that's pointed out we love them.
• 1:19:40
  SPEAKER_01: Yeah, that's well, we love them too.
• 1:19:42
  SPEAKER_01: I mean, what an interesting crowd.
• 1:19:44
  SPEAKER_01: And and and that's a good business.
• 1:19:46
  SPEAKER_01: And we assessed it and we were like, this can be a great business.
• 1:19:49
  SPEAKER_01: And it's um really I would have funded them if you didn't.
• 1:19:53
  SPEAKER_03: Yeah, the we didn't know you were involved with them as we were becoming a customer.
• 1:19:57
  SPEAKER_03: I just love that you are because it's it's great.
• 1:19:59
  SPEAKER_01: What a great team and and and what a great product.
• 1:20:02
  SPEAKER_01: And and yet they're alongside their business um that they're doing um for you guys and for others, they're building what will become the largest fungal library in the world.
• 1:20:14
  SPEAKER_01: In fact, it was interesting listening to Toby said one day you're going to be able to stand on top of our library and you're going to be standing on the most biodiverse place on earth.
• 1:20:23
  SPEAKER_02: And and this is it's you know, just extending that point, this is when we get into the uncharted territory of we're we're talking about a market that doesn't exist yet.
• 1:20:32
  SPEAKER_02: You know, the fungal kingdom of life is the most under-researched of all the kingdoms of life.
• 1:20:38
  SPEAKER_02: Is there an opportunity?
• 1:20:39
  SPEAKER_02: If we ask the high-level question, is there an opportunity to build incredible businesses off the back of fungal RD?
• 1:20:46
  SPEAKER_02: The answer to that question is absolutely yes.
• 1:20:48
  SPEAKER_01: Yeah.
• 1:20:48
  SPEAKER_01: And that was my point, is that these guys are building one business, but by building that business, they're building a biological asset that we don't yet know the full value of.
• 1:20:57
  SPEAKER_01: Now, when they start to, you know, look at the non-human genomes and the medical discoveries that could come from a fungal library from that, like that, or the bioaccumulation of hazardous substances that might clean our soils and waterways.
• 1:21:10
  SPEAKER_01: I mean, how much is that worth?
• 1:21:12
  SPEAKER_01: I don't know.
• 1:21:13
  SPEAKER_01: And I think it's a random number.
• 1:21:14
  SPEAKER_01: Yeah.
• 1:21:15
  SPEAKER_01: Well, when we, when we when it was being assessed by a lot of traditional investors, Rhizocore was passed over because they were saying, show me a unicorn outcome for your tree planting fertilizer replacement company.
• 1:21:28
  SPEAKER_01: And they were like trying to build the models and they were like, oh, it gets close, and da-da-da.
• 1:21:32
  SPEAKER_01: And we were just like, you're putting way too much pressure on this business to do something that is, you're missing the point.
• 1:21:40
  SPEAKER_02: I mean, and and the the you know, investors are simple beasts.
• 1:21:44
  SPEAKER_02: And as an investor listening to that, you know, the the reflex is but focus, you know, but where are you going to focus?
• 1:21:54
  SPEAKER_02: And so, you know, the challenge that is a a company like Risercore is focused with is like do one thing well and but at the same time make sure that you're building the fundamental, the fundamental uh uh value of your asset.
• 1:22:09
  SPEAKER_02: Um and so that's what we're also evaluating is you know, does this team have a vision that is beyond what they're going to be delivering in year one, two, three?
• 1:22:17
  SPEAKER_02: Um, but do they also have the tools to deliver year one, two, three um, at the same time as holding that vision?
• 1:22:24
  SPEAKER_02: And that's you know, that's not a common skill set.
• 1:22:26
  SPEAKER_02: No, it's difficult.
• 1:22:28
  SPEAKER_02: You know, some teams are incredible on the vision side, but not great on the near term.
• 1:22:31
  SPEAKER_02: And some are incredibly focused on the near term, but not great on the vision side.
• 1:22:34
  SPEAKER_02: So it's so exciting when you find a team, which, like the team at Risercore, when you find a team who can, you know, bridge these two quite sophisticated viewpoints.
• 1:22:43
  SPEAKER_03: Just for the Risecore guys, I hadn't thought about this until you described it.
• 1:22:45
  SPEAKER_03: Uh, my wife's big into her gardening, and at Chelsea last year, there were these um expert mushroom exhibitors that grow mushrooms in books.
• 1:22:54
  SPEAKER_03: So for their library, there was like a display stand that had the mushrooms growing up through books.
• 1:22:59
  SPEAKER_03: So give it five years until they're ready to do it, and then what a way to announce it.
• 1:23:02
  SPEAKER_03: Literally have a library with the amazing.
• 1:23:04
  SPEAKER_03: Yeah.
• 1:23:05
  SPEAKER_01: I was talking to uh the the head of the of Design Week in London, and Q Gardens approached him to maybe do a pavilion down in Kew.
• 1:23:12
  SPEAKER_01: And I said, let's just build a pavilion and store RyzoCore's library underneath it, so it's the most biodiverse place on earth under it.
• 1:23:19
  SPEAKER_01: And let's construct it in mycelium.
• 1:23:21
  SPEAKER_01: So you know, it's as so much, it's fun with this.
• 1:23:25
  SPEAKER_03: I would completely agree.
• 1:23:27
  SPEAKER_03: The time, the time domain.
• 1:23:29
  SPEAKER_03: Bench is all about speed and urgency and that fast return.
• 1:23:35
  SPEAKER_03: That's not what nature's about and climate's about.
• 1:23:38
  SPEAKER_03: You know, they don't care, it doesn't care about the financial year.
• 1:23:41
  SPEAKER_03: How do you marry those two competing timelines?
• 1:23:44
  SPEAKER_02: Yeah.
• 1:23:45
  SPEAKER_02: I mean, this is a the this is a rich question.
• 1:23:47
  SPEAKER_02: Thank you.
• 1:23:48
  SPEAKER_02: Um rich?
• 1:23:49
  SPEAKER_02: Yeah, rich question, Rich.
• 1:23:51
  SPEAKER_02: And there's a lot in it because you know we are a venture business.
• 1:23:56
  SPEAKER_02: We have to deliver high-risk, high reward uh opportunities for our.
• 1:24:01
  SPEAKER_03: What does the origin of the word venture been adventure capital?
• 1:24:04
  SPEAKER_03: When you actually go back and read it.
• 1:24:06
  SPEAKER_03: I think people forget that.
• 1:24:07
  SPEAKER_03: And what you guys bring is the fun, playful, adventurous element to it.
• 1:24:10
  SPEAKER_03: And I adore that.
• 1:24:12
  SPEAKER_02: And I I also think, you know, if you go back to the beginning of venture capital, it was really about working closely with you know pioneers.
• 1:24:20
  SPEAKER_01: Yeah, if you read books on the history of venture like the power law, those original venture capitalists were sitting at the shoulders of those entrepreneurs.
• 1:24:26
  SPEAKER_02: And usually they weren't, you know, investing giant funds with diversified strategies.
• 1:24:32
  SPEAKER_02: They're working very closely with a small number of entrepreneurs, and they were helping them build the future that they could both see possible in front of them.
• 1:24:40
  SPEAKER_02: Anyway, that's a that's that's a slight deviation.
• 1:24:43
  SPEAKER_02: You know, how do we how do we think about the timescale?
• 1:24:46
  SPEAKER_02: Is that because of the nature of the investments that we're making, they're not contingent on the recovery of a landscape in order to deliver returns.
• 1:24:58
  SPEAKER_02: You know, very often we're either looking at the what could be crudely described as the kind of data side, or we're looking at the solution side of this transition to a regenerative economy.
• 1:25:08
  SPEAKER_02: And on the solution side, you know, a great example of this would be a a Bristol-based company that we recently invested in called Matter.
• 1:25:16
  SPEAKER_02: Matter have developed the world-leading technology to filter microplastics from uh wastewater.
• 1:25:22
  SPEAKER_02: So this could be done in a micro setting and put into a uh a washing machine in your home, or it could be done in a uh a huge setting and done uh applied to um wastewater treatment plants or uh textiles manufacturers where there's incredible volumes of plastics going into waste.
• 1:25:38
  SPEAKER_03: There was a lot of companies trying to do that.
• 1:25:40
  SPEAKER_03: What is it that made you focus in on them as being the leaders?
• 1:25:43
  SPEAKER_03: They have developed an incredible piece of technology.
• 1:25:46
  SPEAKER_02: It's just fundamental engineering, and they have an exceptional engineer founder, yeah.
• 1:25:52
  SPEAKER_01: They just uh leapfrogged everyone else.
• 1:25:53
  SPEAKER_01: It was an ex-Dyson engineer and he was running Dyson's innovation lab, and everything in Dyson spins, and he just was like, hang on.
• 1:26:01
  SPEAKER_01: Rather than using so much energy to push water through increasingly fine filters, let's just use some of that centrifugal force and uh, you know, push like violently push all of the stuff through the filtering system, and then you can just switch it around and it cleans its filter.
• 1:26:19
  SPEAKER_01: So, you know, for the same amount of energy, you're just doing so much more work.
• 1:26:22
  SPEAKER_01: And so it's really interesting.
• 1:26:24
  SPEAKER_02: It's kind of like incredibly efficient.
• 1:26:26
  SPEAKER_02: It's it it filters much smaller particles, uh, and it can be applied at really large scale on a tiny footprint comparative to yeah, self-cleaning comparative to the existing multi-stage filtration processes, which are very space inefficient, chemical inefficient, so on and so on.
• 1:26:42
  SPEAKER_02: So there's a very clear ROI with this business.
• 1:26:45
  SPEAKER_02: But you can directly identify the impact, the positive impact for nature, each time you deploy one of these units.
• 1:26:53
  SPEAKER_02: And in this case, you know, we can see that there's a direct link between this company scaling and the positive outcomes for nature.
• 1:27:00
  SPEAKER_02: How do they achieve those positive outcomes?
• 1:27:01
  SPEAKER_02: It's about deployment.
• 1:27:02
  SPEAKER_02: You know, how do they get into as many sites as they can as quickly as possible?
• 1:27:07
  SPEAKER_02: Um, and you know, remove X number of tons of microplastics from our fresh and uh seawater systems in the next five to ten years.
• 1:27:16
  SPEAKER_03: My brain's already popping with the other industrial applications you could have to that type of technology as well.
• 1:27:21
  SPEAKER_03: So clearly great primary purpose, but you can see it applying to maybe fuel sources, maybe food and beverage separate things like you can see that centrifugal approach to tons of different.
• 1:27:32
  SPEAKER_01: Yeah, well, the the the innovator, the founder of the business is Adam.
• 1:27:36
  SPEAKER_01: Let's give him a shout out.
• 1:27:37
  SPEAKER_01: Yeah, he's the kind of guy who will be able to develop many technologies, just has this you know, idea a minute.
• 1:27:46
  SPEAKER_01: In fact, you know, the challenge for him has been to find a team around him who can actually just deliver on one product at a time.
• 1:27:52
  SPEAKER_01: And they sometimes sort of send him home for like a couple of weeks.
• 1:27:55
  SPEAKER_01: Like, Adam, we need less ideas for a moment because he's such a brilliant thinker.
• 1:28:00
  SPEAKER_01: And you know, such a great innovator.
• 1:28:02
  SPEAKER_01: And he's been so wise to find a team around him who can deliver in that way.
• 1:28:06
  SPEAKER_01: And, you know, we really respect those guys.
• 1:28:08
  SPEAKER_03: Um so I went to uni with our head of operations and he briefs the team when I go on holiday.
• 1:28:14
  SPEAKER_03: He's like, look, do not think this is gonna get better.
• 1:28:18
  SPEAKER_03: Rich is gonna have two weeks straight of no meetings sat with his family.
• 1:28:22
  SPEAKER_03: Look at Penny nodding behind the scheme.
• 1:28:23
  SPEAKER_03: All you're gonna get is like 200 ideas.
• 1:28:26
  SPEAKER_03: Like this isn't a rest, this is worse.
• 1:28:28
  SPEAKER_03: So yeah, when they keep me in the business and busy.
• 1:28:31
  SPEAKER_02: But yeah, I mean, the the to on the timescale piece, the businesses that we're looking at tend to be decoupled from uh a specific plot of land regenerating.
• 1:28:41
  SPEAKER_03: That's super important.
• 1:28:42
  SPEAKER_03: So for us, it's three years, right?
• 1:28:51
  SPEAKER_03: Pretty much you time it exactly right, maybe just under two, but you you can't always have everything in your favour.
• 1:28:57
  SPEAKER_03: The ability to skip that step is you're gonna be able to do that.
• 1:28:59
  SPEAKER_01: Yeah.
• 1:28:59
  SPEAKER_01: So yeah, yeah.
• 1:29:00
  SPEAKER_01: And and I think for for us, as I said, we you know, we're relying on people like you guys to go and do the work on the land.
• 1:29:06
  SPEAKER_01: We're just trying to help everything around that.
• 1:29:09
  SPEAKER_01: So and that and that we have to have like tight timelines on, not just for our venture returns, but because the problem is is really urgent.
• 1:29:17
  SPEAKER_01: And I think it's sometimes hard for us to speak um without being it's hard to really own how pressing this problem is.
• 1:29:31
  SPEAKER_01: Um and I and I find that we're even tempted to water down the language of the scale of the eco the ecological crisis that we're living in.
• 1:29:41
  SPEAKER_03: Sounding like the campaigner which undercuts the clarity of the commercial approach.
• 1:29:46
  SPEAKER_03: Exactly.
• 1:29:48
  SPEAKER_01: Exactly.
• 1:29:48
  SPEAKER_01: But if you're a thinking person and you apply yourself to the data, we really are at an extraordinarily important time in terms of focusing on the environment.
• 1:30:03
  SPEAKER_01: Like the most crucial thing we can do for the survival of our species is this work.
• 1:30:10
  SPEAKER_01: And thank God we've you know come up with something else, AI, that might help us do it at at pace and at scale.
• 1:30:18
  SPEAKER_01: But you know, this is the work that has to be done now.
• 1:30:21
  SPEAKER_01: And there's just no question.
• 1:30:23
  SPEAKER_01: I mean, the best time to start working on nature was, you know, 700 years ago, but you know, certainly pre-the Industrial Revolution.
• 1:30:30
  SPEAKER_01: And I kind of wish people like Descartes hadn't sort of separated us from animals, you know, but you can't go back and you know, wish that away.
• 1:30:37
  SPEAKER_01: But you can't.
• 1:30:41
  SPEAKER_03: So Tim referenced the exact same thing.
• 1:30:43
  SPEAKER_01: So it comes up in a lot of key part of his book is that distinction nature.
• 1:30:48
  SPEAKER_01: Yeah, it was those sort of like economists in the 70s that sort of started like looking at that.
• 1:30:53
  SPEAKER_02: Yeah, I I was inspired actually uh coming back from Davos this year, um, and uh I went to one notable panel uh which had um Andre Hoffman, uh Johann Rockstrom, and Paul Pullman all speaking.
• 1:31:10
  SPEAKER_02: Um, and they were speaking in the plainest terms about the extraordinary threat that our human activity, our simple economic activity, is providing to the survival of our species.
• 1:31:24
  SPEAKER_02: And, you know, it couldn't be in simpler language, and this is the work of our time, you know, and it's the work of you guys, you know, as developers building this data stack.
• 1:31:36
  SPEAKER_02: It's the work of us trying to demonstrate that you can invest in this space, but you can develop technologies that can enable this transition, that can make your work on the ground possible.
• 1:31:49
  SPEAKER_02: And it's the also the the work of a whole load of other collaborators, not just in the capital markets, but you know, people who need to engage with the political spectrum, people who need to engage with the education system.
• 1:32:01
  SPEAKER_02: There's so much there.
• 1:32:03
  SPEAKER_02: And it's the work of our time.
• 1:32:04
  SPEAKER_02: And, you know, I think whatever we can do to speak in plain language in a way that doesn't scare people from participating, but brings them on board, is you know, how we should be how we should be addressing it, I think.
• 1:32:16
  SPEAKER_01: I was listening to an AI safety discussion podcast.
• 1:32:23
  SPEAKER_01: And the one guy was saying, we hope that we end up as AI's uh dogs rather than their chickens.
• 1:32:30
  SPEAKER_01: Yeah.
• 1:32:32
  SPEAKER_01: And uh something along those lines.
• 1:32:34
  SPEAKER_01: And I thought, how lovely.
• 1:32:36
  SPEAKER_01: But it's a there's a guarantee that if we do get to develop an intelligence that is more sophisticated than ours, that if we haven't fixed our relationship with the planet that we're living on, that we're a threat to it.
• 1:32:50
  SPEAKER_01: And our current behavior is 100% on that trajectory.
• 1:32:54
  SPEAKER_01: So I think that there's this interesting moment where what it means to be human is demands that we look at our relationship with all other species and our relationship with the ecosystems on which we're dependent.
• 1:33:08
  SPEAKER_03: It's got this dystopian version of AI turning around and going, I'm sorry, you had your chance.
• 1:33:12
  SPEAKER_01: Well, 100%, wouldn't you?
• 1:33:14
  SPEAKER_01: I mean, and and now we're going, oh, let's go and find another planet to mess up.
• 1:33:18
  SPEAKER_01: Whereas I I think, you know, i even look at our morality.
• 1:33:22
  SPEAKER_01: Our morality for a long time has been that, you know, might is right and higher intelligence, you know, means higher value, and therefore we can like exploit and uh destroy anything below us in intelligence.
• 1:33:35
  SPEAKER_01: Now, if that's the case and we're about to have something of higher intelligence, then we must accept by our own moral code that we become dogs or chickens.
• 1:33:44
  SPEAKER_03: It's quite hard to segue off the back of the dogs or chicken stories.
• 1:33:50
  SPEAKER_00: I mean, it's it sounds dramatic, but you know that it's it's actually not.
• 1:33:54
  SPEAKER_03: It's it's really What's especially fascinating is your ability to hold a duality that you are both optimistic and enthusiastic about AI, but quite potentially see that as a potential future as well.
• 1:34:05
  SPEAKER_01: Well, you have to.
• 1:34:06
  SPEAKER_01: If you're again, if you're a thinking person, you know, you have both roads are open.
• 1:34:12
  SPEAKER_01: And I think we the more the more we push down the techno-optimist naivety or the apathy of standing on the sidelines and going, this problem is too big for me, the more likely we raise the risk of that dystopian future.
• 1:34:28
  SPEAKER_01: Whereas the one thing I would just encourage if you're talking about your listeners and they are younger, in fact, it doesn't even matter.
• 1:34:33
  SPEAKER_01: I try tell it to older people as well who are a bit jaded about this.
• 1:34:37
  SPEAKER_01: But if you stand on the sidelines of any problem, it looks overwhelming.
• 1:34:42
  SPEAKER_01: As soon as you start to try and do something about it, it looks even more overwhelming, but somehow your power is back and you regain the idea that you can make a change.
• 1:34:54
  SPEAKER_01: So anyone who's nervous of the decline of nature, just get on the playing field.
• 1:35:00
  SPEAKER_01: Yes.
• 1:35:01
  SPEAKER_01: Like honestly, because you regain some sense of efficacy and power, and you go, wow, you know, if these people can make a change, I can too.
• 1:35:09
  SPEAKER_01: And you know, if you don't know how to make a change, go and help someone else making a change.
• 1:35:12
  SPEAKER_01: That's what I did.
• 1:35:13
  SPEAKER_01: You know, that's what we're doing.
• 1:35:14
  SPEAKER_03: Love it.
• 1:35:15
  SPEAKER_03: Um, I'd be admissed if I didn't ask about the sort of composition of the LPs, the people who are contributing to your funding side of stuff.
• 1:35:22
  SPEAKER_03: So can you give us a breakdown of the sort of type of investors you're working with and why they choose you?
• 1:35:27
  SPEAKER_02: Yeah.
• 1:35:28
  SPEAKER_02: I mean I mean, we when we started, we went to the people that we knew the best and that we thought were the most aligned.
• 1:35:35
  SPEAKER_02: Um so that was a group of family officers and individual investors.
• 1:35:39
  SPEAKER_02: Um and they're an interesting snapshot.
• 1:35:42
  SPEAKER_02: You know, some of them invested in us because they trusted us as people, and some of them already had an understanding or a sense of the market that we wanted to play into and said that we're happy to back then.
• 1:35:55
  SPEAKER_02: Um as we look forward, well, you know, actually since we uh engaged with that initial investor group, our investor group has gradually increased.
• 1:36:05
  SPEAKER_02: Each time we've set up a new deal, we've brought new investors along with us.
• 1:36:09
  SPEAKER_02: Um and now as we look towards raising a fund, uh the largest group of investors that we're targeting are aligned family officers.
• 1:36:19
  SPEAKER_02: So family officers who are already investing in our space.
• 1:36:22
  SPEAKER_02: And then a handful of foundations and institutions who believe that there's uh a challenge and that it's a worthy challenge to be investing in in this transition from the dislocated to a regenerative economy.
• 1:36:36
  SPEAKER_02: Um, what we want to do, our absolute ambition, is that we want to also be bringing more passive capital in future.
• 1:36:45
  SPEAKER_02: Um, but we think that we'll need to demonstrate uh returns and we think that we'll need to demonstrate a clearer sense of a track record in order to bring in uh coded capital, institutional capital, pension capital, um, and the types of funders who you know really are the bedrock of the venture funding market, uh, but typically don't invest in emerging managers with relatively niche thesis.
• 1:37:10
  SPEAKER_01: I think what we, yeah, relatively niche.
• 1:37:12
  SPEAKER_01: I mean, ironically, that probably the least niche thesis you could possibly come across, but it's seen as niche still.
• 1:37:17
  SPEAKER_01: Um I think we're lucky that a lot of individuals and family officers who have long-term planning um outlooks can see the pressures that we're trying to address.
• 1:37:35
  SPEAKER_01: So, you know, it's a really about it's not that they won't invest in the space.
• 1:37:40
  SPEAKER_01: They want to and they're trying to.
• 1:37:42
  SPEAKER_01: They whether it's through protecting market, all of those families often will protect a marquee land asset or they'll have invested in, you know, something to do with nature already.
• 1:37:51
  SPEAKER_01: Um and we just offer a new way of investing in those technologies that support the transition that they're looking for.
• 1:37:56
  SPEAKER_03: In terms of the timeline you guys are looking at, and you say about the fund phase, is that one, two, three?
• 1:38:02
  SPEAKER_03: What is your timeline you're thinking about now in terms of future raises?
• 1:38:06
  SPEAKER_02: Yeah, so we're we're kicking off a fundraise in the second half of the year.
• 1:38:09
  SPEAKER_02: Awesome.
• 1:38:10
  SPEAKER_02: Um, so for anyone who's interested in investing in this space, then you know, get in touch with us.
• 1:38:14
  SPEAKER_02: We'd be delighted to I would highly recommend these guys, they're awesome.
• 1:38:18
  SPEAKER_02: Um and you know, we're actively investing until then.
• 1:38:22
  SPEAKER_02: Um we we tend to syndicate SPVs um and do it on a deal-by-deal basis, but we'll be raising a committed fund uh from the second half of the year.
• 1:38:30
  SPEAKER_02: And that will be our first uh fund.
• 1:38:33
  SPEAKER_02: Um, and you know, we'll be investing our our deployment for that fund will be starting probably from 2027.
• 1:38:40
  SPEAKER_01: We've been lucky that we had enough support.
• 1:38:43
  SPEAKER_01: Um, we put a lot of our own money in as well, and we found enough support that we could uh learn on the job to some degree and to refine our thesis and to really understand like what deployment could look like.
• 1:38:55
  SPEAKER_01: So now that we have those parameters mapped out, it's the right time to go out for committed capital.
• 1:39:01
  SPEAKER_03: I love it.
• 1:39:02
  SPEAKER_03: Um guys, you have been so wonderfully kind with your time.
• 1:39:05
  SPEAKER_03: I've enjoyed every aspect of the conversation.
• 1:39:07
  SPEAKER_03: Us too.
• 1:39:08
  SPEAKER_03: I thank you.
• 1:39:09
  SPEAKER_03: Um I finish every podcast the same way.
• 1:39:11
  SPEAKER_03: Um but actually this is the first time I've asked it this way.
• 1:39:14
  SPEAKER_03: Uh are there two questions I haven't asked you you wish I had?
• 1:39:18
  SPEAKER_03: So you get one each.
• 1:39:21
  SPEAKER_01: I think um the only thing that was like niggling in the back of my mind maybe was just how maybe if you'd maybe if you'd asked if you'd asked about um something along the lines of what it um what it feels like to work in a field that you're passionate about, you know, this field.
• 1:39:44
  SPEAKER_01: That's interesting for me because I think that the journey that I've been on where I've gone from doing what I was told was valuable in the world to doing what I believe is valuable in the world and it comes from somewhere deeper within me has been something incredible, an incredible shift for me.
• 1:40:11
  SPEAKER_01: And you know, that's something that I kind of want other people to not waste as much time as me on, you know?
• 1:40:18
  SPEAKER_03: Like what on a day-to-day basis, how has that made you feel or behave differently?
• 1:40:27
  SPEAKER_04: It's it raises the stakes because I really care about the end result of our work.
• 1:40:35
  SPEAKER_01: But you can be yourself at every moment and it feels like some of what you do is marginally divinely inspired because it just comes naturally.
• 1:40:47
  SPEAKER_01: For me to go and connect with another person who's passionate about the natural world is a joy and is simple and it comes from a really authentic place, and um so it it isn't work in the same way.
• 1:41:01
  SPEAKER_01: It feels like a calling um and it's so rewarding.
• 1:41:08
  SPEAKER_03: Unless unless anyone's felt that, they'll find it difficult to even comprehend what you're saying and feels.
• 1:41:16
  SPEAKER_01: Yes, maybe people can't um uh know what I'm saying unless they felt it.
• 1:41:21
  SPEAKER_01: But there was a key there was a moment for me where a person involved in extraordinary impact work, a guy called Fred Swaneker, one of the biggest educationalists in Africa, raised an incredible amount of money to found private universities.
• 1:41:35
  SPEAKER_01: And basically his mission is to uh develop three million African leaders within his career, which is an extraordinary um task.
• 1:41:44
  SPEAKER_01: And he's put himself to it.
• 1:41:46
  SPEAKER_01: And he offered me a job after a holiday we were on when I was leaving the family business.
• 1:41:51
  SPEAKER_01: And, you know, I I sort of said to him, Bugger off, Fred, I'm no one's number two, as a joke.
• 1:41:58
  SPEAKER_01: But actually, you know, I was so, so flattered by the fact that he someone like that wanted to work with me.
• 1:42:05
  SPEAKER_01: And I thought about what my life would look like compared to my previous life of working with a man who was trying to change the trajectory of an entire continent through education.
• 1:42:16
  SPEAKER_01: I just thought, Greg, I got quite drunk that night.
• 1:42:18
  SPEAKER_01: And I was sitting in a fireplace of this house we were standing in, sort of, you know, having a cigarette, which I only do when I drink, thinking, why you why do you feel weird after, you know, such a beautiful holiday and then this wonderful conversation with this man who you admire so much?
• 1:42:33
  SPEAKER_01: And it was because I felt that I felt curious, maybe mildly ashamed.
• 1:42:40
  SPEAKER_01: Why had why had it taken you so long to go and do something that you cared about?
• 1:42:46
  SPEAKER_01: Like, why, why is why does he go and do that?
• 1:42:49
  SPEAKER_01: Why have you not been brave enough to go and do what you care about?
• 1:42:51
  SPEAKER_01: Because you already know it.
• 1:42:52
  SPEAKER_01: And the reason I said no to him wasn't because of not I would happily be Fred's number two.
• 1:42:57
  SPEAKER_01: Anyone in the world would want to be Fred's number two, but it was because you know, education wasn't my first love.
• 1:43:03
  SPEAKER_03: And so, you know, a bit like the um the Chris Williamson quote where he said, um, you what is the person if they were watching the movie of your life would be screaming at you to go do that next thing and go do it.
• 1:43:15
  SPEAKER_03: Yeah.
• 1:43:16
  SPEAKER_03: Have you got a question that yeah?
• 1:43:19
  SPEAKER_02: I think we're we're recently talking about, you know, what does success look like in 10 years?
• 1:43:24
  SPEAKER_02: Um and you know, for Sand River in 2035, what would we be proud of?
• 1:43:29
  SPEAKER_02: Oh, that's 10 years.
• 1:43:31
  SPEAKER_02: Um and yeah, and and there are a couple of things that came up.
• 1:43:37
  SPEAKER_02: One of them was that we want to have demonstrated that this feedback loop exists between raising money, deploying money, supporting entrepreneurs, building things that are going to change the world, returning funds and raising more money.
• 1:43:56
  SPEAKER_02: And if that flywheel exists, then that flywheel doesn't just exist for Sand River, it exists in catalyzing a whole market.
• 1:44:05
  SPEAKER_02: And, you know, ideally, imitation, you know, imitation is the highest form of flattery.
• 1:44:10
  SPEAKER_02: We want loads of sand rivers.
• 1:44:11
  SPEAKER_02: And let's stretch it out another 10 years and go to 2045.
• 1:44:16
  SPEAKER_02: Ideally, there's no such thing as investing in nature.
• 1:44:20
  SPEAKER_02: You know, every investment decision should encompass a natural capital decision.
• 1:44:26
  SPEAKER_02: Every decision in a corporate setting should be thinking about what is our risk and opportunity when it comes to our dependencies on nature.
• 1:44:34
  SPEAKER_02: And we'd love it if we could make ourselves redundant.
• 1:44:38
  SPEAKER_02: If we make ourselves redundant by even being part of a movement doing some of this work and, you know, sprinkling a little bit of creativity and inspiration on some of the people that we're able to work with and be part of a movement, that would be success.
• 1:44:52
  SPEAKER_02: You know, ideally, there's no Sand River thesis in 2045.
• 1:44:55
  SPEAKER_02: We will be here in 2045.
• 1:44:57
  SPEAKER_02: We'll just be doing different work.
• 1:44:59
  SPEAKER_03: It's a brilliant microphone.
• 1:45:00
  SPEAKER_03: Guys, I've loved every minute.
• 1:45:02
  SPEAKER_03: Thank you.
• 1:45:02
  SPEAKER_03: Thank you, Rich.
• 1:45:03
  SPEAKER_03: Thanks, Rich.
• 1:45:03
  SPEAKER_03: That's great.