Different by design, to make a difference

Executive Summary Feb 2012

Transform  Capital  Management  

Execu6ve  Summary

Transform  Capital  Management  is  launching  a  

new  ins6tu6on  -­‐  a  model  for  a  Private  World  

Bank.  More  descrip6vely  we  explain  it  as  a  

Global  Impact  Investment  Bank.  

In  short,  we  aim  to  transform  the  way  we  use  

financial,  natural  and  human  capital  -­‐  globally.  

Increasing  focus  on  short-­‐term  specula;ve  

returns  has  come  at  the  expense  of  what’s  

beneficial  in  the  longer  term.  Sustainable  

returns  on  a  broad  level  can  only  come  via  

diverse  job  crea;on,  increasing  social  capital  

and  good  stewardship  of  precious  resources.

Since  2008,  we’ve  had  many  reminders  of  how  

so  called  free  markets  oEen  work  against  our  

common  interest.  Thats  how  austerity,  

inequality  and  social  unrest  have  been  

increasingly  fueled  around  the  world.  

And  we’re  all  much  poorer  for  the  destruc;on  

of  natural  resources  that  this  short-­‐term  profit  

fixa;on  has  brought  about.  Worse,  the  risk  and  

resilience  issues  faced  on  both  a  local  and  

global  level  are  ever  more  alarming.

Silver  linings  and  golden  opportuni6es.

It  doesn’t  need  to  be  like  this.  We  can  all  be  

richer,  happier  and  truly  sustainable.  

Where  others  see  gloom,  we  see  hope,  

opportunity  and  innova;on.  But  we  also  see  

an  urgent  need  for  systems  innova;on  in  

finance,  enabled  by  technology  -­‐  to  beKer  

allocate  capital  for  things  that  are  important  in  

the  longer  term.  Thats  why  we  do  what  we  do.  

We  also  see  a  tangible  hunger  in  people  for  

new  incen;ves  -­‐  not  only  short  term  profit,  but  

for  the  kind  of  things  that  really  count.    The  

things  that  increase  social  capital,  true  quality  

of  life  and  environmental  sustainability.  This  

hunger  and  the  creativity  it  unleashes  is  what  

gives  hope  -­‐  but  hope  needs  a  helping  hand!

The  funds  we’re  establishing  -­‐  the  innova;ve  

Global  and  Local  Impact  Investment  Funds,  

and  aligned  advisory  and  banking  services,  will  

directly  address  these  pressing  needs  at  scale.

As  a  Private  World  Bank,  rather  than  being  

funded  by  countries,  substan;al  core  funding  

and  powerful  aligned  support  will  come  from  a  

group  of  mo;vated  corpora;ons  (sponsors).  

Through  Transform,  these  visionary  leaders  are  

able  to  indirectly  address  their  biggest  threats,  

differen;ate  against  compe;tors,  iden;fy  key  

opportuni;es,  and  properly  change  the  rules  

of  the  game  that  are  in  our  individual  and  

collec;ve  interest.  Collec;ve  intelligence!    

• Transform  Capital  Management  will  use  a  mul;-­‐layer  process  to  intelligently  raise  and  deploy  commercially  focused  Ac;ve  Impact  Investment  -­‐  and  scale  this  model  globally.  Our  success  will  be  measured  in  social,  environmental  and  economic  returns.  

• We  aim  to  innovate  and  ensure  responsible  Impact  Investments  flow  to  fill  funding  gaps  that  will    efficiently  s;mulate  environmental,  social  and  economic  recovery.  The  focus  is  on  working  to  combine  strength  and  align  interests.  

• By  deploying  much  needed  capital  in  this  way,  the  model  automa;cally  removes  the  condi;ons  for  some  of  the  worst  social  and  environmental  abuses  and  omissions.  Transform  Capital  Management,  and  its  funds,  have  the  capacity  to  directly  unlock  over  £150Bn  over  a  10  -­‐  15  year  period.  Indirectly  we  can  unlock  even  more.  

• Our  model  for  a  Global  Impact  Investment  Bank  is  collabora;ve  and  designed  to  incen;vise  all  par;es  whilst  lowering  individual  risks.  Implementa;on  is  achieved  through  prac;cal  steps.  

• The  first  is  an  innova;on  on  how  early  staged  funds  are  raised  and  deployed.  Our  pilot  fund  is  an  innova;ve  fund  to  create  a  basket  of  sample  investments  over  a  24  month  period.  First  deals  are  already  highlighted  and  key  team,  systems  and  structures  will  shortly  be  in  place.  

• As  well  as  re-­‐engineering  the  early  stage  

investment  model  (objec;ve  systems,  use  of  

technology  to  improve  filtering,  decision  

making  and  support  processes  and  pa;ent  

capital  structures)  all  Transform  funds    

will  have  incuba;on,  accelera;on  and  

corporate  finance  units  aKached.

• This  pilot  fund  is  designed  to  de-­‐risk  the  equity  investment  into  the  whole  project,  enabling  marke;ng,  communica;ons,  revenue  and  credibility  to    further  drive  momentum  and  glue  everything  together.  

• The  larger  funds  this  then  enables  are  the  Global  and  Local  Impact  Investment  Funds.  With  target  fund  sizes  of  £300m  to  £2b,  the  structure  is  for  blended  Public  Private  Partnerships  designed  to  deliver  maximum  impact  and  decent  returns.  

• We’re  currently  raising  £6m  into  the  management  company  which  will  enable  regulatory  approval,  the  pilot  fund  and  cornerstone  deals  to  be  closed.  Our  team  will  become  opera;onal  and  we’ll  begin  ini;al  technology  and  system  development  for  roll  out.  A  follow-­‐on  £30m  First  Round  will  offering  highly  aKrac;ve  commercial  returns  (30%  +  IRR)  alongside  posi;ve  social  and  environmental  impacts.  

• Revenues  will  come  from  sponsorship  (up  to  30  corporate  sponsors  each  providing  £5m  pa  +  secondees)    in  return  for  focused  risk,  opportunity  management,  global  publicity,  and  innova;on  pipeline  access.  

• Over  ;me,  the  model  migrates  to  genera;ng  a  greater  share  of  revenue  for  advisory,  management  fees  and  carried  return  for  funds  under  management.  

• While  the  vision  for  Transform  is  truly  global,  implementa6on  is  first  local  (in  the  UK  and  GCC)  with  system  design  to  ensure  scaling  can  then  occur  at  op6mum  speed.  

    MANAGEMENT  &  ADVISORS  

• Steve  Podmore  –  Founder  Transform  Capital  Management.    Steve  is  a  believer  in  working  markets,  but  is  driven  by  the  market  and  value  failure  that  has  created  so  much  inequity  in  the  world.  He  has  made  it  his  social  business  and  life’s  work  to  do  something  about  it  on  a  scale  that  can  make  a  difference.  With  a  business  background  in  marke;ng,  psychology,  finance  and  educa;on,  Steve  created  the  ini;al  idea  which  over  six  years  of  development  morphed  into  a  model  to  Transform  Capital  Management.  

• Gareth  Hughes  -­‐  Beetle  Capital  Partners  -­‐  Founder;  Prior  to  establishing  Beetle,  Gareth  was  a  Founder  and  Board  member  of  Climate  Change  Capital  ('CCC')  with  responsibility  for  Marke;ng,  Fund  Development,  Capital  Raising  and  Investor  Rela;ons.  In  this  role  Gareth  was  involved  in  the  incuba;on  and  development  of  CCC's  funds  and  led  capital  raising  of  in  excess  of  $1.75bn

• Arthur  Wood  –  Founding  Partner  -­‐  Total  Impact  Advisors;  Founder  –  World  Sanita;on  Financing  Facility;  Head  of  Social  Financial  Services  -­‐  Ashoka;  Expert  in  Social  /  Commercial  Structuring;  20  yrs  in  banking  crea;ng  replicatable  financial  products;  Klienwort  Benson;  CouKs.

• David  George  -­‐  Head  of  Energy,  Europe  URS;  Sustainability  and  Environmental  Due  Diligence  Expert;  VP  &  Director  of  Transac;on  Services  Europe  for  URS.  

• Anita  Hoffmann  –  Managing  Director  of  Execu;va,  mission  cri;cal  search,  advisory  and  coaching  in  the  Energy,  Renewables,  CleanTech,  Sustainability  and  Climate  Change  area.  Previously  Founder  and  Global  Co-­‐head  of  the  Alterna;ve  &  Renewable  Energy  Prac;ce  at  Heidrick  &  Struggles.  Career  in  Resources  and  Energy  with  Exxon,  Dow  Corning,  Accenture,  DeloiKe  and  ABB.  Anita  holds  an  MSc  Chem  Eng.  from  Lund  Technical  University  in  Sweden  

• MaVhew  Hale  -­‐  Head  Of  Sustainable  Banking  -­‐  Bank  of  America  /  Merrill  Lynch  Europe;  Treasurer  -­‐  Merrill  Lynch;  Treasurer  -­‐  Bankers  Trust;  Founder  -­‐  BearBox  &  Striding  Edge.

• Paul  O’Donnell  -­‐  Chairman,  Ogilvy  &  Mather  Group  UK.  Founder  member  of  OgilvyOne  Worldwide  of  Ogilvy  Group  Inc.  and  has  served  as  President  in  Asia  Pacific,  Chairman  of  OgilvyOne  London,  and  Chairman  OgilvyOne  EAME.    Founder  of  the  IPA  Direct  Marke;ng  Group.    Paul  holds  the  Inaugural  Interna;onal  Diploma  Program  from  INSEAD,  and  Masters  Degree  from  Haute  Etude  Commercial  in  Paris.

• Rory  Sutherland  -­‐  Vice-­‐Chairman  of  Ogilvy  Group  UK.  One  of  Wired  magazines  top  100,  Rory  joined  Ogilvy  &  Mather  Direct  in  1988,  served  as  head  of  copy  in  1996  and  Crea;ve  Director  in  1997,  where  he  was  closely  involved  in  the  agency’s  relaunch  and  restructuring  as  OgilvyOne.  Execu;ve  Crea;ve  Director  since  2002  and  past  President  of  the  Ins;tute  of  Prac;;oners  in  Adver;sing.

• Ian  Philion  -­‐  Speechwriter,  Crea;ve  Media  Producer,  E-­‐learning  &  Sustainable  Construc;on  Entrepreneur;  Advisor  to  Governments  and  to  Corporates  in  the  resources,  media  and  financial  sectors.  

Addi$onal  core  team  members  are  iden$fied  and  lined  up  but  are  not  yet  publicised.  

Steve  Podmore  -­‐  Founder  steve@transformcapitalmanagement.com  +44  7853  008199