Green Options

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This is not what you think.

You are the entrepreneurial genius. Yes, everyone thinks you’re a nut, but I’m talking about a different nut.

In entrepreneur-speak, your “nut” is what it costs to pay all your life expenses each month, including the cost of launching your start-up business.

Ask yourself, do you have a regular inflow that matches your monthly outflow without needing to raise investment capital?

Recently, I wrote about the financial ROI of Green Investing. Let’s drill down further…

In finance, an investment is a “thing” you buy with money for the purpose of getting both getting your money back, and getting more money in the form of “interest”, “capital appreciation” or both. This “thing” is a piece of paper called an Investment Product, also known as a Security.

To prime the pump on this “Dear Abbey” style ecopreneur coaching column, I’d like to start with some actual consulting projects, with enough changes to protect the client.

A few years ago I got a call from a cool green company that already had good sales, about $1 million a year. Problem was, their cash flow was “upside down” - they were trying to cover current expenses with money they wouldn’t get until later. They wanted me to help raise money to cover the gap.

At first, it seemed they were all set to receive some financing. I had a lender in mind who specialized in high-risk loans to green enterprises. All the lender needed to start the approval process was an up to date financial report. But as I started interviewing the principles, I learned that the company’s financial books were several months behind. Sadly, even weeks and months later, this situation persisted, making it impossible for the firm to make effective requests for money from anyone other than family members.

In my last post, I talked about the ecological and social outcomes one might wish to support via green investing. But what about the financial return on investment (ROI)?

Financial ROI (profit) is vital to green investing. This can sound jarring to green-minded folks because for quite a long time, the profits of most businesses have come at the expense of human and ecological health. Yet the underlying system holds much promise. I’m seeing a new generation of green businesses that align profits and green objectives to create powerful engines for economic transformation. These businesses are building the reality envisioned by a previous generation of green non-profit leaders.

Financial ROI is important because it impacts the rate and scale at which this new reality can unfold.

Dear Ecopreneurs…

Thanks again to GreenOptions.com for adding me to the Ecopreneurist blog team.

My favorite activity these days is coaching and advising ecopreneurs, investors, and green leaders on how to shorten the path to their objectives.

Having founded several green businesses and non-profits over the past 25 years, I’ve accumulated a ton of experience on starting, growing, and capitalizing green enterprises, and producing results via a broad assortment of strategies and leadership paradigms.

For GreenOptions readers, I’m offering my [...]

Green investors often refer to the “triple bottom line”:

What are the social benefits?
What are the environmental benefits?
What is the financial Return on Investment (ROI)?

The first Socially Responsible Investment (SRI) funds avoided companies that made cigarettes, supplied the military, or did business in South Africa. This new approach was called “negative screening”. Later on, SRI investment companies started including environmental screens.

The next logical step beyond negative screens is to assess the proactive “good” being accomplished by the company in which one is investing. What result is the company being responsible for?

Some green investors suggest selecting companies that will “make a lot of money” against the backdrop of climate change or other major issues. While this is a first step, something more is needed. I propose a new approach called the “Ecology Benefit Index”.

Hi Everyone,

I’d like to thank Green Options for inviting me to join their team of writers.

I’ve been an eco-entrepreneur my whole career, over 25 years. These days, I help connect green leaders and the general public in new ways that accelerate benefits to people and the biosphere.

One of the most vital, energetic, and promising links between green leaders and the general public is green investing. In my opinion, the world of finance shapes our economy even more than [...]