OUR
APPROACH
We provide long-term land leases and long-term venture loans to start-up technology-led industrial, agricultural, commercial, alternative energy and social investment initiatives. Land Leases and Term Venture Loans are offered as one package. We call the package Venture Finance.
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Venture Finance is designed to improve the economic and financial viability of capital investment initiatives. Venture Finance is offered on concessional terms and Term Venture Loans incorporate loan covenants that improve the loan's financial sustainability. This allows enterprises pursuing a wide array of investment initiatives bearing high levels of technology, operating, and market risks and limited to no borrowing capacity to safely avail debt financing, meeting up to 75% of investment needs.
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We plan to offer Venture Finance to enterprises operating in countries with the strongest climate adaptive capacity and the highest and high sovereign credit ratings and high levels of greenhouse gas emissions. A large number of these countries are classified by the IMF as advanced economies.
VENTURE FINANCE.
Venture Finance Land Leases and Term Venture Loans are structured with limited to non-recourse and are available to start-ups or companies with an operating track record pursuing Greenfield/new-build investment initiatives.
Concessional Land
Leases
Term Venture Loans
Land Leases are highly concessional with ground rents of $1 per annum, and typically have a term of 100 years. These leases are written on public land.
Where possible, Term Venture Loans are concessionally priced, with final maturities ranging from 30 to 50 years. Term Venture Loans will typically meet up to 75% of an investment initiative's funding needs and can be made available to enterprises creditworthiness classified as highly speculative.
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These loans are designed to improve the market competitiveness of ambitious capital intensive initiatives. They will benefit enterprises depicting with high costs of new technology adoption or high levels of technology and business model risk. Term Venture Loans can be integrated into a multi-sourced funding plan, helping start-up enterprises broaden their access to long-term financing or bridge viability gaps, or reduce sponsor equity contributions.
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Term Venture Loans are structured to be financially sustainable and they are designed to mimic and reside on borrower balance sheets as institutional preferred equity. They incorporate aspects of senior secured project finance loans, allowing lenders to actively manage risk through oversight, allowing them step in and remediation rights. They incorporate covenants that help reduce the likelihood of a borrower bankruptcy. Borrowers have the ability to roll-over, re-profile, reschedule or subordinate Term Venture Loans. If necessary, borrowers can make use of the remaining 100-year term for their land lease to extend loan maturities.
TARGET MARKETS.
We plan to launch operations in a select number of countries classified by the IMF as advanced economies. We expect to select markets into which to expand our operations by taking into account a variety of factors, including a location's climate advantage and the sovereign credit rating of the nation in which we operate.
The Climate Advantage
Venture Finance offers 100-year Concessional Land Leases, requiring us to adopt a 100-year investment horizon. Over this period, the leased land is likely to be exposed to the long-term uncertainties of climate change, which we consider to be a major risk factor.
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To reduce exposure to long-term climate risk, we plan operate in locations that depict relatively lower climate vulnerability, high levels of climate readiness and strong climate adaptive capacity. We define the combination of these three factors as constituting a location's Climate Advantage. We believe many of these locations are to be found in advanced economies. Many of these locations are also often associated with higher total and per capita green house gas emissions.
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We aim to tap the Climate Advantage, an unanticipated outcome of climate change, to address the problem of climate change. Availing the Climate Advantage to rapidly develop, diversify and decarbonise advanced economies can, we believe, significantly reduce global emissions, a win for the world, especially for countries most vulnerable to the deleterious effects of climate change and less able to adapt.
Sovereign Credit Ratings
Countries with higher sovereign creditworthiness typically depict lower long-term borrowing costs. Lower costs can translate into improved national competitiveness and sustain long-term economic growth.
High sovereign credit ratings also reflect higher levels of institutional development and integrity within a country. This, we believe, will be an increasingly important characteristic of economically successful countries, especially as the political, social and economic costs and challenges of climate change mount.
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On the other hand, countries with weaker institutions, with less integrity may be more susceptible to climate-induced political violence and instability. This will, we believe, hamper long-term growth. The risk of this occurring in advanced economies, many of which currently benefit from the highest to very high sovereign credit ratings, is lower.