Innovation

Greens Swans Partners (GSP) is an environmental venture entrepreneurial firm started in Washington D.C. in early 2020. A venture entrepreneur shares similarities with a venture capitalist in that they work directly with their companies in spurring growth through added capital. They differ in the fact that Green Swans also provides connections, business resources, and growth strategies for the companies that they partner with. The emphasis on environmental ventures is a key part of who the company is and the companies they partner with as their approach clearly states:

“We help companies deliver disruptive blue-tech and green-tech alternatives; create operational and environmental efficiencies and; surpass compliance with existing and near-term environmental standards.”

All companies they partner with focus on key environmental issues with the goal of disrupting industries that are very stuck in their ways. The industries that are targeted by Green Swans are primarily energy, maritime, industrial, and manufacturing as these have some of the highest environmental growth potentials.

These industries are targeted because of the experience of the founders Chetan Chothani and Lalaruhk Faiz. Chothani built and exited industrial manufacturing companies and through her time with the foreign service, Faiz provided direct support to entrepreneurs and structured investment products, vehicles, and credit guarantees to address the sustainable development goals. One of the reasons that Chothani and Faiz found each other as business partners were because they both had the thought of “if they had access to people like themselves 15 years ago, they could have grown a lot faster.” Green Swans has had an emphasis on social capital from day one, attracting team members that have special skills and connections.

On the business side of Green Swans, the focus is to provide new avenues for growth to smaller companies. The companies they look for are pre-Series A with a product that can be commercialized within six months. The end goal of Green Swans is to build a portfolio of environmentally geared companies across all sectors and eventually to use this portfolio to enable synergies between the companies that they are partnering with.

Inspiration

The original idea came about when Chothani realized that he could have done a lot more work on sustainability at a faster rate if he had had the resources to help him build a social enterprise. He hoped to build a new venture that would create long term value. For Chothani, it was also an opportunity for a “redemption tour” to his previous work in the fossil fuel burning sector. Although he was working in the emission reduction space, he felt guilty for the negative environmental factors of fossil fuel emissions and wanted to focus his efforts on sustainability. He knew that he had a variety of skills and abilities, and his idea was to help support new companies that focus on the United Nations’ sustainable development goals. Chothani understood that new companies are challenged due to the lack of capacity to deal with presenting opportunities, and he envisioned a company that would bring the skill set to young companies to build ventures and allow them to grow faster. Ruhkfaiz was inspired to become part of the team as a founder because her extensive experience in sustainability and blended finance gave her perspective on running a good business. She shared that “in certain subsectors, it is just about running a really good business that meets environmental standards.” She also strongly believes that discipline and rigor in a for-profit company are the way to bring faster environmental and social impact.

Overall impact

Green Swan Partners offers funding, expertise and a concept co-founder Chetan Chothani introduced to us, “social capital.” The idea of social capital is that those who have similar ideas and passions are able to create a cooperative work-centered culture that advances their ideas. Chothani and Ruhkfaiz are able to provide these resources to growing environmentally-centered businesses especially those who, “can bring in disruptive innovation,” innovation which outperforms traditional technology but is more sustainable, “create operational environmental improvement,” or creating more efficient operations in an industry which have an environmental impact, and finally companies who are able to surpass the existing environmental regulatory standards. Essentially, GSP’s innovation is providing these resources to companies, which requires the partners to play a role in the functioning of the companies. Some partners are focused on financial modeling, others finding companies and others on participating in execution teams. Once a company is included in GSP’s portfolio, a limited number of partners are chosen to be on a “core team,” and oftentimes an outside execution partner will be hired to assist the core team.

Green Swan Partners aims to “transform industries” through a sustainability approach. By adding companies to their portfolio, Green Swans is able to make incremental changes towards their goal. These companies, by fitting the criteria listed above, not only function to reduce adverse environmental effects from human operations, but essentially will shift the ways in which people work and think about sustainability. To demonstrate, Bawat, GSP’s first partnership is a ballast water treatment company that collects ballast water from ships with inoperable or no system and safely treats through pasteurization and discharges it. Ballast water is normally treated on ship, without a set place to discharge it safely if the ship’s system does not function. Bawat’s onshore treatment changes the way ships work by adding a process not done by many. More abstractly, GSP changes society by offering a sustainability-focused approach to industry operation, in hopes that it will be considered even more in the future.

The impact of the innovation on the environment is that they are dedicating time, talent, and capital to companies that address one or more of the following UN Sustainable Goals: affordable and clean energy, industry, innovation and infrastructure, sustainable cities and communities, responsible consumption and production, climate action, and life below water. They want to look at ways to transform an industry from a sustainability standpoint. The partners Chothani and Rukhfaiz mentioned, “how do you change an old-fashioned way of doing things in an industry?”. They look for companies that will surpass upcoming environmental standards or help them become more sustainable.

The long-term effects are yet to be seen since the company was founded last year. As for the short-term, they are starting to partner with 4-5 deals per year. They screen companies and take into consideration certain stands to meet regulatory requirements of the environment such as energy and water-saving technologies, and help them before the environmental requirements come into effect in future years.

A quote that Rukhfaiz mentioned in our interview was that “In order to be a successful business you need to take environmental impact into account”. They partnered with a company called Bawat that “collects ballast water from ships with inoperable or no system and safely treats through pasteurization and discharges it”. For concrete evidence, they are looking into how many ships have used the collection technology per time period.

Business benefit

Chetan Chothani, when reflecting on "social capital" and what it means to the business, said: "This is what I wish I had 15 years ago when I was starting a company." The "joint venture structure" of Green Swan Partners not only brings partners together to work toward a common goal, but also produces a net gain for all parties involved. They, "help companies reach their milestones and take equity from [these companies], but also create the new equity for the company. In order to do so, Green Swan Partners "finds a market or region that [they] can carve out from the primary tech owner and venture out, create new value, then bring that new value back to the primary owner." The impact of their innovative approach to creating value for the business, aside from financial gains, is the cooperative culture to promote sustainability and business growth.

Social and environmental benefit

Green Swan Partners, through their expertise and business model, had and will continue to make positive environmental and societal impacts. During our interview, the founders mentioned that “In order to be a successful business, you need to take environmental impact into account.” After the interview, our team determined the following UN Global Goals to fit Green Swan Partners: Goal 7 affordable and clean energy, Goal 9 industry, innovation, and infrastructure, Goal 11 sustainable cities and communities, Goal 12 responsible consumption and production, Goal 13 climate action, and Goal 14 life below water. The partner’s first company hits many of these points, and they make an effort to only reach out or accept companies that fit their goals for sustainability. Overall, Green Swan Partners will make a great impact through their ventures.

Interview

Chetan Chothani, Founder