Erb Elements, Summer 2009

Q: What in your background led you to pursue a dual degree program, and how did you choose CEMP/Erb at a time when such a program was almost unheard of?

Jon: Growing up, I was always concerned about environmental issues, whether it was saving water or recycling.  As an undergraduate at Tufts I took grad school courses in environmental policy and land use planning, and following graduation I went to work for Booz Allen Hamilton focused entirely on environmental policy and regulations on a project with the EPA. 

Before going to Michigan, I had worked with a then new group at Booz called the Corporate Environmental Management Practice, which went beyond the regulatory, reactive, risk management perspective to actually use environmental issues to help companies gain competitive advantage by addressing them in a proactive manner.  This was very forward thinking at the time, and it opened my eyes to the fact that in order to work on behalf of the environment, you didn’t have to work for a regulatory government agency, but could actually have a tremendous impact, and perhaps an even more significant impact, from the business side.

This was almost perfectly in line with what Stuart Hart was trying to put together through CEMP.  So when I arrived in Michigan to get my MS in Resource Policy, I met Stuart and his vision immediately struck a chord with me given what I had been doing at Booz Allen in forming this new practice.  Several of us applied to the business school, and thanks to Stuart and his dedication to this idea, the Corporate Environmental Management Program was created. 

This dual focus on environment and business actually became a theme in choosing where and how I would work, because I felt that I could have the greatest positive impact, ironically, by working for the largest industrial companies with the greatest environmental footprint, by working with them to think about how they could improve.  I continued working for Booz both during and after my time at Michigan, and joined the Energy and Chemicals group with the goal of understanding how these industries operate.

Q: Looking back on your experience, what did you take from CEMP/Erb that you wouldn’t have received from either a straight MS or MBA alone?

Jon: It’s hard to narrow it down to one or two things, but I would say that you just learn how to operate in both worlds.  You are able to understand the pressures, requirements, culture, and the tools of the business world, such as valuation and strategy, all of the core learning that you take with you for the rest of your career, but that has to be combined with an understanding of how environmental policy, regulation, and environmental economics work. 

I remember back in the mid-90s learning about what externalities are, and today all we read about is “what are environmental externalities and how are we going to manage carbon?”  It’s interesting that as I go through my career I see the same things coming back over and over again…I think that happens in my world where we have to manage environmental policy while also having to make business sense. 

Q: How did you and Professor Keoleian come up with the idea to do this seminar, and what was your motivation? 

Jon: While I was at Michigan for a conference back in the fall, I went out to dinner with Greg (Keoleian) and we were talking about his teaching, and the growing interest in renewable energy.  I think he suggested it but I jumped on the idea of doing something that would expose students to the work that I do in renewable energy on a daily basis, with a specific focus on project finance to give them some practical insight on how you develop one of these projects.  One thing led to another, and a few weeks later over the course of a 10-minute phone conversation we came up with an outline for the seminar, and I went to work coming up with the slides.  I give most of the credit to Greg, as he did a terrific job organizing the seminar, handling the logistics, and getting the students there. 

Q: Did the seminar meet your expectations and would you consider doing it again in the future? 

Jon: Absolutely, I’d love to do it again.

Q: Erb is growing rapidly and the expanding alumni network has the potential to add tremendous value to the Erb student experience and overall program.  And not just in terms of contacts and fundraising, but in the active sharing of practical knowledge, advice, and exposure in order to engage students and strengthen the network.  Many current students were attracted to Erb because of the size and breadth of the community, and unlocking its full potential could be a driving force in pushing the Institute successfully into this next phase of growth.  What do you think could be done to further strengthen the alumni network, and in light of your participation, what would you recommend to those alumni who are looking to give back to the program during this critical time?   

Jon: I think that this deserves further discussion, and I would love to get a group together to figure out what makes sense for everybody.  Obviously, not everybody is able to do a presentation on campus because of time constraints or the nature of their work, so it’s not something that we can hold up as a single model for everybody.

Another opportunity that I see is to target alumni more methodically in order to develop MAP projects that are specifically designed around issues that Erb students are interested in.  We probably have already done that, but now that we have a larger alumni network, the potential for high impact projects is much greater and we should take advantage of that.  Also, since in many cases Erb alumni are not at the large companies who have the resources to sponsor a MAP project, we should look for ways to finance these projects so that there are opportunities to work with more innovative companies and projects that otherwise wouldn’t be accessible; for example clean tech startups or international companies. 

Another way to work with alumni would be to develop very specific research projects, so find a topic that you are interested in but don’t have time to dive deeply into, and develop a project around it for students.  Of course it may end up having to be extracurricular work for the student, but I think that is one of the best ways to get exposure to an industry.  Then of course there are internships, which are already being extended to Erb students through the alumni network, but hopefully as the community grows we can build upon this.  So I see a range of possibilities.

Q: What do you recommend for Erb students interested in getting into renewable energy project finance & development? 

Jon: While at Michigan, I would recommend reaching out to people who are in the roles that I am interested in and trying to find out if they have internships or research projects available.  I do think that at certain times you have to be prepared to work for free in order to get your foot in the door, and a project is a great way to do this.  It can be very valuable to the company and shows a potential employer that this person is a self-starter who has what it takes to get the job done. 

In terms of coursework, I think that taking a finance course and having the basic business toolkit is obviously very important.  Same thing on the policy side.  In my case, I was interested in entrepreneurship, so I took several courses that gave me exposure to starting companies, like Professor Lawlor’s course on writing business plans.  So I was able to get some hands-on experience with that.  And of course, students should all take the corporate strategy courses focused on the environment and business.  On the science and policy side take courses that require you to get into some depth, beyond just the basics, and to force you to get into the details.

Most importantly, be proactive and be willing to go the extra mile to put your time and effort into getting involved and reaching out to the people and companies that interest you.

Q: What additional advice do you have for those students looking to get into private equity and VC related to renewable energy and clean technology?

Jon: This is an interesting question, and obviously very dependent upon what you have in your background already.  Somebody with an investment banking background who worked as an analyst before school can potentially go to a private equity job earlier than others, but to the extent that you don’t have any background in finance, then you may want to consider starting at one of the larger banks with a good training program in order to get the practical finance and deal-making experience, and then jump from there to something that is more in line with your interests. 

The other possibility is to get industry experience in which case I think you have to decide what it is that interests you.  Are you interested in the technology development side, and working for a company that makes things?  If so, do you want to work for a tech startup or a more established company like GE or Siemens?  If that is what interests you then try to find a role in one of those companies and then use that to take the next step.

The other route is to try to go into development, which is focused less on the specific technology but rather on getting projects built.  So in this case you want to get in with a bigger shop that does development work and you can do that in a couple of ways.  You could work directly for the utility, or go to work with a large private developer that has the resources to hire and train recent graduates.  Development is a very diverse field, and it’s also very segmented.  With biomass, there are very few developers large enough to hire and train multiple people each year, so that is a very targeted search.  With wind, however, there are some larger wind concerns that you can work with where you can get into development and get a lot of grounding.  From that point you can decide if you are going to be an entrepreneur and form your own team to go after building a project.  So you need to define what it is that interests you.

The consulting route is also certainly possible.  I got into private equity through consulting, more by accident than by design.  It can be done, and certainly the established consulting firms will give you a great set of tools, but for those looking to work in an advisory role rather than going the industry route right out of school, the most common path to what I do is through banking.

Q: Thank you very much for your time, and we look forward to seeing you back on campus soon!

Jon: Thank you - I think it’s terrific how much Erb has grown, and I look forward to coming back and doing more seminars in the future.