Impact, Power & Profit

By Omar Blayton

September 26th, 2018

Far too often, the concept of impact investing is solely linked to philanthropy, or the idea of concessionary returns. While such capital can be vital to those wishing to stimulate deep impact in high-risk, low-return asset classes, it is possible to have a similarly material impact in asset classes where the risk-adjusted return profile is far better.

How is this done? First, you must identify areas of mispriced risk. This mispricing often occurs where there is a lack of sufficient interest due to some combination historical bias and financial complexity. Many investors opt for the familiar, leaving significant opportunities for investors who are willing to dig a little deeper, especially if their motivations are impact, as well as return.  Second, you need to efficiently structure your investment so that you maximize all benefits attributed to the asset, whether it be cash, tax credits, or other incentives.

While there are potentially many areas of investment where following the steps above can provide you with great returns and meaningful impact, one area that I am certain this confluence exists is in commercial-scale solar projects. Through financing these projects, investors can enjoy the benefits of diversification and high-quality cash flows, while simultaneously providing a needed solution to underserved communities that are excluded from traditional financing. Creative structuring can amplify the impact, allowing one not to just fight climate change, but also help democratize the financial benefits of solar energy across diverse communities.

The opportunity for meaningful impact and returns is what led me to join Sunwealth as its CFO.  At Sunwealth, we work to create a more inclusive energy economy, accelerating the flow of capital into projects that reduce carbon emissions and spur local economies by providing considerable energy savings to a diverse community of schools, churches, municipalities and nonprofits. That targeted impact can be seen in our 2017 Impact Report, as 33 projects provided nearly 2.7 MW of clean energy, offsetting 2,000 metric tons of CO2and saving our partners a collective $108,000.  We are changing the access to solar energy by changing who invests in it, engaging our community of socially responsible investors to continue and amplify our Impact, (Solar) Power & Profit.

ABOUT THE AUTHOR

omar-blaytonOmar Blayton is Chief Financial Officer at Sunwealth.  Formerly he served as a Vice President with Reznick Capital Markets Securities, a subsidiary of the Reznick Group. Omar also sits on the Wharton IGEL Alumni Advisory Board and will speak at the upcoming Sustainability Career Panel in November.  Omar’s background focuses on renewable energy, asset sales along with the raising, structuring, and negotiating of tax equity investments. Omar was an associate in Bank of America Merrill Lynch’s Leveraged Finance Group, focusing primarily on the industrial, healthcare, and gaming spaces. During his time at BAML, Omar structured and executed high yield, leveraged loan and asset-based loan transactions for leveraged buyouts, strategic acquisitions and corporate refinancing. He participated in 10 lead left transactions, totaling more than $14 billion. Before entering finance, Omar was an attorney with Reed Smith LLP where he focused primarily on investment management advisory to one of the nation’s largest mutual fund companies. Omar received his MBA in Finance from the Wharton School. He received a JD from Columbia Law School and his BA from Cornell University.

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