Page: We have been covering the clean tech arena in listed equities for over 10 years, so we have lived through the progressions of successful technological disruptions, while observing potential clean solutions that have failed due to costs that cannot meet end market demand. We break-down our research to nine themes and analyze the underlying industries, seeking Fund exposures for solutions we believe to be hitting market adoption tipping points.
As we model the growth prospects of companies across our themes, we may be factoring in a solution provided by a company that is missed by many analysts – such a company could well have greater growth potential in our opinion. For example, the Fund has several companies that provide solutions to auto manufacturers that are planning to enter the electric vehicle market with scale. We purchased these companies as they were underperforming over the past 12 months given concerns about the general automotive cycle. We believe the greatest automotive growth segment over the next several years will be electric vehicle manufacturing, providing strong positioning for electric vehicle suppliers with differentiated technological solutions.
We believe the Fund’s holdings are solving some of the greatest, most complex issues we are facing: How can we feed the world? We invest in technologies that increase productivity for farmers through the use of technologies such as big data weather forecasting and precision irrigation.
How about Day Zero, when Cape Town loses water access? We have investments in distributed water de-salination and treatment that allow clean water access in faster and less expensive fashion when compared to constructing a large water treatment or de-salination plant.
Hortz: Please walk us through your nine investment themes and five focus investment areas.
Uek: There are massive secular trends afoot globally that provide long-term opportunities for new and clean energy technologies. Our investment approach with the Essex Environmental Opportunities Fund is to invest across nine environmental themes that provide solutions for global resource optimization, or “doing more with less.” The nine themes are: agricultural productivity; clean technology and efficiency; efficient transport; low carbon commerce; environmental finance; power merchants and generation; power technology; renewable energy; and clean water.
Our Fund invests in an array of important clean technologies. Clean tech is not just solar energy—there are so many more solutions. The Fund currently has five areas of focus:
Smart City: LED street lighting and industrial internet of things (IoT) are examples of current investments.
Agricultural productivity: precision agriculture and field computing.
Efficient transport: electric vehicle systems, autonomous driving.