A growth fund for sustainable cities

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1Paris green finance initiatives

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Paris city supports green & sustainable finance

Paris has adopted a green and sustainable financing strategy

> New Paris Climate Plan to reach carbon neutrality in 2050

> A goal even more ambitious than the COP21

Paris is committed to accelerate the ecological transition

> 1st Paris Climate bond issued in 2015 for €300 millions

> Paris sustainability bond issued in 2017 for €320 million

> Paris green financial marketplace positive ecosystem

> Paris city encourages the mobilization of privates actors

Furthermore, Paris supports green and sustainable finance

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Paris Green Fund: innovative financial instrument

Objective:Leveraging public and private investment to finance innovative and fast growing SMEsto accelerate the ecological transition in large cities

> A territorial investment fund for the ecological transition initiated by Paris City

> Managed by an independent management company (Demeter) ;

> Investing in innovative SMEs whose solutions contribute to ecological transition

> Building on the innovative Paris area ecosystem

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Paris Green Fund timeframe

Launch of tender to select

management firm

Fund gets

TEEC label

1st investmentsChoice of the mngt firm

Bids from mngt firms

Preparation Fund raising by mngt firm

New regulation

enabling Paris

to invest in a fund

1st closing at €100m

Paris City council’s vote

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2Demeter in a nutshell

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Demeter in a nutshell

> An independent management company

> A cleantech pioneer now European leader in sustainable investment

> Venture, growth and infrastructure expertise

> 35 people in France, Germany, Spain

> 80+ institutional and corporate investors

> €1bn assets under management

> 130 investments

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3What is a growth fund?

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What is a growth fund?

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4Paris Green Fund

Paris Green Fund governance

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Compliance Com.

5-7 investors

Bylaws & compliance

Strategic Committee

Qualified experts

Strategic guidelines

Management Co.

Fund management

Advisory Committee

15 investors + experts

Opinion on investments

Investment

committee

Fund

Repr. by the Man. Co.

X

Portfolio

company

Y

Portfolio

company

Z

Portfolio

company…

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Paris Green Fund investors

€200m fund : Strong leverage on Paris city investment (€15m)

A significant majority of private investors

Institutional investors

Corporates

Family offices

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Building Mobility Energy Air Waste Digital

Paris Green Fund investment strategy

€5m to €15m unit investment in equity

Innovative & fast growing & profitable SMEs

x 2 net multiple, 15% net IRR

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Example of companies

Digital solutions for construction waste management

€25m revenue, 25% CAGR

Consultants for energy-efficient building renovation

€20m revenue, 40% CAGR

Electric vehicle charging stations manufacturer

€25m revenue, 20% CAGR

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5ESG & territorial impact

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ESG (Demeter) & territorial impact (Carbone 4)

Annual

reporting…

Fund

exit

Deal

preliminary

evaluation

grid

Deal

detailed

impact

evaluation

Deal

cumulated

impact

reporting

Fund

ESG & impact

annual reporting

Fund

ESG & impact

annual reporting

Detailed

study

Advisory

CommitteeAdvisory

Committee

Fund

investment

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6Key points

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Key points

Large cities face huge sustainability challenges …

… and represent great markets for sustainability SMEs1

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3

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Large cities names are powerful brands to launch a fund …

… and are effective catalysts to leverage on private investors

Funds must be managed by professional fund managers …

… and financial performance must be the primary objective

We are happy to share our experience to help to launch new funds …

… clementine.baju@paris.fr, stephane.villecroze@demeter-im.com