The following interview is a conversation we had with Adam Silver, CEO & Co-Founder of Plural Energy, on our podcast Category Visionaries. You can view the full episode here: $2.8 Million Raised to Build the Future of Clean Energy Investing
Brett
Hey, everyone, and welcome back to Category Visionaries. Today we’re speaking with Adam Silver, CEO and Co-Founder of Plural Energy, a clean energy investing platform that’s raised 2.8 million in funding. Adam, welcome to the show.
Adam Silver
Hey, Brett. Thanks for having me.
Brett
No problem. Super excited. Let’s go ahead and jump right in, talk to us about what you’re building today.
Adam Silver
Yeah. So great to meet everyone. Long time listener of the pod, excited to appear amongst so many other incredible guests. So, my company is Plural Energy, and essentially what we do is we make investing in the clean energy transition more accessible and easy for anyone. Whether you’re a regular investor or a family office or an institution. You can come to Plural Energy and access high quality renewable energy deals in just a couple of minutes.
Brett
Take us back to the founding of the company. What was it about this company and this problem that made you say, yep, that’s it. I’m gonna go spend the next 3510 years of my life building.
Adam Silver
Yeah. Well, hopefully this. I’m spending my lifetime building this company. We. We joke on the team that we all hope we’re in our last job ever and that we get to do it forever. We love what we do. And so I had always, I guess, going way back, I grew up in a family of entrepreneurs. Both my parents were entrepreneurs. My brother’s an entrepreneur. My wife just became an entrepreneur. And I have many aunts and uncles that are business owners, too. So entrepreneurship was always something that was just kind of, like, standard in my family, and so was this interest in the public sector and societal problems. And so right away, you just have, like, a nest for a renewable energy company to grow up in. And so I.
Adam Silver
And then when I graduated college, I worked at Deloitte Consulting, where I was a management consultant, and I became absolutely obsessed with the clean energy transition. The clients I was working with that touched every single one of them, whether they were in the energy industry or not. And I became just fascinated with the miracle of the lights turning on. And so then I knew I really wanted to do something in energy at some point, but I just didn’t have the right, you know, idea or courage or the right feeling to go start a company. So I spent a few more years, you know, developing myself, my career. I went to business school where I focused on energy. Tried my first startup there. Didn’t really get very far with it.
Adam Silver
And then, and then eventually I learned about blockchain and I became absolutely obsessed with smart contracts. And I could see kind of this thread starting to form in my career, where I started my career as a management consultant, talking about digital transformation and energy and industrials and so forth. And then I was a product manager serviceNow, where I was building products to do that. And I could just see that every single one of the industries that I’d built products in or that I had studied was going to be impacted by the smart contract. That was just the part of blockchain that really clicked for me. So I quit my job at Servicenow to focus on smart contract applications industry.
Adam Silver
And the real kernel of an idea that led to Plural Energy were these two ideas that seem to be universally true, but somehow not cooperate with each other. So the first one is that we don’t have enough money going into clean energy projects. So according to the UN, we’re $4 trillion short of the amount of financing required to meet global climate goals. And today only 16% of the necessary climate projects get financed. And then on the other hand, every day it feels like there’s a new net zero requirement coming out or an ESG goal for a fund. And more and more people around me are talking about investing in clean energy. And so the fact that those, that people want to invest and the problem needs more money, it just didn’t make sense to me how those two problems could be together at once.
Adam Silver
And so immediately you have the suggestion of some type of market inefficiency. And my, I just started drilling at that and eventually formed a team that was laser focused on solving the myriad of problems that happen at like the, at kind of the intersection of those two truths.
Brett
Those are pretty depressing numbers to hear. Is that it sounds like you felt the same way about them. Why is that the case? Or maybe better questions like, how is that the case? I feel like we’ve been talking about this for a long time now. There’s a lot of focus on sustainability. Like, how are things still so bad?
Adam Silver
Yeah, I mean, it’s getting better. The. The Biden administration’s inflation reduction act was. Was super helpful for the industry. And, and, yeah, there’s just a lot to do. Like, we have done some real damage to the climate. But I think. I think what I. The way I kind of approached it was so much of the climate industry and, like, the messaging around it was about guilt and, you know, we have to do this. It was. It was like, you know, scary urgency, like fundraising for, you know, a hurricane or something. And what I started to realize with Plural Energy was that messaging is almost getting in the way of just the quality of the assets that people can invest in climate, especially when it comes to renewable energy deals. I, you know, this is my personal opinion. This is non investment advice, blah, blah.
Adam Silver
I think that you would be hard pressed to find a better risk reward profile than the deals that we bring to market. And that’s what I decided we need to start leading with, because guilt is only going to get you so far in the energy transition, whereas, you know, money gets you further. So I think part of it is about, the damage we’ve done. Part of it’s about the messaging around the industry and, And, yeah, and then I think probably the biggest piece, which I’m sure we’ll spend a lot of time talking about today, is how hard it is for regular people. Generalist funds, family offices, really, anyone who is not a mega infrastructure fund, to actually participate in these markets. And we’ve gotten to a point technologically where that’s just unacceptable.
Adam Silver
All types of capital need to be able to come into renewable energy projects. And that’s why we’re called plural. Like, the idea of pluralism, that all different types of capital need to be able to come together into financing the clean energy transition.
Brett
Let’s. Let’s dive into that problem a bit more. Why is it hard for them to get access to these types of opportunities?
Adam Silver
Yeah, I think there’s like, what is like the four horsemen or something? I feel like every Founder has, like, some, you know, four horsemen, three pillars, something like that. So, the horseman of the clean energy transition in accessibility. So the first one is, you know, regulations. The current us financial market, is really built so that there’s only very few products that are available to investors easily. And those products have. And, like, the reason why is because you need to have very deep reporting structures and I. Information gathering and all that stuff. And so blockchain can immediately change that because it is an always on risk reduction transparency system. So that’s the first thing. Sometimes it’s just inaccessible because you are not an accredited investor or you do not have the net worth required to hit the minimum investment.
Adam Silver
So there’s a fractionalization regulation story there too. The second reason is its confusing. Renewable energy project finance is not the most simple, easy to understand thing as it exists today. If we gave a pretty savvy investor one of the data rooms for the renewable energy projects we work with, they probably would not be able to tell if its a good project or nothing, just because it’s a very like, jargon laden, complicated regulated industry. And so that’s another thing we try to change. Like we think that, investing in this asset class, like ultimately everything is dollars and cents. And that if we work with the renewable energy developers that we work with to build, an on chain reputation and to simplify their models and information, that ultimately people can just look at it as another sleeve that they’re allocating into.
Adam Silver
So understanding is the second one and then the third one is transaction costs. So transaction costs are incredibly high in this industry and to the point that traditional players don’t even form a deal team if it’s not a project worth hundreds of millions of dollars, because you have to work with lawyers and bankers and it’s all analog, you have to travel to conferences to raise money. And so what that ends up doing is that if you’re an up spending $2 million in legal and banking fees, you better be financing a pretty big deal. And you also better have like a lot of money behind you.
Adam Silver
And so it’s just a recipe for people to not access it, which is a shame because like I mentioned, they’re great assets and the layers and layers of, you know, rent seekers between the cash flowing renewable energy project itself and the end investor who might own an ETF, of ETF’s that has renewables in it, you’re not actually reducing that much risk through those different management layers as you invest. So that’s essentially the opportunity that we’re going after is, let’s make this simple, easy to trust, easy to diligence, instantly accessible in a few clicks.
Brett
So you have the idea. What do you do first? Where do you even begin with an idea like this?
Adam Silver
Yeah, I mean, I, I always say ideas are cheap, like it’s the most ultimate truth in entrepreneurship. Like when like, it’s just ideas are so easy and everything else is just really hard so at this point, I had the idea. The kernel of it’s just. Is even like a kernel of an idea. It’s like we need to move money into projects. And I then wanted to go deeper into understanding the, like, sub problem. So now I have this problem, or this idea actually. Wait, Brett, can we. I want to take that one back.
Brett
Yeah, no problem at all. I’m asking. Yeah, and let’s. Sorry, I totally forgot my question. What was my question?
Adam Silver
Your question was. Your question is you have the idea. Now what?
Brett
Yeah, there we go. Now you have the idea. Where do you even begin with something like this?
Adam Silver
Yeah. So our idea was really more of just like a curiosity, which was. And at this point I was, you know, alone at Plural Energy building it by myself. And it was a curiosity which was essentially, how can this be true? How can there be so much money that wants to invest, so much money that is needed? The deals are high quality. What’s not clicking in the market. And so I decided where I need to look at was, where does the money need to go? So I started talking to people, and what I ended up finding through a number of conversations was that it’s really a tale of two cities in the renewable energy industry where you have the large projects, the large funds, the large developers who don’t really have a problem at all. They have deep lines of credit with Wall street.
Adam Silver
They have bank of America doing tax, doing their tax equity financing to monetize tax credits and tax benefits. Things are good for them. And so when I was talking to those folks, I was like the most demoralized entrepreneur ever. I just kept hearing like, oh, nothing to solve here, kid. Like, the amount of times I heard these people tell me, your idea seems pretty bad. Was. Yeah, you couldn’t count it. But then I realized I was asking the right question to the wrong people. When I would talk to smaller developers, they would tell a completely different story, which is about the, you know, how hard it is to access financing. The only liquidity options for them are complete sale of their project, and now they have nothing on their balance sheet to borrow against other than cash, you know, things like that. And.
Adam Silver
And I started to kind of see this, you know, second part of the industry forming, which we sometimes have referred to as the missing middle, where there’s projects that are too big for you and my rooftop, but too small to be worth KKR’s time, that are really high quality and absolutely struggle to get financing. And then, you know, for any entrepreneurs listening, there’s. There’s a point in your process, where you start to feel like you found some, like, I guess, religion. Like religion, you know, like where when you’re talking to your customers or your users that you can say something that it just seems to be like a accepted, believed truth about the world where it’s like, you know, like praise, we got it, you got it.
Adam Silver
And, and at that point, company building is just kind of hits a different, stride because, you know, like I’m onto something, I’m building the right thing. And obviously that gets harder when you’re building a platform because you have to do that twice, three times, four times, however many times it is. If you’re building B2B SaaS, it’s probably a little bit different. But if you’re building a platform, you got to find religion with both sides. And once we found it with the renewable energy side, then the most simple, hard solution to the problem kind of came to mind, which is like, we need to build a new financing platform for renewable energy, and smart contracts will be the best, fastest, cheapest way to run that platform.
Brett
I feel like everyone does understand smart contracts today, but maybe that’s just me from having conversations with a lot of founders in this space. So let’s go back and talk about that technology a little bit. Can you talk about how the smart contract here works exactly?
Adam Silver
Yeah, I think, I mean, I, when I first got in, when I first started, plural, like, the smart contract was what clicked for me. And then when I got into the blockchain space, it was what clicked for my, like, normal family members who thought that NFTs were stupid, but I would explain a smart contract to them and they’d be like, oh, yeah, that does make sense. And it’s basically, a smart contract is basically code that can follow rules really well without interruption or without management. And so imagine that, like, imagine that you’re a renewable energy developer and you’re building a solar project, and your investors, there’s a ton of business rules that you’re setting between you and your investors. Like, one of them is, I’m going to pay you every quarter.
Adam Silver
You might say that I’m going to pay you 100% of all profits until you get money back, and then we’re going to split it 50. Or you might say that you have, you can get part of your payment in renewable energy credits and you can get part of your payment in cash, and you just have to tell me and then we’ll send you that. So there’s all these business rules that are in these contracts. And ultimately, what we can do with Plural Energy is we can codify those business rules in a smart contract.
Adam Silver
So now, if you can imagine the old world of finance, when a renewable energy company needs to pay out their dividends, they need to go through some excel sheets that probably have different wire instructions for all their investors, who knows, and calculate everything, copy and paste the wire instructions in, and spend about half a day sending out wires to their investors. And then they have to go to carbon credit registries or renewable energy credit registries do all this stuff, too. It is so much administration with us. When you need to make a payment, you send a single wire into a smart contract, and our smart contract then automates all of the rules that you set so that everyone is paid accordingly.
Adam Silver
And that includes the types of things I mentioned, but it also includes things like, if we’re operating a secondary market, what happens if Brett owns the share of renewable energy asset for two thirds of the quarter and I own it for the other third? Like, how do we figure out who gets paid what when? And our smart contracts just take care of that and track trading everything that’s related to these assets and automate away the administration.
Brett
Talk to us about how you find these developers. What does that process look like?
Adam Silver
Yeah, well, I mean, this kind of goes back to the religion thing. Like, I really only want to talk to right now, and maybe the religion thing is a terrible metaphor, but it works for me. I only want to talk to developers right now that share my religion that I know we’re solving a problem for them, and so we find them in a lot of ways. To be honest, one of the best things that we’ve done that I highly recommend every Founder does, is use your equity to work for you through advisors. And so I started Plural Energy as a solo Founder. I have co-founders now, but I really started Plural Energy as a solo Founder. And I, and so I had the ability to set aside equity to align people and align industry experts to help me.
Adam Silver
And so one of our biggest sources of pipeline is from our advisors. One of my advisors used to run the energy transition team at KKR. He sends us deals all the time. One of my advisors is this incredible, shes like the Madonna of the renewable energy industry. Everyone knows her by her first name only, and she does small to mid market debt transactions. And so essentially now she and Plural Energy go to market together, where she does the debt and we do the equity. And so as she’s finding deals, she’s bringing them to us. And then immediately, it’s so much easier for us because, a, we know the other side of the capital stack is going to be strong, and b, we know that she has, like, the deepest network in the industry and only works with good projects.
Adam Silver
So advisors are a huge piece of what we do, to get started, but then eventually you got to do the, you know, the boots on the ground sales stuff. Like, we go to conferences. We, when we go to a renewable energy conference, like, we hardly sleep. We’re just meeting with developers nonstop, and we do cold outreach to developers that we really think might have a good project. And then we partner with developers to essentially not just do one project with us, but do their entire pipeline with us. It’s gotten to the point now where we have about $300 million of assets in our pipeline, and that’s been mainly inbound from just our network, and we’re now about to unlock a much more outbound strategy because we know so much more about the projects we want to launch.
Adam Silver
And so we’re really about to turn on a lot more pipeline development.
Brett
Trey, how do you get amazing advisors like that? I’m sure any Founder listening in is thinking, yeah, I would like to have the Madonna of my industry. How do you pull that off?
Adam Silver
Yeah, I mean, I don’t know. I’d love to ask them, but it starts by being a relationship person, and it’s a big decision for you as well. And so I think at the beginning, I was a little bit too keen to offer advisory roles, to be honest. And in some cases, I had to say nevermind, because I just didn’t think I was going to get enough value for equity. And in some cases, I even had to, you know, tell an advisor that I was going to be canceling his shares and that they were. That I appreciate the advice they’d given, but, I, the shares would be more effective, use somewhere else. And that was a tough conversation, but they agreed.
Adam Silver
So you kind of got to be a little bit careful because the advisors that you can get when you’re a pre seed company and the advisors you can get later are not necessarily the same. So you got to make sure that if you’re asking someone to be your advisor, they’re going to be able to provide something in perpetuity. So I know that’s not your question. I’m saying, you know, your question is, how do you get them? But I think there’s another piece, which is, how do you filter them? So, some of my advisors, the thing that they give me in perpetuity is actual, literal advice. I have one advisor who I truly love calling and running at, running things by him, and we have some advisors who the thing they give in perpetuity is industry knowledge.
Adam Silver
I know that Paula, who is the Madonna of clean energy, in my opinion, that Paula is. I can call her at any time, and I can say, hey, what are bank rates at right now? What are renewable energy project bank rates at right now? And she’ll have answer on the spot. She’ll know it. She’ll have talked to three banks that week, and immediately, I have just the easiest access to input into all of our models at all time. So there’s always got to be something that they’re giving you forever, not just for now. And then when it comes down to it, you got to nurture the relationship, you and. And really make sure that it’s a fit and really, like, similar, I guess, to the renewable energy companies. Find some religion with them, too.
Adam Silver
Like, find, like, they either got to believe in you, they got to believe in the company, they got to believe in the idea, they got to believe that you’re making your world easy, their world easier. Like, you got to find some type of religion with them that they can be excited about, because they are ultimately going to be your biggest advocates, and you’re going to have to answer questions about who your advisors are whenever you raise money, too. So you got to be ready for that.
Brett
Thinking about all the advice that they’ve given you, what would you say has been the most impactful piece of advice so far, and what made it so impactful?
Adam Silver
Jeff? Oh, Mandy. Yeah, I think so. One of the thing about. One thing about me, and that is sometimes a good thing, sometimes a bad thing is I like asking for and getting advice. And so I have a lot of. I kind of feel like I’m in the center of this circle of feedback and advice, which is, at times, very dizzying. But it’s also a, but it also makes me really feel like I’ve vetted an idea or a concept from all angles. So all the advice, you know, there’s, all the advice I get often is sometimes conflicting, but it’s always good to get.
Adam Silver
Probably the most impactful piece of advice an advisor gave me was that I don’t want a team in my image alone, and that ultimately, if the company grows up to a point where everyone looks at a problem and is thinking, what would adam do? That I’ve ultimately built, you know, a cult of personality, not a company, and that we. I would be taking away from. I’d be taking away from all the creativity and ingenuity that comes from my teammates. And I know that sounds. That sounds honestly so obvious when I say it back, but I think what’s important, and I still suffer from this, is when you don’t give your team ownership and authority or when you micromanage. You’re essentially setting up the cult of personality.
Adam Silver
Like, you’re making it so that everyone sees problems through your eyes only, and your company will eventually suffer from it. So that was really the most impactful advice. And I’m always working on that as a Founder. Like, you know, I’m obsessed with this company. My co-founders are obsessed with this company, our team is obsessed with this company. And it’s really hard for me to, you know, see something go out the door that isn’t exactly the way I’ve done it, but I got to let it happen that way. I got to let it happen that way sometimes, so that eventually I can have a company of people who are all moving in the same direction with their own twist on it, rather than just trying to be me at all times.
Brett
Robert, what about your own journey fundraising? So, as I mentioned there in the intro, 2.8 million raised to date. What have you learned about fundraising throughout the journey?
Adam Silver
Fundraising is. I used to think that fundraising is so unfair, but now I honestly think the right companies get funded, for the most part. Somehow, some way, this industry works in a way where good companies get funded and the right companies get funded. Some bad ones, too. But I think that ultimately, fundraising is about grit, grind, and storytelling. Like, can you wake up every morning and deliver your message? Can you somehow communicate that religion you’re finding with the industry to the investors that you’re talking to in a new way? And I think I was talking to a Founder early today, actually. And I. The way that I think is you essentially have to answer two questions, is the investors will have two questions, is this a course I want to run? And is this the horse for that course?
Adam Silver
And so ultimately, you got to be just proving those two things the whole time. That, yes, the renewable energy industry needs to change for us to have a chance to meet our climate goals, and people can make money through that change. And then, yes, blockchain is a way to do it. And Adam has built a team of experts that are. That is best suited to actually make that dream come true. And so, yeah, and sometimes it’s really hard to communicate either of those messages more the less, both at once, perfectly so it’s. Yeah. And, like, and then the grit and the grinds. Like, you’re going to hear no so much. You’re going to hear no. And when you’re a Founder, you’re going to hear no more than any other time in your life.
Adam Silver
And you have to be able to wake up every day thinking, like, I’m going to get some yeses today, even though yesterday all you got were no’s.
Brett
I think any Founder listening in can relate to that. Now, final question for you. Let’s zoom out. Three to five years into the future. What’s the big picture vision here? What’s the company going to look like? And what’s the impact going to look like three to five years from today?
Adam Silver
Yeah. I love this question. We call these post 05:00 p.m. Questions because at plural, pre 05:00 p.m. You got. I mean, well, 05:00 p.m. Often is 09:00 p.m. At plural. But. But pre 05:00 p.m. You got to be moving the company forward today. Post 05:00 p.m. Is when you can dream about what the company will one day become. So I think what we’re doing is very important because ultimately there’s not an easy button for clean energy transition financing. And what I mean by that is, I guess what ultimately I mean is that money shouldn’t be the thing that stands between us and a clean energy future, especially when the deals that are going, that are being funded are higher returns than most out there.
Adam Silver
And so we want to build a full financing stack for renewable energy companies where they can log on to their end of the portal structure a deal with plural. Click go, submit it to our team for review, and then immediately we can push it through a number of different distribution channels, all connected by smart contracts. That’s where we’re going. And I think the impact of that would be that we can start to have the clean, sustainable grid that were promised right now. So much capital flows to these massive projects. And so when the idea of solar panels, you know, started to gain traction, it was like, whoa, we can build a grid where everyone’s a consumer and a producer, where everything is connected. It’s a two way street, a decentralized grid where energy production and energy consumption are happening closer together.
Adam Silver
What has happened instead, because of the economic structures of the industry, is we have a grid where many, where dollars move into giant megaprojects out in the desert that are just cranking out power and shooting them through long transmission lines to our homes. And so I think that if we’re able to do what we want to do, that it’ll be easier for people to. For renewable energy companies to develop projects and build a fully decentralized grid. And so what’s ahead? I think we are going to keep bringing these renewable energy projects to market. We have some on our platform today right now that are available for investment, which we’re really excited from. I definitely encourage people to look at the terms of those deals. I think they’re interesting opportunities for the right people.
Adam Silver
And then we are launching a number of new deals in the coming weeks, including sustainable bitcoin mines, where people will be able to invest in a bitcoin mine that is paired with the solar field. And so when the solar production, when the solar markets have low prices, the bitcoin mine turns on. So it makes these solar projects that are in really tough energy markets more economically feasible. We have a number of other renewable energy projects coming online for solar that include some of the tax credits that are related to the Inflation Reduction act. So people can invest in solar cash flows and then also reduce their tax bill by doing it, which is pretty cool. And then I’m really excited to unlock some more of the what’s worked in Defi into the plural stack.
Adam Silver
So we want to make it possible for people to invest in solar and then borrow against their investment. We want to use the liquidity models of that have been successful in the blockchain world to bring liquidity to the long tail of this asset class as well. So I think over the next three to five years, you should see a lot of assets from us. Much easier to finance renewable energy projects and then some really cool opportunities to pair what’s good about solar with what’s good about the rest of the blockchain ecosystem.
Brett
Amazing. I love the vision. I’ve really loved this conversation. We’re going to have to wrap here. Before we do, if there’s any founders that are listening in that want to follow along with your journey, where should we send them?
Adam Silver
Yeah, I’m Adam Silver on Twitter, so follow me on Twitter. Hit me up on LinkedIn, the Plural Energy. Twitter is aural energy. You should definitely check us out. And then, yeah, you can also feel free to shoot me a DM or a note. I’m happy to talk to folks that are thinking about a similar journey.
Brett
Amazing. I love it. Thanks so much, Adam.
Adam Silver
Thanks, Brett.
Brett
All right. That was awesome. Didn’t have to.
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