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Greenprint Partners, a Chicago-based B Corp founded by female entrepreneurs, believes that existing water-drainage infrastructure can be transformed into engines of sustainability that also reduce pollution and flooding.
Nicole Chavas, CEO and co-founder of the firm, says the projects they have spearheaded in some of the Midwest’s grittiest cities have a serious positive social impact, too. They are increasing property values, spurring economic activity, and over the long run, researchers say, such changes in neglected communities can help improve physical and mental health.
One example is in Peoria, Illinois, where Greenprint teamed with municipal authorities and local NGOs to create “The Well Farm at Voris Field,” a hybrid poplar stormwater forest with 100 raised garden beds that are home to an urban agriculture apprenticeship program, flowering bioswales, and space for public gatherings. The project, sited in one of the poorest zip codes in America, plays an important part in mitigating a serious flooding issue – Peoria is on the banks of the Illinois River. That, in turn, helps prevents overflows in the city’s antiquated sewage treatment system, which had regularly poured raw sewage into the local ecosystem.
Chavas and co-founders Laura Kimes, Greenprint’s vice president of operations, and April Mendez, VP of strategy, all graduated from Northwestern University’s Kellogg School of Business Management. In 2018, the firm was certified as a Woman’s Business by the Women’s Business Enterprise National Council (WBENC).
Chavas spoke about the future of green infrastructure and how the water industry is developing with Karma’s Contributing Editor Michael Moran.
Michael Moran: There’s often a narrow definition put on green infrastructure – a sense that it’s all about lower energy and water bills – that leaves out a lot of what Greenprint seems to be doing. Can you take us through your approach?
Nicole Chavas: When you look at a lot of the poorer communities, it was pretty clear to me that before you could lift people up with jobs, education, and healthcare, you needed to do something about their physical surroundings. If folks are negatively impacted by their environmental infrastructure on a day-to-day basis, then you can’t even start to address the bigger picture. That’s where I really saw that investing in our infrastructure is absolutely essential. Just as one example, in the United States our water infrastructure is outdated.
It’s highly vulnerable to climate change and the flooding and pollution that’s coming from (that is) really negatively impacting low- and moderate income communities. So that’s where I really focus my efforts. There’s actually an amazing solution for these problems: green infrastructure using natural solutions like green roofs, permeable pavement, rain gardens, tree trenches to help manage water flow and preventing it from having to go into the sewer system in the first place, reducing water pollution, reducing flooding but also creating all of these amazing additional mental and physical health benefits.
Our mission is to see green infrastructure scale, to see it implemented in a way that maximizes those benefits and to see it scale in a way that’s equitable, that makes sure that the people who benefit the most from green infrastructure see it implemented in their community. So we are a for-profit company, but we’re mission-driven and a certified B corporation.
Michael Moran: Tell me a bit about how the B Corp structure has helped you implement your vision.
Chavas: When I looked at the ways that the current players have tried to implement and scale green infrastructure, the purely philanthropic model has its limits. It’s great for supporting communities, for helping with planning efforts. But when it came to using philanthropic dollars to trying to actually pilot and scale these projects? To work it needs to be built at scale, it needs to be maintained for the long term. If you build a bunch of green stuff and don’t maintain it, it will die. You need a sustainable business model.
So you cannot rely on grant funding to implement it and have it work for the long term. That means that we need to rethink how we procure infrastructure, how we contract for it, who the players are that are delivering it and how we make sure that it’s actually performing over the long term. The only way to do that was through a sustainable business model and that’s why I started Greenprint as a for-profit company.
Michael Moran: You’re working in Peoria, in St. Louis, and in Youngstown, Ohio — all communities that are struggling with industrial decline and associated problems. Are these particularly good laboratories for green infrastructure?
Chavas: To make green infrastructure work, we believe in building partnerships between the public sector and the private sector. Because water utilities don’t own and manage the majority of the urban land where the water collects, many are exploring and implementing a private property retrofit incentive model directly from the playbook of a very seasoned mature industry, which is energy efficiency.
Utilities are obligated by law to find energy-efficiency savings and to find ways for their own ratepayers to reduce their energy usage. Regulations say they have to set up these incentive programs to incentivize their customers to install energy-efficient technologies. We’re starting to see that same model take hold in the water industry.
Michael Moran: What was the source of seed funding and how did you get started?
Chavas: We’ve had a couple of seed rounds and I would say we’re at the seed stage and beyond. I went to Kellogg and that’s where we incubated the idea. We were able to leverage grant funding from Kellogg, to do that initial R&D, and since then we’ve raised a couple of investment rounds. We have raised $2.8 million to date. That’s been a mix of initial seed equity as well as convertible debt. And we’re just about to go out for a $2.5 million raise this year. Because of the impact of our work and the fact that it is still a relatively nascent industry, we have found that foundations and family offices with an impact-first mentality have been the ideal investors into our company at this stage. We’ve done a high-net worth round and we’ve done a larger round with led by a couple of foundations.
Michael Moran: What is your path to profitability?
Chavas: We’re still early stage but we’ve got more clarity than ever on the path to profitability. We’re doing pilot projects and demonstration projects and over the last year and a half we’ve really honed in on our business model, and that’s an incentive program model. We’ve also found key cities that have embraced that model – Philadelphia, St. Louis, and San Francisco. We are now on the ground in each of the three cities developing projects. We have $1.9 million in projects already approved in Philly and St. Louis and we’re submitting project proposals in San Francisco this summer.
So far, we’ve been able to demonstrate the full project cycle of what it takes to get a project contracted, design, financed and built. So replicating that within those three markets to generate enough project activity to continue moving toward profitability is the goal.
Michael Moran: How do you generate revenue and returns for investors? And what do you think your future holds – is there an exit strategy?
Chavas: Our revenue comes from the portion of the projects that we are providing – design, development and project management. Every time we do a project, we’re generating revenue and we’re looking to continue to grow our product pipeline and grow the number of markets that we’re in. In terms of the long-term exit strategy, there are a few ways to go. The way the energy efficiency industry has developed over the last 20 years has a path that I think is very similar to where the water industry is going. Basically, many utilities started to outsource energy efficiency program administration and management as they started to grow the incentive programs. As a result, there has been enormous growth (energy efficiency is now a $100 billion industry) and consolidation within the implementer space.