Empowering the financial sector to take financially and environmentally sustainable decisions.

THE PROBLEM

The energy transition to net zero will see trillions of dollars move within and between industries. For capital allocators, this disruption presents both significant risks and huge opportunities to fund net zero and deliver great returns for clients. At the moment, capital allocators have limited tools to understand the impact of the transition on their investments. Consequences of this include poor returns, greenwashing, and a failure to fund the transition.

THE SOLUTION

Dovetail provides investors with a transition intelligence platform that turns climate economics into investable financial data. Its valuation and scenario analysis capabilities allow investors to factor climate change directly into the investment process, rather than interpreting qualitative ESG ratings. Dovetail’s outputs show the financial impacts of the transition on an issuer’s revenue, COGS, CAPEX, and net present value—allowing capital allocators to act on both the risks and opportunities of the transition.

WHY WE INVESTED

Founder-Market-Fit

Prior to Dovetail, Amos and Philip built the ESG practice at Palantir Technologies. They bring the crucial understanding of big data as well as the financial industry needed to realise the Dovetail vision. Their ability to grasp and process the most complex frameworks as well as being stellar system-level thinkers will drive the success of the endeavour.

Empowering the financial sector

Market estimates show that nearly one-third of the projected total assets under management (AUM) globally, or $50 trillion, will be in environmental, social, and governance-related assets. There is an enormous opportunity to provide asset managers with user-friendly modelling technology to demystify essential transition investments. Only by having better information available will we be able to make more informed and sustainable decisions.

 

Science-Based Impact Assessment

Dovetail is an enabling technology that will help avoid a misallocation of capital. A better understanding of transition risks helps companies and their investors to mitigate these or to adapt to these (ECB 2021; Alogoskoufis et al. 2021, FSOC 2021).

On a systemic level, a better understanding of transition risks allows policymakers, societal actors and companies to try to shape transition pathways with low risks. Better information about climate risk will help us improve financial stability—a prerequisite for a functioning economic system—and allocate resources towards a successful transition.