As one of the first investors in the U.S. solar market, Brad Bauer’s led teams to “boldly go where no one has gone before.” In his fifteen years working in renewables, Bauer co-founded one of the industry’s first private “YieldCos”, raised nearly a billion dollars for one of solar’s brightest burning stars, and started a new company built on the lessons learned from the last one.
In this #Solar100 interview, Bauer discusses lessons learned from Cypress Creek, the evolving market structure of the solar industry, and the future of development capital.
Starting out in renewables
Richard Matsui: You majored in political science and economics, got your JD, then started your career at KPMG focusing on M&A. When did you first decide to work in renewables?
Brad Bauer: I started out working at a law firm in Boston then tagged along with my then-girlfriend, now wife, when she finished school and started practicing in San Francisco. I wasn’t enamored with practicing law — it certainly wasn’t something I wanted to do for the rest of my life. So I joined KPMG, one of the Big Four accounting firms and was admitted to the partnership a few years later.
KPMG was a really incredible place, as it gave me the opportunity to build a proactive practice focused on increasing project returns and corporate profitability and afforded me the opportunity to work with large company CFOs and board directors at a really young age. I realized what I enjoyed most about my work was the creativity required to advise sponsors and investors on project-based transactions. I didn’t work on any solar projects at KPMG but was involved in what were, at the time, some good-sized wind transactions. I left KPMG thinking solar had many of the attributes that made wind attractive and thought I’d have a chance to use what I’d learned and the relationships I’d built in solar.
After leaving KPMG I co-founded MP2 Capital, which was one of the first equity investors in U.S. solar assets. There I had the opportunity to partner with Mark Lerdal, a brilliant lawyer and executive, not to mention a great person, and Jeffrey Glavan. We weathered the global financial crisis and developed a good sized portfolio of operating assets that we sold-off in a piecemeal fashion throughout 2014 and 2015.
Following that, I took a year off before joining Cypress Creek Renewables, where I was the Chief Capital Markets Officer and a member of the Board of Directors. While there we raised $450 million of corporate debt and another $300 million of equity.
I left Cypress last summer and formed Lacuna Sustainable Investments with Patrick McConnell and David Riester. We closed our fund in March of this year.
Cypress Creek: The thesis and the whipsaw
RM: I’d love to hear your experience of Cypress Creek, starting with the early days of the startup and its thesis.
BB: What made Cypress unique was the identified opportunity to build solar at scale, quickly….
Read More: #Solar100’s Brad Bauer: The Captain James T. Kirk of Solar Finance