“It started with me commenting on their blog posts,” Richmond says. “I had been tracking the early growth of Lending Club and Prosper, and I said, ‘Guys, this is a perfect fit for that kind of platform.’ After my second or third comment, Dan reached out to me directly.”
An English major at Princeton, where he also took a full complement of pre-med classes, Richmond nonetheless found his first job in 1996 at small investment-banking firm Hambrecht & Quist (which was acquired in 1999 by Chase Manhattan). “It was the magic of that time,” he says. “With a liberal-arts background you could get a job at a Wall Street bank.”
His career since then has included co-founding two other technology firms: SavvyMoney, an online financial service, and SelectMinds, a provider of talent-acquisition and social-recruiting software.
Richmond’s opportunity at Mosaic dovetails with his interest in the environment, which began in childhood. “I came from the kind of family where if we were walking up the street we’d pick up trash,” he says. “And my dad, who had been an Eagle Scout, brought into the family values around outdoor entertainment like hiking and camping.” But the “aha moment” came during his high-school years in the late 1980s, when acid rain created by steel and coal mills such as those in Ohio and western Pennsylvania became big news and prompted Cincinnati-born Richmond to think hard about society’s impact on the environment.
With good reason, society’s interest in the environment has never been sharper than it is now, and the demand for solar energy is such that Richmond believes the volume of investment in Mosaic-financed projects may be “20 times” greater in 2014 than it was this year. In fact, he finds it somewhat puzzling that banks’ appetite for risk is so low that they’ve not even taken much interest in directly financing such relatively safe projects.
“It’s still a specialty asset class at this point, and banks’ ability to lend to asset classes that don’t have a long-term track record is a bit constrained,” Richmond says. “It takes specialized underwriting and origination experience, and there are only a couple of institutions doing it really well. But there is so much demand and there is nothing to stop that trend.”
Although solar is never going to be 100 percent of the power mix, Richmond says, versus the alternatives “it’s pretty darn good and getting better all the time.” The cost of solar panels has dropped 95 percent in 20 years, and 40 percent since Mosaic was started two-and-a-half years ago. “As the cost of the raw material goes down, and it’s a one-time cost at that, the [internal rate of return] starts to get really good,” says Richmond.