Cecile Blilious : Embracing Impact Parameters When Making Investment Decisions To Win The Battle With Climate And Society

Q:  How does your work at Pitango help you manage or merge or balance the relationship that exists between technology, profit, and social impact? 

A:  There is no contradiction between sustainability, impact, and profits. Pitango Venture capital is Israel's largest and oldest venture capital fund. We have about US$3 billion under management across three separate funds. And we invest across stages from early-stage to growth focusing on many different domains. We look for category leaders in all domains and industries.

A few years ago, the founders of Pitango decided to implement an ESG initiative into all of its operations. We believe that by creating companies that are accountable for our planet and society, and who are creating solutions to some of the biggest challenges that society and our planet are facing, we create companies that everybody wants to work in, buy products from and invest in. This is where the business and impact value blend.

Customers of mission-driven companies are even more dedicated as in some cases, there is even an impact premium that customers are willing to pay. We believe that companies creating solutions addressing real-life challenges can create extra loyalty from their customers and be more profitable. Investors are looking for companies with large markets that can show strong market opportunity that connects with values. Employees also prefer to work for climate forward companies. Overall, investing in ESG creates highly successful and profitable companies.

Q:  Does Pitango only make ‘green’ investments?

A: No, we don’t restrict our investment strategy to only green investments. We use the “ABC” methodology to categorise companies into 1: A - avoiding harm, 2: B - benefitting stakeholders, and C -contributing to solutions. When screening new investment opportunities, we disqualify companies who are least not trying to avoid harm. We also evaluate the company’s ESG readiness, assess for risks, and make recommendations on how to implement an ESG and impact strategy post-investment.

For legacy companies already in our portfolio, we designed a process we call “impact migration” in which we help companies identify ESG-related gaps and fill them, design their impact & sustainability strategy, and implement it across the company’s business processes. For companies that can become “C – contribute to solutions” – we help them identify their stakeholders, recognize the relevant UN Sustainable Development Goal (SDG:, and tie their product outcomes with these goals.

Our hope is that companies push themselves to review their internal operations through the ESG lens and take further steps to align their solutions with the SDGs and by that, contribute to much-needed solutions.

In my mind, every company should be ESG compliant. We make sure that the companies are well managed, putting an emphasis on diversity and inclusion. We encourage them to measure, track and reduce their carbon footprint. This is a process that takes time but companies are asked to address those issues. For companies that have an actual impact with their product, we help them in becoming SDG aligned.  

Q: What about the companies that don’t have any sustainability impact?

A: Some of our companies will not have a high and measurable impact. Their product might have to do with the backbone of the internet, or communications, which really don't have an impact on the sustainable development goals (SDG:. But if their ESG alignment is fine, this is good enough for us.

Approximately 70 to 80% of our companies are actually creating a solution that can have a positive impact – so potentially in the B and C categories. In those cases, we help them review their product and their business offering and integrate the SDGs into their offering.

If we can find a tight relationship between the product outcomes, and the actual SDGs, this is where we push them forward to integrate that into their DNA. And then they become really impact-oriented. In the end, if they can be SDG aligned, this is like the top line for us.

Regarding the actual investment process - once the investment teams like a company enough to continue with the due diligence, this is where we add the ESG due diligence where we ask a set of questions and try to make an assessment of the company’s ESG status on what needs to be improved or making some recommendations. This goes into the investment documents, and the investment committee actually considers it alongside all other DD aspects.

If we do make the investments, then we implement the recommendations in that document and help the company become ESG aligned at the very least, or SDG aligned if possible. The process is led by the company and fits its needs. We're certainly against any kind of impact washing. 

Q: Does the funding have any timeline?

A: Like all other venture capitalists every fund has a timeline of between seven to ten years.

Q: How does the size of the company matter in following these strategies?

A: The length of the process depends on the company. If it's really a small company, then within a couple of months, we can go through the whole process of reviewing, understanding what we're looking for, building strategies, and putting in-place climate forward operations, sexual harassment, hiring, and other HR policies as well as a strong code of ethics. These come into the picture as the company grows.                                         

If it's a larger company, the process takes much longer because these are processes that need to be incorporated into existing company operations. Usually, these larger companies have a bigger impact task force to achieve their ESG goals. I'm a resource to them, and I coach them through the process, but I don't do it for them.

Q:  Weren’t you one of the first people to start a company around social impact irrespective of your gender? 

A: I was really very lucky to be at the right place at the right time and be given the right resources and support by the founders of Pitango. For most of my career, I encountered people who basically told me that what I was trying to create was impossible. Most people claimed that there's no way you can maximize impact and profits together. But I kept going, because of my passion and my belief. Thanks to Pitango, for the past two years, I've been pioneering the movement of Impact and sustainability into mainstream VC. And already, there are hundreds of VCs around the world who are copying it and making the first steps toward adopting it.

Q: Do you think the IPCC report has had any impact on the direction that Middle East-based companies are taking?

A: The IPCC report has moved the psyche of people and corporates. They are now paying attention and have come to realise that we can do something about climate change, especially through the use of technology.

Q:  Being part of the Sustainability, what is the one thing that you think the community of sustainability managers, directors, etc together could try and implement which would help take this initiative globally to that next level?

A: There's a proverb from Africa that says: “if you want to go fast, go alone. But if you want to go far - go together”. I do think that it's not a one-person or one fund effort. It's a collaboration.

We have to work together on agreeing on standards and ensure that there is zero tolerance for impact-washing. It's certainly time for us in the Middle East to start joining hands together and working together to achieve what is important for our region as well. 

Q: What are the risk factors involved?

A: You have to take some risks and we are venture investors after all. The evidence shows that the companies that are at least ESG compliant, addressing impact and sustainability will be the ones that will be not only more resilient but also more profitable. So, there is already evidence out there in the market that ESG and impact are good for business, but we need more and we can't wait until the next 30 years of evidence because by then we won't have a planet to live in.

Diversity also matters a lot most people want to work in environments that are diverse and innovative.

Q: How can one contribute individually?

A:  A lot of times I hear people saying, I'm just this one person, what can I do? Or I'm just a small company? What can I change? I'm just a small country, what can we possibly do? But that's not the right approach. We all have a contribution to make. And if this mindset of looking at our planet and looking at our society as part of every other considered criterion, goes into the same decision process, then we've won something, then we'll change something.

Q: Do you agree that the younger generation is a lot better at it and they think more effectively because they don't know anything different? 

A: Millennials, and certainly Gen Z, are activists and they care about the planet. This generation is expected to inherit at least US$30 trillion in the next decade. So, they're certainly worthy of our attention, even if the older generation doesn't understand why they seem to be blending everything.

By listening and trying to integrate what these young people are talking about into sound business decisions, we can make a difference. There's always been a generation gap between every generation since the dawn of time. But right now, we're just running out of time. 

Q: Which is your favorite city and your favorite book, and why?

A: I am very much in love with Tel Aviv. It's a vibrant city really. Alive 24/7. The food is fantastic and the weather is amazing. I'm a city slicker. I like cities and multiculturalism. I like to see different arts and architecture. 

There's one book that I used to carry in my bag and read. It's called Archie and Mehitabel. It's a very small book that was written by a journalist that was writing a column in a newspaper, maybe 50 years ago. And it always gave me some comfort in seeing life in a funny, but also very down-to-earth way. The book looks at the biggest problems in the world at an eyeball level. That's something that grounded me for many, many years.

And obviously, I certainly recommend anyone who hasn't read Muhammad Yunus regarding world poverty and how to create a world without poverty.

I like poetry and deep thoughts, for example, Yuval-Noah Harrari who writes interesting books about humanity.