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Investing to Save Our Home Planet
A conversation with MIB alumna McKenzie Smith on venture capital and regenerative futures
If you met McKenzie Smith when she was seven, she might have asked you to sign up for her Anti-Litter Club. For Smith, F17, spending time in nature has always been a part of life, a practice developed throughout a childhood spent outdoors in her neighborhood or paddling the Brule River in northern Wisconsin with family. Now, as an investor at Patagonia’s corporate venture arm, Tin Shed Ventures, she has found a way to blend her personal passions with her professional qualifications.
Smith earned her Bachelor of Science in Foreign Service from Georgetown, intending to pursue a career in development aid, but she soon realized it was not the right fit for her. When she learned about impact investing while working in consulting, her next steps suddenly became clear.
“I had underappreciated the power of business and the incentives of the business world to drive change,” said Smith. “I also knew that I wasn’t likely to be the visionary founder with game-changing ideas, but I figured I’d be well-suited to find, fund, and support those founders whose proximity to the problems they’re facing positions them to have the best solutions. Knowing that this was the path I wanted to pursue, I needed to strengthen my financial chops to complement my experience in operations and strategy.”
Given her background in global affairs, she applied to Fletcher’s MIB alongside top MBA programs. When it came time for her to decide, she was attracted to the unique depth and rigor in the social sciences that the MIB offers alongside all the core subjects of an MBA.
Enrolling at Fletcher, Smith found no dearth of opportunities to explore her interests, and she appreciates how her years in the workforce clarified how she wanted to direct her time. Her involvement with the MIINT Competition, an experiential program that simulates impact investing, taught her about the industry and connected her with mentors who are now her peers. She still refers to coursework in corporate finance, global investment management, and international business transactions, even as she has specialized in venture capital as an asset class.
Fletcher’s interdisciplinary curriculum honed the tools Smith needs in her job today. She remembers frequently jumping between finance case studies and econometric impact evaluation as a student.
"That juxtaposition has helped, especially when you’re investing to try to solve a particular problem. You need to understand what the facts and science actually tell us about what works,” said Smith. “As more and more capital floods into this space, there’s ever more of a risk that we back hyped ideas that don’t always hold up under scrutiny. I’m not a scientist, but the ability to dig into research papers and understand statistical analyses is something that I got from the coursework at Fletcher.”
This dexterity is pivotal at Tin Shed Ventures, Patagonia’s corporate VC. The company’s mission to “save our home planet” means environmental return on investment is as important as financial returns in Tin Shed’s investment decisions.
“We look at every investment through multiple lenses. We’re always thinking about the environmental impact, and like all VCs we look for strong financial returns, but we also consider strategic relevance: what are the investments we can make that have relevant ties to our businesses today and where we want to go tomorrow? How can we add unique value to those companies?”
Tin Shed focuses its investments in three fields: regenerative agriculture, biodiversity, and apparel. In her work, Smith looks for companies that can accelerate the transition to regenerative agricultural systems for food and fiber. She supports innovations that will reduce the environmental impacts of Patagonia’s apparel supply chain. And while the increase of atmospheric carbon remains top of mind, Smith notes that the loss of key species, habitats, and other natural capital is an equally troublesome crisis that gets far less attention. To that end, Tin Shed invests in companies with ideas to increase biodiversity monitoring and confront the factors that are reducing it in the first place.
“The economic opportunities that are going to come from the huge transformation that we have to make in the way we work, live, produce, consume, and discard things is going to be one of the biggest value-creation events in our century,” she said. “There’s a huge economic opportunity here if we can accelerate this transition, but more than that it’s critical to our survival as a species.”
In addition to the environmental and financial motivators behind corporate investing, Smith is equally compelled by other imperatives.
“How do we accelerate this transition and not exacerbate, but hopefully rectify, inequities that we see globally and within countries?” she said. “That really motivates me, and we think about that a lot in terms of the founders and types of companies that we want to back.”
Read more about Fletcher’s MIB Degree Program.