Cleantech Capital (A): Banking on a Green Future

The two-part case “Cleantech Capital (A) and (B): Banking on a Green Future)” follows John McNally, a senior investment banker who leaves a successful career to found Cleantech Capital, an investment bank dedicated to financing the clean technology sector. This case study is based on actual events; however, some elements, such as names, characters, places, or dates have been fictionalized. (The actual company name was Greentech Capital Advisors, and its founder was Jeff McDermott). In Part A, McNally faces the early strategic decision of how aggressively to build his firm in a nascent, uncertain market. Having raised $22.5 million from Capricorn Investment Group and other backers, he must decide whether to expand rapidly to capture first-mover advantage or scale more cautiously while the clean energy financing ecosystem matures. At the same time, he must ensure he is building the right team to go after the opportunity he believes is emerging.

Part B picks up five years later, when McNally’s optimism has given way to frustration. Despite early promise, Cleantech Capital has yet to turn a profit, several founding partners have left, and he is losing confidence in his ability to execute. McNally must decide whether to persist, pivot the business model, or wind down the firm. The case concludes as McNally prepares to meet his lead investor to discuss the firm’s future, forcing a reckoning he hopes to meet with both professional resilience and strategic adaptability.

The central decision in Part A concerns how to time and fund early growth in a sustainability-focused venture, balancing conviction and risk in an unproven market. In Part B, McNally faces the critical questions of whether (and how) to pivot or stay the course after sustained underperformance—a test of both leadership and entrepreneurial endurance.