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KEY INVESTMENT MODELS 

IMPACT INVESTMENT

Impact-only funding includes public funding, development assistance and philanthropic grants. Impact investors do not have any expectation of financial return but instead seek progress toward a particular public good. All of these funders will want information confirming that the project outcomes will be delivered in a cost-effective way, and some may also need to provide an impact statement to their own stakeholders or funders. Impact-only investments are often relatively small in scale but more long-term than conventional commercial investments. Impact investors are closely related to philanthropists. The key difference is that they may also expect a financial return (ranging from a return of capital through to conventional rates of return), but this is typically a lower priority for them compared to the achievement of positive environmental or social goals. The Global Impact Investing Network (n.d.) identifies four key principles of impact investing: • An intention to have a positive social or environmental impact • Designing the investment based on impact data and evidence • Managing the impact performance of the investment, including identifying and managing risks to the impact of the investment • Contributing to the growth of impact investing through transparency, use of standards, and sharing findings

DEBT INVESTMENT 

Debt is the lending or borrowing of funds, at scales ranging from micro-finance loans (typically up to US$50,000) to large-scale corporate loans (US$100 million or more). Debt instruments may be called loans, bonds or notes, among other things.Debt is a low-risk investment for the lender, whose risk is limited to the non-payment of the principal and interest on the loan. However, to reduce this risk, some lenders may require a Investment models \ 7borrower to ‘secure’ the loan by pledging assets as collateral against it. Mortgages are the most common example of this (for example, for residential properties); however, it is challenging for private organisations to identify assets for collateral in ocean-based development projects, given the public ownership nature of most ocean and nearshore real estate. This is not necessarily a concern for governments (as ‘holders’ of these and many other assets), but sovereign borrowers also need to consider their budgetary debt position.In line with its low risk, debt can also have a low return to the lender, limited to the interest that it is agreed the borrower will pay. This may be a fixed rate of interest or a variable rate that may fluctuate over time. Although private sector lenders usually set interest rates based on market conditions, some public organisations (such as MDBs) provide loans at reduced (or concessional) interest rates.Apart from any terms set when the lender and borrower enter into the contract, lenders generally have little influence over the investment. For green loans and bonds, the terms may include compliance with green or sustainable standards. For example, green bond standards limit the use of the borrowed funds to particular environmental projects and also apply conditions on how the funds are managed in the meantime. Green bonds (and related thematic bonds such as blue and SDG bonds) are very attractive to investors and are usually oversubscribed.

EQUITY INVESTMENT

Equity investing means that the investor takes an ownership stake in the project. Having an ownership stake means that the investor can sell their share of the project at a future date. In addition, equity holders can usually expect to receive a regular payment (or dividend) from the profits of the project. Equity may be private or public. Public

HYBRID INVESTMENT
In commercial settings, hybrid funding models have elements of both debt and equity, which means that the investor receives both a fixed return (similar to the interest returned on a loan) and a variable element (similar to the dividend received from holding shares). In development settings, hybrid funding models may instead have elements of both loans and grants.There are three particular hybrid models that are particularly relevant to ocean finance:• Conservation Trust Funds, which invest funds in low-risk investments and use the returns from these investments to provide grants towards conservation projects• Carbon credit schemes, where organisations purchase carbon credits from projects that are either sequestering or reducing GHG emissions• Debt-for-nature swaps, where a country’s foreign debt is reduced or cancelled in exchange for the country investing in the protection of its natural resources
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SDGs are the Global Blueprint for Investment Support. 

Project Building and Investor Help 

Here Government entities can find the necessary tools to help complete an application form and/or develop a proposed project, these employ a step-by-step approach, alternatively, you can also request a face-to-face meeting to walk you through the process.

Here investors can provide an outline of what and where their key interests are, and what they would like to invest in. 

751 EARTH has embedded as good practice a strong confidentiality policy, so clients can be assured that their interests are safeguarded at all times. 

Only when 751 Earth finds a match between stakeholder and investor will each be contacted with the relevant details and permission sought from both parties to progress to the second level.

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