Adam Torres and Dan Carol discuss the Milken Institute Center for Financial Markets.
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Show Notes:
The Milken Institute’s Center for Financial Markets works with local governments and stakeholders to foster best practices in public investment. In this episode, Adam Torres and Dan Carol, Senior Director of the Milken Institute Center for Financial Markets, explore the Center for Financial Markets and also the Milken Institute Global Conference 2023.
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About Dan Carol
Dan Carol is a senior director in the Milken Institute’s Center for Financial Markets and leads Institute programming on climate-resilient infrastructure and public finance. Carol’s portfolio expands the Institute’s work with local governments and stakeholders to foster best practices in public investment, accelerate deployment and financing of community-scale and resilient infrastructure, and scale up regional innovation and the use of public-private partnerships, including impact capital, climate finance and ESG, public pension fund engagement, and Opportunity Zones. Prior to joining the Milken Institute, Carol worked for Governors Jerry Brown and Gavin Newsom of California, directing the state’s Opportunity Zones working group and serving on the Executive Committee of the US Climate Alliance, a bipartisan alliance of 24 states implementing the Paris agreement. Before that, Carol served the Obama Administration as a member of the US Department of Energy State Energy Advisory Board and led efforts to create the West Coast Infrastructure Exchange, a 2015 winner of the Harvard Ash Center award for government innovation
About Milken Institute
The Milken Institute provides equal employment opportunities to all employees and qualified applicants without regard to race, color, religion, sex, sexual orientation, gender identity, national or ethnic origin, age, disability, or status as a veteran.
Every person at the Milken Institute is treated with respect, supported with resources and training, and exposed to a broad range of experiences. They foster a space for growth with opportunities to share knowledge and passion with both clients and colleagues. Milken Institute are committed to building a diverse workforce and creating an inclusive environment where people can thrive. Our leadership is committed to diversity and inclusion, and fostering a culture that creates opportunities for everyone.
Full Unedited Transcript
Hey, I’d like to welcome you to another episode of Mission Matters. I am so thrilled and excited to be covering the Milking Global Conference 2023 and today my guest is Dan Carroll. He is the senior director of the Milkin Institute Center for Financial Markets. Dan, Welcome to the show. Great to be here.
All right, Dan, so we got a lot to cover today. First off, I know that the financial pillar of the Milkin Institute is growing and you’re the guy I wanna talk to about that and some of the initiatives. We’re also going to get into some of the highlights or the moments that you recall the best out of the MILKIN conference so far.
Talk a little bit about your background and how you got started as well with Milkin and the Milkin Institute. Sure. But to get this episode kicked off, we’ll start it the way that we start them all. With what we like to call our mission matters minute. So Dan, we at Mission Matters. We amplify stories for entrepreneurs, executives, and experts.
That’s our mission. Dan, what mission matters to you? What mission matters to me, other than being a, a good family member and, and friend who all folks I deal with in my life at work, we’re trying to accelerate the deployment of climate resilient infrastructure. Through public-private partnerships that link together communities and public capital, muni bonds, private capital impact capital to deploy more projects to create jobs, build us competitiveness, address the climate issue, and in particular, work with thousands of underserved rural and urban communities that find it harder to access grant programs, loan programs, and get in front of investors like those in attendance here at milking this week.
Oh, that’s great. Love bringing mission-based executives on the line to share why they do what they do. And one of my goals, as we talked about, and as everybody that’s been watching this series should know, is I want to create more awareness around the Milk and institute, of course, this conference, and really just the milkin magic that you walk through the corridor as you walk through the hallways that we all get caught up in, in my opinion.
How did it all start for you? Like how did you discover the, whether it’s the institute or the conference, like where did all that begin for you? Well, I’ve worked both in the public and private sector for a number of years. Maybe about 10, 12 years ago, I was involved in one of the financial innovation labs that we do here and now those, some of those folks are colleagues.
This is where cross-sectoral leaders come together trying to solve a problem about how you might finance new forms of infrastructure or healthcare or other. Other policy meets finance, meets technology, those sort of three legs of the triangle. And then I guess about four years ago I was wrapping up the work I was doing for Governor Jerry Brown and Governor Gavin Newsom.
I was leading work as the senior advisor for infrastructure and energy, but also had taken on the role of being the state’s lead for the implementation of the Opportunity Zones program. This was a new source of impact capital. That Senator Corey Booker and Tim Scott on a bipartisan basis had brought forward.
And at the time, folks from the Milken Institute were essentially on the other side of the table figuring out how to deploy capital, how to structure deals. And I was the state guy on the other side of the table. And as I was talking to them, one thing to led to another, like whatever weird cross-sectoral partnership stuff you do, come do it over here.
So that’s how I got over here. It’s a great story. And one of the other things that I like to do is I want others that are, you know, in industry and that are in corporate America, that have maybe heard of Milkin or the institute. I’m, one of my other missions is to make sure that more people get involved.
So if you’re talking to those corporate leaders out there for a moment or two that are, that have, you know, kind of heard of it, have kind of been like, ah, should we attend? Should we not Like, like what does, what does that look like? My involvement? What kind of things would you tell them? I think the first thing I would tell them, I, I love this quote from general Dwight David Eisenhower.
From World War ii, which was, if you face an intractable problem, make it bigger. Mm-hmm. I think that sort of applies to how we try to solve problems here. I mean, we have a lot of frustrations, system failure, institutions that aren’t working. Hmm. And so thinking about big, hairy problems and how to approach them in a new way, whether it’s.
The work of our chairman and Esther Crok on faster Cures over the last 20 years. And most recently, what the big hairy problem that we’re tackling at the Milken Institute is, you know, we’re gonna need probably 27 trillion in additional private capital to flow into. More energy efficient wastewater treatment, plants, buildings, new technology for climate tech, as well as protect existing neighborhoods and communities and projects from being flooded or burned out, et cetera.
So how do you do that at a time when public dollars are flowing but not always flowing in the way that you want? I, I joke sometimes there’s a lot of money flowing from the inflation reduction act. Mm-hmm. But because of match requirements, et cetera, so lot of. Machination to figure out what are the new piping to drive capital and build these complicated public-private partnerships.
I, I joke cuz my wife looks at me, I’m like, what exactly you do? I say, well, I’m doing the infrastructure of infrastructure. And then also I’ve made up a pint glass that we hand out called Deploy or Die because the deployment. Of the federal dollars and the the private dollars that we have to do to upgrade our energy systems and really be competitive as economy, as well as partner and help other communities around the globe is, you know, takes a little bit of big hairy problem solving.
Can you talk a little bit about the, maybe center for financial markets or just the financial pillar in general? Yep. Of Milkin and, and really what you do. Yep. So we have, within the financial pillar at Milkin, there’s several major programs. So there’s an inclusive capitalism and d e I program led by a colleague, Blair Smith.
We have our Financial Innovation Labs team led by another colleague, Caitlin McClean, who was the first person I met at Milin, and is, is still just doing great work. We have a retirement security effort looking at the new Jobs Act and other ways to promote financial literacy and savings over the next number of decades.
And then the work that I do. Is called the Climate Resilient Infrastructure Initiative, where we’re looking at how we, you know, there’s a certain amount of public dollars that can go to this stuff, but a lot of the infrastructure debate tends to be focused in on what is Washington doing. Mm-hmm. And is there federal dollars flowing?
But in fact, Over two thirds of infrastructure is funded at the local level. Mm-hmm. By either muni bonds or private infrastructure. So making sure that all those pieces fit together at a time when you know we need less roads and bridges and more broadband and other new types of infrastructure. We’re moving towards more distributed models of smaller scale community scale.
Internet of things, driving new innovation, infrastructure sensors and wastewater treatment systems. A lot of nerdy stuff where AI meets climate. Mm-hmm. And that’s where we’re trying to help bring together technologists, finance experts, and policy people to really hit the sweet spot. So when we think about Milk and Institute and Mike’s directive for it being, you know, an action tank and something that we’re actually doing, like how does that concept of maybe being an action tank and infrastructure, like how does that relate?
Like, talk about the correlation. Yeah, so we are sort of working two sides of the problem. I forgot to bring, I’ve got a, a cartoon I sometimes use to try to explain this cuz usually got a cartoony brain. Come on. It’s in my, it’s in my bag. I’ll show it. I’ll show it to you later. But, you know, sometimes a picture is worth a thousand words, but I’ll, I’ll give it a crack.
So we have, you know, at Milin, for example, over $30 trillion in asset owners Mm. That wanna invest in infrastructure, but it, for them to look at projects below $200 million. Mm-hmm. It’s expensive. They need to move big chunks of capital, CalPERS and other major, you know, multi-billion dollar pension funds.
And so, The infrastructure conversation for them is they tend to be looking for like Hoover Dam scale. Yeah. Utility scale, solar and wind. And there’s not that many of those projects. They come along slowly. We’re working on Permiting innovation to speed that up, but basically they’re bidding up the price of those projects.
Yeah. And so we are trying to connect with them with, there’s thousands of. 20, 50, a hundred million projects, community, wastewater, treatment plants. There’s a thousand of ’em, for example, in the US that were built in the 1970s, three types of technologies. They’re the largest energy hogs in every community.
And so we’re looking to aggregate and bundle those projects together so that big scale investors, institutional investors, and underserved communities can meet in the middle. And everyone can get what they want, which is investing in US infrastructure. Particularly, you know, a lot of European investors are interested in French shoring and Nearshoring, all that sort of stuff.
So we’re in the middle of this, this mashup, and we’re trying to basically reduce acquisition costs around that in a number of ways. Yeah. So Dan, first off, I feel like I’m getting to know the team. I had some of your colleagues on the show, Caitlin, Emily. Yeah. So I’m of those guys, I’m getting. Absolutely.
It was a, it was a joy having them on and I asked them the question and I’ll also ask you, putting you on the spot, so I, I know that the the conference isn’t over yet, but so far what’s been one of your most memorable or favorite moments you care to share? Say the most memorable moment so far is, so Senator Joe Manchin has been here for a couple days.
It’s an interesting time for him. I, there’s a new announced challenger in his Senate race in West Virginia. There’s also rumors he may run as a third party candidate, and so you know, he’s, A politician trying to figure out reelection. You know, he’s done an amazing amount of work over the last eight to 10 years on energy with Lisa Murkowski, the senator from Alaska.
But right now I think he’s trying to position himself and it was funny, yesterday there’s a big session with Darren Woods. Who is the CEO of Exxon, who basically said the Inflation Reduction Act and the 369 billion of carrots and long-term incentives. He’s excited about carbon reduction, investor certainty, and Joe Manchin.
You know, cuz he is in West Virginia was a little like, eh, I got some issues with this. So basically, you know, Darren Woods, the CEO of Exxon, is more excited about a climate bill than Joe Manchin. It was just kind of, I don’t know whether it’s a Milkin moment, but an interesting moment in front of a lot of investors who are excited, I think.
On all of the above, whether it’s carbon credits mm-hmm. Carbon storage, you know, c Cs and renewables that you’ve got the CEO E O of Exxon, like I’m all in. And Joe Manchin’s like, well, maybe harder to get reelected. I say, I’m all in, so I’m con in. So I, I was getting a kick out of that. That is a milkin moment, and that’s, I’ll argue, that’s one of the reasons why people that are thinking about attending and haven’t like, yeah, you want, you wanna be here.
This is where decisions are happening, deals are being done. And really I feel like great ideas that need to be spread. I think some of these rooms you get together, some of these meetings, like there’s just. Panel after panel of brilliant people that ha are bringing their best ideas, what they’re working on.
I know we heard a, a little bit about the MAE Prize and like what they’re doing there and just all these other, or awards, excuse me, and all the other things that are happening like there. To me, there’s true innovation and that is part of the whole idea of action and what’s happening here at as an, at this action tank, right?
No, a hundred percent. And you know, the, you pick an issue like infrastructure and climate. I mean, right now, The word energy transition everyone’s talking about, we all agree we need to transition. Yeah. From where we are to somewhere else, but it’s also, you know, it’s almost like a Roark ink plot right now.
It’s very active discussion. Everyone thinks and says it the word en energy transition, but they often. Mean different things. Mm-hmm. So we had, one of the things we do in addition to the public sessions where you can see, you know, UMMA Thurman talking about micro psychedelics or whatever down the hall, be talking about, you know, public private partnerships.
We had a private session yesterday where we get people in a room in Chatham House to actually really problem solve. So yesterday we had a great discussion with folks from the oil and gas industry, NGOs and institutional investors. Like, how do we get clear about this? How do we actually stage these changes over time in a way that is.
Recognizing that we’re not gonna get rid of oil and gas and legacy systems overnight, but we’re gonna have to move more intelligently moving forward. And whether it’s transmission permitting, how do we actually fix these problems? That, that’s is one of the attractions for me both as somebody who’s working in the private sector and government to be able to have that.
That witches brew, if you will mm-hmm. Of cross-sectoral leaders that come at with different perspectives and try to make some specific steps out of it. Yeah. I had had Bill on the show, and we’re not gonna talk about Bill talking about banks, but if you watch the previous episodes, you already know we got a little flavor of that one.
So nice. These are I, I think they’re fun. I think they’re memorable and meaningful moments. And I think, again, the whole point in, in executing on the mission and really. Progressing ideas that need to be heard are happening, which is, is what this is all about. Well, Dan, I have to say, first off, thank you for coming on the show today.
For those that are watching and listening and if they wanna learn more about, you know, the financial pillars of Milkin or just hooking overall and to follow the work, I mean, what’s the best way that you say people can get involved? I would love for folks, we have a, a website called 10,000. It’s called the 10,000 Communities Initiative.
So you go to 10 k communities.org. This is actually a place for whether underserved communities. You’re a project developer, you’re a funder, you’re impact investors. Chance to plug in. We BA basically built a matching platform. So if you’re, you wanna sponsor a project, whether it’s a water project, energy project, housing, and you’re looking for capital or expertise, you can go there.
We’re working with partners, you can actually sign up your project. Wow. And we’re trying to basically, you know, do a dating service between communities that have projects but don’t know how to build them with experts and capital providers that might be able to help. So some people will match and get a date.
Yeah. Others will take longer. But we have this 10,000 communities initiative that, that we’re rolling out as a way to really help link mm-hmm. High scale investors with communities in high need. That’s amazing. And one more time, the, the website one more time. 10 k communities.org. But I think if you go to 10,000 communities.
Initiative or 10,000 Communities initiative, but there’s something called Google, I believe, where you might be able to find it. And for our audience too, we’ll be putting all that in the show notes so that, you know, you can just click on the links and maybe even the cartoon too. Oh, I got it. Yeah, the cartoon.
The cartoon will be on TikTok. So you’ll, that more to come there. Well, Dan, again, pleasure coming on the show. I know that you, you’ve been busy, busy at this conference back to back, and so we really appreciate you making time for us and the Mission Matters community. So thank you. Appreciate you. Thanks.
