Thought Leader Spotlight - Tracy McKibben

Fatimah Gilliam Founder, and CEO The Azara Group

September 05, 2017

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1. What attracted you to your chosen field and profession?

As a child, I knew I wanted to become a lawyer. That was always my dream. The energy sector has been a part of my entire professional career. After clerking for a judge after law school, I went to a law firm where I worked closely with a partner who had many energy clients, including in Central Asia. I began developing expertise and global contacts in the industry. Energy quickly became a strong theme, but I worked on a broad range of matters.

Through my work and relationships, then Secretary of Commerce Don Evans offered me a position at the U.S. Commerce Department. His priority was to improve bilateral relations with Russia, focusing on efforts with major CEOs of oil and gas companies. Working on international commercial and trade issues, I supported his efforts with Russia and Central Asia. My work on Russia also involved significant inter-agency discussions within Government.

Then Condoleezza Rice, who was the National Security Advisor at the time, offered me a role at the National Security Council (NSC) to focus on the European economic portfolio, including international trade, energy, and aviation. At the NSC, I oversaw a key dialogue with American and European CEOs. I facilitated discussions around climate change and clean technology in Europe and the U.S. with multinational CEOs. The U.S. co-chair was from Citigroup, which led to my joining Citi as the Head of Environmental Strategies. I helped start an alternative energy group at Citi since the company was committed to investing $10 billion in this space.

Clean, renewable, sustainable, and alternative energy has been a running theme with my work. As an international energy and clean technology expert, I run an investment and consulting company that brings together investors in structuring and financing energy deals. My company has acquired, developed, and financed global renewable energy assets over 200 megawatts. Much of what I've been able to accomplish during my career started with working on energy transactions and expanding my network with key strategic business leaders. I love what I do.

2. What person, opportunity, or game-changing moment had the biggest impact on your career?

The biggest game-changer really was moving from the legal profession to the policy world. I never expected to be a non-practicing attorney, but being a businesswoman curating global clean energy deals with investors suits me. My legal training has served me well during my career, it's given me a different perspective when solving problems and analyzing situations. I didn't have any plans to go into the government, but it opened up new opportunities for me.

My government positions exposed me to sectors beyond energy, like aviation and steel. I also got to work at the intersection of business and government. I began to see that I could accomplish more and have a broader career outside of the legal profession. While I was at Citi, increasingly I wanted to focus more on renewable energy. I left Citi and start my company in 2010. The timing was challenging, with limited access to capital for renewable energy.

It was difficult since energy is a capital-intensive industry. Even though we were in the midst of a global economic meltdown, I still wanted to focus on renewables. I had to get creative to help companies grow in this sector, working with private equity firms, family offices, and wealthy individuals. I knew I couldn't raise funds through traditional investment banking mechanisms. I helped raise capital to fund deals. And renewables, solar, wind, clean technology, and water recycling, require special and unique attention. Renewable investing is a long-term commitment. It takes a special investor, one that's patient.

I knew that if I could reach the right investors, starting my business would be a great opportunity for me and any investors. My intuition was right. I've been able to grow a business from scratch, we've done profitable deals all around the globe, and we've returning value for investors. We've proven our concept and my company is flourishing.

3. What is the biggest challenge you faced professionally? How did you overcome it?

Convincing people to invest in this space has been the hardest challenge. In 2010, a lot of companies in the energy sector were failing. People were not knowledgeable about what renewable energy, really meant, and renewable energy was seen as heavily dependent on government subsidies. The hurdle was getting people to understand there could be attractive returns like with other investments. However, they would need to be patient since it's a longer-term investment. If they could be a long-term holder, then they could eventually get attractive returns.

My first big client was a European utility that wanted to expand in this space. I had served on the board of an organization in the Ukraine, and my first client came through this experience. Another early client was a geothermal company that I knew through my network. I started with these clients, and I had relationships with private equity firms and high net worth individuals.

Back then, not a lot of people were willing to risk a lot of capital. Investors were also hesitant since it was unclear what would happen with government subsidies. It's still not an easy sector, but it's gotten better. There are more institutional investors now who focus on sustainable and impact investing. We were able to prove, by taking a strategic approach and delivering results, that people and firms should invest in our projects.

4. What tools or tactics do you rely on in being a more effective leader and team member?

I try to be a good partner with my team and those I collaborate with externally through joint ventures. I build strategic relationships with people and companies. With my team, I make sure they understand my vision for the business, and I provide leadership so they develop the confidence to commit to and believe in it. This is how they can execute on it.

I also communicate regularly. I want people to feel successful and have a stake in creating the bigger picture. Even with younger associates, I give them exposure to different transactions and grow their level of involvement. My company isn't large so we have fewer bodies than some other companies. This means people have to chip in more, but they also learn more. They get to see the impact of their work, they have greater responsibility than they would in a larger company, and I give them as much exposure as they can handle as they strive to deliver for investors.

In the U.S., we have five people. Depending on where we are with certain projects, we have 10 to 20 people in Europe. Through a joint venture with an Engineering, Procurement, and Construction (EPC) partner where we build wind farms, we indirectly have another 10 to 20 people depending on the construction phase.

5. Share a story about an interesting or difficult negotiation and how you were able to gain more influence and leverage as a result.

A good example is with one of my key investors, a European private equity firm. They were in the technology space but not the clean energy space, and the model they used was not the best for the types of projects that my company develops. I wanted to bring them on board, and naturally they were somewhat hesitant at first. I started incrementally with them by getting them involved in a small project. It was a 10 megawatt project for them to test out and see how my company executed. I wanted to turn them into a long-term investment partner.

I was flexible with how I brought them in. They weren't investing in a fund and paying management or performance fees. They could invest directly in the project, and were equity holders. I set up a flexible model with the goal of landing that long-term relationship since they had the capital to support my company's growth portfolio.

I provided them with early information, more than what was customary, including information on regulations. The core of the negotiation was to figure out how to get them comfortable with my approach to business so they'd invest in the portfolio. Through proving results for a longer-term play, the relationship strengthened. I wanted to get their investment back to them to prove we could deliver returns. This was the first of additional deals with them.

Today, my company only does utility-scale projects that are at least 10 megawatts, and range in value from $20 to $200 million.

6. What do you see as your unique value proposition and how has your personal background prepared you to excel?

It's a combination of many things. I went to Harvard Law School, and don't work in a legal capacity. My legal training and experience informs my thinking and my process for analyzing situations. I rely on my unique perspective in building projects, how I put together fact sets, and how I run my business.

I'm also used to working hard as a black woman and a businesswoman. I've always had the expectation that I would have to work hard for what I wanted. I make myself available to speak to investors at any time. I appreciate the value of hard work.

I also come from a large family, which made me appreciate all kinds of views and personalities. I have 13 siblings. In a big family, you learn how to manage different people and navigate relationships.

7. What is your proudest achievement?

I'm very proud of having built a successful company that can build renewable energy projects and deliver attractive returns. I was going to be a lawyer, but now I'm a businesswoman. I'm proud to be at the helm of running MAC Energy Advisors, and that we continue to grow.

I've grown a global business that started in Europe. We have deals and projects in Africa and Asia, and we're expanding our presence in the United States, Canada, and the Americas. I've carved out a successful professional path that's enjoyable and financially rewarding, and where I'm steering my own course.

Opinions expressed by the author are not necessarily those of WITI.

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