TGIF, Agents of Impact! In today’s Brief:
- State of the Impact
- Five women who invest for social justice
- Impact-first venture fund for Mesoamerica
⚡ Plugged In: Tech equity in action. Google-backed Tech Equity Collective is working to double the number of Black developers in tech by 2030. Tech Equity Collective’s Rachelle Olden joins ImpactAlpha’s Sherrell Dorsey on the next Plugged In, Wednesday, March 13 at 10am PT / 1pm ET / 5pm London. RSVP today.
Contradictions. “Nevertheless, they persist,” ImpactAlpha’s Jessica Pothering wrote of female fund managers on our International Women’s Day Liist of actively raising funds. Women-led companies and asset management firms continue to raise less than 2% of invested capital worldwide, yet studies suggest women-led firms outperform, providing impact alpha for LPs who buck the prevailing trend. Dennis Price reported from Mérida, Mexico on impact investors’ optimism and urgency about Latin America’s future and restarting the region’s stalled progress on the Sustainable Development Goals. The (possible) advent of artificial general intelligence has made Elon Musk an unlikely (and perhaps unreliable) ally in corporate-governance efforts to steer major AI companies to the public good, as B Lab’s Andrew Kassoy wrote. And impact investors like Kapor Capital’s Brian Dixon are finding ways that AI can lower the cost and broaden access to quality, personalized education. (ICYMI: “These VCs are betting on AI to upskill workers”). “This is the moment we’ve been waiting for,” Dixon said on a panel kicking off SXSWedu in Austin.
This week’s 900-page rule on climate disclosure, finalized by the US Securities and Exchange Commission, is a study in contradictions. “The markets demanded clarity, comparability, reliability. The SEC has delivered confusion, subjectivity and an unfair marketplace,” wrote Climate Finance Fund’s Marilyn Waite. Yet the rules also level-up corporate disclosure of transition costs and physical climate risks, and may yet advance efforts to establish true emissions accounting, as Andrea Riquier and I reported. Kataly Foundation’s Lynne Hoey explored the contradictions of working within extractive financial systems in order to transform them. “If we are being honest with ourselves, we know that there is no completely morally sound way to use the tools of an inherently racist and unjust system,” Hoey said.
In his State of the Union address last night, President Biden acknowledged the inevitable contradictions in social policy and social progress. “In thousands of cities and towns, the American people are writing the greatest comeback story never told,” he said early in the speech. He closed with a shoutout to equality and justice for all. “We’ve never lived up to those ideals, but we’ve never walked away from them either.” – David Bank
The Week’s Agents of Impact
Five women who invest for social justice. Everyone in the impact investing ecosystem has an impact origin story, a moment that pointed them toward business and finance as tools for social change. On this International Women’s Day, we’re pleased to share important moments in the lives and careers of five women in impact investing, in their own words. The stories are excerpted from “The Social Justice Investor: Advance Your Values while Building Wealth,” by Andrea Longton. Pre-order the book and RSVP for the April 23 launch party at LISC’s headquarters in New York.
What’s your impact origin story? Share it with us by replying directly to this email.
- Beth Bafford of Calvert Impact Capital reflects on her choice to turn down a lucrative job at an investment bank to volunteer for the presidential campaign of a not-so-well known senator from Illinois. Read more.
- Rachel Robasciotti of Adasina Social Capital shares how her personal connection to the Black community in the floodpath of California’s Oroville Dam changed her thinking about racial and climate justice. Check it out.
- Lakota Vogel of Four Bands Community Fund recalls playing Monopoly as a kid, and reflects on the board game in the context of Native American economic empowerment. Pass Go (and collect $200).
- Tanay Tatum-Edwards of FreeCap Financial recounts a conversation at an uninspiring conference that opened her eyes to the internalized ways she was holding herself back. Lean in.
- Sonya Dreizler of CHOIR tells the story of making an important speech about privilege and racial justice before hundreds of her peers. Read on.
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The Week’s Short Signals
🚚 China’s clean trucks. Electric and hydrogen-powered models nabbed 16% of light commercial vehicle sales in China in December, and 10% of large truck sales, defying the narrative of an EV slowdown. (Bloomberg)
👩🏿🌾 Benchmarking small business lending. Bank lending in East Africa to small and mid-sized agri-businesses has grown three times faster than overall lending in the region, helped in part by first-loss protections and other incentives. (Aceli Africa)
💯 All in. Compton Foundation will spend down its assets by the end of 2025. In a new report, the foundation details how, with help from advisor Sonen Capital, it is channeling 100% of the foundation’s remaining assets to addressing inequities. (Compton Foundation)
- Also see, “California Endowment goes ‘all-in’ on impact.”
🌟 African climate stars. Kumulus creates water from air in Tunisia. Complete Farmer streamlines smallholder agriculture supply chains in Ghana. Egypt’s NoorNation offers off-grid clean energy and water. The companies are among “26 African climate tech startups to watch.” (Climate Hack Weekly)
👩🏻💻 AI abundance. Venture capital firm Andreessen Horowitz lists dozens of AI productivity apps that could reduce administrative costs for small businesses to zero, “allowing them to dedicate more time to their specific craft.” (Andreessen Horowitz)
The Week’s Dealflow
Deal spotlight: Impact-first venture fund for Mesoamerica. ImpactAlpha last month launched a specialized newsletter to report on the impact ecosystem in Latin America and the Caribbean. This week, Costa Rica-based impact investor Atta Impact Capital launched an early stage fund to invest in “missing middle” social enterprises in the region spanning central and southern Mexico, Guatemala, Belize, El Salvador and parts of Honduras, Nicaragua and Costa Rica. The Mesoamerican Catalytic Fund was seeded with a $1 million in recoverable grants from IDB Lab and Costa Rica-based Fundacion CRUSA. “The entrepreneurial ecosystem in our region has enormous potential to grow and the opportunities are immense,” said IDB’s Irene Arias.
- Innovative finance. Over three years, the fund will write equity and quasi-equity checks in up to 10 social enterprises, half of them led by women. A redeemable equity structure will allow the fund to exit to its portfolio companies, enabling founders to “buy back their shares over time at a predetermined price or using a formula for valuation agreed upon ahead of time,” Atta Impact’s Abigail Napsuciale told ImpactAlpha.
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Affordable housing. Catalyst Opportunity Funds provided $56 million for a mixed-use development in Salt Lake City.
Circular economy. Online second-hand clothing market Vinted, based in Lithuania, acquired Danish peer Trendsales.
Climate finance. Athens-based Hellas Direct raised €30 million for climate insurance in Europe from the European Investment Bank, Endeavor Catalyst and the IFC… Carbon Equity raised €100 million for a climate tech fund of funds… Warc raised $7.5 million for regenerative agriculture in West Africa (video).
Green transport. LanzaJet secured $30 million from Southwest Airlines for sustainable aviation fuel… San Francisco Bay Area’s Range Energy raised $23.5 million to decarbonize commercial trucking with electric-powered heavy-duty trucks.
Energy transition. The OPEC Fund provided a $150 million policy-based loan for Colombia’s climate action policy and energy transition program… Enviria, a German solar startup, raked in over $200 million from BlackRock… Geothermal producer Fervo Energy raised $244 million to meet demand for clean energy… German green hydrogen producer Sunfire inked €315 million in equity and debt… InSolare clinched 660 million rupees in growth funding… Mexico’s Niko clinched $3.3 million to finance and install rooftop solar for homes and small businesses.
Economic inclusion. SDS Capital Group made a $17.5 million New Markets Tax Credit allocation to Bongards Creameries, a Minnesota-based farmer-owned co-op that will create up to 260 full-time jobs in low-income communities… Stepful scored $12 million to upskill workers for entry-level healthcare jobs… Adenia Capital acquired South Africa last-mile delivery platform The Courier Guy.
Inclusive fintech. Kenya-based fintech BFree snagged $3 million… Online lending app mPokket secured $60 million in debt to provide India’s young professionals and freelancers with access to credit… Wagely inked $23 million to help Asia’s workers with cash stability and financial health… Baubap inked $120 million to help underbanked Mexicans avoid predatory lenders.
Investing in health. Chilean healthtech startup Keirón raised $1.7 million to expand its digital medical records and “patient journey” services for healthcare providers in Mexico… J&J Foundation’s Impact Ventures backed CareAdvisors… MDaaS Global raised $3 million, led by Aruwa Capital.
Low-carbon transition. General Motors and Panasonic backed Canada’s Nouveau Monde Graphite for its green graphite production process… Denmark’s Investment Fund for Developing Countries invested $8 million in India’s Smart Joules to provide energy-efficient cooling for data centers, pharmaceutical manufacturing facilities and commercial offices.
Water and sanitation. Gates Foundation seeded Africa Water Facility with a $6 million grant for urban sanitation.
The Week’s Talent and Jobs
Zee de Gersigny, formerly with the Collaborative for Frontier Finance, joined FSD Africa as investment head of venture and early stage financing vehicles. Susan de Witt departed CFF to pursue a PhD in nature and biodiversity finance in Africa at Stellenbosch University… Opportunity Finance Network hired Brendon Miller, previously with Washington Area Community Investment Fund, as executive vice president, chief of staff and head of communications.
At Reach Capital, Caoimhe MacRunnels joined as a senior associate, and Gloria Liu and Demetrius Palmer joined as analysts… Simone Balch, formerly with Cambridge Associates, joined Sonen Capital as chief growth officer… Steven Novick, previously with Coller Capital, joined BlueEarth Capital as a senior adviser… Sayuri Nonaka, a former principal at Universal Materials Incubator, joined Pangaea Ventures as director for Asia.
McKnight Foundation hired Muneer Karcher-Ramos, previously financial empowerment director for the city of St. Paul, Minn., as its program director for vibrant and equitable communities… Cambria Allen-Ratzlaff, previously with JUST Capital, and Rose Easton are named chief responsible investment ecosystem officers at Principles for Responsible Investment… John Biagioni of Lampin Corp. joined Massachusetts’ employee ownership advisory board.
💼 See and share the week’s impact jobs. View dozens of other jobs on our new job board. Want to post a listing? Submit it here.
That’s a wrap. Have a wonderful weekend.
– March 8, 2024
