The Brief: Women’s economic power in Latin America

Greetings Agents of Impact!

In today’s Brief:

• Gender lens investors gather in Buenos Aires
• Lighting the way to affordable cultivated meat
• Digitizing small-business banking in Tanzania

Overheard: GLI Forum Latam

In Latin America, investors see economic opportunities through a gender lens. The abandoned Don Pedro de Mendoza Power Plant in Buenos Aires’ La Boca neighborhood has been revived as a cultural hub and “arts powerhouse.” Under the sky-high ceilings and towering arches of the Usina del Arte, Latin America’s gender-lens investors gathered last week at the GLI Forum Latam to unlock the value of another underutilized asset: Women. In the pursuit of women’s economic empowerment, “Pro Mujer will not yield,” declared Pro Mujer’s Carmen Correa to open the forum. “I will personally not yield, either.” On the gender-lens agenda: More women in leadership roles, more gender-smart fund strategies and more financial innovation to bring more women into the formal economy. Pro Mujer, which tapped the public bond markets in Argentina twice last year, is moving to issue new gender bonds in Bolivia and Nicaragua, Correa told ImpactAlpha. “Set your own agenda, or someone else will set it for you,” Correa said, citing Melinda French Gates.

• Gender plus. Fund managers in Latin America are looking for impact alpha at the intersection of gender and health, the care economy, workforce, and climate. Bogota-based EWA Capital, led by Patricia Saenz, is nearing the close of its gender-smart tech fund to address socio-economic inequality. Circulate Capital is bringing a gender lens to recycling and other circular economy deals through its new $66 million strategy in Latin America. Canadian fund manager Deetken Impact is readying its sixth impact fund to advance gender equality and climate action in Latin America and the Caribbean.
  
• Institutional shifts. After backing Denmark-based Unconventional Ventures and US-based Supply Change Capital, Heading for Change is on the hunt for Latin America-focused managers investing at the intersection of climate and gender. The gender-climate nexus “is about mitigating risk and looking for opportunities,” said Heading for Change’s Sana Kapadia. US International Development Finance Corp.’s Elizabeth Boggs Davidsen said almost half of the DFC’s investments now align with the 2X Initiative’s criteria for gender lens investing. The $20 million Linked Foundation, which will complete its spend down strategy next year, has added New Ventures’ Empodera fund for women’s health to its portfolio of catalytic investments in women’s health funds and social enterprises in Latin America.

• Growth market. Google.org has backed Pro Mujer with $10 million and named Correa one of seven of global “leaders to watch.” Visa Foundation has provided $3 million to the social enterprise. Other companies also are looking to local gender-lens investors to reach women as customers, clients and business owners. “With the digital revolution, it is possible communities are left behind,” said Visa Foundation’s Payal Pathak, who was joined by Samantha Hennessey of Google.org, Laura Reyna of TikTok and Guadalupe Marin of the Latin American e-commerce platform Mercado Libre. “We need to make sure we’re accessing communities with these tools so they’re not left behind.”
  
• Keep reading, “In Latin America, investors see economic opportunities through a gender lens,” by Dennis Price. We round up all of our regional coverage each month in ImpactAlpha Latin America. Opt in at no additional cost.

Dealflow: Financial Inclusion

Prolific Machines snags $55 million to improve biomanufacturing of cultivated meats and medicines. Prolific Machines has wagered that the precision use of light can make cultivated fish, poultry and beef a low-cost, mass-market reality. The Emeryville, Calif.-based biotech startup raised $55 million to commercialize its photo molecular biology platform, which it claims can significantly reduce the costs of producing cultivated meats, pharmaceuticals and nutritional and therapeutic proteins. Prolific’s biomanufacturing platform has potential “to unlock profound impact in both human and environmental health across multiple industries,” said Komal Mistry-Mehta of Ki Tua Fund, the venture arm of New Zealand-based publicly-traded dairy cooperative Fonterra Co-operative Group. That includes whole cuts of cultured meat, antibodies to treat diseases, and other bio-manufactured solutions. The Series B round, which included convertible notes, was led by Ki Tua alongside Breakthrough Energy Ventures, Footprint Coalition Ventures, Mayfield, SOSV, Shorewind Capital, In-Q-Tel and family office Darco Capital, among others. 

• Lighting the way. Prolific Machines’ technology is a twist on optogenetics, which uses light to control the activity of living cells. The experimental field has been the domain of neuroscientists seeking to treat autism, drug abuse and depression. Prolific says its proprietary AI-assisted software, genetic tools and hardware platform can shape and influence “virtually any cell function in any cell type.” The company plans to license its technology to other companies to “more efficiently biomanufacture high-value bioproducts.”
  
• Get lit.

Selcom’s stake in Access Microfinance could spur digital small business lending in Tanzania. Access Microfinance Bank Tanzania started in 2007 to provide credit, savings and money transfer services to low-income earners and entrepreneurs. Digital payments company Selcom has acquired a 65% stake in the bank, along with its microfinance license, and will use its digital infrastructure to help Access Microfinance reach more underserved small businesses. “We started the bank based almost entirely on human, manual work assisted by very basic and ‘cobbled together’ technology,” Access Microfinance’s David James wrote on LinkedIn. The combination with Selcom’s digital capabilities will be a “game changer for the Tanzania banking sector,” he added. The bank is being rebranded as Selcom Microfinance Bank Tanzania.

• Digital leap. Tanzania has a robust microfinance sector, but small businesses have few accessible or affordable options for financing one they graduate beyond microfinance. The country’s CRDB Bank is one of the few mainstream banks to offer tailored small business financing via its SME Bidii loan product. A new fund from Accion is helping traditional micro and rural finance institutions upgrade their digital systems, similar to how Selcom is supporting AMBT.
  
• Check it out.

Dealflow overflow. Investment news crossing our desks:

• Zeal Capital Partners led an $8 million Series A round for women-led Rising Team, which offers online tools to connect remote teams and foster healthier work cultures (for background, see “Agents of Impact: Nasir Qadree.” (Rising Team)
  
• Brazil’s Kanastra raised $20 million from Kaszek, Valor Capital, Quona Capital, QED Investors and other investors to provide back-office infrastructure to fund managers, banking and credit providers. (Latam List)
  
• Climate advisory firm Pollination rolled out an early-stage fund for climate and nature-focused startups. It’s targeting $150 million and will focus its investments in Australia. (ESG Today)
  
• Aymium secured $210 million to produce biocarbon as an alternative to coal. (Aymium)

Short Signals: What We’re Reading

⛈️ Catastrophe risks. Issuance of catastrophe bonds has surged as insurers including Florida’s Citizens Property Insurance Corp. and Texas Windstorm Insurance Association seek to offload risk from natural disasters. Issuances hit a record $4 billion in May. But investors are nervous about the risks of warming oceans, an unusually active hurricane season and La Niña: Spreads on CAT bonds have risen by 23% in recent months. (Bloomberg)

📈 Record green investment. US clean energy and transportation investment reached $71 billion in the first quarter, up from $51 billion in the same quarter last year in 2023 and $41 billion in 2022. Financing for deployment of emerging climate tech such as clean hydrogen, carbon management and sustainable aviation fuel increased fivefold. (Rhodium Group)

💪🏼 Collective climate action. Some 43% of Americans believe that by working with others, they can affect federal government action on climate change, up from 38% in 2018. Such beliefs make people more likely to engage in climate activism. Groups with the strongest belief in the efficacy of collective action: Latinos, Blacks, Democrats, youth – and those who hear others talk about global warming at least once a month. (Yale Program on Climate Communication)

🚦 Slowdown for women-led funds. Women-led funds are on track to raise $2 billion this year, less than two thirds of the totals for 2023 and 2022. Hope springs eternal: Openseed VC (founded by Maria Rotilu, formerly of Octopus Ventures); Type Capital (founded by Terri Burns of GV, formerly Google Ventures); and Sarah Smith Fund (Smith is a former partner at Bain Capital Ventures) are among 18 women-led funds launched by first-time managers. (Venture Capital Journal)

🔌 Magnificent Seven. The surprising list of the seven countries that generate nearly 100% of their electricity from geothermal, hydro, solar or wind power: Albania, Bhutan, Nepal, Paraguay, Iceland, Ethiopia and the Democratic Republic of Congo. The International Energy Agency says another 40 countries, including Canada, Portugal and Brazil, are at 50% or higher. For the US, the figure is just under 21%. (Stanford University)

Agents of Impact: Follow the Talent

UBS names Jiayun Fang, formerly of United Overseas Bank, as Southeast Asia social impact lead… Solaris Energy appoints Nick Perugini as CEO, replacing Alex Blackmer, the commercial solar and storage developer’s founder, who will continue as president… Lissy Smit steps down as CEO of Aqua-Spark. She will be succeeded by Mike Velings, who co-founded the fund with Amy Novogratz. 

Local Initiatives Support Corporation, or LISC, appoints Sam Ruark, previously with Green Built Alliance, as director of Equitable Green Initiatives, LISC’s national green development program… The Robert Wood Johnson Foundation has an opening for an impact investing officer in New Jersey… Growald Climate Fund is hiring a senior associate in Brookline, Mass.

The Nathan Cummings Foundationis on the hunt for a grants and partnership team coordinator… JustFundis recruiting a client success senior manager… Quona Capitalseeks an investment analyst to join its Latin America team in Mexico City… Accessois looking for a remote director to oversee its market-driven agrifood programs in Latin America and the Caribbean.

👉 View (or post) impact investing jobs on ImpactAlpha’s Career Hub.

Thank you for your impact!

– June 11, 2024