100+ creative economy investors, Omidyar’s simple complexity, microfinance in Pakistan and Mexico, Clarmondial’s food fund



Greetings, ImpactAlpha readers!

Featured: ImpactAlpha Original

Hiding in plain sight: More than 100 funds that are investing in the creative economy. If you think “arts and culture” when you hear “creative economy,” you’re not thinking big enough. Think creative places, ethical fashion, impact media, sustainable food and other creative businesses. The creative economy is a $768 billion market in the U.S. alone, where it accounts for 10 million jobs. “The more we look, the more we find,” says Laura Callanan, founder of Upstart Co-Lab, an artist/entrepreneur/investor collaborative. “It seems clear that a creative lens is a good way to be looking for investment opportunity.”

Some investors are embracing the investment thesis directly. The new NYC Inclusive Creative Economy Fund, launched by the New York office of Local Initiatives Support Corp., has raised $2.5 million of a targeted $10 million for investments in affordable work spaces for the city’s creatives. Many other investors also have stakes in the creative economy, sometimes without even knowing it. Upstart Co-Lab’s new report, “Hiding in Plain Sight,” catalogs 107 funds that either explicitly target a sector of the creative economy or have made at least two investments in creative economy ventures. LISC, for example, scanned its national portfolio and found 98 projects related to arts, culture, and creativity representing $139 million in direct lending volume. The new fund, LISC NYC’s Sam Marks told ImpactAlpha, is a “more intentional version of what LISC was already doing.”

Read, “Hiding in plain sight: More than 100 funds that are investing in the creative economy,” by Dennis Price on ImpactAlpha.

ImpactAlpha Series: Measure Better

Customer survey data that makes it simpler to embrace the complexity of impact investing. Jessica Kiessel believes that social policy should be subjected to the rigors of randomized control trials. But such rigorous trials, which compare groups that receive an intervention with a control group are often not feasible or appropriate. “We have limited impact data that rolls up to the portfolio level,” says Kiessel, the head of learning and impact at Omidyar Network. What’s she to do? ImpactAlpha’s Measure Better series, produced in partnership with Acumen, has tried to assess Acumen’s Lean Data approach to impact measurement, in which trained call-center operators reach out to real customers. “Just talk to the people,” Kiessel says. “It’s not a perfect solution. It doesn’t fit everything. But its simplicity is reassuring.” ImpactAlpha caught up with Kiessel to take the measure of impact measurement.

Dealflow: Follow the Money

Today, it’s all about inclusive finance.

Tez Financial Services raises seed funding to serve Pakistan’s unbanked. The Karachi-based startup is a digital microfinance lender serving the nearly 100 million Pakistanis without a bank account or access to formal financial services. Tez provides a range of services to Android mobile users, including fast loan approval, short-term savings accounts, and access to health and life insurance. It has raised $1.1 million from Omidyar Network, Accion Venture Lab, and Planet N. Read on.

Incofin commits $10 million to Mexico’s Financiamiento Progresemos. Mexico City-based Financiamiento Progresemos is a non-bank financial institution that serves Mexico’s micro- and small- entrepreneurs. It has built a loan portfolio of $115 million and served 120,000 borrowers—80% women and 90% rural—in 22 Mexican states. Belgium-based Incofin, a $1 billion impact asset manager, is backing the company with $10 million through two investment initiatives. Dive in.

USAID backs Food Securities Fund with $37.5 million guarantee. The Luxembourg-based Food Securities Fund is a blended-finance initiative of investment advisory firm Clarmondial. The fund offers affordable lines of credit to agricultural producers in emerging markets to encourage sustainable agricultural practices. USAID’s guarantee will reduce risks to investors in the fund’s target $150 million portfolio. Learn more.

Please send deal news and tips to dealflow@impactalpha.com.

Agents of Impact: Follow the Talent

Lisa Hamilton, who has been executive VP at the Annie E. Casey Foundation, is the foundation’s new presidentCindy Holle is the new CEO at Community Housing Capital… Eric Stephenson, portfolio director of Cordes Foundation, moves over to Align Impact as director of client services, and up to co-chair of the foundation… Cheila Fernandez joins the Reinvestment Fund as chief compliance and risk officer.

October 23, 2018.

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