The Brief | April 23, 2019

Advice for advisors recap, tilapia in Zambia, charter-school finance in Atlanta, accelerating impact in Latin America

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Greetings, Agents of Impact!

Featured: ImpactAlpha Original

Agents of Impact Call No. 8: Financial advisors spill their secrets of sustainable investing (audio). Financial advisors are transforming themselves into “agents of impact” to deepen their relationships with existing clients, build their book of business – or stay in business at all. “This is a retention and recruitment conversation,” Morgan Stanley’s Noel Pacarro Brown said on ImpactAlpha’s Call No. 8 last week. Nearly 200 subscribers signed up for The Call, which aimed to help advisors eager to start those conversations. State Street’s Brie Williams said many advisors aren’t proactive about speaking with their clients, despite research that suggests half of investors want their advisors to speak with them about investments screened for environmental, social and governance, or ESG, factors. Advisors need to be able to talk both about values-alignment as well as financial returns, said The Investment Integration Project’s William Burckart, co-author of “Fundamentals of Sustainable Investment,” a new guide for advisors. “It is useful to financial advisors to be open to facilitating the conversation either way, or with a mixture of both.”

A frustration for some advisors: continuing resistance from their home offices, which are gatekeepers for the investment products financial advisors can recommend to their clients. Clients are eager to apply to their financial portfolios the same conscious considerations that “sent them to Whole Foods or to Patagonia, said Mark Sloss of Regenerative Investment Strategies. “This isn’t just ‘a thing’ but a megatrend.” Home offices will find that the pressure from financial advisors and their clients will only get louder, Burckart said. “You are operating at your own risk if you are a home office and not providing those resources.”

Keep reading, “Agents of Impact Call No. 8: Financial advisors spill their secrets of sustainable investing (audio),” by Jessica Pothering on ImpactAlpha, and listen to the audio replay of Agents of Impact Call No. 8.

Dealflow: Follow the Money

Sustainable tilapia farm in Zambia secures $10.5 million loan. Dutch development bank FMO issued the loan to boost Yalelo Tilapia’s production of sustainable fish. Tilapia, a low-carbon, efficient source of protein that is well-suited to aquaculture production, could have “a transformational effect for the availability and affordability of locally produced protein,” FMO said in a statement. Yalelo’s farm is 30% female-run, employs 800 people and provides training to local smallholder tilapia farmers. FMO’s loan will help the company expand regionally, create an additional 200 jobs and become one of the first operations to Africa to achieve certification for responsible aquaculture by the Aquaculture Stewardship Council. A portion of the loan came from FMO’s infrastructure-focused Building Prospects impact fund. Read on.

GoATL fund backs LIIF’s charter school finance program in Atlanta. The Community Foundation for Greater Atlanta put $1 million into the Low Income Investment Fund to finance charter schools in Atlanta’s lower-income communities. The U.S. Department of Education also provided funding. “Throughout the nation and many parts of metro Atlanta, children of low-income families are attending poorly performing schools,” said Mark Crosswell of the Community Foundation, which has a $10 million impact fund. “At the same time, mission-driven charter schools can’t find the capital to launch in these markets.” LIIF, a national charter-school financier, and redefinED Atlanta, a local education organization, will assess the performance and potential of Atlanta-area schools. More.

Series: Impact en Las Americas

New Ventures is accelerating impact entrepreneurs in Mexico and Latin America (video). Rodrigo Villar and New Ventures Mexico are waking up private investors to Mexican and Latin American startups tackling social and environmental challenges. “The real innovation that’s going to happen in this region is going to be social,” New Ventures’ Villar told ImpactAlpha’s David Bank at this year’s Foro Latinoamericano de Inversión de Impacto, or FLII. “The needs are huge so the opportunities, as well, are big.”

  • Market building. New Ventures has helped accelerate more than 800 ventures tackling housing, education, health, financial, environmental and energy challenges in the past 15 years. New Ventures has invested in 10 of them through two quasi-equity funds managed by its in-house venture capital firm, Adobe Capital, and exited from two. New Ventures hosts one of the region’s leading impact investing conferences, FLII, now in its ninth year.
  • Working capital. New Ventures’ new tool, Viwala, aims to fill a financing gap for a broader swath of impact ventures. Viwala will make working capital loans of $50,000 to $150,000 and link repayments to revenues. The goal, says Villar, is to be able to finance growing firms with real revenues, but without tech-style exponential growth. “If you really want to convince the private sector to move into this sector,” says Villar, “then you need a proof of concept.”

Read, “New Ventures is accelerating impact entrepreneurs in Mexico and Latin America,” by Dennis Price on ImpactAlpha.

Agents of Impact: Follow the Talent

SVX spins out of the MaRS Centre for Impact Investing in Toronto… Partners Group is hiring an ESG and sustainability investment professional in Denver… “Investing in forest health” and “Putting a price on nature” are on Stanford Social Innovation Review’s Earth Day reading list… The SEED conference, which aims to expand the seed stage of the social impact ecosystem, reconvenes in San Francisco, May 20-21. ImpactAlpha subscribers can register with the code “SEEDPromoPartner” for a 30% discount.

April 23, 2019.