The Brief | August 28, 2018

Getting to yes, FINCA’s impact fund, priming the climate pipeline, ‘huge demand’ for impact debt

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Featured: Returns on investment podcast

Getting to Yes: Would-be impact investors start to run out of excuses (podcast). In this summer of climate reality, a report that global renewable energy investment fell 7% last year was as infuriating as it was dispiriting. “The inflection point should have already come and we should now be cranking on exponentially higher amounts of capital, and it’s just not there,” ImpactAlpha’s David Bank complains in the latest episode of the Returns on Investment podcast. Similarly flat-to-down numbers have been reported in key sectors such as small-business lending and smallholder farmer finance. Impact fund managers of all sorts report slow and difficult fund raising. What will it take for investors to make big bets on a better future?

Podcast roundtable regulars Imogen Rose-Smith and Brian Walsh lay responsibility at the feet of the impact investing marketplace, which has struggled to match supply and demand and create investment products that meet the needs of institutional and high-net-worth individual investors. All true. But the objections still sound like convenient excuses to spare investors from actually having to write a check, Bank argues. “They haven’t said, ‘This is the economy of the future and that’s the economy I want to be invested in and I’m going to put the money down to make it so.’ They haven’t made the bet. They’re still hedging,” he says in the podcast discussion. “I want to say to these investors, ‘Make the bet.’”

Read on and listen in to the latest Returns on Investment podcast, “Getting to Yes: Would-be impact investors start to run out of excuses” on ImpactAlpha. And catch all the Returns on Investment podcasts by subscribing on iTunes, Soundcloud, Stitcher or wherever you listen.

Dealflow: Follow the Money

PRIME Coalition sets three climate-tech startups on path to commercial capital. The Boston nonprofit has emerged as critical early link in the climate deal pipeline. The latest tech startups to join PRIME Coalition’s portfolio are Opus 12, which recycles carbon dioxide; Mallinda, which is creating lightweight, recyclable materials for the auto industry; and Lilac Solutions, which is developing new methods of mining lithium for batteries. All told, 56 philanthropies and investors have backed PRIME’s nine portfolio companies with $17 million. One of PRIME’s earliest investments, Quidnet Energy, which turns old oil wells into energy storage vaults, won backing by Bill Gates’ Breakthrough Energy Ventures. Here’s more.

FINCA Ventures to fill early-stage capital gaps for African social enterprises. Finca International, the D.C.-based microfinance institution, launched 34 years ago to improve access to finance for more than two billion adults worldwide. Finca Ventures expands the strategy by filling critical funding gaps facing early-stage companies serving low-income customers in Africa.  “We couldn’t have done this 20 years ago,” FINCA Venture’s Ami Dalal tells ImpactAlpha. “There wasn’t this dynamism in market-based solutions. Today there is.”

  • Early portfolio. FINCA Ventures has backed six firms, including: Amped Innovation, which designs solar home systems and DC-powered appliances; and BioLite, a manufacturer of clean cookstoves and energy systems for off-grid households. Get the full story.

Signals: Ahead of the Curve

‘Huge demand’ for credit in U.S. impact investing. Marc Lasry, founder of the $14.1 billion Avenue Capital Group, told CNBC the firm is “finding huge opportunities” in impact investing, “especially on the credit side, where most people are doing impact on the equity side.” The interview.

Omidyar Network and Kapor Capital among most active family VC investors. The two impact investing family offices sit atop Crunchbase’s list of “top 10 family investment offices with the most VC deals,” with 193 and 165, respectively (through March 2018). The analysis.

Mapping impact companies to the global goals. UN Principles for Responsible Investment is identifying “large, mature and liquid companies” across 10 impact investment themes that advance the Sustainable Development Goals. The report.

Agents of Impact: Follow the Talent

L.A.-based electric aircraft designer Ampaire, Paris-based battery startup EP Tender and San Francisco air-quality sensor firm Aclima are among 10 finalists of the Los Angeles Cleantech Incubator… Nia Impact Capital was certified by Gender Equity Now for gender equity in the workplace after beta-testing the certification model… Catholic Relief Services’ Evan Gill is researching NGOs and blended finance… Social Ventures Australia is looking for an associate director… Impact Management Project is hiring an associate.

— August 28, 2018.