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Saludos, Agents of Impact! 

👋 Welcome to the latest ImpactAlpha Latin America. It’s been a busy time of conferences, news and dealmaking in Latin America and the Caribbean (see ImpactAlpha’s coverage of the FLII). We have you covered in this month’s newsletter, including with a half-dozen exclusive video interviews.

First, let’s give a warm welcome to our newest enterprise subscriber, the Mexico City-based climate VC firm, Savia Ventures. Not yet a subscriber? You too can gain full access to ImpactAlpha for your Latin America-based team with an affordable enterprise subscription. And welcome, too, to Quito-based Impaqto and GSG NAB Chile, who are helping expand our coverage and distribution in South America. They join existing partners FLII, New Ventures, Alterna, Latimpacto, Aliança pelo Impacto and Pro Mujer. 

We’re especially grateful to you, the hundreds of Agents of Impact who have opted in. Send us your news, updates and job listings, or just say hello. And please share the registration link to the newsletter with friends and colleagues who should be part of ImpactAlpha Latin America. Ok, let’s jump in. – Dennis Price

In this month’s newsletter:

• Inclusive growth in Brazil
• Innovative nature-based finance
• Laura Ortiz Montemayor on investing in life vs. tech
• Latina Agents of Impact

Featured: Inclusive Economy

Path to growth in Brazil runs through the impact economy (videos). In May, thousands of visitors will descend on São Paulo for the Feira Preta festival, the largest Black cultural and entrepreneurship event in Latin America. Founder Adriana Barbosa has over two decades grown Feira Preta, or Black Fair, into a platform that has helped plug more than 10,000 Black and Indigenous creative entrepreneurs into the Brazilian economy. Barbosa’s Pretahub supports entrepreneurs to produce and distribute their work with accelerators, physical spaces and financing. In turn, Barbosa, an Ashoka fellow, has helped companies recognize the purchasing power of Black consumers. Brazil’s Black community “is an economically active population,” Barbosa told ImpactAlpha at the Latin America Impact investing Forum last month (video). Investments in Brazil’s African descendants “would produce much more wealth,” she says.

• Investment incentives. Growth in Latin America’s largest country has largely stagnated in recent years, in part due to persistent inequality.The half of the population that identifies as Black has long faced barriers to credit, education and the formal economy. Investment in Brazil’s Black entrepreneurs, and thousands of impact businesses throughout the country, stands to get a boost from Brazil’s new National Impact Economy Strategy, or Enimpacto. The coordinated policy aims to address inequalities and environmental challenges, and boost impact investing in the country from $11 billion to $120 billion over 10 years with blended finance, investment incentives and more inclusive procurement. “We are committed to building a better world, a more inclusive world,” Lucas Ramalho Maciel, who heads “new economies” in the Brazilian ministry behind Enimpacto, told ImpactAlpha at FLII (video). “Investing in Brazil is investing to combat inequalities.” In a follow up interview, Maciel confirmed that racial and social inclusion is a cross-cutting component of the national strategy.
  
• Impact economy. Pipe.Social and Quintessa have mapped over 1,000 impact businesses in Brazil. That almost certainly undercounts businesses in Brazil’s majority-Black northeast.Almost 60 organizations, including Artemisia, NesST, and Din4mo, now support Brazil’s impact businesses, according to Guia 2.5, a survey conducted by Quintessa. In São Paulo, Estímulo has used blended finance to turn a COVID relief fund into a small business lender that has provided more than $40 million to more than 3,400 businesses. “The impact economy in Brazil is rising,” Estímulo’s Lucas Conrado told ImpactAlpha as FLII (video). “The financial sector is increasingly interested in innovative financing structures with the social sector.”
  
• Keep reading, “Path to growth in Brazil runs through the impact economy (videos),” by Dennis Price on ImpactAlpha.

Impact Voices: Climate Finance

Investing in life vs. tech: Lifting up nature-based solutions for ecosystems and communities. Three recent ag-tech deals in Latin America left Laura Ortiz Montemayor uncomfortable. Marketed as impact investments, she saw them as instead serving big banks or corporate interests, selling more toxic agrochemicals and degenerating both biodiversity and smallholder farmers. “While ag-tech may offer efficiency gains, it often neglects the cultural and ecological dimensions of farming, favoring corporate interests over the well-being of smallholder farmers and the environment,” Ortiz writes. “True impact lies in regenerative practices that restore ecosystems, promote biodiversity, and empower local communities.”

• Beyond techno-optimism. “Rainforests and their stewards remain substantially undervalued against the word of any chief technology officer,” she says. One blind spot: The need for ever-more gadgets and minerals for “climate-tech” solutions. “Regions of the Global South have become the defacto ‘sacrifice zones,’” Ortiz says, citing the impact of tech’s cobalt addiction on the Democratic Republic of Congo.
  
• Ecological intelligence. “The synergy of natural systems, from photosynthesis to ecosystem dynamics, offers unparalleled and real solutions,” says Ortiz, founder of SVX Mexico, who has launched Regenera Ventures to make equity investments in regenerative land projects throughout Mexico (see, “Stewarding capital for Mexico’s regenerative economy”). The fund manager is anchored by a $4 million commitment from the US International Development Finance Corp. Other investors practicing nature-based approaches include Eco Enterprises Fund, Ceniarth, Reciprocity Fund, Mad Agriculture’s Perennial Fund, CI Ventures, Urapi, The Nest, Grounded Investment Co. and Althelia (now part of Mirova)
  
• Keep reading, “Investing in life vs. tech: Lifting up nature-based solutions for ecosystems and communities,” by SVX Mexico’s Laura Ortiz Montemayor.

Why Beta Impacto combined venture capital and an NGO to scale impact in Latin America. Buenos Aires-based Sumatoria is an impact-driven financial NGO with a track record in impact measurement. The team at Xeibo Ventures, also in Argentina’s capital, specializes in risk investments. As Beta Impacto they are targeting a $25 million fund to channel capital “towards innovative solutions that generate both financial benefits and positive and quantifiable social and environmental impact,” said Beta’s Matías Kelly, formerly Argentina’s secretary of state for social economy. 

• Keep reading, “Why Beta Impacto combined as venture capital and an NGO to scale impact in Latin America,” by Beta Impacto’s Matías Kelly.

🗣️ Tell your story. Send your deal news, fundraising milestones and other tips and stories straight to me or Jessica Pothering. Or submit a guest post to demonstrate your thought leadership or issue a compelling call to action.

Dealflow: Catalytic Climate Finance

Global Innovation Lab gets creative about nature-based finance in LatAm. The Climate Policy Institute’s decade-old Global Innovation Lab for Climate Finance has mobilized $4 billion for climate mitigation and adaptation efforts in the Global South. The Lab’s 10th cohort features four financing initiatives from Latin America and the Caribbean focused on biodiversity preservation and nature-based solutions. “The rationale for our broader focus in Latin America is that it’s a huge engine of economic growth, and it’s also very much at risk of food scarcity and other climate challenges,” CPI’s Ben Broché told ImpactAlpha.

• Creative capital. In Colombia, The Nature Conservancy and CIPAV are providing incentives for cattle ranches to transition to regenerative “silvopastoral” production, including profit share-based financing, links to carbon markets and technical assistance. The Nature Conservancy is also working with Impact Bank on the Amazon Food and Forest Financing Initiative, a credit facility to bolster sustainability among small businesses and communities in the Amazon. Brazil’s Traive Finance and Instituto Folio created Growth Next-Generation Agriculture to connect developers of sustainable crop treatments to lenders. Regenera Ventures is making equity investments in farms in Mexico to support their transition to regenerative practices.
  
• Read the full story. 

Mexico’s Savia Ventures backs Chilean alt-protein startup Done Properly. The Santiago-based biotech company uses fermentation to produce healthy and sustainable food alternatives, including meat and additives. The company works with large food companies like Nestle to replace harmful additives with healthy ones, helping corporations transition to non-animal proteins. Done Properly claims its products, including a fungi-based protein, use 10 times less energy, 20 times less water and 150 times less land than traditional alternatives, while reducing sodium and sugar by up to 40%. Another Santiago-based lab-grown food producer, NotCo, raised $70 million in 2022, bucking the continuing downturn in financing for plant-based food startups (for context, see, “Plant-based versus lab-grown meat”). 

• Latam’s climate opportunity. The investment in Done Properly is the fifth from Mexico-based Savia, a climate tech VC whose portfolio includes timber-based biocomposite firm Strong by Form, tire-life extending startup Ruedata and AI-based grid optimization company Splight. “Latin America is the largest untapped climate market opportunity right now,” Savia’s Andres Beahr told ImpactAlpha at FLII (video). Beahr cites lower valuations, abundance of natural resources and nearshoring trends in northern Mexico and Central America. “All of that will need solutions that reduce the amount of energy, optimize logistics and use better processes,” he says. “And all of that is climate tech.”
  
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More deal activity:

• Inclusive economy. Potencia Ventures backed Trampay to bank gig economy workers in Brazil (video)… Costa Rica-based Atta Impact Capital is targeting “missing middle” social enterprises in Mesoamerica… Peru’s Leasy raised $28 million to provide vehicle financing for ride hailing drivers in Peru and Mexico to acquire vehicles… Mexico City-based fintech venture Grupago secured $4.3 million in seed funding to provide credit to micro and small businesses… Mexican digital microlender Baubap inked $120 million to expand access to credit for Mexico’s underbanked.
  
• Gender smart. Pro Mujer’s second gender bond, a 370 million Argentine pesos ($1 million) bond issued last year, listed on the Luxembourg Stock Exchange. (For background, see “Pro Mujer issues first gender bond in Argentina,” and Pro Mujer’s 2023 annual report.)
  
• Energy access. Mexico’s Niko clinched $3.3 million to finance and install rooftop solar for homes and small businesses… Brazil’s Nextron inked $5.2 million to connect energy users to renewable power on a subscription basis.
  
• Low-carbon transition. The OPEC Fund for International Development provided a $150 million policy-based loan to co-finance a Colombian government-backed climate action policy and energy transition program.
  
• Impact acceleration. Agora Partnerships acquired Bogotá-based ChangeLab (formerly CreativeLab), marking the accelerator’s launch in Colombia.
  
• Investing in health. Chilean health tech startup Keirón raised $1.7 million to expand its medical record and “patient journey” digitalization services to healthcare providers in Mexico.

Short Signals: What We’re Reading

♀️ Latin American impact leaders. Ana Vanessa González of Citibanamex, Ana Laura Fernández of Fondo de Fondos, Liliana Reyes of AMEXCAP are featured on Disruptivo’s list of women driving impact investment in Latin America. So too are ImpactAlpha Latin America partners Carmen Correa of Pro Mujer, FLII’s Carolina Puerta, Impaqto’s Michelle Arevalo, and Latimpacto’s Carolina Suárez Visbal. (Disruptivo.tv)

⚡ Where LatAm climate VCs are investing. Latin American entrepreneurs are turning to innovative adaptation and mitigation technologies to minimize the impact of climate change. VCs are following with investments in biodiversity (Antom.la), energy tech (Savia Ventures), agrifood (GridX), plasma (ARCHECompany), Water Tech (Dalus Capital) and mining (Silence VC). (ClimateHack Weekly)

♻️ Batteries get a second life in Latin America. Second-life companies acquire used clean energy assets and redeploy them in environments with lower performance requirements. Mexico-based Butoni is developing second-life energy storage for regions prone to energy outages. The Inflation Reduction Act in the US is accelerating the replacement of clean energy assets; some of the old stuff is going to Latin America. (CREO)

💧 Water management solutions. Latin America’s population is forecast to reach 717 million by 2030. Brazilian waste management company EcoCircuito and Atlanta-based onsite hydro systems startup Emrgy are among the cleantech solutions addressing water treatment and management challenges in the region. (EHI Corp)

🌿 Catalyzing nature-based solutions. The UK government’s Partnerships for Forests has leveraged £112.5 million ($143 million) in private capital with £18.7 million in grants for land-use businesses and nature-based solutions in Brazil, Colombia and Peru, with a focus on gender inclusion. (Partnerships for Forests)

Get in the Game

💼 Step up

• Co-Impact is recruiting a remote associate director global and Latin America in Mexico or Brazil.
  
• About True Colors seeks a Latam program manager (remote).
  
• Sempra Infraestructura is hiring a supervisor de desarrollo y de proyectos (financiero) in Mexico City.
  
• Sistema Biobolsa is looking for a global marketing manager in Mexico.
  
• Impact Hub CDMX is recruiting a project coordinator. Send resume to [email protected].

SUBSCRIBER BENEFIT: Visit ImpactAlpha’s Career Hub for more jobs in impact investing and sustainable finance. Contact us for job postings.

🤝 Meet up

Don’t miss these upcoming ImpactAlpha partner events:

• Apr. 10-11: Platform for Social Impact’s NEXA Summit (San Juan) (To request an invitation, email [email protected])
  
• Jun. 4-5: Pro Mujer’s GLII Forum Latam (Buenos Aires). Propose a session.
  
• Sept. 9-12: Latimpacto’s Impact Minds (Oaxaca)
  
• Nov.: Alterna’s FLII Central America and the Caribbean (Costa Rica)

SUBSCRIBE (with an introduction offer) for discounts on partner events.

🏆 Level Up

• Francisco Ferreira, founder of BizCapital and previously with Open Co, is named CEO of  ABCD (Associação Brasileira de Crédito Digital).
  
• Diversity VC has partnered with five funds of IDB Lab’s active portfolio to promote diversity, equity and inclusion in venture capital: DILA Capital (Mexico), CITES (Argentina), GridX (Argentina), The Yield Lab Latam (Argentina) and Dadneo (Chile).
  
• Latimpacto welcomes Fernanda Camargo (Wright Capital Wealth Management), Márcia Soares (Fundo Vale), and Stefan Wilhelm (Bayer) to its board of directors.
  
• Impaqto’s Proyecto VIQTORIA is looking for 60 women microenterprise leaders based in Ecuador who want to digitize their business models.
  
• Latimpacto, Open Society Foundations, and Fundo Vale invite seasoned investors and grantmakers to apply for the Pan-Amazon Impact Fellowship. The deadline is Monday, April 1st.
  
• NESsT’s Lirio Fund is accepting applications from social enterprises in Colombia y Perú for up to $500,000 of impact growth capital. The deadline is March 31st.
  
• PVBLIC Foundation and CleantechHUB, with the support of the U.S. Department of State, invite climate entrepreneurs and startups to apply to its incubation program by Friday, May 10th.
  
• 500LatAm invites Latin American CEOs and CTOs to apply for the Female Tech Founders Initiative.
  
• Village Capital and Moody’s Corporation seek climate and cleantech startups in Africa, Asia and Latin America for Greentech 2024, an accelerator for innovative and sustainable solutions.

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