ImpactAlpha’s Big 5: Quality jobs, resistance to revival, summer dealflow, Agent of Impact Kristina Newman-Scott, themes and memes



TGIF, Agents of Impact! 

Take five. It was great to see so many Agents of Impact on yesterday’s Call, in which we aired out some of the themes of ImpactAlpha’s coverage (see No. 5, below). Special thanks to Special Agents Cynthia Muller of Kellogg Foundation, John Goldstein of Goldman Sachs and Adam Connaker of Rockefeller Foundation for playing along. We’ll have a full report, and audio replay, when we return from our one-week summer break. We’ll be back in your inbox Monday, Aug. 12.

– David Bank, editor

Featured: ImpactAlpha’s Big 5

1. The quality jobs agenda (podcast). The low-unemployment economy masks the fact that wages, especially minimum wages, have lagged the recovery and that many workers are juggling multiple jobs in the gig economy. The Returns on Investment podcast took up the challenge of how investors can help make sure workers get a better shake. The opportunity: Going beyond merely counting the quantity of jobs, but lifting their quality as well. It means treating labor not as a liability to be shed, but as an asset to be valued. This week, HCAP Partners, the San-Diego based private equity firm closed its $150 million fourth fund with the thesis that companies that provides “good jobs” are better performers over time (see No. 4, below). Good job.

2. Can candidates turn from resistance to revival? With the economy and inequality both growing, Democratic presidential candidates have an opening to lead on “the inclusive economy.” ImpactAlpha scoured the platforms of the more than 20 candidates for proposals that expand on successful efforts in towns and cities across the U.S. for broad-based opportunity and ground-up economic growth (see, “New Revivalists are using these six strategies to revive entrepreneurship and the American Dream). When Kamala Harris last week introduced a plan to invest $12 billion, she became the sixth presidential candidate to focus on minority small business owners. Opportunity Zones (h/t Cory Booker) have shown that capital can mobilize quickly, but that governance and transparency are key. This week’s debates exposed a challenge for Democrats: Crafting a national narrative for local revival. Policy matters.


Sponsored Content: Tiedemann Advisors

Your impact investing journey. Tiedemann Advisors sponsored “Your impact investing journey” this week to explore the role of a financial advisor in helping clients navigate the many steps in building an impact investing portfolio. Aligning investments with value, impact due diligence and measuring and managing impact – the primer covered essential topics for high net worth individuals, family offices, foundations and other investors. “Impact investing isn’t for the faint of heart,” wrote Tiedemann’s Brad Harrison. “A financial advisor can help investors navigate this rapidly maturing—and increasingly complex—market.” Start your journey:


3. Agent of Impact: Kristina Newman-Scott, BRIC. Cities have long known what impact investors are just discovering: The arts can drive social change and economic development. As head of BRIC, a leading arts nonprofit formerly known as Brooklyn Information & Culture, Newman-Scott is curating the borough’s creative economy. Newman-Scott studied art at Edna Manley College in her hometown of Kingston, Jamaica. Moving with her husband to Connecticut in 2005, she took a job as curator for a Hartford arts organization. That led to her role directing Hartford’s marketing and cultural affairs. “Curating a city” where more than a third of residents live below the poverty level, she launched public art projects, a free outdoor film program and an incubator that helped creative small businesses fill empty storefronts and increase foot traffic downtown. “I essentially got to curate my city,” she says in her TEDx talk. As director of culture for the state of Connecticut—the first woman and immigrant of color to hold the position—she oversaw an $80 million portfolio in arts, culture and historic preservation.

“My curatorial practice became thinking about cities and how they can be reflective of those that reside in them,” says Newman-Scott, who became president of BRIC a year ago. In New York City, people of color make up two-thirds of the population, but two-thirds of the leaders of the city’s cultural institutions are white, according to a study commissioned by the city. In an op-ed in The New York Times, the Ford Foundation’s Darren Walker recently called on these “guardians of a fading social and demographic order” to adapt along with their audiences. At BRIC, Newman-Scott commands a budget of $17 million (a mix of government, foundation and cable fees) and a full-time staff of 110 that is heavily female and 60% racially diverse. The creative economy has long flown under the radar of impact investing (see, “Hiding in plain sight: More than 100 funds that are investing in the creative economy). Says Upstart Co-Lab’s Laura Callanan: “In low-income communities, creativity and culture have been part of comprehensive community development for decades.” – Amy Cortese

4. Deals of the week. Stay on top of the dealflow all week long on ImpactAlpha.com. A few that stood out:

  • Good jobs. HCAP Partners closes $150 million fund with a “good jobs” thesis… Jobs for the Future adds investment capacity with Employment Technology Fund acquisition… mHUB launches fund to revive manufacturing in Illinois.
  • Sustainability alpha. Techstars Sustainability startups tackle clean water, regenerative farming and supply chains… Amp Americas raises $75 million to convert farm waste to truck fuel… Moody’s snaps upclimate risk analytics company Four Twenty Seven.
  • Growth markets. Schroders acquires majority stake in BlueOrchard Finance… Indifi raises $21 million to extend financial services for India’s small businesses… Upaya uses recoverable grants to invest in two Indian agribusinesses… IIX leads funding round for Indonesian chocolate maker Krakakoa.

5. Themes and memes that explain the transformation of finance. Five days a week, ImpactAlpha endeavors to make sense of impact investing news for our growing community of Agents of Impact. Deals are data points. Data points add up to signals. Signals suggest breakthrough features. We’ve crafted short-hand themes or lenses that guide our thinking. Institutional shift tracks the moves of long-term investing pension funds and other “universal owners” that are realizing they can’t dodge systemic risks. Returns on inclusionrecognizes that bias is a liability, diversity is an asset. Share the wealth targets income inequality as a systemic risk and identifies business and financial strategies driving wealth down the economic pyramid. Collect the whole set.

– Aug. 2, 2019

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