The Brief | February 26, 2019

Inclusive cannabis investing, ImpactAssets 50, affordable breast cancer screening, water infrastructure in Cambodia, GSG goes to Chile

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Greetings, Agents of Impact!

Featured: ImpactAlpha Original

‘Inclusive cannabis’ investors apply a racial-equity lens to a high-flying industry. The “green boom” is drawing both investors and entrepreneurs. Projections suggest annual cannabis revenues in the U.S. could reach $50 billion by 2026, up from around $9 billion today. One arguably well-prepared group faces obstacles in taking advantage of the opportunities.  The crackdown on illegal pot put hundreds of thousands of people behind bars in the U.S. Those felony drug convictions now are keeping many formerly incarcerated would-be entrepreneurs and employees out of the newly legitimate cannabis industry. To redress that disparity, some cities and investors are specifically advantaging those disproportionately impacted by decades of prohibition.

Because many of the challenges that can hold many members of minority populations back from success stem from the very products now attracting so much interest, some view ‘inclusive cannabis’ as the ultimate impact investment. A program in Oakland, Calif., reserves half of the city’s cannabis permits for designated “equity applicants” with cannabis-related arrests, local residency or below-average incomes. The Oakland-based People’s Dispensary has raised more than $1 million through crowdfunding campaigns. Co-founder Christine de la Rosa told ImpactAlpha the collective is now seeking bigger financing to support its mission: “Making sure those who have been most harmed from the War on Drugs are able to benefit from this industry that is now legal.”

Read, “‘Inclusive cannabis’ investors apply a racial-equity lens to a high-flying industry,” by Liz Enochs on ImpactAlpha.

Dealflow: Follow the Money

Naramai raises $6 million for affordable breast-cancer screening. Cancer-related deaths are on the rise in India, which lacks early diagnostic and treatment resources. Bangalore-based Naramai is trying to make breast cancer detection and diagnosis easier and less costly. Rather than mammography, which is painful and has high equipment costs, Naramai’s thermal imaging screens the body and uses artificial intelligence to find malignant tissue. The women-run startup secured backing from Japanese venture capital firm Dream Incubator, BEENEXT, pi Ventures, Ankur Capital, Axilor Ventures and Binny Bansal, co-founder of the Indian e-commerce giant Flipkart. Read on.

Water infrastructure enterprise in rural Cambodia gets loan from Nexus for Development. Fewer than one in 10 households in rural Cambodia are connected to a reliable water supply. Social enterprise Khmer Water Supply Holding is trying to bridge the country’s fragmented rural water infrastructure by acquiring, connecting and expanding existing small-scale water infrastructure. Singapore-based Nexus for Development provided a $500,000 loan to help Khmer Water acquire two water stations to serve 12,500 households. Nexus made the loan through its working capital fund, the Pioneer Facility. Dive in.

Signals: Ahead of the Curve

First look at ImpactAssets’ 2019 list of 50 impact fund managers. The San Francisco-based financial services firm’s annual list of impact fund managers has become a Who’s Who of impact fund managers. Now in its eighth year, the ImpactAssets 50 is “meant to demonstrate a wide range of impact investing activities across geographies, sectors and asset classes.”

  • Billion-dollar babies. The new list features a half-dozen fund managers with more than $1 billion in assets, same as last year. But albeit a slightly different set. Kairos Investment Management Company, North Sky Capital, LeapFrog Investments and Enterprise Community Partners (at $12.9 billion) repeat as billion-dollar fund managers on the ImpactAssets 50 list. Turner Impact Capital and Low Income Investment Fund round out 2019’s list. (Bridges Fund Management and Finance in Motion appeared on the list last year.)
  • Newbies. Newcomers to this year’s ImpactAssets 50 include Western Europe-based small-business lender Advance Global Capital; Chicago’s women-owned and led Impact Engine, which invests in U.S and Canadian companies tackling social and environmental challenges; SunFunder, the Nairobi-based solar financing company that has raised more than $100 million across its fund to lend to solar businesses in Africa (see “SunFunder secures $42.5 million for its largest energy access fund); Strategic Development Solutions, a woman-owned manager of U.S and Canada-based real estate and private equity funds targeting low-income communities; and WaterEquity, co-founded by actor Matt Damon, which deploys capital to water and sanitation enterprises in Asia, Africa, and Latin America.
  • Impact investing gateway. Criteria for inclusion on the list includes: three years of impact investing experience; at least $10 million in assets; a commitment to impact (and to measuring it). ImpactAssets is quick to point out that the list is not an index, nor a competition. “It is an information resource to begin research on the impact investing sector.”
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Agents of Impact: Follow the Talent

Maycomb Capital is hiring an analyst for its Community Outcomes Fund… Toniic is recruiting an associate covering its network in Europe and the Middle East… Alphabet’s Sidewalk Labs is looking for an associate director of sustainability and thermal energy in New York… City solutions publication Next City is hiring a senior editor in Philadelphia… Hundreds of global impact leaders are expected in Santiago, Chile November 18-19 for the annual summit of the Global Steering Group for Impact Investment. Passes are only $100 before Feb. 28.

February 26, 2019.