Motif’s alternative proteins, education bond for bedouins, Landit lands WeWork, impact in public equities, overcoming investor bias



Greetings, Agents of Impact!

Dealflow: Follow the Money

Motif’s $90 million launch raises the stakes in the alternative protein race. The alternative ingredients company uses biotechnology and fermentation, not animal agriculture, to “engineer dozens of proteins derived from dairy, egg and meat without compromising the functionality, taste and nutrition of animal-based ingredients.” Motif Ingredients, the second startup to launch from Boston’s Gingko Bioworks, attracted $90 million in Series A financing. Demand for meat substitutes and plant-based beverages grew 17% last year, and the company could have an impact on climate change as well. Investors include the $1 billion Breakthrough Energy Ventures, backed by Bill Gates, Jeff Bezos and other billionaires, which has a goal of reducing methane emissions from cattle by developing lower-emission replacements. Other backers are food processing corporation Louis Dreyfus Company, dairy cooperative Fonterra and hedge fund Viking Global Investors. The company is led by CEO Jonathan McIntyre, the former R&D chief at PepsiCo.

  • Heady brew. Motif will develop new proteins using a fermentation process similar to brewing beer, with genetically engineered yeasts and bacteria, already being used to make vitamins, amino acids, enzymes, flavors and other ingredients.
  • Feeding frenzy. Impossible Foods, maker of the Impossible Burger, has raised nearly $400 million. Beyond Meat has filed for an initial public offering. Gates is an investor in both companies.
  • Disruption ahead. As alternative proteins become cheaper and tastier, consumer tastes could quickly shift away from meat, predicts venture capitalist Paul Graham. That could be boon for sustainability, but a bust for traditional farmers. “The replacements for meat will be created by startups, which means more Bezoses,” Graham tweeted, “and will simultaneously put lots of small farmers out of business.”
  • Eat it up.

Social Finance Israel launches bond to boost education for Arab-Israeli bedouin. The historically nomadic bedouin are one of the most socio-economically disenfranchised groups in Israel. Social Finance Israel and the Israeli government see education as a path to higher-skill, higher-paying jobs that can break the cycle of poverty. Social Finance Israel is looking to raise $4.1 million for a six-year program to improve math and Hebrew-language performance for Israeli bedouin high school students in the city of Rahat. An unnamed Israeli bank has committed 40% of the funding. It is Israel’s third impact bond and the third worldwide to focus on education for primary and secondary students. Learn more.

Landit lands $13 million to support professional growth for women and minorities. The professional development and coaching firm partners with companies to help underrepresented professionals plan and navigate their careers. Co-working giant WeWork led Landit’s $13 million Series A round of funding. Landit’s founder Lisa Skeete Tatum launched the company in 2015 based on her own experience in changing careers after more than a decade in venture capital. “We’re unlocking talent,” Skeete Tatum told ImpactAlpha last year. “There isn’t one leader in today’s world that doesn’t understand the importance of leveraging everyone in their workplace.” Keep reading.

Signals: Ahead of the Curve

Optimizing impact with public market investments. Positive change at scale. That’s the potential of managing the impact of investments in companies in the public markets. Most publicly listed companies aren’t primarily run to deliver positive impact, yet they have significant impact across supply chains and distribution channels and in the communities in which they operate. Public equities have sometimes been given short shrift as a driver of social impact. The Impact Management Project teamed up with investment manager Neuberger Berman to explore how the IMP’s five dimensions of impact can be used “to assess and manage each of a company’s impacts.” Smarter money.

  • The five dimensions. They are: what, who and how much impact, the level of risk, and the contribution that can legitimately be credited to investors. The Impact Management Project’s Clara Barby is an Agent of Impact. Follow ImpactAlpha on Instagram.

Unlocking capital for women entrepreneurs and entrepreneurs of color. Investor biases that steer capital toward white entrepreneurs and away from women and minority founders are inequitable – and inefficient. Only 2% of venture capital funding goes to women entrepreneurs. Less than 5% of founders backed by VC firms are black or Latinx. The biases cause inefficiencies in the allocation of capital and undermine potential investment returns. A new report from New Venture Fund and Arabella Advisors explores the levers philanthropic investors can pull to drive system-wide adoption of inclusive investing practices. Top of the list: Changing how the foundations invest their own endowments. Returns on inclusion.

Agents of Impact: Follow the Talent

Madelyn Antoncic, a former World Banker, takes the helm at the Sustainability Accounting Standards Board… Remo Oswald and Daniel Perroudas are co-heads of business development at BlueOrchard… Cornerstone Capital Group was certified as an LGBT Business Enterprise by the National LGBT Chamber of Commerce. Cornerstone’s Erika Karp, formerly head of global sector research at UBS, was one of the first openly gay female brokers on Wall Street… Iroquois Valley Farmland REIT is hiring a vice president of finance… Transform Finance is seeking applications from worker justice organizations.

February 28, 2019.

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