The Brief | October 30, 2018

Next-gen community financiers, doubling gender-lens assets, Vietnamese online education, mobile digital inclusion in Africa

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Featured: Impact Voices

‘Next-gen leaders have arrived’ and four other insights into the future of community investing. Thriving communities in the U.S. depend on investments in housing, healthcare, education, small business, and other basic services – and that people and places now being left out share in such newly created value. Consulting firm Next Street has interviewed leaders from the kind of community development finance institutions, or CDFIs, that make such investments. Among the takeaways: “The next generation of leaders have arrived and they are increasingly prevalent in the industry,” writes Next Street’s Tim Ferguson in a guest post on ImpactAlpha. “They are acutely aware that they need to evolve if they are going to be successful in a landscape where much of their historical funding, particularly bank and government, is at risk or at a minimum changing.”

Elyse Cherry of BlueHub Capital – formerly Boston Community Capital – talks about building a profitable business model. Capital Impact Partners’ Ellis Carr outlines a partnership with a real estate investment trust to finance projects in low-income communities. And Betsy Biemann of Coastal Enterprises lays out the “continuum of capital” (from debt to equity) available to investees. Leaders from Community Reinvestment Fund, Local Initiatives Support Corp., Opportunity Fund, Craft3, and IFF chart where community finance is heading in “Next Up: CDFI Leaders Thinking Ahead and Acting Now.

Read, “Next-gen leaders have arrived and four other insights into the future of community investing,” by Tim Ferguson on ImpactAlpha.

Dealflow: Follow the Money

SEAF women’s fund backs education company Dream Viet Education. The Washington, D.C.-based impact investor invested in Vietnamese online education provider Dream Viet Education. The company offers courses for adults on everything from soft work skills to parenting instruction through its Kyna platform, while Kyna for Kids offers school-aged kids lessons in English and mathematics. SEAF views the investment as an impact play in women’s economic empowerment. It made the investment through its Women’s Opportunity Fund, a partnership with the Australian government’s Investing in Women initiative. Read on.

Geltor raises $18.2 million for animal-free collagen. Collagen is used in everything from cosmetics, pharmaceuticals, food and nutritional supplements. Most collagen on the market is produced from animal bones, skin and tissue through a chemical process. California-based Geltor’s technology produces collagen products using plant-based products instead of animal byproducts. The firm’s Series A was led by agtech investor Cultivian Sandbox and backed by venture funds of two global food and agriculture companies—Archer Daniels Midland and Wilbur Ellis—as well as global collagen supplier GELTIA. The deal is the latest in a trend towards “alternative” and animal-free protein. Here’s more.

GSMA launches digital inclusion fund for Africa. The industry network for mobile operators is using grant-based funds to seed companies in Uganda and Ghana focused on digital inclusion. The organization has found that countries with “high levels of mobile connectivity have made more progress in meeting their SDG commitments.” GSMA’s fund, called the Innovation Fund for Rural Connectivity, aims to “close coverage gaps in rural areas so that more citizens have access to life-enhancing mobile services.” DFID, the U.K. development agency, provided $390,000 for the fund. Learn more.

Signals: Ahead of the Curve

Total assets in public and private gender-lens products double to $4.65 billion. Capital continues to move into investment vehicles betting on women. Nearly three dozen publicly traded securities now hold $2.4 billion in investor capital, up 85% over last year, according to Veris Wealth Partners’ report on public gender-lens investment products. Along with $2.25 billion in assets under management of private gender-lens funds (see, “More than two dozen new private gender-lens funds launched in 2018), total gender-lens investing assets stand at $4.65 billion, up from $2.2 billion a year ago. “The growth of gender lens investing is one of the most positive developments in a year overshadowed by the gender pay gap, lack of women on boards and sexual harassment scandals,” said Veris CEO Patricia Farrar-Rivas.

  • Institutional support. Pension fund investments into public gender-lens products have boosted growth. The Ontario Municipal Employees Retirement System, for example, seeded RBC Global Asset Management’s RBC Vision Women’s Leadership ETF with $100 million in January. CalSTRS (California State Teachers’ Retirement System) earlier seeded State Street’s “SHE” ETF with $250 million.
  • Across asset classes. The set of public gender-lens vehicles includes 14 separately managed accounts, nine exchange traded funds, seven mutual funds, three gender equality bond issues, one exchange traded note, and one certificate of deposit (see, “Investment vehicles that benefit women are proliferating across asset classes). Since January 2017, 16 new public gender-lens strategies have launched.
  • Resolution success. Since 2015, Pax World has filed or co-filed 14 shareholder resolutions on pay equity. Twelve companies have enhanced their pay equity disclosure, including Apple, eBay and Amazon, says the firm. In March, for example, Pax withdrew resolutions following commitments from Discover, HP and KeyCorp to close their gender pay gaps. (Oracle is an outlier, Pax World says.)
  • Reminder: Join ImpactAlpha and other Agents of Impact at the Gender Smart Investing Summit this Thursday and Friday in London.
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Agents of Impact: Follow the Talent

UBS is hiring an impact investment analyst in Zurich… Impact Capital Managers is looking for an executive director… The MaRS Centre for Impact Investing’s Social Finance Forum will take in place in Toronto Nov. 7-9… BNP Paribas will host Nest’s New Handworker Economy Convening 2018 in New York Nov. 9.

October 30, 2018.