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The Brief

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town in Colorado
April 17, 2024 | ImpactAlpha

Greetings Agents of Impact! In today’s Brief: Featured: Macro Impact  Good economy actually is good news as impact investors adjust to new realities.

Today’s brief

Featured: Macro Impact 

Good economy actually is good news as impact investors adjust to new realities. The US economy may have gone from a soft landing to no landing. Goldman Sachs this week raised its estimate of first-quarter US GDP growth to 3.1% from 2.5%, after the fourth quarter’s 3.4% and the scorching 4.9% in last year’s third quarter. Interest rate expectations have normalized, lending markets are thawing, and investor sentiment is back to positive. “This feels like a Goldilocks moment, and impact investors are sitting in Baby Bear’s chair,” ImpactAlpha contributing editor Robert Brown writes in the final article of his four-part Macro Impact series. As broad markets rally, he says, impact investors that have been bruised and frustrated should take note. “Despite the drumbeat of negative election-year rhetoric emanating from the DC echo chamber, objectively, for most investors, things look rosy.”

Sponsored by Impact Ventures by J&J Foundation

Innovative startups are changing the landscape of health impact everywhere. Are investors aware? While impact investment funding levels in health are low, “the need and opportunity for investment in health only grows,” write Carl Nicholas Ng and Miguel Legarda of Verge HealthTech Fund, a venture fund backed by Impact Ventures by J&J Foundation. Reach52’s digital platform, for example, connects community health workers and small pharmacies in rural areas to collect data, deliver targeted health campaigns, and make affordable health products available. More than three-quarters of unvaccinated households engaged by Reach52 received their essential childhood vaccines for Hepatitis B, polio and other diseases within a month.

Dealflow: Energy Transition

Quilt raises $33 million to launch its sleek heat pump. Heat pump sales in the US are expected to ramp up, as states implement generous financial incentives in the 2022 Inflation Reduction Act. Even with financial support, systems can be complicated and costly to install, requiring new ducts or room-by-room “mini-split” units. California-based Quilt is launching small ductless heat pumps that can be controlled with smart thermostats. Energy Impact Partners and Galvanize Climate Solutions led Quilt’s Series A round. Other investors include Lowercarbon Capital and MCJ Collective, as well as Drew Scott, host of HGTV show Property Brothers. “As someone who has spent years transforming homes and understanding homeowners' needs, I've been eagerly waiting for a breakthrough like this,” Scott said.

Overheard: Employee Ownership Ideas Forum

Colorado is demonstrating how states can accelerate conversions to employee ownership (video). Colorado Gov. Jared Polis in 2019 created an employee ownership office to incentivize and provide support for retiring owners to exit to employees. Polis also introduced tax credits for employee ownership structures and a cash collateral program to finance conversions and provide liquidity to selling business owners. “Colorado is the first state in the country to codify the substantive characteristics of employee ownership in a way that is form-agnostic,” said Jason Wiener of the Colorado Employee Ownership Commission at the Employee Ownership Ideas Forum in Washington, DC, last week. The three-day gathering by the Aspen Institute and Rutgers showcased how federal and state policymakers can work with private investors to build an equitable and inclusive ownership economy. Employee ownership is “a big deal” and “a little bit revolutionary,” Senator Bernie Sanders told forum participants during a visit to Capitol Hill. “It suggests that people don’t have to just work for other people. They can actually own the places that they work in and be part of the decision making process.”

Agents of Impact: Follow the Talent

Appalachian Funders Network appoints Ryan Eller, previously president of Beloved Community Foundation, to executive director… Elaine Di Monaco, formerly with the Center for Public Integrity, joins The Pivot Fund as associate director of philanthropy… The Rockefeller Foundation is recruiting a foundation services office manager in Washington, DC… The Reinvestment Fund is hiring a clean energy and sustainable finance lending director… Macquarie Group Foundation’s social impact investment team is looking for an investment manager in New York.

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