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#Dealflow: Follow the Money
TPG’s Rise Fund’s second deal is a $50 million investment in an Indian dairy. Dodla Dairy, based in Hyderabad, is a 22 year-old company that works with 250,000 smallholder farmers across 7,000 southern Indian villages, many of them surviving on the brink of poverty. The Rise Fund’s first investment in the food and agriculture sector comes a week after its first impact deal, a $120 million investment in edtech company EverFi (see, “TPG’s Rise Fund comes out of the gates with a big edtech investment in EverFi”). Dodla provides the farmers with access to a growing segment of India’s food and agriculture market, as well as access to financing and farming services and inputs to help them invest in their own production. “India has more dairy farmers than any other country, and is the world’s largest and fastest‐growing producer of milk,” said Bill McGlashan, TPG Growth founder and CEO of The Rise Fund. “Investments that facilitate stronger and more efficient market links in this food value chain can help to significantly reduce rural poverty.” TPG Growth is seeking to raise as much as $2 billion for the Rise Fund, which counts Jeff Skoll and U2 frontman Bono as co-founders (see “Billionaire’s Ball: A look at TPG’s $2 billion Rise Fund”).
Karnataka fund to boost organic agtech innovation in India. The Indian state of Karnataka, home to India’s startup and tech capital Bangalore, is launching a 10 crore rupees ($1.6 million) fund for agriculture tech startups, particularly those focused on organic agriculture. Karnataka’s agriculture department is providing the capital. The move is the latest by the state to boost innovation and entrepreneurship. Karnataka has earmarked $333 million to nurture 20,000 early enterprises by 2020. In March, the state government launched a similarly sized fund for women entrepreneurs (see, “Karnataka launches “proof of concept” fund for women entrepreneurs”).
Medici Ventures invests in Ripio to bring bitcoin to the unbanked in Latin America. Overstock.com’s venture fund Medici Ventures has invested $428,000 in Ripio, a bitcoin exchange startup based in Argentina. Ripio’s platform offers remittance and other financial services to 70,000 users in Argentina and Brazil and is expanding to Mexico and Colombia. A host of startups are working on blockchain-based remittance and financial services. “It feels like blockchain is very well positioned for the unbanked, which the current technology and systems are not,” said Medici’s Jonathan Johnson. Medici was launched in 2014 to invest in emerging blockchain technologies, both financial and non-financial. In November, it invested in Belgium-based SettleMint, which uses the technology for election vote recording and transparency. Medici’s latest commitment closes Ripio’s $2.25 million Series A round, which was led by Chinese venture capital fund Huiyin Blockchain Venture.
See all of ImpactAlpha’s recent #dealflow.
#Signals: Ahead of the Curve
Five ways public policy can promote high-quality jobs. The official unemployment rate may be low, but most people still aren’t getting ahead. As focus has shifted from the number of jobs to their quality, Pacific Community Ventures’ Insight team has identified five levers of U.S. policy to promote living wages, basic benefits, career- and wealth building opportunities and a fair and engaging workplace. The first step is simply to mandate the measurement and reporting of “quality jobs” data through the Community Reinvestment Act, the Small Business Administration and even the Securities and Exchange Commission for publicly-traded corporations. Some measures would go further, such as tying SBA loan eligibility to job quality improvement and favoring quality-job creating companies in awarding federal contracts. The report also suggests setting aside some New Markets Tax Credits for businesses that create quality jobs. “Public Policy and Investments in Good Quality Jobs” follows PCV’s earlier good-jobs report, Moving Beyond Job Creation.
How accelerators are tapping the potential of growth-market entrepreneurs. Just 10 percent of private capital goes to emerging markets. A new report suggests that ventures and entrepreneurs in emerging markets are just as prepared as their high-income country peers to deploy capital and grow their businesses. Accelerating Startups in Emerging Markets, which examines 2,400 early-stage venture applicants to 43 acceleration programs in emerging and high-income markets, found entrepreneurs in emerging markets who apply to accelerator programs have the same or higher levels of education and experience as their high-income country peers. They report even higher revenues and more employees. After acceleration, startups in both geographic areas raised nearly identical sums of debt and equity funds. What they lack is access to capital, according to the research from the Global Accelerator Learning Initiative, a partnership between the Aspen Network of Development Entrepreneurs and Emory University’s Goizueta Business School. Says Emory’s Peter Roberts: “Many experts we interviewed expressed concern that cultural bias might be driving the perception of lower entrepreneurial skills compared with higher reported rates of experience.”
Climate change is fiction, in New York 2140. Sea levels have risen 50 feet, submerging much of New York City. But 40 years after the climate crisis of 2100, life in Gotham has settled into a new normal. “Every street has become a canal; every skyscraper an island, linked by sky bridges and boat taxis.” That’s the future sketched by Kim Stanley Robinson in his new novel, New York 2140.
In an interview, Robinson makes clear that while the climate scenario is futuristic, the choices we face are immediate. “I wanted to talk about the financial situation we’re in, this moment of late capitalism where we can’t afford the changes we need to make in order to survive because it isn’t cost effective. These economic measures need to be revised so that we pay ourselves to do the work to survive as a civilization facing climate change,” he told New York magazine. “All science-fiction novels are about the future and about the present at the same time.
Indeed, climate change is already here: 2016 was the hottest year on record, devastating bleaching is killing the Great Barrier Reef, Arctic ice continues to shrink. Even the global climate agreement reached in Paris in 2015 won’t limit the rise of global temperatures to two degrees Celsius, and the U.S. commitment to the agreement is seriously in doubt. What comes next?
“When things get really bad, society, [Robinson] seems to suggest, can still manage to survive,” write reviewers in The Verge. “It’s a setting that feels completely real, vibrant, and visceral as he takes us up and down a city that’s adapted to water life: buildings have installed waterproofing measures and garages for boats, while people walk overhead in skywalks that connect the buildings to one another.”
Onward! Please send any news and comments to [email protected].