The Brief | July 3, 2018

Social Israel, affordable Silicon Valley, impact opportunities in Puerto Rico, farmer waste-to-energy

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Welcome ImpactAlpha readers! We’ll be taking a break for the Fourth of July holiday in the U.S. We’ll meet you back here Thursday morning.

Featured: ImpactAlpha Original

Bridges Israel emphasizes the social in new $50 million impact fund. There’s more than tech to startup investing in Israel. The opportunity to deliver healthcare and housing to Israel’s underserved, not the country’s hot tech sector, is the impact investment thesis of Bridges Israel. The new $50 million fund is a sister fund of U.K.-based Bridges Fund Management, chaired by Sir Ronald Cohen, the Egyptian-born British investor often called the father of venture capital in the U.K.

Israel ties the U.S. for the highest poverty rate among the 35 countries in the Organization for Economic Cooperation and Development. In the Orthodox and Arab-Israeli communities in particular, which together represent nearly 30% of Israel’s population, the poverty rate is as high as 50%. To ensure it is identifying appropriate opportunities, Bridges Israel has recruited to its advisory board leaders and influencers in both communities. The fund’s first investment is in Venn, a startup connecting residents to co-living and public spaces, social resources, classes, and events in the Shapira neighborhood of Tel Aviv, which is a known hub for immigrants, refugees and elderly residents. “The people who do impact investment have an emotional connection to where they invest,” Bridges Israel’s Sandrine Montsma told ImpactAlpha. “Those investors that we attract have a specific, personal interest in the Israeli market.”

Read, “Bridges Israel emphasizes the social in new $50 million impact fund,” by Jessica Pothering on ImpactAlpha.

Dealflow: Follow the Money

LIIF lends $7.5 million for Silicon Valley affordable housing. The Low Income Investment Fund’s loan will finance affordable housing units in Milpitas, Calif., where the low-income threshold for a family of four is almost six figures. The loan is the second from LIIF’s $30 million affordable housing preservation partnership with Morgan Stanley and the National Affordable Housing Trust. The first was a $9.4 million acquisition loan for a property on Maryland’s eastern shore. Here’s more.

CalBio and Land O’Lakes partner on farmer waste-to-energy projects. Land O’Lakes, the $14 billion Minnesota-based dairy cooperative, is joining forces with CalBio to help Land O’Lakes’ California farmers finance, install and manage CalBio’s biodigesters on their farms. The financing will help dairy farmers meet the state’s 2030 methane reduction targets. Land O’Lakes’ Matt Carstens said the initiative’s impact lies in “eliminating barriers to the adoption of new sustainability technology, unlocking new revenue streams for farmers, cutting emissions and creating a public good.” Land O’ Lakes has a $20 million loan fund to help farmers make sustainability improvements. Read on.

Signals: Ahead of the Curve

The Puerto Rico opportunity: Urgent, tech-ready and women-led. U.S. impact-lens investors have a domestic opportunity to invest in long-term economic development and climate action. In Puerto Rico, roughly 135,000 people have left since last year’s back-to-back Category 4 hurricanes. Unemployment remains around 12%. Nearly 60% of small businesses have closed, at least temporarily. It’s also a burgeoning tech hub, tourist haven and maintains strong connection with its diaspora on the mainland. One group of opportunity-spotting, gender-lens, impact investors is taking notice of post-hurricane opportunities in agriculture, food, education, healthcare, energy, jobs and… women. Pipeline Angels, the network of more than 300 female angel investors, is recruiting U.S. and Puerto Rican accredited investors for its first investor bootcamp in San Juan, July 14-16. Since 2011, the angel network has invested $5 million in more than 50 social ventures founded or co-founded by women, and has had five exits. Pipeline already is seeing “pipeline” from female founders building tech-based solutions to natural-disaster resilience, says Pipeline Angels member Karla Fraguada, a Puerto Rican executive at Bacardi.

    • Entrepreneurship ecosystem. Pipeline will bring “friends and family” pre-seed capital to Puerto Rico. The islands’ entrepreneurial ecosystem includes San Juan-based accelerator Parallel18, the IDEA seed fund and venture accelerator from nonprofit investment firm Grupo Guayacán, Semillero Ventures, an agriculture and food venture fund and Santurce POP, a pop-up space for retail and artisan entrepreneurs.
    • Latina-led. “There are a growing number of businesses led by women and non-binary femmes after Hurricane María that need support,” said Santurce POP’s Carla López de Azúa said in a statement.
    • Local angels. Pipeline is looking to boost the number of Latina angels. “We know investors in Puerto Rico have money,” Fraguada told ImpactAlpha. “We also want to bring female investors to Puerto Rico to back women founders who don’t have friends and family money.”
    • Tech-ready. Before the hurricanes, tech companies like Infosys, Honeywell and Fusionworks had data centers and offices in San Juan. “Having Pipeline Angels launch in Puerto Rico will help transform the economic landscape by mobilizing more capital for Boricuan founders,” added Santurce POP’s de Azúa.

Agents of Impact: Follow the Talent

Emmett Carson stepped down as CEO of the Silicon Valley Community Foundation. Greg Avis will continue as interim president and CEO at the $13.5 billion community foundation… Social Finance is seeking a managing director of social investment in Boston… Transform Finance wants to bring to your community its multi-day training on the intersection of finance and social justice.

– July 3, 2018.