The Brief | April 27, 2020

The Brief: 10x’ing impact investing, Repsol’s solar farm, agri-business fund, digital vocational training, Hiro Mizuno’s next steps

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Greetings, Agents of Impact!

Featured: The Impact Alpha

The 10x challenge: Pandemic is a chance for impact investors to step up by an order of magnitude – or more. Billions to trillions represents thousand-fold growth, or several orders of magnitude. Certainly, the scale of the challenges presented by the COVID-19 crisis calls for responses on that scale. The capital is there among institutional asset owners, giant asset managers, high-net-worth family offices and even retail investors. Yet for all its pre-pandemic momentum, impact investing is the dog that has yet to bark. The examples of private investors stepping up are notable mostly for their rarity so far. Asset – and impact – growth of even a single order of magnitude would send a signal that private investors won’t let this crisis go to waste, that they will “make this s**tstorm matter.” With due deference to the 2X Challenge among development finance institutions to boost investments in women, it’s time to 10x impact investing.

The market is ripe for mobilization. At ImpactAlpha, we’ve watched the scramble by emerging market by fund managers to keep their entrepreneurs and enterprises afloat, the heroic community development financial institutions who rushed to process loans, the quick pivots of portfolio companies to pandemic response, and the rapid emergence of social bonds to tap the capital markets for countries and companies. Big Path Capital convened a series of promising ‘summits.’ Catalyst at Large’s Suzanne Biegel brought together gender-smart funds and investors. Mission Investors Exchange, in a digital version of its biennial conference, is lining up foundations around place-based investing and more expansive use of their expansive endowments. The Global Steering Group, newly led by Cliff Prior, is convening impact investing’s multiple field-building organizations. Many more ad hoc and organized efforts are underway.

A number of impact investors have asked ImpactAlpha to convene an Agents of Impact call to help raise the collective ambition. “We believe impact investments can play a vital role in the economic recovery from the COVID crisis and beyond,” say Encourage Capital’s Ricardo Bayon and Jason Scott, who are helping to organize this week’s Call. “Can we bring existing and new efforts together to develop even deeper and more effective ways to channel capital to individuals and businesses most in need?” they ask. “Can we design and build a more inclusive and resilient financial system that will outlast the pandemic?” We’ll be announcing additional participants in ImpactAlpha’s Agents of Impact Call No. 16 all week.

Keep reading, “The 10x challenge: Pandemic is a chance for impact investors to step up by an order of magnitude – or more,” by David Bank on ImpactAlpha.

Dealflow: Follow the Money

Oil company Repsol breaks ground on its first solar farm. The Spanish oil company is a ways down the list of global oil and gas majors. But it’s among the leaders in adjusting to the new world energy order (see, Agent of Impact: Josu Jon Imaz, Repsol). Repsol has broken ground on a €100 million ($108 million), 126-megawatt solar project, the company’s first, just south of Madrid. It is gearing up to start construction on a 264-megawatt farm in western Spain.

  • Low-carbon transition. Repsol’s launch into the solar market follows its pledge to become net-zero by 2050, when it took a $5 billion write-down on its fossil fuels assets, linked executive pay to decarbonization goals, and created a renewables division. Repsol’s renewables portfolio includes about 3-gigawatts of installed capacity and another 2-gigawatts planned or under construction. Most of its renewable assets are in wind power, including a floating wind farm off the coast of Portugal. Read on.
  • Catch up. Just in time for Earth Day: Oil’s epic crash.”

IFAD backs Agri-Business Capital Fund to support small farm businesses. The U.N. agency and international financial institution made a $9 million investment in the blended-finance fund, which it helped develop. It is IFAD’s first direct private sector investment. The fund, managed by Bamboo Capital, is looking to raise €200 million ($217 million) to invest in agribusinesses in emerging markets.

Aprende Institute raises $1.6 million to expand online vocational training in Latin America. Aprende provides short skills-courses for jobs “not easily replaced by robots or algorithms,” including gastronomy, wellness, beauty, trades and entrepreneurship. Angel Ventures, Artisan Venture Capital, 500 Startups and Claure Group backed the company.

Agents of Impact: Follow the Talent

Hiro Mizuno joins University of Oxford Saïd Business School’s global leadership council. Mizuno, who recently departed Japan’s $1.6 trillion Government Pension Investment Fund (GPIF) after five years as chief investment officer, also joined Tesla’s board of directors (see, Hiro’s Journey: Japan’s pension fund chief rallies ‘universal owners’ around sustainable finance)… Kiva is looking for a managing director for its Invest in Women Fund, location flexible… Oikocredit seeks an impact investor relations officer in Amersfoort, Netherlands.

Thank you for reading. 

–Apr. 27, 2020