Greetings, Agents of Impact!
Featured: Impact Voices
How investors can blend finance for CDFIs to advance economic and racial justice. Community development finance institutions, or CDFIs, have proven themselves as “first responders” for small businesses in historically underinvested communities. “What we are asking is that CDFIs and their investors go much deeper and with greater intentionality in our pursuit of racial and economic equity,” Pacific Community Ventures’ Bulbul Gupta and Blended Value’s Jed Emerson write in a provocative post on ImpactAlpha that calls out impact investors to step up to the opportunity. “We know impact investors can generate competitive financial returns. The question remains whether they can generate compelling and sustained community and systemic impacts,” they argue. “The bar we must clear is that of economic and racial liberation of communities and entrepreneurs—reparative capital.” Too few foundations and impact investors are going far enough. “Even now, as more foundations and impact investors are starting to respond to the economic and racial injustice crises in this country, many are still prioritizing 2019-style market-rate returns over impact and social good.”
Gupta and Emerson call on capital market intermediaries like PCV, along with their investors and supporters, to offer more affordable capital, advice and access to networks in order to close racial and economic gaps. CDFIs need an additional $1.3 billion in low-cost capital over the next four months to meet the demand from Black and Brown small business owners. Grants can help CDFIs keep the doors open, cover loan loss reserves, keep the cost of capital affordable, and provide business advising to entrepreneurs. Investors should advocate to expand the Fed’s Main Street Lending Program, which provides subsidized federal loans to small businesses. Foundations can purchase portions of loans originated by CDFIs with program-related investments. What is the world they’re envisioning? “One where Black and Brown business owners are included and prioritized by capital markets” and where investors commit “to centering equity as a key impact in the outcomes.”
Keep reading, “How investors can blend finance for CDFIs to advance economic and racial justice,” by Bulbul Gupta and Jed Emerson on ImpactAlpha.
Dealflow: Follow the Money
Motiv secures $15 million to convert trucks to electric vehicles. With states like California passing policies to accelerate electric vehicle adoption, Motiv’s technology offers an intermediary step for commercial vehicle and fleet owners. The San Francisco-based company makes chassis that can convert gas-powered vehicles to electricity. Customers include the U.S. Postal Service.
- Commercial EV capital. The company raised $15 million in convertible notes from existing investor GMAG Holdings. Motiv’s funding follows a $20 million raise by commercial electric vehicle maker Xos Trucks and word of electric microbus company Canoo’s plans to go public. Last year, Motiv secured an undisclosed amount of funding from camper maker Winnebago.
- Read on.
Algae-based materials company Checkerspot raises $36 million. The Berkeley, Calif.-based company is working on a range of sustainable industrial and commercial materials that aren’t petroleum-dependent. Checkerspot, launched four years ago, has brought to market three materials derived from microalgae, including one used to make commercial skis that are manufactured with recycled plastic. The Series B round was backed by Viking Global Investors, Builders VC, Breakout Ventures and Cavallo Ventures. Check it out.
SparkMeter clinches $12 million to expand reliable electricity in emerging markets. The Washington, D.C.-based company helps utilities and micro-grid operators improve operations and connect more users. The Series A round was led by Breakthrough Energy Ventures, Clean Energy Ventures and Goodwell Investments. Alitheia Capital and Total Energy Ventures also invested. The funding will help SparkMeter roll out a data analytics tool for utilities and scale its smart metering technology.
Trellus Health raises $5 million to help patients and health providers manage chronic conditions. Trellus has developed a digital care management platform to help patients and care providers reduce the cost of treatment, starting with chronic digestive conditions like Crohn’s disease and ulcerative colitis. Mount Sinai Health System and EKF Diagnostics led the women-led company’s seed round.
Agents of Impact: Follow the Talent
UNDP is hiring a gender-lens investing and impact management and measurement expert in Amman, Jordan… Vivid Economics seeks a principal of sustainable finance in London… Neuberger Berman is looking for an ESG portfolio specialist in London… UNICEF USA is recruiting an impact investing associate or senior associate for its Impact Fund for Children in New York… ECMC has an opening for a corporate development and impact investment associate in Minneapolis… The Global Impact Investing Network is looking for a fall research associate.
The Ann Arbor Entrepreneurs Fund, the University of Michigan Social Venture Fund and A2 Startup Garage are accepting applications through Monday, Aug. 31 for their Social Impact Startup Pitch Competition… CERES and Valuing Water will host “Futurecasting a World with Water-Aware Financial Institutions,” on Friday, Aug. 28. The webinar is part of World Water Week At Home.
Thank you for reading.
–Aug 25, 2020