The Brief | October 12, 2023

The Brief: Child-lens investing, access to insurance in India, women-led private equity in South Africa, community solar, closing the gender credit gap

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Greetings, Agents of Impact! 

Featured: Child-Lens Investing

Unicef leads investors to see their investments through children’s eyes. Trick question: How many of you once were children? It may seem like a truism that all investor actions impact children. But positive and negative impacts on children have largely been unidentified or unaccounted for, leaving consideration of a large portion of the population out of investment decision-making. Unicef, along with its impact investing arm, the Unicef USA Impact Fund for Children, has taken a page from the playbook of gender-lens (or racial equity-, refugee-, or decarceration-lens) investing to advance a framework for child-lens investing. “Children are everywhere. They’re ubiquitous. But they’re invisible from investment strategies and decisions,” Unicef USA’s Cristina Shapiro told ImpactAlpha at last week’s GIIN Impact Forum in Copenhagen. Child-lens investment sectors go beyond the obvious categories of childcare, education and child nutrition. Renewable energy, for example, can power schools or health clinics. Affordable housing strategies have a direct bearing on children’s health. Clean cookstoves can improve air quality and reduce health burdens for children.

  • Child risks. Unicef has developed a child risk questionnaire for asset owners and managers. The Global Child Forum tracks the performance of more than 1,000 publicly listed companies to develop a children’s rights benchmark for corporations. Ethical Partners partnered with Unicef to understand how publicly-listed companies from the Australia Stock Exchange perform against child rights indicators. The Global Health Investment Fund invests in the development of drugs and vaccines to fight diseases facing populations, including children, in low-income countries. Cross-Border Impact Ventures in Canada backs affordable health technologies that advance maternal, newborn and child health. 
  • Asking questions. Calvert Impact Capital has begun collecting data on how children are impacted through investments made with proceeds of its Community Investment Note. Calvert asks portfolio partners to report on the number of client households with children and the number of children gaining access to improved drinking water, clean energy and affordable housing. “We were really surprised that some of our funds already were thinking about children and centering children in their work,” says Calvert’s Caitlin Rosser. For asset owners, taking action may be as simple as asking fund managers how they account for the benefits and harms of their investments on children, she says. “Just start asking questions.” 

Dealflow: Financial Inclusion

InsuranceDekho raises $60 million to expand access to insurance in India. InsuranceDekho spun out of online car shopping site CarDekho in 2017 to bridge India’s insurance gaps. Through about 150,000 part-time agents, InsuranceDekho sells health, life, car and business insurance policies to customers throughout India. “Our entry into the insurtech sector signifies a strategic commitment to increase insurance accessibility in India,” Mitsubishi’s Shashank Joshi said. The latest funding comes from Mitsubishi UFJ Financial Group, BNP Paribas, Beams Fintech Fund and Yogesh Mahansaria Family Office. It follows a $150 million mixed debt and equity round earlier this year, which included participation from existing investor LeapFrog Investments. More.

  • Employee health plans. The International Finance Corp. led a $24 million Series B round for Bangalore-based Onsurity, which is working to expand health insurance coverage by providing plans for employees of India’s small businesses. Businesses pay monthly, making Onsurity’s plans more budget-friendly than alternatives that charge annual premiums. Financial inclusion-focused Quona Capital and Nexus Venture Partners reupped in the round. Check it out.

Sanari Capital lands $65 million to invest in South African businesses and job growth. The portfolio of the women-led, Johannesburg-based private equity firm includes Edulife, a 25-year old operator of private schools, including low-fee schools that target low-income learners. It has also invested in biometric data company iidentifii and women-led sensor manufacturer LightWare. The fresh injection of capital “will play a pivotal role in addressing structural economic imbalances, promoting transformation, fostering economic growth, creating jobs, and delivering both environmental and financial returns,” Sanari’s Samantha Pokroy said.

  • Local investors. Sanari’s growth-stage fund secured its latest commitments from the Public Investment Corp., which manages Africa’s largest pension fund, the Government Employees Pension Fund (listen to the GEPF’s Musa Mabesa on ImpactAlpha’s podcast, “Putting Africa’s pension funds to work for Africa’s social infrastructure”). The firm is also backed by 27four Black Business Growth Fund, Telkom Retirement Fund, the Motor Industry Retirement Funds, and the National Fund for Municipal Workers. Sanari is targeting a $100 million final close.
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Dealflow overflow. Other deals crossing our desks:

  • Nuveen invested $30 million in Boston-based Perch Energy to provide management services for community solar projects. (Perch Energy)
  • Washington DC-based Accolade Partners raised $325 million for its second Empowerment Fund to invest in funds led by women and diverse managers. (Wall Street Journal)
  • The European Investment Fund invested €20 million ($21.2 million) in Vireo Ventures’ Electrification Fund, which backs early-stage tech ventures addressing the energy supply, electric mobility, and the electrification of buildings and industries. (Startup EU)
  • FemHealth Ventures raised $32 million to invest in pharmaceutical, biotech, medical devices and digital health ventures centered around women’s health. (Wall Street Journal)

Signals: Gender Smart

Can the Community Reinvestment Act be a model for closing the gender credit gap in emerging markets? Harvard University’s Claudia Goldin won the Nobel Prize this week for advancing “our understanding of women’s labor market outcomes.” But women remain woefully underfunded as business owners and economic actors, WhiteLabel Impact’s Christina Zausner and Emily Brearley write in a guest post on ImpactAlpha. The World Bank estimates the unmet credit gap for women globally stands at $1.7 trillion, despite two decades of cajoling of banks with concessional loans from the World Bank, free training and mentorship programs, and dedicated instruments like the Inter-American Development Bank’s “gender bonds.” The Eurasia Group estimates that prioritizing investments in women’s economic power could add $10 trillion to the global economy by 2030. 

  • Community reinvestment. As finance leaders gather in Marrakech for this week’s meetings of the World Bank and IMF, Zausner and Brearley offer a model that has been hiding in plain sight: the network of community-based lenders, funded by big banks and spurred by the US Community Reinvestment Act. The CRA “recognized the power of corporate incentive structures and the value of data analysis to cajole banks toward intended behavior,” they write. Instead of offering carrots, the CRA employed sticks, and “quietly formed a whole new financial ecosystem for low-to-moderate income communities.”
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Agents of Impact: Follow the Talent

Bluestar Energy Capital appoints Neil O’Donovan, ex- of Orsted, to president and chief operating officer… Kapor Capital promotes Batul Joffrey to principal… Prime Coalition seeks a senior manager of impact in Boston… S2G Ventures is hiring a senior communications associate in Chicago.

The National Community Reinvestment Coalition is recruiting a senior director of racial economic equity in Washington, DC… Supply Change Capital will host a pitch showcase on Thursday, Nov. 16 for female founders addressing the food system’s sustainability and climate resilience.

👉 View (or post) impact investing jobs on ImpactAlpha’s new Career Hub.

Thank you for your impact!

– Oct. 12, 2023