The Brief | July 16, 2019

The Brief: Dutch impact fund-of-funds, heavy hitters back Mahmee, clean agritech, formerly incarcerated founders, Darren Walker confronts contradictions

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Wire Group’s new impact fund-of-funds offers global footprint for Dutch family offices. European investors have been leaders in sustainable investing. Institutional investors in particular have been racing to shift public equity portfolios to holdings screened for environmental, social and governance factors. That same progression hasn’t played out in private impact investing. Wire Group, based in the Netherlands, is working to change that. After 10 years of impact investment advisory work, the firm is launching a €60 million ($67.5 million) impact fund-of-funds targeting sustainable food and agriculture, access to clean energy and healthcare, and conservation around the globe. “The fund builds upon our existing experience and expertise in impact investing of the past years,” Wire Group’s Carolien Wegener told ImpactAlpha.

A third of family offices, which hold trillions in assets worldwide, say they’re engaged in some form of impact investing, according to UBS. Still, a perceived lack of investment opportunities is keeping more family capital on the sidelines, showed a Family Office Exchange survey last month. “There is an incredible amount of dry powder out there right now,” said Paulina Cromwellof FOX, a network of 350 wealthy families. The fund-of funds structure, says Wire Group’s Wegener, is meant to cater to the diversity of family offices’ values and interests, and give them a place to start. “Every investor has its own starting point and impact journey,” Wegener said. “What matters is raising consciousness on the way our money works in the world.”

Keep reading, “Wire Group’s new impact fund-of-funds offers global footprint for Dutch family offices,” by Jessica Pothering on ImpactAlpha.

Dealflow: Follow the Money

Arlan Hamilton, Serena Williams, Mark Cuban and Steve Case line up behind Mahmee to improve maternal health. Los Angeles-based Mahmee, a digital support network for new mothers, attracted investors with varying inclusion, impact and growth theses for its $3 million seed roundArlanWasHere Investments, Arlan Hamilton’s project with Mark Cuban, led the round. Serena’s Williams’ Serena VenturesCuban and Steve Case’s Rise of the Rest Seed Fund also participated. The U.S. is one of the most dangerous places in the developed world to give birth, with women of color bearing an outsized burden of deaths and serious harm. The U.S. healthcare industry lacks the tech infrastructure needed to connect maternal health professionals to each other and to follow and monitor patients in the system, says Mahmee’s Melissa Hanna. Mahmee’s online dashboard connects mother and baby’s health histories, monitors patients with “maternity coaches” and raises any issues with doctors and caregivers. Previous investors in the startup include Cross Culture VenturesAcumen Americathe HelmBackstage Capital, Bumble Fund, and others. Dig in.

Caspian and Hivos-Triodos Fund back India clean agritech startup Ecozen. The Pune-based startup’s solar-powered irrigation and “cold-chain” products help some 20,000 Indian farmers boost yields and fetch optimal prices for perishable produce. Hyderabad-based Caspian and Dutch financial inclusion fund Hivos-Triodos Fund invested an undisclosed sum in the firm’s Series A. Omnivore, the active India agtech venture firm, originally invested $1 million in Ecozen in 2015 and participated in the latest round. Ecozen’s Ecotron solar irrigation pumps and diagnostics software help farmers boost efficiency and yields, while its Ecofrost portable cold room allows farmers to store fruits, vegetables and flowers on-farm and off-grid and sell them at optimal prices throughout the year. The firm’s platform also connects customers to exporters, retailers and processors. More.

Opportunity Zone Justice accelerates returning citizen entrepreneurs in Washington D.C. Consulting firm 20 Degrees, which helps nonprofits and social enterprises diversify revenues, is helping stock D.C.’s Opportunity Zone investment pipeline with operating business founded and led by entrepreneurs who were previously incarcerated. The first cohort of the Opportunity Zone Justice accelerator includes Will Avila of Clean Decisions, a janitorial and labor company; Marcus Bullock of Flikshop, which helps families connect with loved ones during incarceration; Maurice Dixon of southern hospitality Reese’s Catering and Lorenzo Stewart of VOW Transportation, which specializes in transportation for children with special needs. The District of Columbia’s Department of Small and Local Business Developmentprovided funding. Check it out.

Dealflow overflow.

Alternative proteinTyson Food and Singaporean state investment firm Temasek back Big Idea Ventures’s $50 million New Protein Fund to invest in plant-based food products, plant-based food ingredients and cell-based meats in Asia and North America.

Signals: Ahead of the Curve

Inside Darren Walker’s effort to transform philanthropy from the inside out. For Darren Walker, president of the $13 billion Ford Foundationtaking on inequality was always a contradiction. Philanthropy was born of inequality. Nineteenth century industrialists-turned-philanthropists like Ford, Rockefeller and Carnegie viewed inequality as an unavoidable condition of the free market system, as Carnegie wrote in “Gospel of Wealth.” Philanthropy, they believed, was an effective means to reduce it. Even today, philanthropy relies in part on inequality. Tax breaks given to the nation’s philanthropists gobble up about $50 billion a year in taxpayer money that could otherwise be used to fight inequality. A lengthy New York Times profile explores the many contradictions Walker faces in his efforts to tackle the structural underpinnings of inequality, an agenda that often upsets the status quo. “I’m not interested in tokenism,” Walker told the Times. “I’m interested in transformation.” That’s an uncomfortable idea, he says, “Because not everyone in the room is going to look like you when this transformation is complete.”

  • The whole purse. One of Walker’s biggest challenges to philanthropy’s status quo: The idea that the investments made from a foundation’s endowment shouldn’t contradict what it pursuing through grants. In 2017, Walker carved out $1 billion from Ford Foundation’s $13 billion endowment for mission-related investments in affordable housing, quality jobs and diverse fund managers (see, “Ford Foundation: Spotting mispriced risks). The strategy initially met resistance from Walker’s investment committee.
  • Shifting priorities. When Ford renovated its New York offices last year, Walker turned his palatial office into three conference rooms and settled into a modest, glass walled room. He sold the foundation’s blue chip art collection and bought 320 newer works, many by female artists or artists of color.
  • Community voice. “I hope I’ve brought a sense to the organization… that we actually don’t have the answers,” says Walker. “The answers are in communities and in the people we are investing in. They are the key to unlocking solutions.”
  • Gospel of giving. Walker plans to expand his widely read “The New Gospel of Wealth,” essay into a book this fall, with a memoir to follow next year.
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Agents of Impact: Follow the Talent

Silverstrand seeks an investment professional of impact investing in Singapore… The College for Social Innovation is recruiting an adjunct educator of social innovation in Boston… The Miller Center for Social Entrepreneurship and Catholic Charities USA are accepting applications from U.S.-based social enterprises for their Pathways Out of Poverty online accelerator.

– July 16, 2019