Greetings, Agents of Impact!
Featured: ImpactAlpha Original
Renew rightsizes checks with new East Africa fund for female founders. Up to now, Renew, an Addis Ababa-based impact investment firm, has managed a network of 150 angel investors to coordinate a dozen investments of about $500,000 each into Ethiopian startups. A new “mini-fund” of pooled capital will cut smaller checks and invest exclusively in women-led companies. The new fund is among a growing number of “gender lens” focused investment vehicles targeting female founders in emerging markets. Renew has found that although women entrepreneurs outnumber their male counterparts in Africa, fewer women-led companies are ready to absorb half million dollar checks. “Women have a harder time accessing banking relationships and supplier relationships,” Renew’s Laura Davis told ImpactAlpha. Davis and her husband Matt, an American couple living in Addis Ababa, founded the firm in 2012. “So we wanted to build an investment structure that works for women and supports them,” she says.
The first investment is in Kampala-based Kijani Baby, a Ugandan maker of colorful cloth diapers. Kijani founder Valerie Rogers Muigai launched the company after realizing that there were no washable diapers available on the Ugandan market. Her customers include middle-class Ugandan families looking for an affordable and green way to diaper their babies, as well as international nonprofits and social businesses that provide cloth diapers to low-income Ugandan families. “This investment will be instrumental to scale our production and improve our systems,” Muigai said. Renew’s portfolio companies have created nearly 1,500 jobs and two exits have netted the firm competitive returns. A reminder of the risk: The Kijani deal was delayed when the Ethiopian government shut down the internet for 10 days after a group of soldiers staged a failed coup.
Keep reading, “Renew rightsizes checks with new East Africa fund for female founders,” by Carol Clouse on ImpactAlpha.
Dealflow: Follow the Money
Clean water startup Aquvio raises capital to build out purification technology. Varanasi, India-based Aquvio builds and installs water purifiers to provide safe drinking water to schools, hospitals and government agencies. The company has raised an undisclosed amount of pre-Series A funding from India’s Technology Development Board, early-stage impact investor and accelerator Villgro, and the Indian Institute of Technology. In a country where water scarcity is a looming issue—21 major cities in India are expected to run out of water by 2020—Aquvio claims its technology purifies water with less waste and energy. Its products serve more than 1.2 million people. More.
Pink Farms secures early funding to bring vertical farming to Brazil. Post-harvest food losses can reach 40% in many places, and Brazil is no exception. São Paulo-based Pink Farms has raised two million reals ($532,000) to combat food waste by bringing the farms into the city. The funding round was backed by agribusiness venture capital firm SP Ventures and seed venture fundCapital Lab. Pink Farms will use the funding to build its first large-scale facility to grow greens and vegetables in São Paulo. The company is an early mover in vertical farming in Brazil, but globally, its peers have been raking in hundreds of millions of dollars in investment capital to improve the nascent technology’s capabilities and costs. New Jersey-based AeroFarms and Germany’s InFarmboth recently raised $100 million funding rounds to support their vertical farming growth. Check it out.
New Media Ventures backs startups engaging new voices and voters. The civic tech investor announced investments into 17 startups that will share $1.5 million in funding. The portfolio includes Contest Every Race, a platform for recruiting and launching new progressive political candidates; Luz Collective, a storytelling forum for the Latina community; and New/Mode, a grassroots political and community activism convener. New Media Ventures has invested $50 million over the last decade in 70 companies developing new methods and platforms for engaging people in politics, news and social activism. More than half of the companies selected in the latest cohort are platforms driving voter engagement and amplifying the voices of under-represented communities. Others are addressing issues like communication with hard to reach populations (CommunityConnect Labs), debt management (Savi and UpSolve), and climate change activism (Sunrise Movement). Read on.
Signals: Ahead of the Curve
Getting drones to deliver for global development. Investors from TPG Growth’s Rise Fund to Singapore’s Temasak piled into the recent $190 million investment round of Zipline, a fleet of autonomous drones improving emergency medical care in frontline clinics in sub-Saharan Africa. The tech unicorn highlights the vast potential of drones in development settings where roads and infrastructure are lacking. It has also been an anomaly in its ability to scale and attract capital. Most drone projects have lingered in the pilot stage. The key to moving from pilot to scale to impact, writes Catherine Cheney of Devex, “is improving the reliability and lowering the cost of the technology while also coordinating rather than duplicating efforts.” In a new report, “Drones for Development,” Devex surveys the state of use of unmanned aerial vehicles in global development today and identifies ways to fulfill their potential for impact. Among the insights:
- Pilots, pilots, pilots. Drones have been used to fight the Zika virus in Brazil, deliver vaccines in Vanuatu and blood in Malawi. But few projects have grown beyond the pilot stage. Only four of 27 drone projects for global health identified by the Interagency Supply Chain Group have achieved sustained operations. The outlier: Zipline, which has reached national scale in Rwanda and is expanding into Ghana and the U.S. (see, “How Zipline raised $190 million to build a global drone logistics network”).
- Cost competitive. Unmanned aerial vehicles are often critiqued for diverting resources from basic needs such as roads, healthcare or electricity. Most drones are least three years away from being cost-competitive with optimally routed motorcycles, according to one analysis. Increasing flight frequency by using drones across multiple applications, or focusing on denser population areas, can help defray costs.
- Local experts. Most drone companies are still only selling technology. Donors and international nonprofits need people to operate the drones and provide other on the ground expertise. One solution: Tapping local expertise. Flying Labs, for example, is building a global network of local drone experts.
- Democratizing airspace. “It used to be only wealthy governments or corporations could collect data from the sky or move goods through the sky,” says Timothy Reuter of World Economic Forum. “Now you’re empowering both less wealthy governments and new entrepreneurs to take advantage of the sky as a resource.”
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Agents of Impact: Follow the Talent
Lindsay Hadley of Hadley Impact joins Cicero Group’s council of senior advisors… 10Power seeks a solar finance professional… WeFunder’s XX accelerator is offering $20,000, training and networking opportunities to venture partners in local tech hubs around the U.S… Duke University’s CASE i3 Initiative on Impact Investing is looking for clients to work with business students on an impact investing challenge.
– July 18, 2019