The Brief | November 10, 2020

The Brief: Gender-smart call, biotech nudges, sustainable food in China, preserving jobs in emerging markets, ESG pendulum swings

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Greetings, Agents of Impact! 

Agents of Impact Call No. 25: Gender-smart investing for a sustainable recovery. The COVID pandemic is exacerbating gender inequity around the globe, making gender-smart investing central to a sustainable recovery. On ImpactAlpha‘s The Call No. 25, CDC Group’s Nick O’Donohoe and International Finance Corp.’s Stephanie Von Friedeburg will launch Private Equity and Value Creation: A Fund Manager’s Guide to Gender-Smart Investing, and discuss strategies for mobilizing capital to drive gender equality. Join them, along with equity and debt investors in Africa and Asia, local entrepreneurs, and other Agents of Impact, in conversation with ImpactAlpha and the Collaborative for Frontier Finance, to explore how gender-smart investors are mitigating risk, realizing returns, and identifying opportunities to rebuild sustainably, Tuesday, Nov. 17, at 9:30am ET / 2:30pm London / 5:30pm Nairobi / 8:00pm New Delhi. RSVP today.

Featured: ImpactAlpha Original

Gates Foundation’s role in Pfizer’s promising COVID vaccine is part of a strategy, not a conspiracy. The Gates Foundation’s $55 million equity investment last fall into a German biotech company could have a big payoff: an effective vaccine for COVID-19 and a breakthrough in vaccine technology for infectious diseases more broadly. The foundation’s investment, made months before the arrival of the novel coronavirus, was intended to steer German biotech company BioNTech and its breakthrough approach toward vaccines and immunotherapies for tuberculosis and HIV. In the race for a COVID vaccine, BioNTech provided its “messenger RNA” technology platform to Pfizer, which this week reported positive early results from its COVID vaccine trial. Messenger RNA, or mRNA, vaccines are a holy grail for vaccine developers, who have been chasing success for decades. Rather than using inactivated doses of organisms that cause disease, mRNA vaccines trigger the body to produce such antigens itself, a “software” solution that is potentially much faster, and cheaper to produce than traditional vaccines. 

The foundation, one of the largest private funders of public health, has laid low since becoming the target of unfounded conspiracy theories after it said in February that it would donate $100 million to coronavirus vaccine research and treatment. The foundation’s program-related investments into biotech companies are part of a strategy to “nudge” private biotech startups to turn their techniques toward neglected diseases (see, Nudging biotech startups to tackle diseases of the developing world). Unlike a traditional biotech venture capitalist, the foundation spreads its bets among competitors. The foundation has invested and funded dozens of biotech companies, including CureVac and Moderna, which are also pursuing mRNA COVID vaccines. Alongside the investment in BioNTech, the foundation committed up to $45 million in grants to underwrite clinical trials for tuberculosis and HIV candidates and support other infectious disease projects. 

Keep reading, “Gates Foundation’s role in Pfizer’s promising COVID vaccine is part of a strategy, not a conspiracy,” by Dennis Price and David Bank.

Dealflow: Follow the Money

Bits x Bites secures $30 million to improve agrifood sustainability in China. The Shanghai-based investment fund will invest in technologies to help China boost food production and health while reducing its environmental footprint. “With African swine flu, COVID, and uncertain trade relations, nothing else is more urgent in China today than growing the self-sufficiency and sustainability in food production,” said Bits x Bites’ Matilda Ho. The fund is targeting homegrown and foreign companies developing agri-inputs, bio-manufactured food ingredients, and farm automation. Bits x Bites is looking to raise $70 million. 

  • First deal. The fund’s first investment is Mojia Bio, a sustainable ingredients manufacturer based in Hangzhou. Bits x Bites has also re-upped commitments to U.K.-based gene editing tech venture Tropic Biosciences and Israeli plant-based protein startup InnovoPro.
  • Fund investors. The fund is backed by Singapore’s Temasek and Heritas Capital Management, along with Henry Soesanto, CEO of food company Monde Nissin, and food conglomerates and family offices in China and Southeast Asia.
  • Check it out

BlueOrchard raises $140 million for COVID relief for emerging market small businesses. The Zurich-based impact investor will invest in microfinance and small business finance organizations with the aim of preserving 200 million jobs, particularly at businesses owned by or employing women. The fund is backed by development finance institutions in the U.K. (CDC), U.S. (DFC) and Japan (Japan International Cooperation Agency). Switzerland’s SECO is providing technical assistance capital. BlueOrchard is looking to raise $350 million and invest in 20 emerging market financial intermediaries. Earlier this year, BlueOrchard backed the International Finance Corp.’s COVID relief bond to support emerging markets’ pandemic preparedness and response.

Kenya’s Wee Media expands data-driven business journalism in Africa. The Nairobi-based media company is filling a global gap in African tech and venture capital reporting. Wee Media’s $400,000 seed round attracted investment from U.S.-based investors Knarrs Ventures and Jim Waltrip, as well as Japan’s Samurai Incubate and Hong Kong’s Greenfell Holdings. Wee is shifting its revenues from advertising to subscriptions. 

UniSieve snags €3.9 million to help industry conserve energy and minimize waste. The Zurich-based cleantech startup helps chemical and energy companies drive efficiency and reduce waste. The company plans to use the capital to set up a pilot program and co-finance industrial testing at its customers’ chemical sites. Wingman Ventures led the round, which also included Green Deal Grant and the EIT Climate-KIC initiative. 

Signals: Ahead of the Curve

How far will the pendulum of ESG guidance swing back in a Biden administration? Investors poured nearly $50 billion into ESG-focused exchange-traded funds in just two days last week, as the U.S. election swung toward former Vice President Joe Biden. Behind the rush of investment: a belief that environmental, social and governance, or ESG, investing will get a boost from Biden’s agenda, which calls for a transition from fossil fuels to renewable energy and an inclusive, green recovery. “We think a potential Biden administration could create a regulatory environment that is more supportive of ESG investing,” wrote a team of Morgan Stanley strategists. One challenge: overturning an unpopular rule rushed through by the Department of Labor that creates obstacles for retirement plan fiduciaries offering ESG funds as options.

  • Beyond permission. The U.N. Principles of Responsible Investment, whose signatories represent more than $100 trillion in assets, wants a Biden administration to go further than tepid permission to include ESG. “American regulators should require pension and investment fiduciaries to integrate material ESG factors into their investment processes,” writes PRI’s Fiona Reynolds. The U.S. Impact Investing Alliance, as part of a broader policy agenda, is urging comprehensive legislation mandating corporate disclosure of ESG factors.
  • Political appointees. US SIF recommends the creation of a new White House Office of Sustainable Finance and Business to work with federal agencies and Congress “to advance guidance, regulations and legislation to enable sustainable investment.” It also calls on Biden to appoint leaders with sustainable investment expertise to key agencies such as the DOL and the Securities and Exchange Commission.
  • More.

Agents of Impact: Follow the Talent

The Financial Accountability and Corporate Transparency Coalition names Ian Gary, ex- of Oxfam America, as executive director… MSCI is looking for a corporate social responsibility business manager in New York… U.K.-based Mott MacDonald seeks a global head of sustainability and climate change… Connect Lab launched the Women in Business Growth Lab for early-stage women-led startups in Nigeria. Applications are being accepted through Nov. 30… EIT Food is hosting its “EIT Food Venture Summit,” Nov. 17-18.

Thank you for reading.

– Nov. 10, 2020