Greetings, Agents of Impact!
Featured: International Women’s Day
Frontline communities hold the keys to inclusive gender and climate finance. Good green jobs. Better climate solutions. Food security. Resilient supply chains. Increased wealth in low-income communities. And increased returns for more stakeholders. Those are some of the shared benefits of investing at the intersection of climate and gender, according to Inclusive Gender and Climate Finance, a new report from 2X Global, the gender-lens investing collaborative. Frontline communities – across rich, middle and low-income countries – bear the brunt of climate change and hold the key to many climate solutions, say the authors, Suzanne Biegel (see, “Agent of Impact”) and Sana Kapadia (hear Sana on last week’s Impact Briefing podcast). “Inevitably, the risks facing frontline communities trickle through supply chains and into investor portfolios.”
The report cites more than a dozen funds and enterprises that exhibit elements of such an intersectional approach. In the U.S., Matriarch Revolutionary Fund will provide grant and debt capital up to $150,000 to Native- and women-led ventures. The fund will use character-based lending, replacing the traditional five Cs with five Rs: “relational, rooted, restorative, regenerative, and revolutionary” (see, “The Reconstruction: The Indigenous wisdom of lending based on character, not collateral”). In Africa, Good Nature Agro works with more than 25,000 smallholder farmers in Zambia and Malawi to convert production from maize to legumes. The Rallying Cry, a collaborative of women business leaders and development professionals, is seeking to catalyze investment in gender and climate, specifically in agribusiness in Kenya and Zambia. “When we invest with both a climate and gender lens, our money goes further,” says Biegel. Among the growing number of women-led climate funds:
- Emerging markets. Mexico City-based SVX Mexico has launched Regenera Ventures to make equity investments in regenerative land projects that tap into the “underlying wisdom that smallholder farmers have” about biodiversity and soil health. Wangara Green Ventures in Ghana is supporting local green businesses while working to give livelihoods and job opportunities a boost. Satgana is a woman co-led fund that’s investing in gender-lens, climate-tech startups in Europe and Africa. In Singapore, IIX’s Women’s Livelihood Bond series is increasingly focusing on climate resilience.
- Europe. Ireland’s WakeUp Capital is focusing on climate change and biodiversity loss as two of its core investment themes. Systemiq Capital, a spinout fund from climate advisory firm Systemiq, provides early and growth-stage equity to sustainable startups in Europe and North America.
- North America. Toronto-based BlackTech Capital backs early-stage Black and other underrepresented founders that are building solutions to the climate crisis. Colorado-based Blackhorn Ventures is backing tech ventures that are enabling a green transition of emissions-intense industries.
Keep reading, “Frontline communities hold the keys to inclusive gender and climate finance,” by David Bank and Jessica Pothering on ImpactAlpha.
- Go deeper. 2X Global will launch the report with Lelemba Phiri of the Africa Trust Group, Native Women Lead’s Vanessa Roanhorse and Wanona Satcher of Mākhers Studio, which produces affordable modular housing from recycled shipping containers. Join the call, Tuesday, March 14, at 8am PT / 11am ET / 5 pm CET. RSVP today.
Signals: Gender Smart
Gender-lens investing in private and public markets. More than 300 private-market funds now invest with a gender lens, across private equity, venture capital, private debt and permanent capital vehicles, according to Catalyst at Large and Project Sage 4.0, including more than 200 that have raised a combined $6 billion.
- Asset growth. Publicly traded gender lens equity funds totaled $4.7 billion in assets under management as of mid-2022, according to Parallelle Finance. Fixed income products with a gender lens had assets of roughly $7.6 billion.
Gender-smart diligence. Small changes to startup due diligence, like assessing the founding team’s potential based on their past performance, can help investors reduce such discrepancies and spot overlooked risks or growth opportunities. Village Capital and academic partners tested three diligence tweaks with 69 startups. The results: Investor scores of women-led startups rose 5x more than the control group, which used a standard diligence framework.
- Mispriced. Investors tend to undervalue women-led startups and overvalue men-led startups. More than eight in 10 global VC dollars went to startups with only men on the founding team in 2021.
Seeking gender alpha. Companies with better gender equality have been shown to outperform. The financial industry made progress in gender equality scoring (including gender pay gap and flexible work options) by six percentage points, pushing the sector to second place (from fourth) among 11 sectors, according to Equileap. The introduction of the EU Sustainable Finance Disclosure Regulation has increased transparency within the sector.
- Pay gap. The lack of gender parity in leadership roles has led to a persistent gender pay gap in financial service, Equileap said. Top performers include Medibank (Australia), Allianz (Germany) and UBS (Switzerland). No U.S. financial firm cracked the top 10.
Sponsored by CalCEF Innovations
Seeking proposals for a China climate ETF or mutual fund. California Clean Energy Fund (CalCEF) Innovations, a nonprofit public benefit corporation, is seeking proposals from sustainable financial advisors and fund management companies that specialize in the development of climate-aligned exchange-traded funds and mutual funds, as well as the marketing of those investment products to U.S.-based retail and institutional investors. The purpose of the request for proposals is to expand China-focused, climate-aligned investment product offerings for the U.S. market through the development of a climate-friendly fund product – in the form of an ETF, index fund or mutual fund, which tracks a designated climate index. The RFP will offer a sponsorship of up to $300,000 to deliver the fund. All work required for regulatory approval must be concluded by October 31, 2023.
- How to apply. All proposals must be submitted by Friday, March 31. For more information read the full RFP.
Dealflow: Returns on Inclusion
Charles King’s Macro raises $90 million to amplify diverse voices in Hollywood. The Hollywood super agent turned entrepreneur and investor created Macro in 2015 to put voices and perspectives of persons of color in front of mass audiences (see, “Agent of Impact: Charles King”). The film and production company has delivered, with a slate of critical and financial successes that includes Blue Bayou, Judas and the Black Messiah, Mudbound, Just Mercy and Fences. BlackRock’s Impact Opportunities Fund led the latest funding round, which included funds managed by Goldman Sachs Asset Management and Harbourview Equity Partners, as well as returning investors Emerson Collective and Essence Ventures. Content focused on people of color, “has historically been in short supply but high in demand,” said BlackRock’s Pam Chan. Macro is gearing up to launch its biggest production to date, They Cloned Tyrone, a summer sci-fi movie starring Jamie Foxx and John Boyega.
- Vertical integration. Macro will use the investment to bolster the company’s talent management, creative agency and digital content studio, and an early-stage venture fund. “Our mission goes beyond building a multibillion-dollar media company,” King told Fast Company. “We also have a mission to be part of shaping culture and economically empowering communities of color.” MaC Venture Capital, the firm’s early-stage venture fund, has backed companies including Brooklyn-based BlocPower and Oakland-based fintech venture LendStreet. Mac Venture Capital last year raised $203 million for its second fund.
- Cultural capital. Closing the representation gap for people of color in the TV and film industry could unlock more than $10 billion in annual revenues, according to McKinsey & Co. In 2017, Macro raised $150 million in slate funding from a cohort of impact investors, including Emerson Collective and the Ford, Kellogg and Libra foundations. “Macro’s portfolio of work is correcting false narratives in Hollywood and beyond,” Kellogg’s Cynthia Muller told ImpactAlpha. “We are glad to see that Macro is continuing to raise substantial capital from mission-aligned investors looking to tap into a rapidly diversifying consumer market.”
- Check it out.
Aspiration and One Small Planet back conservation venture RenewWest. Reforestation in California. Mangrove restoration in Mexico. Regeneration of mining land in Jamaica. Colorado-based RenewWest is vetting, developing and tracking landscape restoration projects worldwide to rebuild ecosystems, capture carbon and improve community resilience (see, “The Liist“). The startup has secured $3.2 million, led by green bank Aspiration and the venture fund of nonprofit One Small Planet. RenewWest will use the capital to grow its team and pipeline of projects, which include rainforest restoration in Peru, tropical forest conservation in Papua New Guinea, and wetland preservation in Tennessee. One Small Planet’s Jack Wielebinksi said its investment is about accelerating “the harmony of environmental and economic wealth.”
- On the ground. RenewWest has two projects underway, including the Collins-Modoc Reforestation Project, which is reforesting 10,000 acres in northern California. The company says it’s “the largest single-site carbon-focused reforestation project in U.S. history.” RenewWest is also restoring mangroves on Mexico’s Yucatán peninsula.
- Carbon value. Capturing carbon and trading carbon credits is one of the most tangible ways to monetize natural capital investments. “Investing in environmental repair is an effective way to do this,” said Olivia Albrecht, who took the helm of Aspiration in October. “Healthy ecosystems are the world’s most powerful carbon sink.” The investment with RenewWest aligns with the bank’s pledge to invest only in green companies and projects.
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Dealflow overflow. Other investment news crossing our desks:
- Switzerland-based Blue Earth Capital invested $15 million in Lok Capital’s fourth fund, which invests in tech-based businesses improving financial inclusion, healthcare access and farmers’ livelihoods in India.
- Energy and infrastructure investor EIG staked $90 million to Industrial Sun, a Texas-based solar energy developer owned by Modern Energy.
- Sumday, a carbon accounting software company based in Tasmania, raised $2 million from Blackbird Ventures, Possible Ventures and individual investors including Canva co-founder Cameron Adams.
- RangeForce secured $20 million from Energy Impact Partners, Paladin Capital Group, Cisco Investments and others to upskill workers with cybersecurity tech skills.
- The U.K. government announced that it would make an additional £880 million ($1 billion) from forgotten bank accounts available to social enterprises via its Dormant Assets Scheme; £31 million will be immediately available to help companies cope with the U.K.’s energy cost crisis.
Impact Voices: Digital literacy
The $1 trillion opportunity: tackling women’s digital exclusion in the developing world. The exclusion of women from digital opportunities has shaved $1 trillion from the GDP of low- and middle-income countries in the last decade. The challenge is reflected in the theme of this year’s International Women’s Day, “Innovation and Technology for Gender Equity.” Models that work at the intersection of digital access and women’s rights build power and provide safety, argue Elizabeth Vivirito and Hazami Barmada of the Aspen Institute’s Aspen Digital. “Access alone won’t make the difference the world needs,” they write in a guest post on ImpactAlpha.
- Gender smart. Aspen’s Digital Equity Accelerator, in collaboration with HP, invests in not-for-profit organizations and NGOs that are accelerating digital inclusion. In its first year, the effort helped scale seven organizations in India, Morocco, and the United States, boosting their cumulative reach by 1.7 million people. A new cohort of 10 organizations in Malaysia, Mexico, South Africa and elsewhere fighting digital exclusion for marginalized communities will be announced this month.
- Safe space. In Morocco, eSTEM selects local NGOs to install laptops in secure locations where girls can access them and build confidence to pursue STEM careers. The nonprofit has reached over 500 women and girls with hardware and training, helping them develop over 400 mobile applications. In India, the Digital Empowerment Foundation works with rural women to provide digital literacy to local communities.
- Keep reading, “The $1 trillion opportunity: tackling women’s digital exclusion in the developing world,” by Elizabeth Vivirito and Hazami Barmada of Aspen Digital on ImpactAlpha.
Agents of Impact: Follow the Talent
The Pew Charitable Trusts seeks a conservation finance senior officer and an officer for its conservation trust fund Enduring Earth… Graca Machel Trust is looking for a part-time analyst for its investment team and other roles in South Africa… Tiffany Manuel’s TheCaseMadeis hiring a remote leadership coaching and training director or senior director… Danoneis looking for a sustainability and social innovation manager… Accionhas an opening for a remote director of public relations.
Packard Foundationseeks a mission investment analyst in Los Altos, Calif… 2X Global is hiring a climate lead… University of Virginia is recruiting for the Donna and Richard Tadler University Professorship of Entrepreneurship in Charlottesville… Global Impact Investing Networkseeks a database manager in New York… The Andrews Grouphas an opening for an impact investing manager in Michigan.
Green Leadership Trustis looking for a researcher to produce a study on Black, Indigenous, and people of color, or BIPOC, leaders joining environmental and climate finance boards… The African Development Bank’s Africa Digital Financial Inclusion Facility launched a call for proposals for digital financial solutions fostering access, quality, and usage of financial services.
MIT Solve’s Global Challenges program will accept applications until Mar. 9 from fintech, climate tech, healthtech and civic tech entrepreneurs for over $1 million in grants and investments. Solve also is accepting applications from Indigenous innovators for its annual Indigenous communities fellowship.
Thank you for your impact.
– Mar. 8, 2023