Greetings, Agents of Impact! It was great to see so many of you on yesterday’s Call, “Mobilizing capital in Indian Country.” We’ll have a recap, and the replay, in tomorrow’s Brief.
Featured: Maui Watch
In Maui, investing in future resilience and community stewardship after the fires. Whether it’s firefighting resources, land use planning, water rights, electric grid maintenance, or community finance, this month’s fires in Maui exposed decades of extraction and mismanagement – and opened a brief moment of possibility for renewal and reform. As Hawaiian officials process the damage and death toll, attention has turned to the conditions that enabled the fires to cause such destruction, and how best to build back. “Seeing these wildfires ravage my beautiful home state has been heartbreaking,” Dawn Lippert, founder of the Honolulu-based climate tech investor Elemental Excelerator, told ImpactAlpha. “As we look to the future, we must pivot from resilience planning to resilience deployment.”
- Climate-friendly. Despite its lush climate and abundant resources, Maui imports some 90% of its food and energy. Many of the sugar cane and pineapple plantations that once covered the island have been overgrown with invasive species that provided fuel for the fires. Lippert says climate-friendly solutions – local food, renewable energy, resilient microgrids and clean water systems – can help families thrive in the face of climate disasters. More than half of the companies in Elemental’s portfolio deploy their solutions in frontline communities, she says. “Communities are the heartbeat of resilience.”
- Blackstone’s responsibility. Private equity giant Blackstone became the largest private employer in Maui following its purchase of the Grand Wailea and Ritz Carlton hotels in 2018. Native Hawaiian groups had earlier raised concerns about Blacktone’s management of the Grand Wailea, including the hotel’s impact on the environment, management of resources and shoreline erosion. That has raised expectations for Blackstone’s response to the fires. The investment firm told ImpactAlpha it is providing $1.5 million in relocation relief and assistance payments to employees of its real estate properties, as well as the people of Maui.
- Community finance. Long-term investments in community finance infrastructure could have a bigger impact than one-time charitable gifts on issues like housing and small business recovery. Oweesta Corp. in January provided a $4 million low-interest loan to The Council for Native Hawaiian Advancement for affordable housing and small business loans, and is now wildfire relief directing grants to other local Native-led organizations. Oweesta’s partners will be able to support Native communities “through what is going to be years of repositioning, rebuilding,” Oweesta’s Chrystel Cornelius said on ImpactAlpha’s Call this week. Kresge Foundation has helped local CDFIs secure at least $4.9 million from the federal CDFI Fund and take on loans from new investors.
- Risk mitigation. Maui’s fires, along with those in Canada, Greece and other regions, are “a call to action” to step up sustainable land and forest management, Michael Ackerman of Ecoforests Asset Management told ImpactAlpha. Fitch this week downgraded Hawaiian Electric’s credit rating to junk status on fears of the utility’s potential exposure to Maui wildfire-related liabilities. For utilities, the heightened risk of financial disaster raises the urgency of increased capital investment, University of Texas grid expert Joshua Rhodes told Axios. “Our grid was built for the climate of the last century, but we’re in a different one now.”
- Keep reading, “In Maui, investing in future resilience and community stewardship after the fires,” by Dennis Price on ImpactAlpha.
Dealflow: Gender Smart
Local investors help Ditiro Capital raise $14.5 million for job creation in South Africa. South Africa has an abundance of minerals, renewable energy and other natural resources. It also has a struggling economy, failing infrastructure and the highest unemployment rate in the world. Madichaba Nhlumayo, Mandisa Nkosi and Karabo Nkoana founded Ditiro Capital in Johannesburg to invest in mid-sized businesses in high-growth sectors, including food processing, infrastructure, manufacturing and healthcare. The Black women-led fund has raised 360 million rand ($14.5 million) with backing from local institutional investors the Motor Industry Retirement Funds and Telkom Retirement Fund, as well as Thuso Partners. Global investment firm RisCura supported Ditiro’s fundraising efforts to help develop emerging fund managers. The first-time manager is looking to raise up to 800 million rand. “We are investment professionals who have grown up in South Africa, who know the South African market, and who have experience and networks in this market,” Nhlumayo told ImpactAlpha.
- Investing in women. The team is looking to make investments of 70 million to 100 million rand in businesses that are positively impacting employment equity, workforce diversity, skills transfer and women (see, “Seizing Africa’s overlooked investment opportunities with an inclusivity lens“). “As a women-led fund, we want to ensure that we also invest in women-owned businesses [and] products or services that are targeted at women,” Nhlumayo said. “We’re not just a gender-lens fund, but that is something that we want to achieve from an impact point of view.”
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Backpack Healthcare acquires Hurdle Health for inclusive mental health care. Young people of color are suffering alarmingly high rates of depression, anxiety, suicide and other mental health struggles. Black woman-led Backpack Healthcare (formerly Youme Healthcare), based in Baltimore, is acquiring Washington, DC-based Hurdle Health and launching a self-care app to connect diverse youth with therapists for personalized treatment. “We are committed to combating the youth mental health crisis by providing accessible, personalized and culturally-sensitive care,” said Backpack’s Hafeezah Muhammad.
- Impact tech. The Backpack app gives users access to an online community to share experiences and connect with their peers. The app features pediatric mental health professionals and affordable teletherapy sessions in all 50 states. Backpack is a portfolio company of Genius Guild, a Black woman-led venture fund that invests in Black-led companies serving Black communities (see, “Agent of Impact: Kathryn Finney”).
- Check it out.
Dealflow overflow. Other news crossing our desks:
- Borderless raised €3 million ($3.3 million) to responsibly fill the UK’s shortage of workers in the care sector, which is notorious for human trafficking and harsh working conditions. (EU-Startups)
- Root Capital provided $300,000 in debt to Oyster Agribusiness to deliver training and routes to market to Ghana’s smallholder farmers. The company also secured $10,000 in grant funding. (Disrupt Africa)
- Electric Era raised $11.5 million in a Series A round led by HSBC Asset Management to make fast chargers for electric vehicles. (Axios)
- Milestones: Greenhouse farming venture and public benefit corporation Got Produce Global Brands inked an agreement with the UN World Food Programme to support sustainable food production in Africa, starting in Namibia. (WHNE Detroit)
Agents of Impact: Follow the Talent
Matt Eggers, ex- of Breakthrough Energy Ventures, joins Prelude Ventures as managing director… This year’s Echoing Green Fellows include Feed Black Futures’ Ali Anderson, Shiluba Mawela of Tshiamo Impact Partners, and the Rainmaker Enterprise’s James Thuch Madhier… Impact Expansion seeks a private equity impact investing analyst or associate in Brussels… Mission Investors Exchange is hiring a communications and marketing associate, a programs coordinator, and a member experience coordinator.
Living Cities is looking for a city and community engagement assistant director in Washington, DC… The Mission Investing Institute will convene philanthropy professionals interested in impact investing from Sept. 14-19 virtually, and in-person sessions in Los Angeles, Nov. 6-7… Emerald Africa is accepting applications for debt financing from early-stage rural agritech startups.
Thank you for your impact.
– Aug. 24, 2023