The Brief | October 3, 2023

The Brief: Native- and women-led funds on The Liist, scaling alt-plastic, clean cooking in Rwanda, surge in small business starts, community-rooted sports

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Greetings, Agents of Impact!

🎙️ Join us for Plugged In: A conversation with Black Farmer Fund. On the next Plugged In series of live conversations, host Sherrell Dorsey will chat with Olivia Watkins on the origins and expectations for upstart agricultural lender Black Farmer Fund. Join Plugged In on LinkedIn Live, this Wednesday, Oct. 4, at 10am PT / 1pm ET / 6pm London. RSVP today.

Featured: The Liist

Native and women-led funds seek opportunities in climate and creativity. There may be too few female fund managers managing too little global investment capital. But in many months, more than half of the managers featured on ImpactAlpha’s Liist of actively raising impact funds are women. This month: five of six. Blume Equity’s all-women founding team is rare among climate-focused fund managers. The firm has the largest fundraising target on this month’s Liist: €200 million, to fill a growth-stage funding gap for Europe’s climate tech ventures. 

  • NEW! The Liist… as a databaseImpactAlpha’s reporting on open impact funds is now available as a searchable discovery tool. The subscriber-only database includes more than 80 impact funds that have been actively raising capital in the last year (log in to ImpactAlpha.com to access). Know an emerging or other impact fund manager currently raising capital? Drop us an email or complete this short form.
     
  • Native-ledSkoden Ventures, launched by Kelly Holmes, who is Mnicoujou Lakota, is the first Indigenous woman-led venture fund we’ve come across in our Liist outreach. That, unfortunately, is not surprising: less than 1% each of venture and philanthropic funding go to Native-led organizations. Impact investors take note: Native-led investment and financial firms often go deep with their impact objectives. Skoden, which invests in diverse-led creative enterprises, seeks “social, cultural, natural and human” returns alongside a financial return.
     
  • Gender edge. Three other women-led funds on this month’s Liist are directing capital to African founders. Kazana Ventures is building a 50% women-led portfolio of early-stage ventures supporting economic inclusion, access to healthcare and education, and more efficient flow of goods and services in Africa. ShEquity focuses 100% on early women-owned and led businesses in Africa. Linea Capital in South Africa is providing revenue-based funding as a founder-friendly source of capital in a market environment that is making it increasingly difficult for founders to raise equity.
     
  • Inclusive healthcare. Health tech investor Headwater Ventures is aiming to drive improvements in US healthcare systems that serve underrepresented and vulnerable patients. Many of the companies in the male-led fund’s early portfolio are women- and diverse-led.
     
  • Keep reading, “Native and women-led funds seek opportunities in climate and creativity,” by Jessica Pothering on ImpactAlpha.

Dealflow: Scaling Up

Germany’s Traceless Materials raises €36.6 million for a plastic alternative. Hamburg-based Traceless Materials has developed a bio-based, low-emission plastic alternative made from agricultural waste, such as rice and wheat straw. The two-year-old startup is building a demonstration plant to scale production and replace several thousand tons of conventional plastics per year. “Financing capital-intensive start-ups is still unfamiliar to many investors and banks,” said Traceless Materials’ Johanna Baare. “We’re pleased we found partners…who understood the challenges of financing our hardware scale-up.” 

  • Green materials. The Series A round was led by United Bankers’s Forest Industry Green Growth Fund and SWEN Capital Partners. Other investors in the $38.4 million Series A round include a local bank syndicate and existing seed investors. Traceless’ materials can replace plastics that end up in the environment and in oceans “such as single-use packaging as well as hidden plastics in adhesive and paper coatings,” said Oliver Raybaud of SWEN, which backed the company via its €170 million Blue Ocean Fund.
     
  • Check it out.

Bboxx snags $17 million World Bank subsidy for clean cookstoves in Rwanda. Cooking with firewood or coal is dangerous to human health and the planet. In Rwanda, more households are looking to transition to more environmentally-friendly cooking methods. UK-based off-grid solar company Bboxx, which tapped the World Bank subsidy through the Development Bank of Rwanda, will roll out clean cookstoves for a half-million households. Bboxx says the goal is to lower the percentage of households that use firewood for cooking from 80% to 42% by 2024. “We won’t stop until every household in Rwanda can cook clean,” said Bboxx’s Mansoor Hamayun

  • Frontier and growth markets. Bboxx will deploy the subsidy via Bboxx Cook, its clean cooking brand, which makes clean cookstoves accessible to low-income households through microloans. Bboxx’s roots are in designing and selling small-scale solar home systems in Rwanda. Today, the company provides pay-as-you-go water, electricity, gas and appliances, as well as loans to millions of low-income individuals in nearly a dozen countries (see, “Off-grid solar pioneer Bboxx is following the data to down-market growth”).
     
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Dealflow overflow. Other deals crossing our desks:

  • Quinbrook Infrastructure Partners closed its third fund, Quinbrook Renewables Impact Fund, with £620 million ($760 million) to invest in clean energy infrastructure projects in the UK. (Quinbrook)
     
  • Rose Smart Growth Investment Advisors, an affiliate of Jonathan Rose Companies, closed on $145 million for its latest affordable housing fund. Listen to last year’s podcast conversation with Jonathan Rose. (Jonathan Rose Companies)
     
  • Pahal Financial Services received a $12 million loan from DFC to provide microloans and technical assistance to women entrepreneurs in rural India. (Pahal Financial Services)
     
  • Chicago-based Cultivate Power secured a $10 million corporate equity investment from Generate Capital to expand the development of community-based solar and storage projects. (Cultivate Power)
     
  • Cape Town-based Revio raised $5.2 million in a seed round backed by SpeeinvestQED and Partech to reduce the costs and risks associated with digital payments for merchants in Africa. (Revio)

Six Short Signals: What We’re Reading

🇮🇪 Ireland’s climate action. Ireland last month made a bold statement on climate action: It rejected a liquefied natural gas import terminal and a related gas-fired power plant. The proposal would have helped keep the island hooked on fossil fuels for years. (Bloomberg)

🌲Minimizing private impact on natural capital. A new, open-source ecosystem services footprinting tool from Stanford University and Morgan Stanley will support the growing effort to integrate natural capital data into private sector decision-making. (Natural Capital Project)

🚫 Inside the EU’s greenwashing ban. A new law designed to help European consumers spot products with misleading environmental claims is expected to most impact the food, travel, and fashion industries. Also in the law’s sights: the voluntary carbon market, which deals with carbon offsets and credits. (Green Queen)

📈 Surging business formation. A pandemic-era jump in business formation may be the start of a trend toward a more dynamic U.S. economy. The flurry of applications included increases in new starts as well as new locations of existing businesses – and was followed by notable associated job creation. (Brookings Institution)

⚒️ Accelerating diverse-led co-ops. Start.coop’s fall accelerator includes worker- and author-owned Bitterroot Books in Tennessee, real estate cooperative The Village in Louisiana, and Origins, a marketplace for smallholder farm cooperatives in the Global South. Five of the eight companies have at least one founder of color. (Start.coop)

⚽ Community-rooted sports. ‘Purpose-driven’ Oakland Roots, which plays in the United Soccer League (one level below Major League Soccer), has raised over $2.4 million on Wefunder. Super Bowl champ Marshawn Lynch, rapper G-Eazy and others have invested in one of the most successful ‘community rounds’ in American sports. (Wefunder)

Agents of Impact: Follow the Talent

Karen Sunderam, formerly with UBS, joins ImpactAssets as an investment strategist… Jennifer Vasiloff steps down from the Opportunity Finance Network to launch Vasiloff Consulting… Robert Wood Johnson Foundationis recruiting a deputy director in Princeton, NJ… TheVermont Community Foundationseeks an executive director for the Vermont Women’s Fund in Middlebury, VT.

Social Financeis looking for a director of impact investments (green workforce) in Boston… Visais hiring a social impact analyst in Washington, DC… HelloFreshis looking for a manager of sustainability and social impact in New York or Boulder, Colo… Supply Change Capitalseeks a senior associate in Chicago, Los Angeles or remote.

EMpact and Guatemalan microfinance provider Fundación Génesis Empresariallaunched a venture studio to nurture startups in Central America, West Africa, and Central Asia… Aga Khan Foundation Canada and the Brookings Center for Sustainable Developmentare hosting “The SDG Second Half: Ideas for doing things differently,” on Thurs, Oct. 5 from 9am – 12:30pm ET.

👉 View (or post) impact investing jobs on ImpactAlpha’s new Career Hub.

Thank you for your impact!

– Oct. 3, 2023