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The Brief: Native natural foods, coastal pollution solutions, Nuveen’s new fund, Latam debt fund, Nick O’Donohoe on Sir Ronald Cohen



Greetings, Agents of Impact! 

Featured: ImpactAlpha Original

A Native food company’s commitment to social mission attracts investors at last. There are impact investments and then there are impact investments. The recent financing of Native American Natural Foods includes a host of terms that ensure the company stays Native-owned and that it continues to foster community health, security and opportunity. NANF set out in 2005 on the Pine Ridge Indian Reservation in South Dakota with a mission to build a health food brand with deep cultural ties and strong community impact. After 15 years, the maker of the popular Tanka buffalo snacks has raised its first institutional funding round from Libra Social Investment Fund, Highlands Associates, and Clearinghouse CDFI, a Native-focused community development financial institution. “The question of fundraising was always about how to do it in a way that is authentic to our Native values and culture and fulfills our mission,” NANF’s Dawn Sherman tells ImpactAlpha. “It takes longer to do something when you’re trying to be mindful of so many pieces.”

Staying true to its mission set the small food company on a difficult path. NANF was the first to launch a commercial buffalo protein bar, originally to steer Native communities hard hit by poverty, food insecurity and chronic disease back to familiar, healthy foods. As Tanka bars took off, competitors flooded in. Knock-off brands out-spent NANF on marketing and raised substantial amounts of venture capital. Food giants Hershey and General Mills bought up two competitors while NANF struggled to find investor funding and working capital. “It was tough to watch these other brands use Native imagery—teepees, arrow heads—and mimic our story.” Sherman says. “It was deliberate cultural appropriation.” The new investment, facilitated by Candide Group, upholds the company’s existing employee-ownership plan and ensures Native ownership for the long term with a commitment that equity investors sell their shares back to the company or a third-party Native buyer. “It required working outside the box and intentionally structuring an investment that benefits Native communities and prioritizes Native ownership,” says Candide’s Aner Ben Ami.

Keep reading, “A Native food company’s commitment to social mission attracts investors at last,” by Jessica Pothering on ImpactAlpha.

Dealflow: Follow the Money

Schmidt Marine Technology Partners awards $1.5 million to reduce coastal pollution. Three startups and a university will receive the funds over two years to address pollution from agricultural and wastewater run-off, a major driver of algae blooms and dead zones (see, “Why KKR is investing in wastewater treatment to manage nutrients). The Schmidt Family Foundation launched the program in 2015 to scale technologies addressing ocean health. 

  • Coastal pollution challenge. The winners include San Francisco-based Mango Materials, which makes a biodegradable plastic alternative that can be used to remove nitrogen from the coastal waters. Takachar in Berkeley produces inexpensive biochar. Station C, a Cambridge-based startup, has a low-cost optical nitrogen sensor. A project out of Northeastern University is creating simple, 3D printed nitrogen sensors. 
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Nuveen raises $150 million for inequality and climate change impact fund. The investment firm reached the first close of a targeted $400 million for its Global Impact Fund. Danish pension fund Velliv invested $50 million. Nuveen will make direct investments in companies driving inclusive growth and resource efficiency.

SVB Financial Group closes $30 million debt fund for Latin America. The Latin America Growth Lending Fund will provide venture and growth debt to later stage companies in Latin America and the Caribbean. SVB Financial, the parent of Silicon Valley Bank, teamed with Partners for Growth and multilateral development bank IDB Invest. The fund can help “to alleviate the economic and social impacts of the pandemic, and to reignite growth,” said IDB Invest’s Gema Sacristan. 

Lowe’s backs LISC’s COVID relief efforts with $55 million. The grant funding from the home improvement retailer will go to businesses struggling to pay rent, payroll and operational expenses. LISC will direct $25 million to support rural businesses and $30 million to minority-owned businesses.

Impact Voices: Pass the Mic

Book review: Nick O’Donohoe on Sir Ronald Cohen’s Impact. The CDC Group’s Nick O’Donohoe co-founded Big Society Capital with Sir Ronald Cohen and served as its CEO for four years. He’s an active participant in the movement he credits Sir Ronald – or Ronnie as he insists he be called – with catalyzing over the past 20 years. That makes even more authoritative his argument, in a guest post on ImpactAlpha, that the strength of Sir Ronald’s new book is that it puts impact investing in a bigger context: “the need to move to an impact revolution which can drive long-term systemic social and environmental change.” In his review of Impact: Reshaping Capitalism to Drive Real Change, O’Donohoe acknowledges that social impact bonds, championed by Sir Ronald, “have grown more slowly than many had hoped for.” Capital flows in Africa, the continent with the longest way to go to meet the Sustainable Development Goals, are falling, not increasing. And despite Sir Ronald’s support for impact-weighted accounts, “the perennial challenge of measuring impact in a consistent and verifiable way is still with us.” But O’Donohoe says it would be churlish not to recognize the enormous change in finance and investing in the last two decades, “a change that has been driven by many people, but nobody as visibly and as powerfully as Sir Ronald Cohen.”

Agents of Impact: Follow the Talent

East Bay Permanent Real Estate Cooperative is hiring an investment and fundraising director in Oakland, Calif… MSCI is recruiting an ESG sales specialist in New York… Farming cooperative Fonterra seeks a corporate sustainability manager in Auckland, New Zealand… Finance in Motion is looking for an intern, debt investments in Frankfurt… Danone has an opening for a sustainability, nature and social advocacy apprenticeship in Paris…. The Workers Lab is taking applications for its summer 2020 Lab Innovation Fund for worker health & safety.

Thank you for reading.

–July 22, 2020

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