Greetings, Agents of Impact!
Call No. 41: Catalyzing adaptation finance in an unequal world. Nearly every corner of the world is feeling the impact of increased drought, wildfires, flooding and extreme weather due to climate change. The most severe impacts will be felt by already vulnerable communities, which face food and water insecurity and mass migration. Funding for climate adaptation has lagged, in part because there aren’t clear business models. ImpactAlpha’s Call No. 41 will explore strategies to catalyze adaptation finance and equity, and share projects and models that point the way to a more resilient future.
- Join us, Tuesday, Apr. 19 at 10am PT / 1pm ET / 6pm London. RSVP today.
Featured: Climate Justice
Inside BlocPower’s mission to upskill workers and green New York City buildings (photo story). On a recent early spring day, a half-dozen workers were installing heat pumps in a two-unit property on Ellis Avenue, a Bronx street lined with low-slung brick residential buildings. The heat pumps, a key tool in the unfolding energy transition, will provide sustainable heating and cooling for residents. They will also lower energy bills, create career opportunities, and bring a measure of climate equity to residents across the Bronx and other communities that bear the brunt of a changing climate. “In low-income communities, there’s a waste of energy and there’s a waste of human potential,” says Donnel Baird, co-founder of BlocPower, the Brooklyn-based company overseeing the installation. The Ellis Avenue retrofit is part of BlocPower’s initiative with the city to create a “civilian climate corps” drawn from communities hardest hit by gun violence. The BlocPower-NYC program pays trainees $20 per hour to learn how to install heat pumps, as well as solar panels, wi-fi systems and electric charging stations. The program has trained and created green jobs for over 1,000 New Yorkers since launching last year.
“I made poor choices when I was younger and paid for them, but now I’m not allowing room for any more mistakes. I just want to work, get paid and enjoy the rest of my life,” BlocPower trainee Robert Rumph told ImpactAlpha’s Roodgally Senatus, who visited the site last month. The 56-year old newlywed, who spent 26 years in prison, views the opportunity as a blessing. “I did too much time in jail to come out and waste more time.” Such stories are playing out across the nation in neighborhoods on the front lines of climate change. BlocPower has projects underway in more than 25 cities, including Philadelphia, Milwaukee, Baltimore and Oakland. The company has a city-wide partnership with the city of Ithaca in upstate New York to electrify and decarbonize its entire building stock by 2030. It also plans to expand the civilian climate corps model nationwide. “There’s no path to addressing the climate crisis directly and urgently without greening buildings, at scale,” says BlocPower’s Keith Kinch. The company, he says, is working “building-by-building, block-by-block, and city-by-city to solve this problem.”
- Keep reading, “Inside BlocPower’s mission to upskill workers and green New York City buildings,” and view the photo story, by Roodgally Senatus on ImpactAlpha.
Dealflow: Climate Tech
Climate accounting tech attracts VC funding in wake of S.E.C. disclosure proposal. The climate accountants are coming. The Securities and Exchange Commission’s proposed mandatory climate reporting for publicly-traded companies and similar rules in Europe are creating a bull market for climate accounting software. The latest in deals:
- Sweep raises $73 million to help corporations track emissions. The Series B funding, led by the tech-focused investment firm Coatue, follows a $22 million Series A round just three months ago. The Paris-based B Corp’s software helps companies visualize their Scope 1, 2 and 3 emissions and achieve their climate goals.
- Deepki raises $166 million to manage real estate emissions. Paris-based Deepki’s software-as-a-service platform helps global commercial real estate companies track and manage the carbon footprint of their portfolios. Clients include AEW, Allianz Real Estate, Tikehau and BNP Paribas Real Estate. Deepki’s raise will “support even more asset owners in taking on the climate challenge,” said Deepki’s Vincent Bryant.
- Accelerated sales cycle. Tempe, Ariz.-based Persefoni raised $101 million last October from The Rise Fund and Prelude Ventures to expand its “ERP for carbon” platform. The company’s Tim Mohin says the new S.E.C. rules will accelerate competition for carbon management and accounting tools. “Imagine a sales cycle, you’re trying to convince somebody this is an important thing to do,” Mohin told ImpactAlpha. “Well, the S.E.C. basically says you have to do it, so that is a very short conversation.”
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Women-led Voyager Ventures raises a $100 million climate tech fund. The first fund from Sierra Peterson and Sarah Sclarsic attracted investment from a range of tech founders and CEOs, general partners from Union Square Ventures, Lowercarbon’s Chris Sacca, former GE CEO Jeff Immelt, and institutions including The Nature Conservancy and The Grantham Foundation. Voyager will invest in North America and Europe-based tech that can decarbonize transportation, energy systems, and food and materials production.
- Climate impact. Voyager aims to sequester or avert 500 million tons of CO2-equivalent over the life of the fund. Peterson’s experience includes climate policy in the Obama White House Office of Energy and Climate Change and the International Energy Agency. Sclarsic co-founded car-sharing firm Getaround and was a founding business director at plant-based materials company, Modern Meadow.
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Dealflow overflow. Other investment news crossing our desks:
- Circulate Capital backs Indian plastic-recycling company Deluxe from its Circulate Capital Ocean Fund.
- Sallie Krawcheck’s Ellevest raises $53 million, with women investors contributing nearly 70% of the total funds for the Series B round.
- U.A.E.-based remote work platform Qureos raises $3 million in a round led by Dubai-based COTU Ventures and New York-based Colle Capital to expand apprenticeships and mentorship globally.
- FarmTogether launches the Sustainable Farmland Fund to invest in farmland opportunities across permanent and row crops in the U.S.
Signals: Policy Corner
Catalytic funding for Tribal communities and small businesses at risk in Congress’ COVID-19 plan. The Choctaw Nation in Oklahoma, the third largest Tribal nation in the U.S., has a plan to develop a venture fund for Choctaw businesses, a fund-of-funds with other Tribal governments, and a venture funding initiative that would attract new businesses to the reservation. Not so fast. Nearly $2.5 billion in funding to spur such small business development in states and on Tribal lands across the U.S. is under threat in Congress’ latest public health response to COVID-19. The Bipartisan COVID Supplemental Appropriations Act would reallocate funding earmarked for small business financing and support initiatives for states, tribal governments and other jurisdictions through the State Small Business Credit Initiative, or SSBCI – a $10 billion, seven-year initiative that was passed as part of the American Rescue Plan last year. “SSBCI is meant to provide long-term access to low-interest loans and investment dollars that businesses need to build and grow,” said Katie Kramer of the Council of Development Finance Agencies, which has been advocating for SSBCI. “They’re chopping that strategy off at the legs,” Kramer told ImpactAlpha.
- Catalytic capital. SSBCI authorizes the U.S. Department of the Treasury to allocate federal funds to states and other jurisdictions to fund small business support programs. An initial version, passed in 2010, attracted $8 billion in private capital with $1.4 billion in federal dollars. The latest version was reauthorized and enhanced last year with the aim of helping state programs leverage as much as 10x in private dollars. It includes a $500 million allocation for Tribal governments. “I am not aware of another small business financing program that could have this magnitude of impact in Tribal communities,” CDFA advisor Rachel Reilly told ImpactAlpha.
- What could change. The proposed COVID funding would strip $2.1 billion in funding from SSBCI, and slash a $500 million technical assistance allocation to $300 million. State programs, warns Kramer, “are being undercut before they even have a chance to be deployed.” It is unclear whether the $500 million for Tribal governments would be impacted, but “the technical assistance will be critical to ensuring the success of the programs for Tribal governments,” says Reilly.
- Creative financing. Reilly worries the latest Act in Congress will deter Tribal governments from submitting applications next month. “It would also limit the ability of Tribal governments to get creative with how they deploy some of this financing,” she said. The Choctaw Nation plan would include catalytic investments in high-tech aviation, including planes, drones and flying taxis. Michael Southard, Choctaw Nation’s economic development director, said, “There are a lot of logistical and investment hurdles that we have to overcome in order to be successful.”
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Agents of Impact: Follow the Talent
FMO seeks a capacity development officer… Apis & Heritage Capital Partners is hiring an investment analyst in Washington, D.C… Omidyar Network is hiring a learning and impact associate… Generation Investment Management is looking for an engagement associate… Intelligent Impact Advisory is looking for a junior analyst… Dalberg Catalyst in hiring a program manager, special advisor and a senior consultant… UNDP seeks a technical specialist of taxation and gender equality.
Latimpacto is hosting “Impact Minds: Standing Together,” Apr. 24-27 in Cartagena, Colombia… Opportunity Finance Network is accepting proposals for sessions for its conference taking place in New York, Oct. 18-21… Giant Ventures launches the $5 million Giant Prize for Danish seed-stage climate startups… Acumen Academy and Refugee Investment Network launch an accelerator for ventures serving displaced people in East Africa.
Thank you for your impact.
– Apr. 7, 2022
