Greetings, Agents of Impact!
Featured: Community Solar
Solar proves a pathway for private capital to flow into low-income communities. The race is on to install solar panels, set up chargers for electric vehicles and retrofit housing for energy efficiency – not just in wealthy neighborhoods, but in low and middle-income communities that for decades have borne the brunt of pollution and disinvestment. The latest entrant: Reactivate, a joint venture between Lafayette Square, the ambitious new impact asset manager, and Invenergy, one of the largest solar project developers in the U.S. The partnership is looking to invest a half-billion dollars in dozens of community solar projects in the next two years. “By developing these projects specifically serving low-to-moderate income areas, we can not only catalyze renewable energy efforts in untapped markets, but provide energy cost savings, create jobs, and generate property tax revenue for local governments,” Lafayette Square’s Damien Dwin told ImpactAlpha.
Other investors are eyeing the same opportunity. Last week, New Orleans-based Posigen, secured $100 million in financing from Magnetar Capital to provide residential solar for low-income families. And North Sky Capital in Wayzata, Minn., has closed on a $200 sustainable infrastructure fund, its third such fund but the first dedicated to low-income communities. The eagerness of big investors to focus on underserved communities proves out the proposition pioneered by startup entrepreneurs like Donnel Baird of BlocPower, Kameale Terry and Evette Ellis of ChargerHelp, and SaLisa Berrien of COI Energy, who have created solutions in communities of color to both go green and build wealth. SunWealth and other companies have for years been developing smaller-scale community solar projects in low-income communities. The entrance of the big players “shows there’s a huge business opportunity here,” says SunWealth’s Jessica Brooks. Reactivate hopes to develop three gigawatts of renewable energy capacity and save $50 million in energy costs for low and moderate-income households by 2030. Says Dwin: “These projects are difficult to finance unless you can do it at scale.”
Keep reading, “Solar proves a pathway for private capital to flow into low-income communities,” by Amy Cortese on ImpactAlpha.
Dealflow: Waste to Value
Generate Capital acquires Atlas Organics to meet demand for composting. The San Francisco-based sustainable infrastructure company acquired Atlas Organics and will inject $200 million into the Spartanburg, S.C.-based composter. Generate is already one of the largest organic waste processors in North America, with biodigesters that convert 250,000 tons of food waste each year into renewable natural gas, clean electricity and fertilizer. Atlas Organics operates eight composting facilities across the Southeast U.S.
- Waste not. Generate’s acquisition comes amid growing interest in waste recycling and waste-to-value solutions. Already this year, General Atlantic’s BeyondNetZero fund invested $70 million in Roadrunner Recycling to help companies manage recycling flows. And L.A.-based textile recycler Ambercycle raised almost $22 million from a group of investors.
- Circular economy. Separately, Circulate’s $106 million Capital Ocean Fund made an investment in Prevented Ocean Plastic Southeast Asia, a partnership between the Singapore-based impact fund and global recycling companies Bantam Materials and Polindo. The capital will support a network of waste collection centers in Indonesia’s coastal communities. The goal: to help prevent more than 400,000 tons of plastic from entering the oceans and avoid over 800,000 tons of carbon while creating jobs for local waste workers.
- Dive in.
VestedWorld backs e-commerce venture ANKA in Côte d’Ivoire. Abidjan-based ANKA is trying to help Africa’s retailers reach more customers. The company launched in 2016 as Afrikrea, an online marketplace for African clothing, accessories and crafts. U.S.-based impact investor VestedWorld backed the company’s $6.2 million funding round alongside other investors to enable ANKA to offer retailers online storefronts, international shipping, digital payment integration, buy-now pay-later financing, and sales management tools. Investisseurs & Partenaires, an impact fund focused on francophone Africa, led the round.
- Deal flurry. VestedWorld, which launched in 2014, is raising a third fund with a target of $35 million, according to an SEC filing. The Chicago-based firm has backed 15 other African startups through its first two funds. Recent investments include Nigeria and Kenya-based fintech BFree, which is trying to forestall a consumer debt crisis in Africa (for background, see, “Investors called to account for fintech lending practices as debt-traps emerge“); Nigerian B2B e-commerce venture Sabi; and Ghana-based biotech company Yemaachi.
- Strategic shift. Business-to-consumer e-commerce in Africa has struggled to gain traction because of low Internet penetration and infrastructure and logistics challenges. ANKA says it has supported $35 million in sales by connecting African businesses to international buyers. “Instead of trying to get Africans to buy more or spend faster, ANKA will be one the few companies that actually help them earn, own and create, at a global scale,” said founder Moulaye Taboure. “Growth, velocity, volume and ‘financial inclusion’ are all empty words without value creation, distribution and worldwide scale.”
- Read on.
60 Decibels raises $8.8 million to measure stakeholder impact at the source. The Acumen spin-off deploys more than 800 researchers in 67 countries to collect data directly from customers and suppliers. U.K. tech investor FPE Capital backed 60 Decibels to meet growing demand for transparency and comparability of social impact data. 60 Decibels works with corporations like Visa, SAP, Unilever and Primark, as well as companies in the portfolios of impact investors such as CDC Group, Ceniarth, Omidyar Network, Omnivore, Generation Investment Management and Soros Economic Development Fund. The firm last year closed more than $10 million in new sales.
- Ground up. 60 Decibels’ “lean data” approach of mobile, voice-based customer data collection and benchmarking has helped distinguish the firm as markets wake up to the value of getting data directly from beneficiaries. “Whether it’s in coffee supply chains or the people that 60 Decibels is working for today, increased levels of transparency visible to end-consumers is a macro trend,” CEO Sasha Dichter told ImpactAlpha.
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Dealflow overflow. Other investment news crossing our desks:
- Estonian green packaging startup Woola scores €2.5 million ($2.9 million) in seed funding to replace bubble wrap with scrap wool that would otherwise be burned or buried.
- Bangalore-based Bambrew secures $2.5 million to source plastic-free green packaging.
- Early-stage venture investor TMV raises $64 million for its second fund to invest in diverse founders in financial inclusion, the future of work and sustainability.
- Pacific Community Ventures secures $3 million from Starbucks to provide capital for underserved entrepreneurs in California who are running out of state and federal relief funding.
- Indonesian fintech KoinWorks rakes in $108 million to provide financing and educational tools for small and medium-sized businesses.
- OneTrust acquires German carbon data platform Planetly to offer carbon and sustainability management tech solutions for its corporate customers.
Agents of Impact: Follow the Talent
Ricardo Michel, ex- of FHI Partners, joins Palladium as managing partner in the Americas… Nicole Systrom, ex- of Sutro Energy Group, joins Galvanize Climate Solutions as chief impact officer… Lafayette Square’s John Moran is named managing director at Reactivate (see above)… Casey Clark is named president and chief investment officer at Rockefeller Asset Management. Clark succeeds David Harris, who will become chairman.
Dana Linnane, previously with W.K. Kellogg Foundation, joins Michigan’s Governor’s Office of the Foundation Liaison as director of research and planning… Daniel Barker, ex- of Mastercard Center for Inclusive Growth, is named managing director of Halcyon Incubator. Halcyon is looking for a program coordinator… The Beacon Fund is hiring an investment officer in Denver… Uber is recruiting a global workplace and real estate sustainability program manager in San Francisco.
DC Green Bank seeks a chief investment officer… Rippleworks Foundation is hiring a head of people and culture in Redwood City, Calif… Quantified Ventures is hiring a director and senior associate of health and human services and other roles… Phenix Capital is hosting Impact Summit Europe, Mar. 29-30 in The Hague… IFC and Village Capital launch ScaleX to award up to $25,000 to business accelerators that have helped women-led companies in emerging markets raise equity financing.
Thank you for your impact.
– Jan. 13, 2022