The Brief: Today’s Carbon Call, positive externalities, impact securities, at-home primary care, Bitwise in Denver, Amplify in Toronto

The team at

ImpactAlpha

Greetings, Agents of Impact! 

Hop on today’s Call: Carbon is $100 a ton. Now what? The rising price of carbon is affecting corporate balance sheets, technology investments, financing for conservation and agriculture, and more (see below). Join General Atlantic’s Emmanuel Lagarrigue, Estabrook Carbon’s Edwin Datson, CDP’s Paula DiPerna, ReGen Networks’ Gregory Landua, Delton Chen of Global Carbon Reward, and other Agents of Impact, today, Feb. 8,  at 10am PT / 1pm ET / 6pm London. Zoom right in (no RSVP required).

Positive externalities: Carrots as well as sticks for the carbon era. Putting a price on carbon is only the beginning. The value of the global carbon market, currently about $270 billion, could exceed the size of the oil market by 2030, if not 2025, according to Trafigura, a big commodity trading house. Carbon could become a $22 trillion market by 2050, estimates Wood Mackenzie. Long before then, the price of carbon will have changed the calculations and operating practices in the steel, cement, agriculture and transportation industries, for starters. Higher prices could become a drag on economic growth and disproportionately hurt lower-income people, who spend a greater portion of their income on basic goods. Unless…

  • Carbon quantitative easing. A model developed by Australian engineer Delton Chen proposes to finance global decarbonization by valuing – and rewarding – the “positive externalities” of emissions reduction without exacting such a cost on the economy – indeed without the public bearing the cost at all. (Chen’s Global Carbon Reward plan figures in sci-fi author Kim Stanley Robinson’s The Ministry for the Future.) Central banks would issue the currency and set its long-term price. It’s the ultimate win-win or, as the economists would say, free lunch.
  • Co-benefits. Putting a price on carbon opens the way for pricing a whole set of other “externalities,” both negative and positive. Regenerative agriculture and nature-based solutions have co-benefits such as water quality, biodiversity and climate adaptation. Tokenizing such ecosystem services allows them to be valued and priced on top of the carbon asset. ReGen Network is building a public (and eco-friendly) blockchain-based registry of more than 60 regenerative agriculture projects. “I think we’re going to get these composite instruments,” says ReGen’s Gregory Landua. “They are going to be the premium assets.”

Keep reading, Positive externalities: Carrots as well as sticks for the carbon era,” by David Bank and Amy Cortese. And get up to speed on the other entrepreneurs and experts on today’s Agents of Impact Call (Zoom right in):

Dealflow: Innovative Finance

Pay-for-success funds raise $7.8 million for seven nonprofits in San Francisco and Colorado. The Bay Area Donor Impact Fund and the Colorado Donor Impact Fund, backed by donations from 35 philanthropic organizations, will support seven nonprofit organizations working to improve economic mobility in underserved communities. The funds are using a type of pay-for-success structure called an “impact security” to help nonprofits raise flexible working capital. Investors in the performance-based debt securities get repaid from the donor impact funds when the agreed-upon impact outcomes are achieved.

  • Inclusive economy. The supported nonprofits include 10,000 Degrees, which assists low-income community college students; Mission Asset Fund, an organization that provides financial services for Latinx communities; and Rivet School, which provides online degree programs for low-income adult learners. The others: ActivateWork, Bridge House’s Ready to Work program, CrossPurpose and LaMedichi’s Savings Club. Four of the organizations are led by women; three are BIPOC-led and/or founded.
  • Innovative finance. The “impact security” structure was developed by the women-led impact advisory firm NPX.  “If successful, the program will not only help people living in poverty build a bridge to economic security, but also prove out a model that could dramatically impact the field,” said Sara Vernon Sterman of Reinvestment Fund, a partner of NPX.
  • Dig deeper

ConcertoCare raises $105 million to support seniors at home. The majority of the more than 46 million seniors in the U.S. wish to remain in their homes, rather than going to nursing homes or assisted living facilities. Health tech startups such as The Helper Bees and New York-based ConcertoCare are enabling seniors to age in place. ConcertoCare works with physicians, nurses, pharmacists, health coaches and social workers “to keep the country’s most medically and socially-complex seniors and other adults healthy and in their homes for as long as possible,” said ConcertoCare’s Julian Harris.

  • Health equity. ConcertoCare has raised a total of $150 million. The new financing will help it extend its national footprint to support “vulnerable patients who are too often failed by the traditional American healthcare system, a situation that is frequently exacerbated by health inequities,” said Harris. ConcertoCare is starting in the Pacific Northwest with the acquisition of Crown Health. Wells Fargo Strategic Capital led the company’s Series B round, with participation from investors including SteelSky Ventures and Schusterman Family Foundation.
  • Share.

Dealflow overflow. Other investment news crossing our desks:

  • Bitwise Industries acquires Denver-based software developer Techtonic Inc. to create tech apprenticeships for low-income women and minorities in Colorado.
  • Fintech venture U GRO Capital secures $18.5 million from responsAbility to provide credit for micro and small businesses in India.
  • Toronto-based Amplify Capital’s second impact venture fund raises $30.7 million to invest in early-stage tech startups building solutions in global health, education and the environment.

Agents of Impact: Follow the Talent

Jotham Chow and Andrew Newton join Amplify Capital as analysts… CalSTRS is hiring an investment officer of stewardship strategies… Calvert Impact Capital is looking for a risk management analyst in Bethesda, Md.

Thank you for your impact.

– Feb. 8, 2022