The Brief | October 4, 2023

The Brief: Today’s Plugged In: Black Farmer Fund, deep climate tech, solar power in Texas, integrated impact and financial analysis

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Plugged In: Road to justice for Black farmers leads through flexible finance. More than 150 years of discriminatory lending and land heists have left a generation of Black farmers with little access to reliable, affordable capital to grow their businesses. Black Farmer Fund provides flexible capital to farmers and food entrepreneurs in the northeastern US, “who were seeking capital that did not replicate the discriminatory and predatory lending practices driving Black farmers and land stewards off their land,” cofounder Melanie Allen wrote in ImpactAlpha earlier this year. After building a pilot portfolio of eight entrepreneurs, Black Farmer Fund last month raised $11 million from Chordata Capital, the Kataly Foundation and other investors. The fund will “center the farmers’ lived knowledge, collective decision-making and community relationships,” wrote Allen. Black Farmer Fund cofounder Olivia Watkins is today’s guest on ImpactAlpha’s Plugged In series with host Sherrell Dorsey. Other lenders breaking down barriers facing Black farmers include Konda Mason’s Jubilee Justice, Potlikker Capital and Farm Credit Mid-America.

  • Justice for Black farmers. There are only about 44,000 Black farmers in the US, down from more than a million in the 1920s. Over the course of the last 100 years, Black farmers and their families have lost some $325 billion worth of farmland and acreage. The Inflation Reduction Act includes $2.2 billion in financial aid for farmers that have faced discrimination by the USDA. The Justice for Black Farmers Act, reintroduced in February by Rep. Alma Adams and Sen. Cory Booker, would go further. The Act would provide debt relief and new land grants for existing and aspiring Black farmers, create a new bank to finance Black farmer and rancher cooperative financial institutions, and fund HBCUs to expand their agriculture research and courses of study.
  • 🎙️ Plug in. Today’s LinkedIn Live conversation is the latest call in ImpactAlpha’s Plugged In series hosted by Dorsey. Dorsey joined as a contributing editor this year to carry on the work of The Plug, her Black tech innovation publication. July’s Plugged In call explored how investors, employers and policymakers are mobilizing finance for and tapping talent at the nation’s historically Black colleges and universities. Today’s call with Black Farmer Fund’s Olivia Watkins takes up the opportunities and challenges of building Black wealth through farming and food businesses. Join directly on LinkedIn Live at 10am PT / 1pm ET / 6pm London.

Dealflow: Climate Tech

At One Ventures closes $375 million ‘deep tech’ climate fund. At One Ventures has backed 27 early-stage, product-based startups from its inaugural $150 million fund. The San Francisco-based venture firm’s second fund is looking to build on its track record with larger checks and more portfolio support for roughly 30 companies. The fund targets deals in climate-critical sectors like buildings and construction, energy and transportation, and food and agriculture. “We didn’t shy away from technologies that are more capital intensive, or technologies that will just take a bit more time to scale, because those are the solutions that we need to face climate change,” At One Ventures’ Helen Lin told ImpactAlpha. The second fund has made nine investments. 

  • Inclusive VC. Companies in At One’s portfolio include battery recycler Ascend Elements, compostable packaging producer Cruz Foam, and Okra Solar, an Australia-based distributor of solar hardware and software to off-grid households in emerging markets. The firm is looking to boost its investment in regenerative solutions that support biodiversity, such as Dalan Animal Health, a portfolio company that has developed a vaccine for honeybees. At least 14 of the founders in the portfolio identify as people of color and women. Investors in the second fund include CalSTRS, MacArthur Foundation and the New Mexico State Investment Council.
  • More.

Ashtrom Renewable Energy snags $270 million in solar project financing. The funding from a consortium of banks, including ING Capital, Rabobank and Société Générale, will help the renewable energy developer complete a large-scale solar plant in Texas, where wind and solar power is booming despite Republican efforts to thwart it (for context, see, Don’t mess with Texas’s lead in the low-carbon energy transition”). The Tierra Bonita project, being developed with Austin-based OnPeak Power, is expected to produce 400 megawatts of power by the end of 2024. 

  • Tax credits. Ashtrom, a subsidiary of Israeli construction conglomerate Ashtrom Group, sold $300 million in 10-year production tax credits due under the Inflation Reduction Act to an unnamed US institution, in one of the first so-called tax credit transfer agreements for a solar project. Ashtrom secured a 20-year power purchase agreement last year to sell more than half of the project’s power to a San Antonio municipal utility.
  • Dig in

Dealflow overflow. Other deals crossing our desks:

  • Legal & General commits up to $100 million to ImpactA Global to support the women-led investment firm’s debt financing for sustainable infrastructure in emerging markets. (Legal & General
  • Houston-based Amperon Holdings raises $20 million from Energize Capital and others for its energy forecasting and analytics software. (Axios)
  • Sustainable supply chain-focused private equity firm Paine Schwartz Partners raised $1.7 billion for a dedicated food and agribusiness fund. (ESG Today)
  • Seattle’s Muir AI, which makes software to help corporations estimate their supply chain emissions, snagged $3.2 million from Base10 Partners. (Muir AI)

Signals: Impact Management

Using integrated analysis to inform impact investing decisions. Impact investors often ask, “Which investments have more impact,” all else being equal? All else is never equal. Some investments offer lower financial risk and/or higher financial return than others. Investors need to consider factors like cost, risk and operational complexity along with impact. “Integrated analysis brings together impact and financial considerations to inform decision-making,” write Jackson Gates and Mike McCreless of Impact Frontiers and Diane Kulju of Impact Capital Managers. In the third and final educational video in their “Impact for decision making” series, they dive into the tools investors can use to allocate resources effectively and maximize impact.

Agents of Impact: Follow the Talent

🎙️ Last chance to RSVP: Upstart Co-Lab and ImpactAlpha are co-hosting, “Investing in an inclusive creative economy,” with Upstart’s Laura Callanan and Ward Wolff, and ImpactAssets’ Deb Parsons, in conversation with ImpactAlpha’s Dennis Price, Thursday, Oct. 5. Register today.

Bamboo Capital Partners names David Grimaud, ex- of Symbiotics, as CEO. After 16 years, Bamboo founder Jean-Philippe de Schrevel is stepping away, following Bamboo’s acquisition earlier this year by Palladium…  Bridges Fund Management appoints Henry Jones, ex- of Axiom, as partner and head of value creation… Sonen Capital hires Amanda Feldman, co-founder of the Impact Management Project and Predistribution Initiative, as head of impact engagement. 

Ownership Works has an opening for a manager in New York… Illumen Capital seeks a chief of staff in Oakland, Calif… Environmental Defense Fund is on the hunt for a remote global climate cooperation manager… Triodos Bank is looking for an investment portfolio officer in Utrecht, Netherlands… The Department of Energy’s Loan Programs Office is on a hiring spree (see, “Energy Department looks to demonstrate, deploy and decarbonize”).

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

Thank you for your impact!

– Oct. 4, 2023