Incorporating both climate and gender angles in an investment thesis is table stakes for fund managers seeking to attract investors, one general partner observed at a convening of for emerging market managers in Dar es Salaam two years ago. Since then, ImpactAlpha has tracked more than 40 funds addressing challenges at the intersection of climate and gender. The growth reflects the increasing awareness that climate action depends on women, and that gender equity includes addressing the climate change’s distinct impacts on women.
“More investors are seeing that gender is a lens that can cut across climate and other thematic opportunities, and that it offers the potential to enhance returns, mitigate systemic risk and deepen value creation,” says Sana Kapadia of Heading for Change, the climate + gender investor and ecosystem builder started by the late Suzanne Biegel (disclosure: Heading for Change sponsors ImpactAlpha’s climate + gender coverage).
In the run up to Climate Week NYC later this month, ImpactAlpha’s Liist of impact funds that are actively raising capital highlights the range of approaches fund managers are taking to address the climate + gender nexus.
Kenya-based climate tech investor KawiSafi Ventures, part of the Acumen network, is aligning its second fund with the 2X Criteria, a nod to women as makers, buyers and users of the products and services in its portfolio.
“We want to source a pipeline that has gender representation,” KawiSafi’s Amar Inamdar told ImpactAlpha.
Women-led EcoEnterprises Fund is raising its fourth fund to strengthen the climate resilience of Latin America’s rural, low-income and vulnerable communities, while protecting the region’s biodiversity and natural resources. In India, women-led Avaana Capital is in the market with a $120 million fund to support early stage tech ventures that help India mitigate and adapt to climate change.
Three managers on this month’s Liist are in the market with funds that seek to enlist nature as our biggest ally in the fight against climate change. The Global Fund for Coral Reefs, managed by Connecticut-based Pegasus Capital Advisors, is one the few commercial-scale impact funds focused on SDG No. 14: Life below water (go deeper with ImpactAlpha’s Q&A with Pegasus’s Dale Galvin). Beartooth Group in Montana is focusing on life on land: it had a first close earlier this year for its targeted $40 million fourth fund to acquire and restore degraded land in the western US (here’s ImpactAlpha’s report on Beartooth’s first fund, way back in 2014). A spate of recent investments testify to the growing recognition of natural value, including the World Bank’s first outcomes-based bond to reforest the Amazon.
On this month’s Liist:
- Avaana Capital’s Sustainability Fund
- Beartooth Capital Fund IV
- EcoEnterprises Fund IV
- Global Fund for Coral Reefs
- KawiSafi Ventures Fund II
Disclaimer: The Liist and this post are based on available information, sourced by ImpactAlpha. Information has not been further reviewed by the managers nor verified by third parties, is not guaranteed for accuracy or completeness, and should not be relied upon as investment advice or recommendations. Nothing in The Liist, this post or on ImpactAlpha.com shall constitute an offer to sell or the solicitation of an offer to buy securities.
Avaana Capital’s Sustainability Fund
Mumbai-based Avaana’s mission is to support India’s economic development through green growth. “India needs to continue to drive manufacturing growth, increase farm incomes, bolster domestic consumption, and bring critical goods and services to the Indian masses, without creating further adverse impacts on climate,” Avaana’s team states.
The women-led firm backs early stage tech startups that address climate change resilience, adaptation and mitigation. It looks for technologies in supporting renewable energy efficiency and adoption, low-carbon transportation, natural resources management, resilient food systems and supply chains, green and resilient infrastructure, and economic resilience.
Avaana is especially interested in technologies enabled by AI, blockchain and connected devices.
- Type of investments: Equity
- Where fund is domiciled: India
- Geographic focus: India
- Commitments/investors: Up to $24.5 million in equity from the Green Climate Fund
- Who is eligible to invest: Development finance institutions, high net-worth individuals, corporations
- Fund leadership: Women-led
- Sample investments: Five investments, including rooftop solar finance company Aerem, EV charging software developer Kazam, and indoor farming startup Eeki Foods
- Sample impact metrics: Social (number of farmers, women and/or small businesses); economic (jobs created, income enhancement enabled, sustainable supply chains catalyzed); environmental (water and/or energy savings, waste reduction, greenhouse gas reduction, climate-resilient food produced)
- Contact information: Shrishti Parikh
Beartooth Group Fund IV
Montana-based Beartooth Group acquires and restores degraded land in the Western US. The firm, which launched in 2004, has restored about 30 properties through three funds. Beartooth is in the market with a fourth fund that is looking to raise $40 million. It reached a $22 million first close in June.
Beartooth has so far made two investments from the fund. Its most recent is a 400 acre property near Bozeman, Mont., where Beartooth headquartered. The land’s natural wetlands had been drained and a nearby creek was in poor condition because of sediment. Beartooth plans to restore the wetlands and the creek into a natural fishery during its roughly 10-year ownership.
As with all of its properties, the fund’s investors will have recreational access to the site while it’s under Beartooth’s ownership.
- Type of investments: Real estate equity investments of around $3 million
- Fund structure: 10-year fund with a five-year investment period
- Where fund is domiciled: Bozeman, Mont.
- Geographic focus: Western US states of Montana, Idaho, Wyoming, Colorado
- Commitments/investors: $22 million first close in June
- Who is eligible to invest: Accredited investors
- Sample impact metrics: miles of creeks and rivers restored, acres of land/wetlands restored and sustainably managed, hazardous materials cleanup, removal of wildlife inhibitors, like fencing
- Contact information: James Dockery
EcoEnterprises’ Fourth Fund
Latin America is fertile ground for nature-based investment strategies. Bogota and Washington, DC-based EcoEnterprises Fund has been at it longer than most.
The women-led investment firm has notched nearly 25 years of experience, three funds and 50 investments in support of the region’s natural ecosystems, and the biodiversity and communities that depend on them. It’s now in the market with its fourth fund to finance sustainable agriculture, agroforestry, agtech, aquaculture, ecotourism, climate tech and “other adjacent sectors that preserve and restore natural habitats, promote climate action, and create social equity concurrent with generating financial returns.”
EcoEnterprises is looking to raise $150 million.
- Type of investments: Growth capital in the form of equity, mezzanine debt instruments with upsides, and quasi-equity
- Fund structure: 10-year traditional GP/LP
- Geographic focus: Latin America and Caribbean
- Commitments/investors: IDB Invest, Wire Group; planned first close in Q4 ($50 million expected)
- Who is eligible to invest: Institutional and accredited investors
- Fund leadership: Women-led
- Additional fund features: Technical assistance support and advisory for portfolio companies
- Sample investments: Past fund investments include Mexico-based SistemaBio, a developer and manufacturer of prefabricated biodigesters for smallholder farmers; acai processor Sambazon; and insect farming venture ProNuvo
- Sample impact metrics: Acres of land under sustainable management or set aside for conservation; annual greenhouse gas emissions and savings; employment generation; salary payments (for both male and female employees); women’s company ownership and leadership/management; number of smallholder farmers and local suppliers supported; community involvement
- Contact information: get in touch via LinkedIn
Global Fund for Coral Reefs
The Global Fund for Coral Reefs is a public-private coalition directing capital to solutions for the least-invested Sustainable Development Goal: Number 14, life below water. The fund has two components: an investment fund managed by Connecticut-based Pegasus Capital Advisors, and a grant and technical assistance fund, managed by a UN global team.
The Pegasus-managed investment fund is among the few commercial-scale impact funds targeting marine ecosystems. It is looking to raise $500 million for interventions that protect and restore critical coastal marine habitats in the global south, including fisheries, aquaculture, hospitality and solutions in the circular economy. GFCR aims for market-rate returns while benefiting coral reef ecosystems and their dependent communities.
“We need to change the trajectory of how companies and businesses and communities and governments interact with the oceans in a much more sustainable way,” Pegasus’ Dale Galvin said in a Q&A with ImpactAlpha.
The fund has made four investments. Its most recent investment is Brazil-base Agrion, a developer of organic crop treatments for sugarcane producers. The company recycles sugarcane crop waste into new fertilizers and pesticides that aren’t harmful to soil or water supplies.
- Type of investments: Equity and mezzanine ranging between $5 million and $75 million. Most of the capital is earmarked for growth equity. A portion will be used for venture capital and project financing.
- Fund structure: LP/GP with a first loss/junior tranche
- Additional fund features: 2X gender-lens alignment; investments can be paired with grants and technical assistance from the UN-managed grant vehicle
- Where fund is domiciled: Luxembourg
- Commitments/investors: Green Climate Fund and unnamed institutional and philanthropic institutions; the fund has reached a second close but has not disclosed how much it has raised
- Sample investments: four investments, including Brazilian crop treatment developer Agrion, and Carbonwave, which is making seaweed-based soil additives and cosmetic ingredients
- Sample impact metrics: acres of high-value seascape and coral reefs improved; number of direct employment opportunities created in fisheries, aquaculture, tourism, waste management in coral reef-dependent communities; number of indirect beneficiaries
- Contact information: GFCR Investment Fund
KawiSafi Ventures Fund II
KawiSafi Ventures has been investing in clean energy technologies and access in Africa since 2016. Now in the market with its second fund, the Acumen subsidiary is expanding into other climate technologies, including battery storage, carbon markets, AI and data applications, e-mobility and climate fintech.
With its second fund, KawiSafi firm is deepening its focus on women in the clean energy transition, says managing director Amar Inamdar. “We want to source a pipeline that has gender representation.”
It is also expanding from East Africa to West Africa. In Nigeria, for example, frequent power cuts and the government’s recent termination of fuel subsidies is driving more interest in solar and clean energy solutions. “We see a lot of opportunity in battery storage and the displacement of diesel generator sets for the small business segment in particular,” KawiSafi’s Marcus Watson told ImpactAlpha.
“We’re excited to invest across West Africa – both anglophone and francophone West Africa – and we also see opportunities in Central Africa in the Democratic Republic of the Congo,” he added.
KawiSafi is looking to raise up to $200 million. It has secured anchor investments from the African Development Bank and the Green Climate Fund, both of which are investing in the fund’s junior equity/first-loss tranche.
- Type of investments: Early growth equity with checks of $1 million to $5 million
- Fund structure: LP/GP
- Additional fund features: Blended finance with a junior/first-loss tranche + return enhancement for senior investors
- 2X gender-lens alignment; technical assistance
- Where fund is domiciled: Ontario, Canada
- Commitments/investors: Green Climate Fund (approved up to $50 million depending on matching funds), African Development Bank — both are junior/first-loss investors
- Who is eligible to invest: Accredited investors
- Sample impact metrics: CO2 emissions avoided; number of customers impacted; job creation; gender balance (women-owned companies, women in company management/leadership; number of female employees and customers)
- Contact information: KawiSafi team
