TGIF, Agents of Impact!
Going exponential. Greenhouse gas emissions fell about 7% last year as the COVID-19 pandemic shut down large parts of the global economy. That nearly achieved the reduction that is needed every year to keep global warming below the 1.5º Celsius increase considered the threshold for catastrophe. Instead, the International Energy Agency forecasts emissions will increase this year by 1.5 billion tons, or 5%. To talk about accelerating progress when we are still stuck in reverse is wildly premature. And yet wild talk may be a crucial precondition for progress. This week’s escalation of commitments to dramatic carbon reduction by 2030, most notably by the U.S., sets an expectation for the low-carbon economy of which entrepreneurs, investors, companies and countries all want a piece (see No. 1, below). Cost curves are falling; dealflow is frenzied. “The FOMO is getting real,” we wrote this week. Call it The Great Acceleration, and make it so. – David Bank
Impact Briefing. On this week’s podcast, host Monique Aiken checks in with Nathan Cummings Foundation’s Rey Ramsey (see No. 3) and The Case Made’s Tiffany Manuel, and chats with ImpactAlpha’s Amy Cortese about climate action news. Plus, the headlines. Tune in, share, and follow us on Apple, Spotify or wherever you get your podcasts.
Clubhouse conversation. We’ll be back on the drop-in audio app today to talk about The Great Acceleration, the week’s headlines and whatever’s on your mind, hosted by Encourage Capital’s Ricardo Bayon and ImpactAlpha’s Lyneka Little. Find us at 9am PT / 12pm ET / 5pm London. Drop by.
The Week’s Big 7
1. 2030 is the new 2050. Net-zero by 2050 no longer impresses. The real marker: Total greenhouse gas emissions have to be halved, at a minimum, by 2030. And leading companies and countries need to go further faster to make up for the laggards and secure their positions in a low-carbon economy. The race to net-zero is turning climate action from a drag to a driver of financial performance and economic growth – and a competitive business and national advantage. Great acceleration.
- Rising ambitions. Don’t let the tech snafus and diplo-speak mask the message. At his Earth Day summit, U.S. President Joe Biden announced the U.S. will cut greenhouse gas emissions at least 50% by 2030, doubling the target set by former President Obama. U.K. Prime Minister Boris Johnson took the biggest leap, committing the U.K. to 78% cuts by 2035; the E.U. is pledged to a 55% cut by 2030. Even Brazil’s President Jair Bolsonaro accelerated by a decade Brazil’s deadline for carbon-neutrality, to 2050. On tap: billions more for the Green Climate Fund and other financing for developing nations to combat and adapt to climate change.
- Dealmaking frenzy. Climate tech to cool the planet is hot. Investments in the sector reached a record $16.4 billion in 2020. Some of the latest: Pale Blue Dot closes its debut climate tech fund… CarbonCure Technologies and CarbonBuilt each win $7.5 million for carbon capture and reuse in the cement industry… Electric boat-maker X Shore draws in $17 million… BlocPower raises $1 million on crowdfunding platform Raise Green… Vietnamese e-motorbike venture Dat Bike secures $2.6 million… Volvo’s electric vehicle company Polestar snags $550 million… CleanCapital secures $300 million to acquire 63 megawatts of solar projects… Blue like an Orange invests in Órigo Energia to boost solar energy access in Brazil. More.
2. Centering community power in investment decision-making. Dozens of locally-driven funds and trusts across the U.S. are giving communities agency in investment decisions in order to build long-term power for participants. Giving communities power to design fund structures and veto investments “can create power where the affected stakeholders are meaningfully engaged,” write Transform Finance’s Andrea Armeni, Shante Little and Curt Lyon. Impact on.
- A community vision for West Oakland. In a fast-gentrifying neighborhood, the East Bay Permanent Real Estate Cooperative jumped on the opportunity to buy a faded icon: Esther’s Orbit Room, where Billie Holiday and B.B. King once headlined. The acquisition is the first phase of the co-op’s vision for a community-governed Black Cultural Corridor. Westside story.
3. The Reconstruction: Rey Ramsey’s 100% impact mandate. The Nathan Cummings Foundation says it has nearly fully aligned its $450 million endowment with its mission goals. The result: stronger financial returns than the foundation’s traditional investment approach. On the latest edition of The Reconstruction podcast on ImpactAlpha, Nathan Cummings’ Rey Ramsey speaks with host Monique Aiken about debunking the 100% impact skepticism that dominates foundation boards and investment committees. “People hide behind the issue of financial returns. And that is a ruse and it is an excuse.” Hear him out.
4. Finding a gender edge in Pakistan. Women-led startups in the fifth-largest country in the world raised just $1.8 million in venture capital in 2020—of $300 billion committed worldwide. Early-stage VC fund i2i Ventures is leaning into that gap, and overlooked opportunities in Pakistan generally, to capture financial and impact alpha. “We’re not an impact fund,” said i2i Ventures’ Misbah Naqvi. “We are a commercial fund with a gender lens.” Gender smart.
5. Replenishing ecosystems in Latin America. At the World Resources Institute’s Land Accelerator Demo Day this week, 15 startups in Latin America pitched their plans to restore degraded land, fuel sustainable agriculture and conserve wildlife. The solutions aim to create sustainable plantations on Mexico’s abandoned pastureland; support indigenous livelihoods in agriculture and textiles in Peru; and promote eco-tourism in restored cloud forests in Ecuador. Collect the whole set.
6. An inclusive recovery for island economies. Overheard at last week’s Island Finance Forum: pathways to a clean energy transition, financial relief for women micro-entrepreneurs affected by the pandemic, and financial inclusion for island communities’ young people. Get the recap.
7. Next normal now. The future of economic growth and prosperity is inclusive, responsible and shared. “Inclusion grows the pie,” said Ford Foundation’s Darren Walker at the first of the Global Impact Investing Network’s “Next Normal Now” series of convenings charting systemic change. Some approaches on display: listening to low-income consumers (LeapFrog Investments), accelerating employee ownership models (Impact Engine), expanding investment opportunities in emerging markets (GuarantCo), and tuning into Indigenous communities’ inherent long-term worldview. Tune in.
- Climate action. The next session of the GIIN’s “Next Normal Now” series is set for Wednesday, June 16. Stay tuned.
The Week’s Dealflow
Agrifood investing. Misfits Market raises $200 million to sell ‘ugly’ fruits and vegetables… New Zealand’s Finistere Ventures and Growth Capital Partners are raising a fund to commercialize innovations in sustainable food and agriculture… Revo Foods clinches €1.5 million for plant-based, 3D-printed ‘salmon’… Mister Veg raises $570,000 for plant-based meat and seafood products in India.
Returns on inclusion. ExecOnline raises $45 million to diversify corporate leadership… Accion Opportunity Fund secures $40 million to lend to minority and immigrant-owned businesses… Mastercard invests $25 million in Fearless Fund to make early-stage investments in women-of-color-owned businesses… Indigenous Growth Fund raises $150 million to back Native lenders in Canada.
Community investing. Three German pensions back Catella Residential Investment Management’s green housing fund…The Episcopal Church’s Pension Fund discloses its commitment to Turner Capital’s second Multifamily Impact Fund.
Financial inclusion. Lendable extends $15 million in debt to Philippines-based fintech Uploan… Tribal Credit scores $34.4 million to offer digital credit cards to small businesses in emerging markets… Fintech Plentina secures $2.2 million to boost access to credit in the Philippines.
The Week’s Talent
Intel Corp. names Dawn Jones as chief diversity and inclusion officer and vice president of social impact… Former Proterra CEO Ryan Popple and Francesca Whitehead, ex- of KKR’s Global Impact Fund, join G2VP to focus on sustainable industrial transformation… Treasury Secretary Janet Yellen names John Morton, ex- of Pollination, to lead Treasury’s new Climate Hub… Impact Capital Managers places 19 graduate students from traditionally under-represented backgrounds at impact investment funds through its Mosaic Fellowship. The fellows include Benjamin White (with Urban Us), Kendall Bedford (Spring Lane Capital), Mariam Dembele (Achieve Partners) and Stella Liu (Arborview Capital).
The Week’s Jobs
ISF Advisors is hiring a project manager and an investment associate… Lowercarbon Capital seeks a synthetic biology associate… KKR is recruiting a vice president of strategic ESG and impact reporting in New York… Great Lakes Protection Fund is looking for a project development manager in Evanston, Ill… New Media Ventures is looking for a vice president of people and operations in the San Francisco area… Envestnet is hiring an impact solutions specialist… Impact Management Project seeks a summer associate.
Emerson Collective is hiring an associate or senior associate of energy and environment in Palo Alto, Calif… Global Development Incubator is looking for a global coordinator and project developer in agricultural finance in Washington, D.C…. Clean Edge seeks a part-time analyst in Portland… CapShift is hiring a marketing director… The Visa Foundation seeks an investment officer in Washington, D.C… Kapor Capital is hiring a portfolio services director in Oakland… Village Capital is looking for a program manager for Europe based in London.
That’s a wrap. Have a wonderful weekend.
–Apr. 23, 2021