The Week in Impact Investing: Climate+

The team at

ImpactAlpha

TGIF, Agents of Impact! In today’s Brief:

  • Climate beta and impact alpha
  • Building BlackGPT
  • Electrifying school buses
  • Plus, dozens of deals, jobs and people moves

🗣 Climate beta. The flip side of climate risk is climate opportunity. The changing climate is behind the cholera outbreak in Africa. Hurricanes and wildfires have driven insurers out of swaths of Florida and California. Migration to the US is being exacerbated by climate shocks, according to the International Monetary Fund. At the same time, demand for renewable energy, climate-resilient infrastructure and sustainable agriculture is fueling a global green jobs boom, declare Dalberg’s Charlie Habershon, Kusi Hornberger and Inês Charro. That’s spurring upskilling initiatives for Africa’s youth across the continent, as Lucy Ngige and Jessica Pothering report. Around the world, the need for low-carbon, low-cost housing is turning affordable housing into a climate investment, write Habitat for Humanity International’s Jitendra Balani, Naeem Razwani and Elizabeth Vivirito. For investors who want to leverage two huge value-drivers, Heading for Change’s Natalie Shriber suggests six questions to level up investments in climate + gender.

“Climate beta” is a measure of volatility – and a way to distinguish companies vulnerable in the climate transition from those set to ride the shift to net-zero. The electric-vehicle transition in the US has turned volatile; that will help sort the ultimate winners from the faint of heart (see my post, “Is the EV glass half-full or half-empty?”). Small operators and public agencies that have relied on oil and gas revenues are installing solar panels and wind turbines on federal lands where pumpjacks and gas rigs have long dominated, as Amy Cortese reports. The Greenhouse Gas Reduction Fund, aka “the green bank,” is set to turbocharge community lending later this year, opening opportunities for impact investors to place equity and debt, as West Potomac Capital’s Hana Freymiller and Neil Gregory explain. “What investors are seeing is the ability to create a new economy that is not extractive, that is more just, that addresses the needs of the 21st century,” DBL’s Nancy Pfund told Dennis Price. With climate + jobs, housing, health, gender, justice and more, investors are learning how to find impact alpha. – David Bank

The Week’s Call

Plugged In: Building an inclusive AI with ‘BlackGPT’ (video). Pressure has been building on Meta, Google, Microsoft and OpenAI to address bias in large language models and get right the stories of Black history and culture. “Black and Brown people should own their stories,” Latimer.ai’s John Pasmore told Plugged In host Sherrell Dorsey. Latimer recently released its own beta “BlackGPT,” loaded with Black historical and cultural facts, including from Amsterdam News, the nation’s oldest Black newspaper. If the tech giants eventually get the story right, great, says Pasmore, “I think we should build it ourselves. They can take our API, and always be correct.” 

The Week’s Dealflow

Deal spotlight: Can school buses balance the electricity grid? A $1.3 billion valuation for electric school bus maker Zum reflects the value of giving kids a cleaner way to get to school. The Redwood City, Calif., startup raised $140 million to build a fleet of 10,000 electric school buses over the next three years. When not in use, the buses serve effectively as batteries on wheels, providing power back to the electricity grid. Along with its raise, Zum formed a partnership with software developer AutoGrid to manage more than one gigawatt of energy storage capacity, enough to power one million homes for up to four hours. The fleet will become one of the world’s largest virtual power plants, or VPP, when fully deployed. Zum last month was awarded $26 million from the Environmental Protection Agency’s Clean School Bus Program. Backup storage and grid resilience is worth a lot to utilities, and to communities as well. The Electrification Coalition last year provided districts with a handbook for using electric school buses to power schools and shelters in emergencies.

  • Magic school bus. Just this week, Baltimore City Public Schools added 25 electric buses to its fleet, with the help of a $9.4 million EPA grant. Generate Capital, which this week raised $1.5 billion in equity, has a joint venture with Georgia-based electric bus maker Blue Bird Corp. “to accelerate the transition to clean air and transportation that all of our families, communities, and school districts are demanding,” said Generate’s Scott Jacobs.
  • Smart routes. In addition to its vehicle-to-grid, or V2G capabilities, Zum touts its AI-assisted route scheduling and app that alerts parents when students board the buses. “Zum is on a mission to revolutionize student transportation,” said Zum’s Ritu Narayan, “moving beyond the status quo towards a future where innovative technologies are used to advance sustainability efforts.” 

Agrifood tech. Aquaconnect raised $4 million to link India’s fish farmers to supplies and markets… Cambridge, Mass.-based Inari raked in $103 million to breed climate-resilient plant seeds using AI and gene editing. 

Carbon markets. Captura scored $33.5 million to capture carbon from the oceans… Cultivo clinched $14 million to unlock capital for nature-based projects… The World Bank and Citi are partnering on a $100 million bond to address plastic waste and generate carbon credits in Ghana and Indonesia. 

Catalytic capital. CARICOM Development Fund anchored Caribbean climate resilience fund… Sorenson Impact Foundation inked five investments for underserved communities… Timbuktoo Africa Innovation Fund snagged a $3 million seed commitment from Rwanda’s government to mobilize commercial capital for early-stage startups in Africa.

Energy transition. Woman-led Ecofy scored $10.8 million to expand green financing for electric vehicles, rooftop solar and climate-focused SMEs in India… Crux scored $18.2 million to link clean energy developers with tax credits available under the Inflation Reduction Act… FMO invested $10 million in Nithio to finance companies improving access to renewable energy for African households and businesses… Future Energy Ventures raised €110 million to invest in early-stage decarbonization technologies… Schroders’ Greencoat group agreed to buy 53 solar farms in the UK.

Fund news. Foresight Group’s SME Impact Fund secured a €25 million commitment to support Irish small and mid-sized enterprises in their sustainable transition… London-based Giant Ventures raised a $150 million climate growth fund. 

Green materials. New York-based GreenSpark clinched $9.4 million for software to help metal recyclers improve their operations… Sweden’s H2 Green Steel hauled in more than $5 billion for green steel plant.

Inclusive economy. Creation Investments Capital Management backed AVLA’s $25 million equity round to expand its small business insurance coverage to the US… MoveInSync, which provides affordable green commuting services via employers in India, raised $15 million. 

Investing in health. Accompany Health raised $56 million to provide healthcare to low-income and other underserved patients with complex needs… Aster raised $2.4 million for patient management software for women’s health providers… Cross-Border Impact Ventures raised $90 million to invest in women’s and children’s health… London-based Giant Ventures raised a $100 million fund focused on health and economic inclusion in the UK and US. 

Waste to value. ResponsAbility backed CleanEdge Resources for wastewater treatment and waste-to-energy… Transmutex snagged $20 million Swiss francs to commercialize a process that burns and recycles nuclear waste for clean energy.

The Week’s Talent

US President Joe Biden tapped clean energy advisor John Podesta to succeed John Kerry as climate envoy… ImpactAssets Capital Partners promoted Houda Ferradji and Helena Hong to investments principal and Siobhan King to portfolio management director… Total Impact Capital promoted Eliza Doll to vice president… Alexis Shivick, previously with Vanguard Charitable, joined Reinvestment Fund as risk and compliance manager.

Veris Wealth Partners named Eric Hsueh, formerly of Bivium Capital Partners, as director of investments… Ava Community Energy (formerly East Bay Community Energy) promoted Annie Henderson to chief customer officer… Edge Growth Ventures hired Janice Johnston, who previously worked on South Africa’s Just Energy Transition Investment Plan, as CEO… Future Fund, Australia’s sovereign wealth fund tapped Greg Combet, the country’s former climate change minister, as chair.

Former Massachusetts Gov. Deval Patrick, previously with Bain Capital, joined Vistria Group as a senior adviser… Jeremy Coller Foundation appointed Fiona Reynolds to president of the FAIRR Initiative… Amir Chireh Mehr, a former vice president at Climate Real Impact Solutions, joined Elemental Excelerator as a senior investment director. Mark Chambers, previously a director at Earth Alliance, joins the nonprofit climate tech investor as VP of partnerships.

The Week’s Jobs

US Jobs

In New York: Black Farmer Fund seeks a development and investor relations director… Maycomb Capital is looking for a finance and operations analyst… Ralph Lauren seeks an impact and sustainability manager… Ford Foundation is looking for an impact investing fellow… Viridian Group is on the hunt for an energy transition investment associate… BlocPower is on the hunt for a full-time intern in Brooklyn. 

Forum Mobility has an opening for a finance manager in San Francisco… The city of Birmingham, Alabama, has an opening for a chief resilience and sustainability officer… Tesla is looking for a manager of environmental affairs in Austin, Texas… NASCAR is hiring a community impact and sustainability coordinator in Charlotte… CapShift seeks a client experience manager, as well as six summer interns and fellows in Boston.

International jobs

Blue like an Orange Sustainable Capital has an opening for an intern in its legal department in Luxembourg… UnLtd is hiring a UK-based portfolio manager… Morgan Stanley is hiring a London-based ESG data specialist for its global sustainability group… Temasek is looking for an impact investing associate in Singapore… Platinum Pacific Partners seeks an impact investing associate in Sydney.

Remote jobs

Autodesk is hiring an impact and ESG specialist… New Energy Nexus is on the hunt for a CEO… The Fund to Build Grassroots Power, a supportive fund for networks and alliances in the US advancing environmental and climate justice, is recruiting an executive director… Second Horizon Capital is on the hunt for a community engagement intern… Autodesk is hiring a sustainability specialist for impact and ESG… The Families and Workers Fund is hiring two program fellows. 

💼Share the week’s impact jobs. View dozens of other jobs on our new job board. Want to post a listing? Submit it here.

That’s a wrap. Have a wonderful weekend. 

– Feb. 2, 2024