The Brief | April 8, 2022

The Week in impact investing: Community assets

ImpactAlpha
The team at

ImpactAlpha

TGIF, Agents of Impact! 

🗣 All hands on deck. Building by building. Block by block. Neighborhood by neighborhood. Both the low-carbon infrastructure retrofit and bottom-up, post-pandemic rebuild for inclusive prosperity require the full breadth of our community assets. Brooklyn-based BlocPower is activating overlooked talent in communities hard hit by gun violence (and opioid addiction) for a “civilian climate corps” to get the job done, as ImpactAlpha’s Roodgally Senatus reported this week. By helping startups tap their community of customers, users and fans as investors, online investment platforms like Wefunder and Republic are funding Black, Brown and women founders at 10 times the rate of venture capital. Local businesses are driving the post-pandemic economic revival on Tribal lands, in rural communities and urban settings, which makes Congress’ move to cut catalytic federal funding for small business all the more perplexing, as Jessica Pothering reported. 

Investing in overlooked community assets is an entire impact thesis. Women’s World Banking, which has long viewed women customers and employees as assets, raised $103 million for its second fund to invest in providers of inclusive financial services in emerging markets. Women-focused robo-advisor Ellevest raised $53 million from, yes, mostly women investors. Pension funds that have invested in women and diverse asset managers are, surprise, realizing better financial performance. Common Future’s model for uplifting community leaders was recognized this week with a Skoll Award for Social Innovation. And to ramp up investment and innovation, the climate tech community has ramped up its own assets, doubling the number of funds in just two years to 177, reported Amy Cortese. Agents of Impact are ImpactAlpha’s audience, our beat and our community assets. How do we know? The Brief is a winner of this year’s SABEW Best in Business awards for best newsletters in the business. Here’s to you! – Dennis Price

🎧 Impact Briefing. ImpactAlpha’s Roodgally Senatus joins host Brian Walsh to discuss his story – and photos – from the frontlines of BlocPower’s civilian climate corps in the Bronx. Dennis Price checks in with Wefunder’s Jonny Price and Fanbase’s Ramiro Canovas to learn how startups are turning their fans and customers into investors. Plus, the headlines.

👋 Next Call: Catalyzing adaptation finance to bridge equity gaps. Mitigation pays; adaptation is the realm of government and charitable funding. Or so the conventional wisdom has been. As climate change hits nearly every corner of the globe, investors are keying in on adaptation as an opportunity – and an imperative for the world’s most vulnerable communities. Join the Lightsmith Group’s Jay Koh, Apollo Agriculture’s Benjamin Njenga and other Agents of Impact to explore strategies for catalyzing adaptation finance and equity, and to share projects and models that point the way to a more resilient future.

The Week’s Agent of Impact

António Guterres, United Nations: Calling ‘BS’ on climate double-speak. The U.N. chief and former Portuguese prime minister has a simple critique of government and business leaders saying one thing on climate but doing another: “They are lying.” The Glasgow climate summit is barely four months behind us and already world leaders are backsliding on climate promises. Tightened energy supplies stemming from the pandemic and Russia’s invasion of Ukraine have politicians from Europe to Washington calling for more oil and gas production, even as they fall short of climate goals. The latest Intergovernmental Panel on Climate Change report paints fossil fuels more favorably than scientists intended, thanks to pressure from member-nation Saudi Arabia. Guterres is not buying it. “Investing in new fossil fuels infrastructure is moral and economic madness,” he said in an address after the release of the U.N.-backed IPCC report this week. Coal? “A stupid investment.” Those financing it “should be held to account.”

Guterres’ frank and colorful speech (he is fluent in four languages) has brought mainstream attention to the wonky climate assessments issued every six years. The IPCC’s February report detailing the effects of climate change was “an atlas of human suffering,” and a “code red for humanity,” according to Guterres. This week’s tome outlining mitigation action? “A litany of broken climate promises,” and a “file of shame.” The world needs to halve emissions by the end of the century to have a chance of limiting warming to 1.5 degrees Celsius. Instead, emissions are on track to rise. “We are sleepwalking to climate catastrophe,” Guterres warns. We should heed his words. By the time the next IPCC report lands in 2028, it may be too late.

The Week’s Dealflow

Deal spotlight: Carbon capture. Cutting emissions is not enough. Scientists now say that the need to remove carbon from the atmosphere is “unavoidable” if we are to keep warming to 1.5 degrees Celsius. Investors are pouring money into carbon capture technologies that can suck CO2 out of the air. This week’s mega-deal: Swiss direct-air carbon capture venture Climeworks raised $650 million to scale its CO2 collection facilities. Carbon removal technologies are needed alongside nature-based solutions to make up for hard-to-abate, high-emitting activities and achieve net-zero greenhouse gas emissions, reports ImpactAlpha’s Amy Cortese (see, “How climate investors are getting ready for the carbon removal boom”). Also this week: Brilliant Planet (formerly Susewi) raised $12 million from Union Square Ventures, Toyota Ventures and others to grow and use microalgae to capture and store carbon.

  • Climate accounting. You can’t manage what you don’t measure. Paris-based Sweep raised $73 million to help corporations track emissions. Deepki, also in Paris, raised $166 million to manage real estate emissions. U.K.-based global carbon management startup Emitwise secured $10 million to work with industrial companies. Also, Manifest Climate scored $24 million to help companies manage environmental risk.

Agrifood investing. South Africa’s Secha Capital and Tiger Brands’ venture fund backed plant-based meat company Herbivore Earthfoods… FarmTogether launched the Sustainable Farmland Fund to invest in farmland opportunities across permanent and row crops in the U.S… MycoTechnology raised $85 million in Series E funding to create sustainable food ingredients through mushroom fermentation.

Returns on inclusion. Sallie Krawcheck’s Ellevest raised $53 million, with women investors contributing nearly 70% of the total funds for the Series B round… Women’s World Banking raised $103 million to invest in women’s financial inclusion… Ohio-based Overlooked Ventures secured a commitment from Bank of America to invest in historically overlooked founders.

Inclusive fintech. Kenyan fintech venture Churpy raised $1 million to help local businesses automate accounts receivables and roll out working-capital financing… Colombia’s Leal raised $10 million to provide cash-back rewards for Latin American consumers to use on essential goods and services… Lendable and Quona Capital backed Khazna’s lending in Egypt.

Low-carbon transition. California’s software venture Liminal (formerly Feasible) clinched $8 million to help electric vehicle battery manufacturers optimize production… Adaptavate raised £2.2 million to slash the climate impact of building materials… Women-led Voyager Ventures raised a $100 million climate tech fund. 

Investing in health. HealthQuad raised $162 million for health tech startups in India… LEVY Health, a woman-led health tech venture in Germany, snagged €2.5 million to develop products to help women facing infertility.

Circular economy. Circulate Capital backed Indian plastic-recycling company Deluxe from its Circulate Capital Ocean Fund… Vox Capital invested in Octa to recycle cars in Brazil.

Education and skills. U.A.E.-based remote work platform Qureos raised $3 million in a round led by COTU Ventures and Colle Capital to expand apprenticeships and mentorship globally.

Inclusive communities. SDS Supportive Housing invested $10 million to develop permanent supportive housing for individuals experiencing homelessness in Northern California.

Water and sanitation. WaterEquity secured $153 million for water and sanitation impact.

The Week’s Talent

John Kluge steps down as CEO of Refugee Investment Network and is succeeded by Tim Docking, the organization’s managing director… Ankur Capital promotes Shreyansh Singhal to vice president of investments and Zahin Hussain to vice president of partnerships. Suraj Nair will lead Ankur’s TechSprouts network and podcast series… Social Finance’s Tracy Palandjian is elected to join Harvard Corporation.

Aaron Bourke, ex- of Reed Smith, joins impact-focused law firm RPCK Rastegar Panchal as senior counsel and head of the fund formation practice… Morgan Stanley’s Jamie Martin is named head of the firm’s global sustainable finance team in Europe, the Middle East and Africa… FSG’s Harvey Koh steps down as managing director to become a senior advisor and pursue independent interests. 

Robyn Luhning is promoted to chief sustainability officer at Wells Fargo… Northern Arc appoints Ashish Mehrotra, ex- of Niva Bupa, as CEO… Enrique Alvarado Hablutzel, ex- of Bamboo Capital Partners, joins Chi Impact Capital as co-founder and managing partner… Hunter Greene, ex- of SVB/Walt Arnold Commercial Real Estate, joins OneTen Capital as general partner.

The Week’s Jobs

WEPOWER is hiring a senior digital director, a vice president of development and director of organizing and campaignsGlobal Innovation Fund seeks an investment analyst on its risk-capital team in London… The Miller Center for Social Entrepreneurship is looking for a director of corporate and foundation relations and a manager of impact investing

Decolonizing Wealth Project is hiring paid summer interns… Pacific Community Ventures seeks a credit underwriter of small business lending and other roles… FMO seeks a capacity development officer… Apis & Heritage Capital Partners is hiring an investment analyst in Washington, D.C… Luminate is recruiting for roles in Sao Paulo, Nairobi, Washington, D.C. and London.

Omidyar Network is hiring a learning and impact associate… Generation Investment Management is looking for an engagement associate… Intelligent Impact Advisory is looking for a junior analyst… Dalberg Catalyst in hiring a program manager, special advisor and a senior consultant… UNDP seeks a technical specialist of taxation and gender equality.

That’s a wrap. Have a wonderful weekend. 

– Apr. 8, 2022