TGIF, Agents of Impact!
Doing something. As a horrified nation tried to make sense of yet another mass murder in yet another school, challenger Beto O’Rourke confronted Texas Governor Greg Abbott in the grief-stricken city of Uvalde. Abbott deflected questions about his moves to loosen access to guns, including to powerful assault rifles like the one an 18-year-old bought legally and used to kill 19 children and two teachers. “This is on you!” O’Rourke shouted. “You said this was not predictable. This was totally predictable when you chose not to do anything.” Doing nothing has effectively been our collective response to mass shootings, white supremacy, climate change and other systemic challenges. Even Engine No. 1, the scrappy fund manager that made its name last year taking on ExxonMobil over climate action, is now opting for accommodation over confrontation with Big Oil and big banks, as ImpactAlpha’s Amy Cortese scooped this week. And two decades of failure to confront homogeneity in asset management has led to a misallocation of resources in the economy – with real implications for women’s and civil rights, as Imogen Rose-Smith lays out in her latest Institutional Impact column.
Agents of Impact prefer to confront obstacles head-on. BlocPower’s Donnel Baird this week rolled into (and live tweeted from) Davos with the hypothesis that BlocPower’s approach to greening thousands of buildings in Brooklyn and Ithaca, N.Y. could best any decarbonization plan presented at the World Economic Forum. “What I have learned over the past week is that my hypothesis was correct,” he tells ImpactAlpha’s Roodgally Senatus in a new Agents of Impact podcast. With proposed rule changes, the U.S. Securities and Exchange Commission appears a bit more serious about confronting greenwashing in ESG and sustainable investments and “instilling transparency and accountability across capital markets,” says Fran Seegull of the U.S. Impact Investing Alliance.
And impact investors like Mission Driven Finance, Developing World Markets and Calvert Impact Capital are confronting the softening economy with resilient, low-volatility investments in small, stable businesses delivering essential products and real revenues. Let’s celebrate actions that confront challenges. As we’re learning all too harshly, choosing not to act is also a choice. – Dennis Price
The Week’s Podcast
🎧 Impact Briefing. Host Brian Walsh is joined by roundtable regulars Imogen Rose-Smith and David Bank to chew over what institutional and impact investors might – and might not – do when it comes to guns and abortion. Plus the headlines.
- Listen to this week’s episode, and follow all of ImpactAlpha’s podcasts on Apple, Spotify or wherever you listen.
The Week’s Agent of Impact
Olu Oyinsan, Oui Capital: Investing in Africa’s mass market. Five years ago, Olu Oyinsan felt an urgent pull back to his native Nigeria while working in the early-stage practice of Silicon Valley Bank in Boston. He had been following venture capital deals in Africa and was struck by the acceleration of startups launching and raising capital. “I felt like we were getting to an inflection point for emerging markets, especially in Africa, and that anyone who cared about emerging markets needed to get involved,” Oyinsan tells ImpactAlpha. Oyinsan launched Oui Capital in Lagos with a specific mission of investing in early-stage companies that “get to the root of poverty” in Africa. The fund screens for companies solving problems that affect the majority of Africans and which help them earn, save and invest their money. One portfolio company, TeamApt, enables anyone with a mobile phone and point-of-sale machine to become a local bank branch. The company has helped create more than 160,000 jobs and expanded access to digital financial services in low-income and remote communities, Oyinsan says. “If you’re not building for the mass market, you’re probably not going to be around very long or grow very much.”
Oyinsan and his team have stretched a $5 million “proof of concept” fund across nearly 20 companies, including enterprise software startup Duplo, mobility venture AwaBike, and women-focused fintech venture Herconomy. For every $1 million Oui has invested, its portfolio has secured $40 million in co-investment and follow-on capital, Oyinsan says. Oui is targeting $30 million for its second fund. Times have changed. When Oui launched, “investing in an African fund with at least a negative screen was an impact investment,” observes Oyinsan. “That’s probably not sufficient today. So we keep tightening the screw on what we consider an impactful company.” With all of the foreign capital that has come into Africa in recent years, Oyinsan says it’s important for African fund managers like Oui to lead seed and Series A rounds. “It has a catalytic effect,” he says. TeamApt’s valuation has grown from $12 million to $850 million; one of TeamApt’s executives is planning to invest in Oui’s second fund. “You see how the wealth that’s been created stays in the ecosystem,” Oyinsan says, “and creates more successful companies that touch more people.”
- Read Jessica Pothering’s full Q&A with Olu Oyinsan, “Oui Capital: Investing in Africa’s mass market,” on ImpactAlpha and share the story on Instagram.
- Meet Olu Oyinsan on next week’s Call. Go deeper on “Fintech, crypto and financial inclusion in Africa,” with Oyinsan, Nelly Chatue-Diop of Cameroon’s crypto-trading startup Ejara, Mercy Corps Ventures’ Scott Onder and other Agents of Impact on Call No. 43, Wednesday, June 1 at 8am PT / 11am ET / 6pm Nairobi. RSVP today.
The Week’s Dealflow
Deal spotlight: Catalytic capital. Patient, risk-tolerant, concessionary and flexible capital can make high impact deals work. MacArthur Foundation committed $20 million in grant capital and long-term loans to help four communities break the link between housing instability and incarceration. British International Investment provided a $100 million guarantee to unlock supply-chain financing in Africa. And Inclusive Prosperity raised $13 million in program-related investments for energy upgrades in underserved communities.
- Educating practitioners. The Catalytic Capital Consortium, a collaboration between the MacArthur and Rockefeller foundations and Omidyar Network, deployed grants to Latimpacto in Latin America and venture philanthropy networks in Asia, Africa and Europe to educate investors on the use of catalytic capital. (C3 sponsors ImpactAlpha’s coverage of catalytic capital.)
Low-carbon transition. Alphabet, Microsoft and Salesforce will spend a combined $500 million on CO2 removal as part of The First Movers Coalition, a public-private decarbonization partnership that gained new commitments at Davos… a16z led Flowcarbon’s $70 million round to improve voluntary carbon market transparency… London-based Seabound scored $4.4 million in a seed round to build carbon capture tech for ships… ChargeLab secured $15 million in Series A funding to help EV charger manufacturers manage their equipment… India’s M Auto raised $20 million for electric mobility-as-a-service in Africa… SparkCharge secured $23 million for on-demand EV charging.
Clean energy. Wunder secured a $650 million partnership with ClearGen, a Blackstone Credit portfolio company, for commercial solar projects… The Off-Grid Electricity Fund provided a loan to Digital Kap to install minigrids in Haiti’s northern cities… Zolar raked in $105 million to install home solar systems and meet clean energy demand in Germany.
Climate finance. Collaborative Fund’s new Shared Future Fund will invest in 100 climate projects with $100,000 uncappedY Combinator-style SAFE notes… UrbanFootprint raised $25 million to help energy, finance and government institutions decide how to invest in infrastructure that will reduce climate impacts in vulnerable communities.
Impact tech. IFC invested $30 million with Partners for Growth to deploy private credit in emerging markets… LGT’s Lightrock secured $300 million for impact tech in Latin America… Germany’s Predium scored €1.6 million in pre-seed funding to help real estate companies manage their assets more sustainably… Sylndr secured $12.6 million to build an online marketplace for buying and selling used cars in Egypt.
Investing in water. World Economic Forum’s UpLink secured a five-year, $15 million commitment from HCL Group to support founders with solutions for freshwater conservation and management… The International Committee of the Red Cross raised $17.6 million to expand access to safe and affordable drinking water in the Democratic Republic of the Congo.
Economic inclusion. A fund managed by Incofin sold its 20% equity stake in ACEP Burkina, a microfinance institution in Burkina Faso, to French impact investor SIDI… Moves raised $5 million to help gig-economy workers become owners.
Corporate impact. Community Carbon received a $20 million commitment from Carbon Streaming Corp. to support access to clean cookstoves and clean drinking water in Africa.
The Week’s Talent
Coleen Lynch, ex- of Eaton Vance Asset Management, joins Impax Asset Management as senior vice president and relationship manager for national accounts… Christine Gabbianelli, ex- of Fairview Capital Group, joins Green Rock Energy Partners as head of investor relations… Sustainability lost a champion in Hazel Henderson, who “went virtual” this week at age 89… Nicole Martens, ex- of U.N. PRI, joins Old Mutual Investment Group as a senior stewardship professional.
The Week’s Jobs
Gratitude Railroad is hiring an impact investment analyst and an impact investment associate… BlocPower seeks a chief of project operations… Mission Driven Finance is hiring a Salesforce and technology administrator… 60 Decibels is hiring a remote senior business development manager… Eurosif is looking for an executive director… Morgan Stanley’s Global Sustainable Finance group is recruiting a vice president of products and solutions for the EMEA region, based in London.
Boehringer Ingelheim seeks an impact investing manager… Accion Venture Lab is hiring an investment officer for Africa, ideally in Lagos… Generation Investment Management seeks an analyst for its growth equity team in San Francisco… The nonprofit GreenWave is looking for an e-learning consultant for July to September… Nuveen Global Impact is recruiting an investment analyst in New York.
World Resources Institute is hiring a corporate relations coordinator, a media specialist, and a planning, monitoring, evaluation and learning analyst, all based in Washington, D.C… USAID seeks a private enterprise/market systems finance officer for its Center for Agriculture-Led Growth… Instiglio has openings in Bogota, Colombia… NeighborWorks Capital is recruiting a CEO in the Washington, D.C. area.
That’s a wrap. Have a wonderful weekend.
– May 27, 2022