The Brief | August 11, 2023

The Week in impact investing: Fearless

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The Week in Impact Investing: Fearless

🗣 Forward motion. Atlanta-based Fearless Fund is on track later this month to award four more small business grants to Black women entrepreneurs, in partnership with Mastercard. “We are not scared. We are fearless,” Fearless Fund’s Arian Simone said in response to a lawsuit by a conservative activist seeking to shut down the program because of alleged anti-white bias. The lawsuit misses venture capital’s real problem with racial equity – implicit bias against founders and fund managers of color, as Dennis Price reports. (And, as Illumen Capital’s Daryn Dodson told me, recent market volatility has exacerbated such bias.) If anything, the lawsuit is spurring Fearless Fund and others to expand support for women founders of color. “Activism is in our DNA,” Simone said.

Other Agents of Impact also are moving ahead fearlessly. “Character-based lending promotes a new, community-informed understanding of who is considered investable by empowering lenders around evaluation and decision-making,” Ana Ramos and Eric Horvath write in a report on Common Future’s pilot lending program. Pakistan is defying the record of failure in many mangrove restoration projects with Delta Blue Carbon, which aims to rehabilitate nearly 900,000 acres of mangrove forests, Marcello Rossi reports for ImpactAlpha. And eight South American countries agreed to a common agenda for protecting the vast Amazon forest they share. 

In Ghana, Mirepa Investment’s Samuel Yeboah is mobilizing local investors to unlock capital for Africa’s small businesses (see, “Agent of Impact,” below). Yeboah is among the first-time fund managers on this month’s Liist of firms currently raising capital, curated by Jessica Pothering. Even heroic efforts won’t quickly overcome systemic obstacles and entrenched opposition, of course. “These are hard truths,” writes Founders Factory’s Ayotunde Aladejana in the context of healthcare challenges in Nigeria. “You cannot change the situation on the ground without acknowledging the monumental challenges standing in the way of positive change.” – David Bank

The Week’s Agent of Impact

Samuel Yeboah, Mirepa Investment Advisors: Helping Africans invest in Africa. The compounding crises of the pandemic, rising fuel and food prices from the Ukraine war and global inflation led Ghana to default on a sovereign debt load that consumed 70% of its revenues. The bright spot is that local pension funds, insurance companies and other investors that were heavily exposed to government securities are looking for other places to invest their money. That’s leading them to impact investment firms like Mirepa Investment Advisors, which Yeboah and his business partner Enyonam Kakane set up in 2017 to invest in Ghana’s undercapitalized small businesses. “All of a sudden there’s a scramble to diversify away from government, and pension fund managers are chasing alternative investment opportunities,” Yeboah tells ImpactAlpha

Impact fund manager was an unexpected career trajectory for the chemical engineer, who spent his early career in the US working for biotech companies Merck and Amgen. When family brought Yeboah back to Ghana, he was inspired by his late mother’s example to redirect his work. “My sister and I grew up seeing her give. So the question for me was, ‘How do I give back?’” Yeboah is seeking to help build a local investment ecosystem. Last year, Injaro Investments became the first fund manager in the country to reach a first close anchored by local pension funds. Mirepa followed, raising half of a targeted $10 million for its first fund, all from local investors.

Impact Investing Ghana is setting up a fund of funds to usher more domestic institutional capital into local impact fund managers. “International agencies are happy to fund programs that unlock local capital, but they don’t want to fund the vehicles,” he says. “Locally, we need to come up with solutions that work for us and serve our long-term interests.”

The Week’s Dealflow

Deal spotlight: Private credit for climate infrastructure. Private credit, global infrastructure and the energy transition are among the biggest opportunities of the decade, according to Blackstone’s Stephen Schwarzman. Blackstone’s $7.1 billion Green Private Credit Fund III looks to capitalize on all three. The “largest energy transition private credit fund ever raised,” according to the firm, will underwrite loans for solar, wind and hydro power as well as battery storage and other infrastructure needed for a low-carbon economy. 

  • Trillion-dollar baby. Blackstone, which hit $1 trillion in assets under management in the second quarter, expects to invest $100 billion in the energy transition this decade. In addition to the green credit fund, the firm is looking to raise more than $4 billion for an equity-focused energy fund. “This will be an area of a lot of capital needs,” Blackstone’s John Gray said on the firm’s earnings call. “The good news is, the investors want it.” The firm estimated the value of its energy transition portfolio across equity and debt at more than $20 billion. 
  • Impact landscape. Private debt as an asset class is on the rise as banks tighten their lending requirements. The number of private debt impact funds has tripled over the last decade, according to Phenix Capital. The research group counts more than 350 private debt impact funds from 200 fund managers, with €45 billion ($49 billion) in assets. More than 200 funds are actively raising, with targets totaling another €43 billion ($47 billion).
  • Go deeper.

Catalytic capital. US government-backed Prosper Africa backed four fund managers through its Prosper Africa Catalytic Investment Facility.

Electric vehicles. Electric bus maker Proterra filed for bankruptcy… San Francisco-based Treehouse raised $10 million from a raft of automotive venture funds to sell electric vehicle home charging stations via EV dealers.

Energy transition. San Francisco-based Equilibrium Energy scored $33 million to support renewable energy integration with the electricity grid… BlackRock and the government of New Zealand launched a $1.2 billion fund to finance the country’s transition to 100% renewable energy by 2030… Japanese investment firm Itochu and Sumitomo Mitsui Trust Bank are partnering on a $2 billion renewable energy fund that will invest in North America.

Waaree Energies clinched $120.1 million to manufacture solar tech components, including ingots, wafers, cells and modules… Bill Gates-backed Breakthrough Energy Ventures is raising a third climate fund… Mexican solar startup Bright raised $31.5 million in a round led by Denmark’s ODS Investment Fund.

Impact tech. Dutch lab-grown pork maker Meatable raised $35 million… Colorado-based Divirod raised a $3.6 million bridge round for its flood and water risk management software… Giving platform Grapevine raises $1.9 million in equity and grants… Matter raised $10 million to filter out microplastics on an industrial scale.

Investing in health. Emerson Collective spins off Yosemite, a venture fund focused on cancer treatments… Nigeria’s Remedial Health secured $12 million to help local pharmacies digitize their operations.

Small business. The UK’s development finance institution stood up a new small business investment firm in Ghana, Growth Investment Partners… Accion Venture Lab invested in Colombia’s Lificy, a startup that connects small construction businesses to potential contracts and financing… Nigeria’s Traction clinched $6 million to digitize and finance small businesses.

Sustainable materials. Hybar snagged $700 million in debt and equity to recycle steel in Arkansas… Carbon Upcycling Technologies secured $26 million to convert CO2 into concrete, industrial-grade plastics and other materials… Newlight Technologies, which uses microbes to convert greenhouse gasses into a plastic alternative, raised $125 million.

The Week in Impact Investing Talent

Eliza Golden Roady, ex- of Acumen, joined the Sorenson Impact Center as a managing director of impact… Hiro Mizuno, former chief investment officer of Japan’s Government Pension Investment Fund, was named special advisor to the CEO of MSCI… Tesla’s chief accounting officer Vaibhav Taneja will add CFO duties as Zach Kirkhorn stepped down after 13 years at the EV maker. Amy Zhao, who first worked with Clean Energy Ventures as an Impact Capital Managers MOSAIC Fellow, joined the firm as an investor.

Damien Wilson, ex- of WD Advisors, joined Reinvestment Fund as a senior director for the HBCU Brilliance Fund… Eric Horvath stepped down as director of impact investments at Common Future… Larry Kramer will step down as president of the William and Flora Hewlett Foundation at the end of the year to become president and vice chancellor of the London School of Economics and Political Science. 

Mohnish Jain, ex- of Deloitte, joins Ankur Capital as finance manager… Adasina Social Capital named Tufts’ Julianne Zimmerman as managing director… Mosaic’s Patrick Moorebecame CEO, succeeding founder Billy Parish, who will become executive chair of the board. Daniel Budington, ex- of Santander, became Mosaic’s CFO… Joe Indvik, ex-of RE Tech Advisors, joined Ares Management in the new position of climate strategy lead.

The Week in Impact Investing Jobs

💼 Share the week’s impact jobs. Want to post a job in The Brief? Drop us a note.

East Coast

In New York: Tent Partnership for Refugees is hiring a deputy director of strategic initiatives; Jumpstart seeks a director of impact initiatives; and Blackstone Charitable Foundationis looking for a finance and operations associate.

Opportunity Finance Network is hiring a senior investment officer in Washington, DC for its climate and green lending programs… Also in DC, the World Bank is hiring a chief executive officer for its Climate Investment Funds… The Nature Conservancy is searching for a director of stewardship in New Haven, Conn… New Majority Capital seeks a business advisor in Atlanta… Rochdale Capital is looking for a loan officer.

West Coast

State Street Global Advisors is hiring a head of sustainability stewardship in Boston… The Nature Conservancy seeks an associate director for its California water program… King Philanthropies is looking for a senior associate in San Francisco… Founders First Capital Partners is hiring a chief credit officer in San Diego… Stanford Social Innovation Review is recruiting an editor-in-chief.

International positions

Think tank New Philanthropy Capital is on the hunt for an impact investing senior consultant in the UK… Dutch development bank FMO seeks a senior sustainable finance officer in The Hague… Regenerative Capital Group is accepting applications for its CEO-in-residence program for social entrepreneurs in Canada.

That’s a wrap. Have a wonderful weekend.

– Aug 11, 2023

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