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The Week in impact investing: New foundations



TGIF, Agents of Impact!

Special holiday subscription offer. We pushed out our best deal of the year this week and want to make sure you know about it. New subscribers and additional group and enterprise members can get 50% off on a full year of ImpactAlpha with code 2020IMPACT. That’s $199 for the first year, or just $19 a month. Just go to subscribe.impactalpha.com (for groups, email info@impactalpha.com). Thank you for growing the network – and for all of your impact.

– David Bank, editor and CEO

The Week’s Agent of Impact

Mark Campanale, Carbon Tracker Initiative. The risk that fossil fuel investments will become “stranded assets” went from fringe thesis to mainstream preoccupation in what must be near-record time. It’s not a theory: this week, the Spanish oil producer Repsol took a $5.3 billion write-down to reflect the falling value of its oil and gas assets in a decarbonizing world. That bankers, investors and now oil companies are taking seriously the value-collapse of fossil fuel assets is in large part testament to Campanale’s dogged research and advocacy. The sustainable investment analyst founded Carbon Tracker Initiative, and in 2011, produced the landmark report Unburnable Carbon, followed two years later by Wasted Capital and Stranded Assets. This week, he helped launch the Fossil Fuel Non-Proliferation Treaty, modeled on the treaty limiting nuclear weapons. The aim: international collaboration around the peaceful phasing out of coal, oil and natural gas. 

Expect more write-downs. The Paris climate agreement, and follow-up meetings like COP25 now underway in Madrid, call for carbon emission reductions, but not yet constraints on fossil fuels. An aim of the non-proliferation project: an accounting of fossil fuel projects representing future emissions as a starting point for a true reckoning. A registry would help determine what licenses must be revoked, which oil rigs should be decommissioned and by how much assets should be written down. “We know fossil fuels need to stay in the ground,” Campanale told ImpactAlpha on the sidelines of the Financial Times’ Investing for Good Conference in New York. “The real question is whose and how.” When Campanale isn’t plotting campaigns to sunset the oil industry, he sometimes fills in on the campaign trail for his identical twin brother, David, who is running for a seat in the U.K. parliament. Happy birthday, Mark and David! – Dennis Price (with reporting by Amy Cortese).

The Week’s Big 6

1. Investing in public goods for private impact capital. To fulfill impact investing’s role in shaping an inclusive and sustainable economy, nine private and corporate foundations and family offices pooled $12.5 million for the Tipping Point Fund to support shared market infrastructure. The fund expects to put out a call this month for impact investing-related public engagement and policy initiatives in the context of the 2020 U.S. election. Dig in.

2. A global thematic impact mutual fund (podcast). Cornerstone Capital couldn’t find a public equities strategy for its clients that targeted Sustainable Development Goals such as health, clean energy and social justice – so it built one itself. Cornerstone’s Erika Karp wants more active managers looking for impact alpha in the public markets. “We need trillions,” Karp tells David Bank in an interview for ImpactAlpha’s Returns on Investment podcast. “This is why you need the public equity markets, and have to find the managers who really get it.” Read on and listen in

3. A ‘neighborhood REIT’ for shared ownership. Nico is starting in Los Angeles to let residents buy equity stakes in their neighborhood real estate for as little as $100. The “neighborhood investment company” is among a growing crop of innovators in Oakland, Philadelphia, Baltimore and other cities with new models for broad-based ownership. Check it out.

4. Harlem Capital’s $40 million bet on underestimated founders. The New York-based venture firm closed its first fund to invest in U.S. companies led by women and founders of color. From the Big Apple to Silicon Valley, Copenhagen to Lagos, new fund managers are seeking an edge by backing entrepreneurs traditional venture capital overlooks. “There’s alpha to make,” Harlem’s Henri Pierre-Jacques told ImpactAlphaInclusion alpha.

5. Catalyzing finance for climate action in India. The world’s third-largest emitter of greenhouse gases is already being hit hard by climate change. India also is one of the few major countries meeting its goals under the Paris climate accord. Shloka Nath of Tata Trusts, India’s oldest philanthropy, says India can reframe the climate challenge and position itself at the center of “the greatest risk-management system the planet has ever known.” Get her take.  

6. Meeting the challenge of Santiago’s protests. When inequality protesters seized the streets of Santiago, Capria headed to Chile to work with local fund managers and scout for deals. Impact investing, writes Capria’s Will Poole, can help “build profitable and scalable solutions to exactly the types of problems that are causing unrest in Chile today.” Hear him out

The Week’s Dealflow

Circular economy. Uncapped clinches £10 million to offer startups revenue-based financing… Circulate Capital reaches $106 million first close for Asia oceans fund… Ecosurety launches £1 million grant fund for eco-packaging and e-waste.

Education and jobs. StudentFinance.com raises €1.2 million to bring income-based student financing to Europe… First Step Staffing secures working capital to help people re-entering the workforce… Motivo raises $2.2 million to train a new generation of mental health professionals.

Climate finance. Toronto’s Atmospheric Fund backs real estate energy retrofits… Encourage Capital backs solar financing company Electronica Finance.

Financial inclusion. FinAccel raises $90 million for low-fee lending app… Nigerian fintech startup Migo scores $20 million.

Energy access. Australia’s ATEC raises $1.6 million to sell biodigesters in Cambodia and Bangladesh.

Growth markets. Copia, Kenya’s ‘rural Amazon,’ scores $26 million.

Conservation finance. KKR Global Impact dives into wastewater treatment to manage ‘nutrients’. 

  • Go deeper with KKR Global Impact’s Robert Antablin’s guest post on ImpactAlpha.

The Week’s Talent

Bank of England Governor Mark Carney accepts an assignment as U.N. special envoy for climate action and finance… David Bohigian, former acting CEO of the Overseas Private Investment Corp, departs its successor organization, the U.S. International Development Finance Corp… Planet FWD’s Julia Collins joins Cleo Capital as entrepreneur-in-residence… Sundial Brands’ Richelieu Dennis transitions from chair and CEO to head of Sundial’s new Social Mission Board.

The Week’s Jobs

Quantified Ventures seeks a vice president of marketing and operations in Washington, D.C… The Asian Infrastructure Investment Bank is hiring a senior environmental and social specialist in Beijing… Acumen is looking for a digital marketing manager in New York and a digital marketing associate in Nairobi… Impact Capital Managers invites first-year MBA students to apply for its inaugural Mosaic Fellowship.

CDC Group seeks a gender equality and women’s economic empowerment executive in London… Notley is looking for an investment analyst in Austin… The Global Impact Investing Network is recruiting a manager of finance and grants in New York… Duke University’s Center for the Advancement of Social Entrepreneurship is hiring a senior program coordinator in Durham, N.C.

Thank you for reading. 

– Dec. 6, 2019

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