The Week in impact investing: Opportunity knocks



TGIF, Agents of Impact!

The Week Ahead

Press forward. ImpactAlpha had no sooner published Dennis Price’s article last week detailing how investments in ‘people and places’ can demonstrate genuine impact in Opportunity Zones, when the New York Times unloaded its 4,000-word critique of the zones as a “windfall for the rich.” The stark contrast illustrates one of the enduring paradoxes of impact investing and, indeed, social change more broadly: It’s easy to be cynical. It’s harder to make progress.

Cynicism serves mostly to entrench business as usual. Harder is to stay in the game, contradictions and all, and make progress as opportunities present themselves. Impact investors needn’t defend abuses of Opportunity Zone tax breaks in order to develop projects with real community engagement and benefits (see No. 1, below). Watchdog journalism that exposes the fakes only makes the case for impact accountability stronger, a case that impact investors have been making all year (see No. 2). Alas, the cynics may often be right. But it’s the agents of impact that will write the new story.

I’d love to see ImpactAlpha subscribers in New York at our next Agents of Impact gathering Thursday, Sept. 19 from 5:30-7:30 at Liquidnet’s NY headquarters. We’ll have some very special guests to preview Climate Week and the UN’s SDG Summit and talk about how investors are stepping up to global challenges – and what more they can do. More details next week, but early birds can RSVP now.

And finally, you’ll notice we’ve revamped today’s Brief, combining the week’s best stories with our Agents of Impact weekly report. Follow the money and follow the talent in a single roundup. As always, help us follow your talent by sending deals, jobs, mandates and other news to editor@impactalpha.com.

 – David Bank, editor

The Week’s Agent of Impact

Tahira Dosani, Accion Venture Lab. Fintech is having a moment in venture capital circles—a $36 billion moment. And even though most of that venture capital investment last year didn’t flow to early-stage, emerging-market startups delivering affordable services to low-income customers, Tahira Dosani thinks the flood of capital is a good thing. Dosani is co-managing director of Accion Venture Lab, Accion’s initiative for early-stage investing in financial inclusion. “There’s more capital coming into fintech, and that means more entrepreneurs, more startups, more business models,” she told ImpactAlpha. “I generally see that as good for the customer.” She joined Venture Lab in 2013, but advancing economic and financial inclusion has been the theme of her career since a stint in Kabul in 2006, where she worked with telecom company Roshan to set up Afghanistan’s first mobile money network.

At Accion Venture Lab, Dosani oversees a portfolio of three-dozen fintech ventures, most of which serve low-income customers in emerging markets. In spite of the global fintech boom, such startups still struggle to attract early capital and partners to help prove out models for the financially underserved. “Some innovative models die on the vine because they can’t get that first institutional money in the door,” Dosani says. Venture Lab is trying to nudge in capital with its new $33 million investment vehicle, and to help professionalize inclusive fintech startups so promising models succeed. “We work on the capital gap, but our approach is also about development: helping companies create boards, think about governance structures, manage pivots and think about what the nature of growth looks like.”  – Jessica Pothering

The Week’s Big 5

1. Dueling Opportunity Zone narratives. A New York Times story that focused on what appear to be extractive Opportunity Zone projects triggered an outpouring of counter-examples that hold promise for more inclusive economic development. Not half-full, but not empty.

2. Opportunity Zone skeptics and advocates can agree on disclosure. Proponents and detractors alike should support more rigorous, indeed mandatory, reporting of Opportunity Zone activities and their impact, argues Kresge Foundation’s Aaron SeybertVoluntary action is not enough.

  • Action alert. Senate Bill 1344 would require the U.S. Treasury to measure and report Opportunity Zone data.

3. Animal agriculture is climate-risky business. The food industry’s failure to address climate-related risks including greenhouse gases, deforestation and water use, coincides with a boom in plant-based and other alternative proteins. Protein markets.

  • NEW: Tyson Ventures backs plant-based shellfish company New Wave Foods.

4. Talk is cheap with shareholder engagement on climate. Blackrock and Vanguard, the two biggest asset managers worldwide, both signed the Business Roundtable’s pledge to embrace “stakeholders,” but have voted against shareholder resolutions pressing climate change concerns in the past year at Exxon, Duke Energy, Dominion Energy, GM and Ford, among others. Impact watch.

5. The “racial equity lens” opportunity (podcast). Many asset allocators continue to reflect bias, implicit or otherwise, in their selections of fund managers, while a pioneering few are applying a “racial equity lens” to unlock impact, and returns. Read and listen.

The Week’s Dealflow

2030 finance. Macquarie Group fills its coffers for ‘pragmatic’ green infrastructure… The Long Term Stock Exchange raises $50 million to allow companies to grow over time… UBS clients chip in $225 million for KKR’s Global Impact Fund… PEG Africa secures $5 million in debt to expand solar access in West Africa.

Impact tech. Emerson Collective-backed OpenGov raises $51 million… India’s Vedantu raises $42 million to expand its online tutoring platform… Mexico’s Credijusto raises $42 million from Goldman Sachs and Point72… Eden Farms raises $1.7 million to connect Indonesia’s farmers and restaurants.

Inclusive economy. Access Ventures seeks new ways to lower costs for the housing insecure… Esusu clinches $1.6 million to integrate rent payments with credit reporting.

ICYMI. Riverwater Partners acquires Falcons Rock Investment Counsel….CNote is providing capital for The Entrepreneur Fund.

The Week’s Talent

James Gifford, previously with UBS, joins Credit Suisse as its first head of impact advisory. Guillaume Bonnel, ex- of Lombard Odier, joins the Swiss bank as head of sustainable and impact products… Phillips Todd Farrington, previously with Tuluni International, joins Innpact as head of portfolio management… Thomas Lanctot was named new CEO of Catholic Investment Services… BBC Global News CEO Jim Egan joins Media Development Investment Fund’s board of directors…

Journalist Ying Chan, University College London professor Mariana Mazzucato and Co-Impact’s Rakesh Rajani and eight others are joining Luminate’s advisory board… David Erickson jumps from the Federal Reserve Bank of San Francisco to the New York Fed as head of community outreach and education… Jennifer Isern is leaving her role at the World Bank to launch Catalyze Global Impact University of Cape Town’s Graduate School of Business is running executive education courses in November on Impact Investing in Africa and Impact Measurement for Investors.

The Week’s Jobs 

New Markets Support Company, a subsidiary of LISC, is hiring a VP of partner services and a chief lending officer in Chicago… Sunwealth seeks a vice president of capital markets in Somerville, Mass… Kauffman Foundation is hiring a program officer to translate research into practice in Kansas City…

NatureBank is looking for a forest carbon project manager in Vancouver… Oikocredit is hiring an equity analyst in Nairobi… Convergence is hiring an associate of training and engagement in Toronto.

Thank you for reading. 

– Sept. 6, 2019

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