The Week in Impact Investing: Risky Business

The team at

ImpactAlpha

TGIF, Agents of Impact!

🗣 Playing offense. The White House this week rolled out a strategy to develop “natural capital accounts” that reflect the value of the planet’s water, soil, air and other natural assets to the economy, the environment and public health (h/t Thomas Morgan). The “world positive” investment firm Obvious Ventures debuted its ESG Term Sheet, championing criteria like greenhouse gas reduction, employee development and stakeholder inclusion in Silicon Valley-style tech startup investing. And Bloomberg reports the finance industry “striking back” against moves such as Texas’ Comptroller Glenn Hegar’s ban on BlackRock, UBS, Credit Suisse and other firms for supposedly “boycotting” fossil fuels, and Florida Gov. Ron DeSantis’ proposal to bar the state’s pension fund managers from considering environmental, social and governance factors, or ESG. ImpactAlpha’s Amy Cortese and Dennis Pricethis week framed up the counter-counterattack, revealing the coordinated anti-ESG campaign as special-interest “riskwashing” that is hurting businesses, taxpayers, workers and retirees. The backlash to ESG is having the inverse effect of making Agents of Impact the proverbial prudent persons who actually care about material and systemic risks.

Keep calm and carry on, as Agents of Impact are doing around the world. In Senegal, Teranga Capital is building a West African impact ecosystem by providing risk capital to micro-businesses, seed-stage startups and growth-stage enterprises, as ImpactAlpha’s Jessica Pothering reports. Vital Capital’s Nimrod Gerber distills three lessons impact investors can offer venture capitalists entering Africa’s hot startup market, including that “not everything can be leapfrogged.” USAID Invest’s Lauren Yang offers examples of emerging-markets fund managers using ESG data to improve performance and manage material risks such as gender-based violence. In Southeast Asia, Beacon Fund’s Shuyin Tang and Yen Do are demonstrating how investing in women-led agricultural businesses strengthens food security in developing countries, where women produce the majority of food. Recession? Inflation? War? Don’t panic, counsel Women of the World Endowment’s Patience Marime-Ball and Tara Health Foundation’s Ruth Shaber. “Having more women in leadership positions isn’t just about righting the collective ship that is our planet and its people,” they write. “It is about accelerating growth, peace and prosperity for our collective future.” – David Bank

🎧 Impact Briefing. On this week’s podcast, Monique Aiken has the headlines and ImpactAlpha’s Dennis Price chats with Havell Rodrigues of New Majority Capital about the democratic approach to fundraising that is putting wind in the sails of new impact fund managers.

The Week’s Sustainability Economics

Szczecin,Poland-January 2022:Electric Tesla Semi on the highway.3D Illustration.

Here come the e-trucks.

The cost of hauling goods with a Tesla all-electric semi, set to ship this year, could be up to 83% cheaper than a standard diesel truck, according to Tesla durability test operator Alex Gayer. With the average price of a gallon of diesel fuel at $4.99, and Tesla’s energy cost of $0.07 per kilowatt-hour (via Tesla Megachargers, Megapacks and on-site solar), a 200-mile haul in a diesel 18-wheeler would cost about $170. In a Tesla semi-trailer, that 200-mile trip would cost … $28. 

The Week’s Dealflow

Photo by Lunar Energy.

Deal spotlight: Electric homes. The raft of consumer savings and incentives in the Inflation Reduction Act for heat pumps, induction stovetops and other home electrification products could reduce electricity prices and accelerate the transition from fossil fuels. This week, Lunar Energy emerged from stealth, having raised $300 million over two rounds led by U.S. solar company Sunrun and South Korean conglomerate SK Group. The company, founded in 2020 by former Tesla energy chief Kunal Girotra, is building a suite of hardware and software to help homeowners generate, store and control their own clean energy. San Francisco-based Span, led by fellow Tesla veteran Arch Raoraised $90 million earlier this year to reinvent the lowly circuit-breaker box. 

  • Clean tech. Lunar plans to launch its home battery system that can control energy loads, by year end. The funding has helped Lunar acquire U.K.-based Moixa, which makes software to manage distributed energy resources. Japan’s ITOCHU and Honda, previous investors in Moixa, join Lunar’s group of investors.
     
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Clean energy. Arevia Power secured an undisclosed investment from KKR to develop utility-scale solar and wind energy projects in the U.S… Bill Gates-founded TerraPower raised $750 million for next-gen nuclear energy… Fervo Energy raked in $138 million for geothermal energy… French sustainable cooling company Koolboks clinched $2.5 million for its pay-as-you-go solar refrigerators in Africa.

Climate finance. Australia’s Palisade Impact raised A$400 million (US$275 million) for an open-ended fund that invests at the intersection of infrastructure and decarbonization… Berkeley, Calif.-based Clarity Movement Co. raised$9.6 million to help businesses, governments and other institutions combat air pollution… Carbon Direct raised $60 million for science-based carbon management… The Engine backed Mantel’s carbon-capture technology.

Sustainability. Boston-based Bevi raised $70 million from Cowen Sustainable Investments to supply bottle-free water dispensers to offices and commercial spaces… Ginew Inc., an Indigenous-owned sustainable garment company, scored $500,000 from Raven Indigenous Capital Partners… Valley National Bank and Community Preservation Corp. committed $100 million to finance mortgage loans for green commercial real estate development projects. 

EV infrastructure. Zitara scored $12 million in Series A financing led by Energy Impact Partners to help electric vehicle and energy storage partners optimize their battery-powered assets… Bangalore-based Exponent Energy snagged $13 million in a round led by Lightspeed to scale up its network of electric vehicle rapid-charging batteries in India.

Impact tech. Groundwork BioAg secured $18 million in a round led by Climate Innovation Capital to produce fungi that can enhance the growth of plants, fruits and vegetables sustainably… Omnivore backed Loopworm’s network of insect farms with $3.4 million… South Africa’s Verdant Capital invested $7 million in Watu to finance motorbike taxis for financially underserved drivers in Uganda. 

Inclusive economy. Beyond Capital Ventures backed Lal10 to boost profits for India’s rural artisans… iProcure, which connects smallholder farmers in Kenya with agricultural inputs like seeds and fertilizers, snagged $10.2 million in Series B financing… Nigerian retail tech startup Omnibiz clinched $15 million in pre-Series A funding to digitalize logistics for informal retailers.

Investing in Health. Brazilian telehealth services startup Dr. Consulta raised170 million reais ($33.3 million) to expand its network of physical medical centers in Sao Paulo… U.K.-based Patchwork Health scored €24 million ($28.4 million) to address  Europe’s health workers shortages (see, “Addressing the nursing shortage”).

Emerging markets. Nigeria’s Microtraction inked $15 million for a second early-stage fund. 

The Week’s Talent

Isabelle Hau, an advisor to Better World Ed, becomes executive director of Stanford Transforming Learning Accelerator… Diana Madson, ex-of Hua Nani Partners, joins Bloomberg Philanthropies to lead its Beyond Carbon initiative.

The Week’s Jobs

Virginia-based Enable Ventures, part of the Sorenson Impact Group, is hiringa principal… Aspiration is looking for a researcher for its carbon programs (see, “IFC partners with Aspiration in $10 million fund to lift quality of carbon credits)… Tidesseeks a remote program officer for civic engagement and democracy… CapShift is looking for an impact investing fellow and an impact investing intern… 60 Decibelsseeks an inside sales associate in New York… The California Endowment is hiring an impact investing portfolio manager in Oakland… Ketchumseeks a vice president for purpose, social, impact and sustainability in New York. 

Sumitomo Mitsui Banking Corp. is recruiting a director of emerging sustainability businesses in San Francisco… Macquarie Asset Managementseeks an associate director in San Francisco… Confluence Philanthropyseeks a communications and development senior manager in New York… BlackRock is hiring a sustainable investing research and strategy associate/vice president… Goldman Sachs’ Sustainable Investing Group seeks an associate in New York… BlackRockis hiring an impact investing research analyst.

VCC Social Enterprisesis looking for a senior investment analyst in Richmond, Va… Honeycomb Creditis hiring an impact analyst intern in Pittsburgh… Westfuller Advisorsis looking for an investment analyst in New York… Social Financeseeks an associate in Boston… The Global Impact Investing Networkis hiring a research associate and executive assistant in New York… Aonis recruiting a head of responsible investing in Waltham, Mass… Peak Performance Taxseeks an impact and ESG analyst in Sacramento. 

Living Citiesseeks a managing director of programs in New York or Washington… Meow Wolf is looking for a director of inclusion, diversity, equity and accessibility in Santa Fe… Harlem Children’s Zone is hiring a director of economic mobility in New York… McKinsey & Co. is hiring a green finance consultant in Singapore… Also in Singapore, Bloomberg Dataseeks an environmental, social and governance team leader… Sustainalyticsis lookingfor a product manager for ESG and impact products in Chicago… Capital Impact Partnersis recruiting a senior loan associate in New York or San Francisco.

That’s a wrap. Have a wonderful weekend. 

– Aug 26, 2022