TGIF, Agents of Impact! In today’s Brief:
- Lunar New Year’s greetings
- Workers and business performance
- Green infrastructure and private equity
🗣 Year of the Wood Dragon. ImpactAlpha wishes happiness and prosperity to all who are celebrating the lunar new year, which begins this weekend with the second new moon following the winter solstice. Even those who don’t normally observe the spring festival may want to join in. The dragon, after all, represents good luck, justice, prosperity and strength, as Chen Yang of George Washington University explains. And in the 60-year cycle of the Chinese calendar, the upcoming Year of the Wood Dragon is set to foster growth, progress and abundance. Wood dragons are full of energy and dreams of changing the world. Sounds like many Agents of Impact we know. – David Bank
Must-reads this week on ImpactAlpha:
- “After the investment and before the exit, how fund managers drive alpha through impact,” by Amy Cortese and David Bank.
- “Confronting real bias in asset management to set the record straight on DEI,” by Dennis Price.
- “California’s climate-risk pioneer Dave Jones on our march ‘toward an uninsurable future’ (Q&A),” by Andrea Riquier.
- “Fund strategies to build inclusive communities and wealth (The Liist),” by Jessica Pothering.
- “In the Asia-Pacific region, girls just want to have funds!” by Sara Danzeo and Elena Mayer-Besting of the UN Economic and Social Commission for Asia and the Pacific.
The Week’s Chart
Support for workers is universal – and drives business outperformance. Worker issues, including wages, training and safety, consistently rank as the public’s top priorities for business behavior, according to Just Capital’s annual survey. The elevation of workers extends across nearly every demographic – men, women, liberal, conservative, low-income, high-income, young generations, older generations, and white, Black, and Latino Americans. Hewlett Packard Enterprises topped this year’s JUST 100 of companies ranked based on their performance across stakeholder issues. Propelling it to the top: Ensuring women and people of color earn the same as their peers, and apprenticeship programs for caregivers and formerly incarcerated individuals.
- JUST alpha. The JUST 100 Index has outperformed The Russell 1000 by 38.4% since inception. Compared to other companies, JUST 100 firms on average deliver a 4% higher profit margin, 2.9% higher return on equity, and 1.2% higher dividend yield. They also use 30% more renewable energy as a proportion of their energy use and emit 42% less metric tons of CO2 per revenue dollar.
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The Week’s Dealflow
Deal spotlight: Infrastructure is the keyword for private equity giants. It was Infrastructure Week in private equity. In quarterly earnings calls, publicly listed firms like Apollo, KKR and Brookfield emphasized infrastructure, renewable power and the energy transition as they looked forward to a rebound in dealmaking this year. “Institutional investor focus has pivoted to asset classes that offer current income, inflation protection, and access to areas of secular growth, namely credit, infrastructure and sustainability,” said Apollo’s Scott Kleinman. Apollo this week kicked off its second Clean Transition fund less than a year after launching its $4 billion first fund as part of a $50 billion climate strategy. KKR said the value of its infrastructure portfolio was up 18% last year. “We are actively fundraising for our infrastructure strategy,” said KKR’s Robert Lewin. KKR recently closed its $6.4 billion infrastructure fund in the Asia Pacific region. Brookfield, which is sitting on over $100 billion in dry power, this week announced the $10 billion first close of its second Global Transition Fund.
- Green transition. “Infrastructure, renewable power and energy transition are expected to be among the fastest growing alternative sectors,” Brookfield’s Bruce Flatt said during this week’s earnings call. Energy security, supply chain resilience and meeting the exponentially growing demand for data “will require trillions of capital investment,” he added. “We were an early mover into these areas after we identified decarbonization, deglobalization and digitalization as mega trends that were shaping the global economy.”
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Agrifood investing. Izote Biosciences clinched $2.6 million to develop a salt-based fermentation process for lab-grown meat and other biotechnologies… Los Angeles-based ProducePay notched $38 million to streamline the US’s fresh foods supply chain and cut food waste… Spain’s Heura raised €40 million for ‘clean’ plant-based meat.
Climate finance. Watershed raised $100 million to help corporations and financial institutions reduce the environmental impact of their portfolios and supply chains… Women-led climate tech VC Voyager Ventures closed its $100 million.
Education and skills. K-12 education software company Branching Minds received an undisclosed amount of growth equity from Bain Capital’s Double Impact fund.
Inclusive fintech. Eco.business Fund backed Family Bank to finance climate resilience for farmers in Kenya… Mexico’s Techreo raised $3.4 million in bridge financing to expand financial services… Suma Wealth clinched $2.2 million for its financial products and content tailored to the young US Latino community.
Independent media. Media Development Investment Fund invested in elDiarioAR, an independent media outlet in Argentina that focuses on social, gender, environmental, human rights, climate and poverty issues.
Investing in health. Accompany Health scored $56 million to provide health services for low-income patients… Health-focused fintech company MAPay is launching the Apierion Impact Fund to address global health inequity… India’s Aarogya Tech scored $1.8 million for chronic disease prevention and management… Women-led Niremia Collective secured $22.5 million to invest in startups supporting mental health and wellness.
Low-carbon transition. Breakthrough Energy Ventures notched $555 million for its Select fund… Mirova secured $282 million for a blended-finance debt fund for clean energy investments in emerging markets… Avnos inked $36 million for its direct air and water-based CO2 capture technology… Heart Aerospace, a Swedish hybrid-electric aircraft manufacturer, raked in $107 million.
Returns on inclusion. Village Capital partnered with Standard Chartered to catalyze capital for African women in tech… Blk Grvty secured $1 million from Surdna Foundation to back underrepresented fund managers.
The Week’s Talent
Vision Ridge promoted Rob van Es to partner and Christina Scalzo managing director… Boann Social Impact appointed Brian Smith, previously with Rhiza Capital, as managing director… JPB Foundation promoted Deepak Bhargava to president… Working Power named Yerina Mugica, a former managing director at the Natural Resources Defense Council, as co-executive director.
Aurum Impact hired Mats Multhaupt, previously with Future Cleantech Architects, to its investment team… Brian Wong, a second-year MBA student at Duke University, joined SJF Ventures as a venture fellow… Kahlil Williams, previously a partner at law firm Ballard Spahr, joined W.K. Kellogg Foundation as general counsel and corporate secretary… Janet Gumbs, previously with ABFE, joined Black Farmer Fund as finance director.
TPG named Scott Lebovitz, formerly with Goldman Sachs, as a partner and head of infrastructure for TPG Rise Climate… Aaron Tanaka, co-founder of both the Boston Ujima Project and Center for Economic Democracy, will join One Project as co-director in July… Equitable Facilities Fund named Elliott Nguyen, former director of charter growth and development at Texas Charter Schools Association, as vice president of development.
Beneficial State Bank tapped Terra Neilson, previously with US Bank, as chief impact officer… BlueMark promoted Sarah Gelfand to president… Felipe Arango, former technical advisor to IFC, became chief operating officer of Fair Trade USA… Meg Massey, former director at Upaya Social Ventures, joined Social Finance as policy and communications associate director.
The Week’s Jobs
In New York, Blue Owl Capital is on the hunt for a corporate sustainability associate; Global Impact Productions seeks a fundraising coach; the Columbia Center on Sustainable Investment is on the hunt for two program associates; JPMorgan is hiring a development finance institution vice president; and the Rockefeller Foundation has an opening for a media relations summer associate.
In San Francisco, Libra Foundation is looking for a new president, and Generate Capital is recruiting a senior investment analyst… JPMorgan is looking for a small business and local economies research lead in Washington, DC… Meta has an opening for a net-zero and sustainable strategy manager in Denver.
Arnold Ventures is looking for an impact investing executive vice president in Houston… Advantage Capital is looking for an impact research analyst in St. Louis… Pursuit seeks an impact investment associate… UNICEF USA is on the hunt for an impact investing fund manager.
In London, M&G Investments is recruiting a contractual sustainability lead; CFA UK is recruiting question writers for its new impact investing certification program; and CrossBoundary Group is looking for a senior associate for its nature fund.
Abler Nordic is hiring an impact and ESG manager in Norway… Mastercard Foundation is on the hunt for a Nairobi-based senior investment director for its Africa Catalytic Impact Fund… Temasek Trust seeks a senior manager in Singapore.
That’s a wrap. Have a wonderful weekend.
– Feb. 9, 2024