The Brief | March 31, 2023

The Week in Impact Investing: Theory of Change

The team at


TGIF, Agents of Impact! 

🗣 Logic models. In the beginning, theories of change were the province of nonprofits asked by funders to articulate how the dominoes might fall to achieve their desired outcomes. Founders of social enterprises adopted the methodology to articulate the levers their businesses intended to pull. Professors of impact investing and sustainable finance coached students through ToC to help them sharpen the social-change logic of imaginary startups and funds. Now, the Global Impact Investing Network is hanging its hat on theories of change as the key differentiator for impact investing in public equities. Even responsible investors in public equities have long gotten away with vague commitments to “accelerate the shift to a low-carbon economy” or “drive inclusive prosperity” without articulating exactly how a fund’s investments or an investor’s actions would achieve such goals. Shareholder activists might pass a resolution or wring a concession from management, but to what end? Embedding an investment strategy in a theory of change empowers the investors – and helps hold them accountable to their claims. “It’s undoubtedly true that many haven’t had the opportunity to step through the cause-effect in a way that enables them to see a role for themselves,” SVT’s Sara Olsen commented on the GIIN’s new guidance. “But there is.”

Pinning down a logic model for racial justice investors was the catalyst for Metrics Madness, the topic of this week’s Agents of Impact Call. The Southern Reconstruction Fund’s Napoleon Wallace and Dorian Burton challenged Agents to come up with a universal metric for racial equity with which to measure fund managers, including themselves (see the Call recap, below,  and watch the video replay). A theory of change for a resilient banking system that makes capital accessible to un- and under-banked customers includes government investment in market infrastructure for community finance, Calvert Impact’s Beth Bafford and Pacific Community Ventures’ Bulbul Gupta argued in a guest post. Conversely, some strategies defy logic, like Republican-led efforts in Texas to thwart the state’s market-driven lead in clean energy (listen to this week’s podcast). That Texas is the nation’s clean-energy leader in the first place might have some comfortably blue states rethinking their own theories of change. A theory of change can help Agents of Impact refine their logic and claim their unique role in delivering impact. – Dennis Price

The Week’s Impact Briefing

🎧 On this week’s podcast. From Austin, ImpactAlpha’s Dennis Price joins host Brian Walsh to discuss Texas’s surprising role as the U.S. leader in clean energy – and how the oil-pumping state might yet wrest defeat from the jaws of victory. Plus, the headlines.

The Week’s Call

Metrics Madness: Wealth, ownership and ‘quality adjusted life years’ (video). The search for a universal metric to guide investments in racial justice and equitable wealth-building was… aspirational. “We are still a little ways away from the winner, but we have found a pool of possible winners that could all make sense,” Southern Reconstruction Fund’s Napoleon Wallace said, summing up ImpactAlpha’s Agents of Impact Call No. 50 (see, Chasing the holy grail of a universal metric for racial equity and wealth-building”). The weight of sentiment landed on wealth, and specifically the increase in wealth as measured by assets for BIPOC clients. The metric was proposed by Caitlin Rosser of Calvert Impact, which is using the metric in its new Mission Driven Bank Fund. “That is going to be our North Star,” she said. “Increase in assets, increase in wealth.”

Closely related, and perhaps more deeply rooted, are pathways to ownership. Greensboro, N.C.-based Partners in Equity helps Black business owners purchase the commercial buildings in which they operate, building their wealth and preventing displacement in the face of rising rents. “It’s so important for our communities to have access to the ability to own this asset,” said Partners in Equity’s Wilson Lester. “It’s allowing that business owner to take a look at how  they can change the wealth dynamic in their family in just one generation.” Wallace himself made a pitch to adapt quality adjusted life years, or QALYs, commonly used to compare health interventions, to a broader set of social-change strategies. “The base concept which holds is that there are few impact goals that are as universal as a longer and happier life,” said Wallace, who himself faces a challenging diagnosis of amyotrophic lateral sclerosis, or ALS, and spoke through a text-to-voice translator (see, Napoleon Wallace: Restorative capital for Black wealth). The highest logical hurdle is to think of the investment of capital as a potentially life-changing intervention,” he said. “Who knows if we will get there but we think it is surely worth a shot.” 

The Week’s Dealflow

Deal spotlight: Climate tech in Europe. Climate tech is the fastest-growing venture capital sector in Europe. Of the $70.1 billion in funding deployed to global climate tech ventures last year, close to $18 billion went to startups in Europe, according to analytics firm HolonIQ. Climate tech ventures in Europe raised only a half-billion dollars in 2017. The European Commission last month set out its Green Deal Industrial Plan, an answer to the Biden administration’s industrial policy that is supercharging clean tech investment in the U.S. This week, Copenhagen-based Agreena raised €46 million ($50 million) to help farmers in Europe transition to more regenerative practices and generate revenues from soil carbon credits. Separately, Finland’s Carbonaide secured €1.8 million to ramp up production of its carbon-negative concrete. Off the mainland, U.K.-based Mixergy landed £9.2 million ($11.4 million) for its energy-efficient and renewables-compatible hot water tanks.

  • Climate software. Berlin-based Atlas Metrics secured €5.2 million to help European companies manage environmental, social and governance metrics in line with new reporting requirements. Also in Berlin, scored €5 million for software that helps renewable energy plant owners and operators manage their operations. In London, climate data provider Connect Earth closed a $5.6 million seed round. Lun in Denmark raised €10.3 million for software that helps heat-pump installers find customers and complete installations.
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Clean tech. Vancouver-based ph7 Technologies clinched $16 million for a greener, non-toxic metal extraction process… Climate-focused investor HASI backed Bioenergy Devco to spur waste-to-fuel anaerobic digestion facilities across the U.S.

Energy transition. Wisconsin-based Type One Energy raised $29 million to build “stellarator” fusion machines… Ride-hailing company Cabify will use a portion of its $110 million raise to electrify vehicles on its platform.

Impact measurement and management. Connect Earth in London scored $5.6 million to provide financial institutions’ customers’ with data on the environmental impact on their spending decisions… Munich-based IntegrityNext raised €100 million to help organizations track and audit their suppliers’ ESG compliance… Alcove raised $3 million for software that enables companies to track and manage their carbon credits. 

Impact tech. Factor[e] Ventures’ Delta40 scored early funding to build tech sectors in Africa… Dutch impact investor Pymwymic led a €2.8 million seed funding round for food-waste startup OneThird… Edtech venture Almentor in the UAE raised $10 million to deliver online lessons to underserved Arabic-speaking students… South Africa’s Fin acquired fintech venture Thuthukani to help low- and middle-income South Africans secure home loans.

Inclusive communities. Lumina Foundation backed Coastal Enterprises to help rural entrepreneurs launch child care businesses… Arctaris Impact Fund secured a $10 million line of credit from KeyBank to invest in low-income communities in the U.S.

Investing in health. Mamotest secured $3.3 million for breast cancer screening in Latin America… Amboy Street Ventures closed $20 million for its first fund, which invests in startups addressing sexual health and women’s health… Kenya’s TIBU Health raised an undisclosed amount of funding for its virtual healthcare service for chronic disease patients. 

Press freedom. MDIF and partners aim to democratize impact investing in independent media. 

Water access. The U.S. International Development Finance Corp. is investing $100 million in WaterEquity’s fourth global access fund.

The Week’s Talent

LeapFrog Investments named Rob Leary, ex- of Nuveen and Olayan Group, as senior advisor to Leapfrog’s leadership team… Alex Bell, formerly with Tikehau Capital, became a partner at J.P. Morgan Private Capital to focus on sustainable growth equity… Jen Sullo, former global head of sustainable investing solutions at Goldman Sachs, joined Earth Finance as managing director of asset management and investing solutions. 

Stifel Financial Corp. scooped up three former Silicon Valley Bank bankers with deep climate tech connections. Jake Moseley, Matt Trotter and Ted Wilson, will join the St. Louis-based investment bank as managing directors… ELIXR’s Catalina Valentino joined UnaTerra Venture Capital Impact Fund as an advisory board member. 

The Week’s Jobs

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

U.S.-based jobs

In New York: The Ford Foundation seeks a mission investments technology fellow… LISC is recruiting a portfolio reporting and impact management analyst… Newmark seeks an ESG director… Impending Bloom is recruiting summer ESG fellows… Rethink Education seeks a senior associate… New York Life Investments seeks an impact investing senior associate.

In Washington, D.C., Quantified Ventures has an opening for a controller, and Energy Impact Partners has an opening for an impact and sustainability associate… Enterprise Community Partners seeks a manager for investment communications in Atlanta… The Bill & Melinda Gates Foundation is hiring an investment officer for its strategic investment fund in Seattle.  

In Los Angeles, Ares Management is hiring a private equity and ESG vice president, and ECMC’s Education Innovation Ventures has an opening for a senior associate… In San Francisco, Tides is on the hunt for a senior contract analyst, and Wetherby is on the hunt for an impact management analyst. 

Jobs in Europe

In Frankfurt, Bethmann Bank is looking for an ESG analyst in Frankfurt, Schroders seeks a sustainable credit analyst, and Finance in Motion is looking for an impact equity investing analyst… The World Food Programme has an opening for an innovative finance venture lead and an innovative portfolio lead in Munich. 

Vontobel Asset Management seeks an impact implementation portfolio manager in Zurich… In Geneva, UR Capital is on the hunt for a senior fund manager and head of impact investing, and AlphaMundi has an opening for a sales officer… Tikehau Capital has an opening for an ESG manager in Paris. 

FMO is recruiting a senior environmental and social officer in The Hague… Norrsken is looking for an ecosystem manager in Barcelona… Sonder Collective is hiring a Finland-based impact finance director… Swedfund is on the hunt for an impact analyst in Stockholm.

Other global locations

New Markets Funds is looking for an acquisition manager in Montreal… Sitawi Finance for Good is hiring an impact investing intern in Rio de Janeiro… NESsT is looking for a country director in Brazil… Symbiotics is hiring a Mexico City-based investment analyst for Latin America and the Caribbean… Kiva seeks an impact investment manager in Bogota. 

Pacifica Continental seeks an energy transition investment expert in the Philippines… In Singapore, IIX seeks a credit portfolio management associate, and Temasek is hiring a sustainable solutions assistant vice president… In Cairo, Finance in Motion seeks a senior equity investment officerCommonShare is recruiting for a sustainability intern in Morocco. 

Remote positions and other jobs

The IFC is looking for an investment officer… Steady Growth Ventures is recruiting a managing director… Nonprofit Finance Fund has an opening for an underwriting specialist… Bridgepoint is hiring an ESG manager… Kiva is looking for an impact content manager

LISC seeks an impact measurement and communications intern… Common Impact is looking for a chief program officer… Sagana is looking for an investment manager… Ocean Outcomes is looking for a program assistant.

That’s a wrap. Have a wonderful weekend. 

– March 31, 2023