The Brief | July 8, 2022

The Week in impact investing: Zeitgeist

ImpactAlpha
The team at

ImpactAlpha

TGIF, Agents of Impact!

Vibe shift. It wasn’t long ago that the war in Ukraine was going to make the transition to renewable energy not only an urgent necessity but a patriotic duty. Pledges to net zero and racial justice flew hot and heavy. And, oh yeah, we were all going to get vaccinated, put the coronavirus genie back in the bottle, and get on with building forward better. Now, dramatic climate progress and transformative political change feel so… 2021. These days, it seems we’re all getting Covid, planning for recession, and resigned to watching the assault on civil liberties and a slow-rolling coup d’etat in real time. ImpactAlpha has built its brand around innovative solutions and long-term thinking and, most of all, the energy and agency of thousands of Agents of Impact. Is such optimism suddenly naive – or worse, outdated? You might think so, judging by the backpedaling of supposed leaders, including investors worried that they dumped fossil fuels too soon. But for those still playing the long-term trends, now’s a time to buy in on the dip. 

Resisting defeatism is the new cutting edge. As The Cook’s Nook’s Amy Bell exemplifies, Agents of Impact are throwing off despair and doing the work (see below). It’s progress to be debating how, not whether, private equity firms should meaningfully advance employee ownership, as the Democracy Collaborative’s Marjorie Kelly and Karen Kahn detail in a guest post. For every asset manager using their hefty take-home income to bankroll the forces of reaction, as Imogen Rose-Smith details in her fiery column, many more are mobilizing capital for the low-carbon future. The Supreme Court cut off one avenue for climate regulation, as Amy Cortese reports, but left open other roads that policymakers and investors can now traverse (see deal spotlight, below). John Kostyack provides a playbook for maximizing the Securities and Exchange Commission’s proposed new rules to police ESG funds for greenwashing. And if all that begets a spate of lawsuits, well, there’s an impact fund for that, as well. – David Bank

🎧 Impact Briefing. Roundtable regulars Imogen Rose-Smith and David Bank join host Brian Walsh to discuss Rose-Smith’s latest column on politics and power in asset management – and draw a throughline to the raft of radical decisions from the U.S. Supreme Court. Plus, the headlines.

The Week’s Agent of Impact

Amy Bell, The Cook’s Nook: Planting seeds for impact. Amy Bell’s early work as a financier and advisor to impact funds and social enterprises helped establish the nascent field of impact investing. As the new chief executive of a mission-driven enterprise in Austin, Texas, Bell is seeking more direct impact. Bell last month took the helm of The Cook’s Nook, a meal and food-service provider for local government and nonprofits that last year produced and delivered a half-million meals to Austin families facing food insecurity. Bell says the company, founded as an inclusive culinary incubator by Joi Chevalier, is just beginning to address the massive gap in healthy food access. Bell’s operating role follows stints at JPMorgan Chase, where she helped build out of the bank’s impact investing business; consulting firm Tideline; and most recently, the strategic investments arm of Whole Foods Markets. “I have a passion for thinking about how for-profit solutions can be used to drive impact,” Bell told ImpactAlpha. Having been on the investor side of the table, Bell thought, “I would personally love the experience on the other side of the table. What is it like to really build one of these businesses and own it from start to finish?”

Another throughline in Bell’s journey: equitable food systems. At JPMorgan, Bell backed smallholder agriculture funds like Pearl Capital Partners and biodiversity funds like EcoEnterprise Funds, where she worked briefly after leaving the bank. In Austin, Bell has advised and made angel investments through Foodshed Investors, and at Whole Foods, she financed mission-driven suppliers and food entrepreneurs. At The Cook’s Nook, Bell will help Chevalier expand the equitable food model regionally, and even nationally. “It’s clear that there is an appetite and interest to go bigger.” Bell’s early seeds are bearing fruit. She sees more investors investing for impact, entrepreneurs driven by mission, and more people talking and thinking about how to change capitalism to work for all stakeholders. “The business we’re building at The Cook’s Nook has a better chance of being successful because we have an audience of stakeholders who understand what we’re trying to build.”

The Week’s Dealflow

Deal spotlight: Carbon capture. The aftershocks of the Supreme Court decision limiting the Environmental Protection Agency’s powers to regulate greenhouse gasses are still playing out. EPA must now shift its focus from systemic approaches to those that target individual power plants. One potential beneficiary: the burgeoning carbon capture field (for background, see “How climate investors are getting ready for the carbon removal boom”). If polluters are forced to capture carbon before it is released – as some think EPA may require – then what to do with all that CO2? 

  • Follow the money. Berkeley, Calif.-based Twelve aims to turn captured carbon into feedstock for eyeglasses, apparel, jet fuel and other products that would typically use petroleum. The startup (formerly Opus12) counts Mercedes-Benz, Procter & Gamble, and the U.S. Air Force among its clients. This week, Twelve raked in $130 million from investors including DCVC, Microsoft Climate Innovation Fund, Breakout Ventures, and Capricorn Technology Impact Fund. “This fresh funding ensures we can reach industrial scale to help new and existing partners achieve rapid emissions-reduction,” said Twelve’s Nicholas Flanders.
  • Share. 

Inclusive fintech. LeapFrog backed Shubham to deliver housing loans for low-income buyers in India…. Lendingkart secured $9.5 million of debt funding from GMO and Triodos Investment Management to deploy working capital loans to small enterprises… Neomoon snagged $850,000 to democratize access to banking services in Latin America and other emerging markets… MNT-Halan, an Egyptian fintech for the un- and underbanked, issued a $150 million bond to finance the company’s growth… Mali-based crop insurance provider OKO raised $500,000 to expand into Côte d’Ivoire.

Clean energy. Australia’s Okra Solar scored $3 million to scale up the distribution of solar hardware and software to off-grid households in Nigeria, Haiti, Cambodia and the Philippines… TPG Rise Climate backed Intersect Power’s $750 million round to scale up renewable infrastructure… Yellow secured $23 million to provide loans for off-grid home solar products in Malawi and Uganda.

Impact tech. Black-led OppZo raised $260 million to connect small businesses with financing… Kukua raised $6 million to create educational entertainment content for kids in Africa… Women-led Proximie clinched $80 million from Emerson Collective, SoftBank Vision Fund 2 and Minderoo Foundation to enable virtual surgical collaboration.

Returns on inclusion. True Wealth Ventures scored $35 million to invest in women-led companies with sustainability or health impact strategies… MaC Venture Capital raised $203 million for its second fund to back tech startups shaping culture and increasing access in underserved communities… Women-led Unconventional Ventures secured €30 million to invest in diverse founders. 

Electric vehicles. EVCS Charging Solutions, which manages a network of electric vehicle fast-charging stations on the West Coast, raised $50 million from Spring Lane Capital to expand across California and Washington.

Upskilling workers. Brazil’s Mottu secured $40 million to train, insure and finance motorbikes for gig workers… Meritize scored an undisclosed investment from Aegon Asset Management to finance worker training in high-demand jobs in healthcare, aviation and industrials.

Democracy and power. Aristata Capital raised £40 million for its impact litigation fund to close the justice gap. 

The Week’s Talent

Erika Gucfa, ex- of Abrdn, will lead business development for North Sky Capital’s impact private equity and sustainable infrastructure strategies as managing director… Jérome Joaug, a venture partner with Aster Capital, joins Carbon13 as a part-time entrepreneur-in-residence… Witold Henisz will lead Wharton’s ESG Initiative as vice dean and faculty director… TriLinc Global promotes Maxwell Lynch to ESG and impact manager… Aisha Benson, ex- of TruFund Financial Services, is named CEO and president at Nonprofit Finance Fund. 

Maya Winkelstein, ex- of Open Road Alliance, joins The 2030 Fund as partner… Monique Villa, ex- of Mucker Capital, is named chief investment officer at Launch Tennessee… Patrizia Baffioni steps down as lead of impact-linked finance programs at Roots of Impact… Caroline Flammer will lead a new sustainable investing research initiative at Columbia’s School of International and Public Affairs.

The Week’s Jobs

Invest.green is looking for a remote chief fundraising officer/director of investor relations… The National Basketball Association seeks a social responsibility program director in New York… Also in New York, Capital Impact Partners is hiring an impact investments director, and Neuberger Berman seeks an ESG investing associate for its fixed income platform… Upaya Social Ventures is looking for a remote director of institutional partnerships.

Stone Alliance Group is hiring an impact investment analyst in St. Louis… The California Endowment is looking for an impact investing portfolio manager in Sacramento… ImpactAssets is recruiting a remote investment services officer… NatureVest seeks a remote impact investing associate… ECMC Foundation is looking for a senior associate for its education innovation ventures program in Los Angeles… also in LA, Netflix is hiring a director of ESG.

That’s a wrap. Have a wonderful weekend. 

– July 8, 2022