Features | April 18, 2018

Welcome the suits to the impact party, new rules of sustainable finance, Virginia seed fund, financing fish

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Featured: Returns on Investment (podcast)

Should impact entrepreneurs beware the strategic corporate investor?Corporate venture capital is a thing. And that thing is converging on impact investing.

The amount that global corporations put into strategic investments in startup companies last year reached $31 billion across 1800 deals, both all-time records.

As ImpactAlpha’s Dennis Price reported last week, companies like SoftBank, Salesforce, Orange and others are directing their corporate venture capital into the kinds of entrepreneurs and companies also targeted by impact investors. Those growth sectors include cleantech, education, urban infrastructure, financial inclusion, agriculture and food.

Welcome the suits to the impact party? Or Katy bar the door? Our roundtable on ImpactAlpha’s Returns on Investment podcast took up the topic; have a listen as the journalists in the bunch turn the tables on the corporate impact investor in our midst.

Read on and listen in to “Should impact entrepreneurs beware the strategic corporate investor?,” ImpactAlpha’s latest Returns on Investment podcast.

Missed an ROI episode? View the full list and subscribe (for free) here.

Agents of Impact: Follow the Talent

URBAN-X, the city startup accelerator from MINI and Urban Us, will launch its fourth cohort in New York on May 8th ahead of the Smart Cities NY 2018 conference… The She Leads Africa Accelerator, from Oxfam, Butterfly Works and VC4A, is now accepting applications from tech startups with at least one woman aged 18-35 as a shareholder or owner… Social Value is hosting a range of impact measurement and management courses during April and May in San Francisco, Oakland, San Jose, Phoenix and Baton Rouge.

Signals: Ahead of the Curve

Three signs that new ‘rules of the game’ are making global finance more sustainable. Small nudges can have big effects. A steady stream of policies, regulations and commitments pushing global markets to align with sustainable development goals is starting to show signs of progress. A new report from the United Nations’ Inquiry into the Design of a Sustainable Financial System, a group charged with exploring policy options to guide global financial markets to invest in the transition to a green economy, takes stock of the markers.

  • Cookie-cutter bonds… Green bond issuance has jumped 14-fold to $155 billion since 2013. That’s partly because of the market-creating role of public institutions including the European Investment Bank and the International Financial Corp, and sovereign bond issuances from Indonesia, Fiji, France, Nigeria and Poland. Keeping it real: The total bond market is $100 trillion.
  • Flight from carbon… Investors have pulled an estimated $5 trillion from carbon-intensive assets (through 2016). The formation of the Climate Action 100+ of institutional investors to push carbon-intensive listed companies to decarbonize was key to building the momentum. Signers of the Principles for Responsible Investment now number more than 1,900, with $70 trillion in combined assets. Keeping it real:Investors still pumped $710 billion into coal, oil and gas over the same period.
  • China and the European Union… China’s “Guidelines for Establishing a Green Financial System” cover banking, capital markets and insurance and are among the strongest national commitments to sustainable finance. The European Union’s High-Level Expert Group on Sustainable Finance has mapped out member state-wide actions and expects to present legislative proposals in May 2018.

Next up, according to the UN, “shifting focus towards pivotal areas such as the potential of digital finance, the roles of rating agencies, China’s Belt and Road Initiative and engagement of key policy platforms such as the G20 all point to further action.”

Dealflow: Follow the Money

Virginia’s new seed fund targets the state’s underestimated entrepreneurs. The Virginia Founders Fund aims to spur tech-based entrepreneurship in software, hardware, life sciences and clean tech. It’s homing in on women, minority, and veteran-run startups, as well as companies based outside of northern Virginia. Read more.

Aqua-Spark, Obvious and Real Ventures back XpertSea’s fish-tracking tech. The Quebec City-based startup has developed a sensing device that helps fish farms and hatcheries keep track of their stock. Go deeper.

Standard Chartered and CDC pledge $150 million for working capital for small businesses. The UK financial services firm and the development finance institution are setting up a fund to help small businesses in Africa and Asia overcome working capital gaps. Learn more.

Eight organizations share £2.1 million to train the UK workforce. Ufi Charitable Trust awarded the winners between £150,000 and £300,000 ($215,000 to $430,000) through its VocTech Impact 2017 challenge fund. Read on.

Click here for more ImpactAlpha dealflow. Send deal tips and news to [email protected].