|
#Dealflow: Follow the Money
Calvert Foundation and U.S. Bancorp back $20 million fund for small business lending. Greenline Ventures, a minority-controlled and employee-owned firm in Denver, will manage the fund. The fund leverages New Markets Tax Credits, a federal program that incentivizes business and real estate investment in low-income U.S. communities with a federal tax credit. The new fund will provide credit to women, veteran, and minority business owners. Small businesses have created more than half of all new jobs since the seventies but have been hit hard by post recession bank consolidation and risk aversion.
Holberton School raises $2.3 million to train techies. The two-year old San Francisco school helps meet demand for software engineers and programmers by training adult student for careers in tech. Holberton raised new funds from Paris venture capital firm Daphni, Reach Capital and Jerry Murdock, co-founder of Insight Venture Partners. At Holberton tuition is free but employed graduates must pay 17 percent of their gross incomes back to the school over three years. Students range in age from 16 to 68 and more than half of those enrolled are women.
B the Change media shutters B Magazine. The March print edition of B Magazine will be the company’s last. The quarterly social business journal, with 7,000 subscribers, was a spinoff of B Lab, the Wayne, Pennsylvania nonprofit that issues “B Corp.” certifications of businesses’ social and environmental performance. Bryan Welch, CEO and publisher, told clients and contributors that the company needed a second round of financing “and unfortunately we could not secure that funding in time,” according to a note reviewed by ImpactAlpha. B the Change says it will reduce staff to just one person, an editor, and continue to publish content on its website. The shutdown follows the recent absorption of Upworthy by Good Worldwide.
Agora Partnerships stocks the pipeline of Latin American social business startups. The incoming class for Agora’s accelerator program includes 31 companies from 12 countries in Latin America and Caribbean, including one from Haiti. Major themes include urban innovation, health access, ethical fashion, water and sanitation, clean tech, education for all and sustainable food and agriculture. This year Agora is adding training around the UN Sustainable Development Goals to help companies measure their impact against the global goals. Since 2011, Agora has supported 125 companies that have raised $52 million and created 5000 jobs. Nine out of 10 are still in business.
Billion-dollar firms tap talent. San Francisco-based Impact Community Capital, a $1 billion investment firm backed by leading insurers including Allstate, MetLife and State Farm made interim chief Jeff Brenner its permanent chief executive. ICC finances housing, community healthcare facilities and childcare centers in low-income communities across the U.S. Global impact investor Oikocredit, the Dutch lender to microfinance institutions worldwide with more than $1 billion in assets, named Thos Gieskes as managing director.
New Summit Investments launches as impact arm of Arjuna Capital and Baldwin Brothers. The joint venture of the two wealth management firms will help clients integrate impact into their portfolios. Bill Marvel and Alex Lamb will lead the Boston venture, which will “target the same risk/return characteristics as other geographically diversified strategies.”
#Signals: Ahead of the Curve
Growing Republican support for a carbon tax. Former Secretary of State James A. Baker III and party elders are pushing a “conservative climate solution.” In return for a $40 per ton tax on carbon dioxide, the plan would scrap the Obama administration’s Clean Power Plan and protect fossil fuel companies against any lawsuits for damage to the environment. Baker is set to meet today with Vice President Pence, Jared Kushner, Ivanka Trump and others. Secretary of State and former CEO of ExxonMobil Rex Tillerson is on record supporting a carbon tax. Mitt Romney tweeted: “Thought-provoking plan from highly respected conservatives to both strengthen the economy & confront climate risks.” Democrats and environmental activists have long favored such a tax and more than 20 countries around the world already have enacted a variation. At $40 a ton, the proposed tax would generate up to $300 billion a year that would then be returned to customers as a “carbon dividend.”
A cautionary note from SSIR’s Data on Purpose/Do Good Data conference. Nonprofits, companies and government agencies that should be cooperating to build the evidence base for social impact are instead forced to compete with each other for grants and investments. "Neither of those funding streams are what people need," said Greg Bloom, founder of the Open Referral Initiative, which is building a directory of health, human and social services for people in need. In an interview with ImpactAlpha on the sidelines of the conference at Stanford, he said projects often are asked to forecast outcomes even before they know what questions to ask.
Direct cash transfers show promise as anti-poverty tool. The evidence base is growing for the effectiveness of giving cash directly to the poor. A new report from Britain’s Independent Commission on Aid Impact (ICAI) found the U.K.’s cash transfer programs delivered “increasing incomes and consumption levels for the poorest households, with modest but positive effects on savings, asset accumulation and debt reduction.” In East Africa, Give Directly, a non-profit that gives money unconditionally to families via mobile phones, has raised $140 million from donors in the last four years.
Antony Bugg-Levine on impact investing’s narrative of common purpose. The chief of the Nonprofit Finance Fund and leading thinker on impact investing felt his confidence wobble after 2016 election results in the U.S. and the U.K. In a post on ImpactAlpha, he describes how he “talked himself down off the ledge.” What’s needed now is hope and a common sense of purpose, he says. “When Nonprofit Finance Fund and our impact investing partners finance a new fresh food market in Flint, Mich., or help expand substance abuse outreach services in Connecticut, or help build a school and community center in central Oregon, we take capital from banks and place it in the hands of people whose work creates a little more hope in their communities.”
#2030: Long-Termism
Will the next 20 years be defined by ‘islands,’ ‘orbits’ or ‘communities’? Will we turn inward, lash out or work together? Looking back from about 2030, the National Intelligence Council sketches our collective choices in its latest unclassified global trends report, which includes three sceneries that lead to widely disparate outcomes.
Islands. An economist looking back 20 years after the 2008 financial crisis found that countries turned inward as “mounting public debt, aging populations, and decreased capital investment exacerbated downward pressures on developed economies.” Automation and AI were more disruptive than expected. Climate change challenged governments’ ability to cope. “The global pandemic of 2023 dramatically reduced global travel.” The good news from 2028: “The slowing of globalization and trade is sparking a new generation of experimentation, innovation, and entrepreneurship at local levels.” Man-machine cooperation is helping reverse job losses.
Orbits. At the end of the Smith administration in 2032, rising regional tensions are giving way as major powers learn to cooperate for self-preservation. The U.S. had not fully realized how nervous Beijing, Moscow, and Tehran were about economic stress and social tensions at home and so could not compromise on external challenges. “It took a mushroom cloud in a desert in South Asia to shake us from our complacency,” the president’s national security advisor reflects. The good news: “With China’s help, the United States quickly moved to defuse the crisis—we were lucky. The conflict barely missed escalating to a full nuclear exchange. President Smith shared the Nobel Peace Prize with the President of China that year.”
Communities. Looking back from 2035, the mayor of a large Canadian city says the rise of sub- and transnational structures seems inevitable in retrospect. “Information and communication technologies are now key to defining relationships and identities based on shared ideas, ideologies, employment, and histories, rather than nationality. In the Middle East, “broad societal rejection of the violent religious extremism” of the early 21st century was driven by the lost generation of youths demanding practical solutions. Around the world, city leaders worked together to tackle issues that national governments neglected. “The term ‘Free World’ now defines the networked group of state, substate, and nonstate entities that work cooperatively to promote respect for individual freedoms, human rights, political reform, environmentally sustainable policies, free trade, and information transparency.”
Onward! Please send any news and comments to editor@impactalpha.com.
|
