Impact Esq Vol. 10

I’m currently 30,000 feet over the Pacific Ocean on a flight back from Hong Kong. For the last month, I’ve been in China and Hong Kong. During my travels, I met social entrepreneurs and fellow members of the social enterprise legal community. My trip culminated at the Social Enterprise Summit in Hong Kong, where I delivered a keynote talk on Profit & Purpose. I was impressed by the burgeoning social enterprise scene in HK, which currently has 600 social enterprises and 4 B Corp certified companies. Mrs. Carrie Lam, essentially the President of HK, opened the conference. I’m very impressed by the government’s support of social enterprise in Hong Kong which has supported the employment of people with disabilities, created tax breaks for early stage social enterprises, and created Policy Innovation & Coordination Office, which is a policy lab to increase innovation in the delivery of public services.

 

Social Enterprise

  • Hong Kong Model Constitution. White & Case has worked with local Hong Kong social enterprise Urbanspring to prepare the Model Constitution for social enterprises who are operating either as a private company limited by guarantee or a private company limited by shares. They have used the HK Default Constitution as a starting point.  They added certain aspirational and recommended provisions based on a review of other sources, such as the constitution of notable social enterprises in Hong Kong, Singapore and the United States, the certification criteria for B-Corps, the Corporate Governance Code under the Hong Kong Listing Rules and the terms of reference of well-known companies listed on the Hong Kong Stock Exchange such as Swire Pacific, MTR Corporation and Hong Kong Broadband. To increase the transparency and accountability of a social enterprise’s social impact performance, the Model Constitution contains a provision for the preparation of an “Annual Benefit Report”. To raise the standard of corporate governance, the Model Constitution also contains optional references to the establishment of committees by the board of directors, such as audit, remuneration, nomination and corporate governance committees. To ensure mission lock, the Model Constitution also includes purpose statements and provisions for asset lock. WYNG 43 (25 minutes)

 

  • Smart Impact Capital. Many of you know or have been following the work of Cathy Clark – one of the world’s leading academic experts in impact investing. She is an adjunct professor with Fuqua’s Center for the Advancement of Social Entrepreneurship (CASE) and also directs Fuqua’s impact investing initiative (CASE i3). Clark‘s latest venture is Smart Impact Capital, an online toolkit to help social entrepreneurs identify and attract the right kinds of capital for their enterprises. It was developed during five years running an accelerator with USAID for entrepreneurs working to improve health outcomes for low-income populations in Africa and India. More than 500 entrepreneurs in 30 countries helped give feedback along the way. It launched to the public earlier this month. I spoke with Cathy about it at SOCAP and am excited about the impact it will have for early stage social entrepreneurs. Duke (6 minutes)

 

Impact Investing

  • The Swiss bank UBS is the latest to roll out a stock fund aimed at positive social and environmental impacts. UBS pledged earlier this year to commit $5 billion towards the U.N. Sustainable Development Goals and raised $325 million for TPG Growth’s $2 billion The Rise Fund. UBS Asset Management’s open-ended impact fund will target 40 to 80 companies focused on “solutions to global challenges such as climate change, air pollution, clean water and water scarcity, treatment of disease and food security,” International Investment reports. Impact Alpha (2 minutes)

 

  • Rise of the Rest. Steve Case and the team at Rise of the Rest are raising $100 million for a new seed fund for entrepreneurs outside the major US startup hubs. The expected $100 million raise will come in the form of venture capital, instead of a hedge fund or private equity fund, which is also to be expected given the forms past Rise of the Rest investments have made. Rise of the Rest is an initiative pioneered by Steve Case, who is also the co-founder of AOL, in an effort to highlight startups in tech hubs outside of San Francisco, New York City and Boston. The team includes Anna Mason, ROTR’s director of investments, and Hillbilly Elegy author J.D. Vance, who joined Revolution in March to head up the initiative. DC Inno (3 minutes)

 

Deals 

  • Gro Intelligence. TPG Growth led agtech venture Gro Intelligence’s Series A round, amount undisclosed, which also include investments from Data Collective and several family offices. Gro Intelligence scrapes information sources from governments, trade organizations and markets and standardizes the data so they can be indexed and searched. The goal is that this increased data will drive more investment into the agriculture sector in Africa. Impact Alpha (2 minutes)

 

  • Lendable, a company that connects impact investors to social ventures in Africa, raises $6.7 million to back Kenyan “alternative lenders.” In the company’s first deal, it helped arrange funds for Tugende, a Ugandan firm that provides credit for motorcycle-taxi drivers to buy bikes through a lease-to-own arrangement. The funds will let Tugende, which in four years has sold bikes to 5,000 drivers, buy more vehicles and reduce its waiting list. Lendable’s latest fundraising was backed by KawiSafi Ventures, Omidyar Network, Fenway Summer Ventures, and fintech angel investors. Lendable (7 minutes)

 

About

Impact Esq is a monthly email summarizing the best articles on social enterprise and impact investing law edited by Kyle Westaway – Managing Partner of Westaway, Lecturer on Law at Harvard Law School and author of Profit & Purpose.

If you like what you’re reading please share it with other social impact attorneys. Have a restful and thoughtful weekend.