Introduction to the Just Transition

In the past years, I screened more than 100 deals related to nature-based solutions. Happy to share observations. Part 2 today is about just transition.

I love the just transition for integrating climate and people in one approach: 'the transition to a low carbon economy while leaving no one behind’. Please find a link to an introduction to this topic + relevant sources, and examples to start integrating the #justtransition in your #investment / funding strategy. 

Enjoy! If you have questions, please let me know!

Saskia

African Union Youth Entrepreneurship Promotion Africa

Invest in Nature-based solutions part 1 definitions

Sharing insights related to investing in nature-based solutions

Over the past years I deep dived into opportunities in investing in nature-based solutions. Including organizing and event with a focus on ‘investing in forestry, for impact, profit and scale’ and after that I supported several families in investing scalable solutions and pioneering business models in the space. I screened over 100 deals related to nature-based solutions, read loads of articles on this topic and happy to share lessons learned. Part 1 of the introduction into investing in NBS.

Definitions Invest in Nature for Different Effects

We can use some definitions to narrow the investment scope

• “Natural climate solutions are conservation, restoration and improved land management actions that increase carbon storage or avoid greenhouse gas emissions in landscapes and wetlands across the globe1”

• Natural capital: The world stock of natural assets, including geology, soil, air, water and all living things3. For example, soil (natural capital) contributes to agricultural production in combination with experience (human capital) and tools (manufactured capital) to produce ecosystem goods and services that provide benefits to people.

• Ecosystem services: the benefits people obtain from ecosystems are for example clean water, food, fuel, pollination, recreation coastal protection by mangroves

• “Nature-based Solutions (NbS) are defined by IUCN as “actions to protect, sustainably manage, and restore natural or modified ecosystems, that address societal challenges effectively and adaptively, simultaneously providing human well-being and biodiversity benefits2”

We face several challenges: How to mitigate and adapt to climate change? How to protect biodiversity and human wellbeing? (4)

• Working with nature, rather than against it, can further pave the way towards a more resource efficient, competitive, and greener economy. It can also help to create new jobs and economic growth, through the manufacture and delivery of new products and services, which enhance the natural capital rather than deplete it.

• Nature-based solutions can tackle both climate change mitigation and adaptation challenges at relatively low-cost while delivering multiple additional benefits for people and nature.

• For example: Planting trees at an uphill area, protect people downstream from flooding, while also increasing carbon sequestration and protecting biodiversity. Trees in a city help with urban cooling, avoid flooding, store carbon, mitigate air pollution and provide recreation and health benefits4.

• Natural-based solutions have a key role to play in solving the climate challenge, yet only receive 2.5% of climate investments (5).

Nature and Climate Change

Nature based solutions can help address climate change in three ways:

• Reducing greenhouse gas emissions, such as CO2, related to land use and the changes in land use

• Capturing and storing additional CO2 from the atmosphere

• Improving resilience of ecosystems, thereby helping communities adapt to the increase in flooding and dry spells associated with climate change

… are cost effective and having benefits beyond reducing climate change

… improved decisions for land use, using the power of natural climate resources can provide at least 30% of what is needed to keep climate change under 2 degrees6

Natural climate solutions offers a powerful set of options for nations to deliver on the Paris Climate Agreement while improving soil productivity, cleaning our air and water, and maintaining biodiversity7.

These land-based solutions with the highest effect on climate change mitigation are

• Forestry: Reforestation, forest protection, improved plantations.

• Wetlands: Restoration of coastal wetlands and peatlands

• Agriculture: Nutrient management is the largest cost-effective agricultural pathway followed by trees in croplands and conservation agriculture (no till, soil cover, species diversification).

Better stewardship of land is needed to achieve the Paris Climate Agreement goal of holding warming to below 2 °C.

A publication in this area is the Griscom report on natural climate solutions (2017) The rapport identifies and quantifies “natural climate solutions” that increase carbon storage and/or avoid greenhouse gas emissions.

Provides insights in maximum effect of the natural climate solutions on reducing climate change and their cost effectiveness (Griscom)

Hope this introduction was helpful, stay tuned for the next update.

Sources/Relevant publications in this space:

1: The Nature Conservancy: https://www.nature.org/en-us/what-we-do/our-insights/perspectives/natural-climate-solutions/

2: IUCN: https://www.iucn.org/commissions/commission-ecosystem-management/our-work/nature-based-solutions

3: Natural Capital Forum.com

4: 2020, Oxford University

5: 2019,Paris finance tomorrow event

6: natural climate solutions.org

7: 2017, Griscom

8: Griscom, 2017

9: FAO 2020

Free Feedback Friday Climate-Friendly Renovations January 21st

In January, we give away three sessions for feedback on your business plan related to climate-friendly renovations (apply here). We are also preparing an investor session about climate and the built environment.

"The built environment, responsible for about 40 per cent of our carbon emissions, requires many and diverse actions to significantly impact our GHG emissions trajectory, such as better insulation to reduce heating emissions, renewable energy, more efficient heating systems, re-using materials and, in particular, switching to carbon-negative building materials such as timber grown by sustainable forestry. The sector has made great progress in constructing climate-friendly buildings that are increasingly affordable. Another challenge though is the renovation of existing buildings."

We look forward to supporting your innovative strategies and collaborate with you to scale impact.

Introduction to Funds related to Forestry

The GIIN published a great report providing a nice introduction on funds investing in forestry (predominately US-based funds), which provides a nice introduction to diverse forest-related funds. See report here

S2G Ventures Announces its First Investments in the Blue Economy

CHICAGO, June 21, 2021 /PRNewswire/ -- S2G Ventures, a leading multi-stage investment firm focused on the food, agriculture, ocean and seafood markets, announced today that it has invested in five companies across four countries as part of its inaugural investment in oceans and seafood. These investments are aligned with S2G's commitment to supporting leading entrepreneurs in the blue economy who are building scalable solutions for a more sustainable and resilient ecosystem. S2G's Ocean and Seafood Fund, the largest in North America, has led four of these investment rounds with strategic and financial partners, and has taken active board seats with three of the companies. More information here

Educational Event: Catalyze Actions and Collaborations to Invest in Forestry For Impact, Profit and Scale.

Impact investing in forestry evidently contributes to carbon capture and the conservation of ecosystems. So why not more investments in forestry and forest friendly agriculture? Challenges we face are:

• Investors lack information and network 

• Lessons learned from first movers are not yet publicly available

• Actors need each other to develop a fundable and scalable pipeline 

• Too little is known about land rights and revenue streams

By bringing together investors and experts, openly discussing information and lessons learned, Climate Circle, in collaboration with Decarbonized, have taken the first hurdle of overcoming these challenges. 
 
The educational event gathered international and local experts, investors, and government officials for a series of in-depth sessions and panel discussions on investing into the sustainable forest, climate-friendly forestry, forest friendly value chains, invest or disinvest in challenging markets, soil recovery.. Attendees learned how blended finance, risk mitigation, satellite imagery, REDD+, and legal structures can enhance the deployment of capital at scale.

If you want to learn more about the expertise shared, suggest a topic for a next event,  or love to learn how we were able to organize this in just three weeks let me know! 

Saskia Reus-Makkink
saskia@climatecircle.nl

April 1st: Invest in Forestry, Landscapes & Forest Friendly Agriculture. For Profit, Impact & Scale.

To mitigate climate change we need to take global catalyzing actions, we believe that joining forces and sharing expertise in finding a solution is essential to deep decarbonization. Investing in climate forestry and agriculture contributes to carbon capture and conservation of ecosystems.

April 1st I Amsterdam
Climate Friendly Investing in Forestry, Landscapes & Agri 
Meet Likeminded Investors. Share. Connect

We go beyond the WHY question to invest. It is about HOW.

Participants include FMO, NewForests, Maris (teak & tea) Common Fund for Commodities, GreenSafaris, Futuro Forestal, Wageningen University, Dutch Government Dutch Space Office (geo data) and HNWI & Familly Offices with 2-10 years experience in investing in forestry/landscapes & forest friendly agriculture and supply chains.

Topics: Develop scalable pipeline / blended finance, REDD+ Carbon Income, favorable tax regulations, sound business models to engage local population in conservation and other topics. Keep an eye on the blog for latest program.

Limited seats, request an invite: Saskia@climatecircle.nl.  

About the organizers:

Saskia Reus: 19 years of business strategy experience, of which the past 9 years focus on Africa (& Asia). Hands-on experience in developing and implementing business models addressing lowering greenhouse gas emissions, climate-resilient water supply and sanitation, climate resilient food security and poverty reduction. Saskia brings relevant experience in convening meetings and bundling forces of like-minded investors. Founder of Climate Circle www.climatecircle.nl (and Africa Funded). Member of impact investor networks. Leads the activities of Decarbonized in Europe, together with Fiona & James. 

This event is organized in partnership with Decarbonized:

Fiona Banister: 20+ years of global experience. Fiona is known for her in-depth expertise in climate-related investments, micro-finance, impact investing and alliances with vital groups working in creating solutions. Fiona is a Toniic.com impact investor member with the other organizers. She is involved with fintech for “good”, www.ethernom.com,  soil, www.soileos.com, oceans www.oceaneos.org and forestry. Co-Founder for Decarbonized.org and coordinated prior event in San Francisco.

James Magowan:  Since 2000, dedicated investor and investment banker with a strong focus on projects aligned with Deep Decarbonization, Inclusive Housing and Finance. Co-Founder for Decarbonized.org, James is a Director at Merchants National Properties

We wish to thank Greenberg Traurig, for offering us a lovely location, food & beverage 

HelloSolar, BelCash to introduce solar home system

Launches international remittance system for diaspora

With Ethiopia moving to a strategy which helps embrace the wisdom of solar energy within the country and play catch-up to successes achieved in neighboring nations such as Kenya and Rwanda; HelloSolar in partnership with BelCash – the mobile banking platform system – is set to introduce a pay-as-you-go system for the nation’s off-grid population with affordable solar home system.

This is a jump-the-queue strategy for the company in offering such a system and becoming a pioneer in a country whose majority of population still lack basic energy. In addition, the company has launched an International Remittance payment system, to allow members of the Diaspora to pay from anywhere in the world with a credit card and convenience local clients. 

For almost six months, HelloSolar has been testing a PAYGO system, bringing brand-name partners to the table such as: BelCash, Shell Foundation, DFID and USAID and Power Africa (President Barack Obama’s initiative to use renewable energy to provide basic energy across the continent). 

“After the pilot project, HelloSolar will adapt and roll out its model nationwide and be at a prime position to achieve the Ethiopian government’s target of providing 3.5 million solar home systems by 2025,” Bart Minsaer, General Manager of HelloSolar, said.

The Ethiopian government has set 2025 as its target to meet its goal of becoming a middle-income country and the manufacturing hub of the region. 

“Our mission goes beyond proving affordable access to energy,” Michael Tesfaye Hiruy, the companies Chief Strategy Officer told The Reporter. “Moving forward, we will forge the necessary partnerships to provide access to connectivity and digital services such as healthcare, education, market access and employment”. 

BelCash is a company known to have introduced an advanced use of technology to provide customized solutions in convenient payments to vital government services in 2010. It has since refurbished what was once a bureaucratic paper system which inconvenienced millions of people who depend on it. We support BelCash since 2010.

Africa Funded Participating in the 2nd Urban AGri Africa Conference

The conference in Johannesburg brings together suppliers, governments, financiers, representatives of small farmers to share expertise, learnings and build new relationships with focus on the African local and export market. Peter Chege of Hydroponics Africa runs a solid business by providing hydroponic technology to low income groups sharing his business model and scaling plans at the Urban Agri Africa Conference in Johannesburg. We are honored to be part of journey of the founder and company in validating, finetuning and scaling of the business.

Aqysta Entering New Markets

Updates from aQysta:

Commercial Director of aQysta, Pratap Thapa was one of the speakers at the opening plenary of the World Water Week 2018 that took place in Stockholm, Sweden from August 26 till August 31. With Honorable Christine Nkulikiyinka, Ambassador for Rwanda to Sweden, leading the panel, Mr. Thapa talked about how Barsha Pump, maintaining the harmony with nature, can solve the water irrigation issues and help farmers save the operating cost (that usually occurs in pumping).
aQysta is thankful towards SWFF for providing us with this great opportunity.

aQysta introduced in Malawi, the very first customer of Barsha pump in Malawi. The Barsha pump will help his Banana plants fight the dry season ahead without any fuel or electricity costs.

aQysta initiated its activities in Malawi this month, with sales and installations are done in partnership with Malawi based social enterprise, Sakaramenta. Two new team members joined aQysta team- Chisomo Kumenda and Kondwani Kathumba.

Next, the team is preparing introduction into the Kenyan market. Africa Funded supports

Part of this article was posted before on the aQysta web site.

Supporting Healthy and Sustainable Diets: How do we get there?

Improving sustainable sourcing and healthy diets will have massive impact in developing countries. Please find below a link to an article on activities on global scale in this area  

Leading experts discussed what action across government, business and civil society can steer us towards healthy and sustainable diets. Spanning technologies, policies and actors, an action agenda that can unlock ambition, increase resources and continue innovation to take steps towards a healthty and sustianble diet was identified. Continue reading

Climate Circle CEO shares start-up support insights at pan-African conference on climate, energy & water

At the Research to Practice Forum 2018 'Energy, water security and climate change in Africa', Africa Funded CEO Saskia Reus-Makkink shared insights in early stage financing and scaling strategies of business models in Africa and Asia.

April 16th to 18th, the Pan African University Institute of Water and Energy Sciences (PAUWES) brought together over 150 participants from over 40 countries to the conference in Algeria to discuss state of the art and innovative solutions in the areas of renewable energy, water and climate security.

As a key knowledge institution, PAUWES supports the African Union Agenda 2063, the African Union Science, Technology and Innovation Strategy for Africa 2024 (STISA-2024) and  the Africa Water Vision 2025. PAUWES provides platforms for experts, scientists, decision makers, entrepreneurs, private and public sector, policy makers, civil society actors and institutions.

An inspiring opening address was given by Dr. Beatrice Njenga, Head of the Education Division of the African Union Commission Human Resources Sciences and Technology (AUC-HRST). The presentation of Saskia Reus-Makkink of Climate Circle was titled 'Venture Capital, Equity Funds and Business Angels in Africa'.

See some pictures below and get in touch for more info on the PAUWES conference or other Climate Circle presentations.

Deep dive into the decentralized water business model

Africa Funded manages the seed accelerator program of Aqua for All, a Dutch NGO focusing on increasing access to water (EUR 25 million AUM). Africa Funded’s CEO Saskia Reus managed and co-authored an in-depth study executed by Dalberg to identify opportunities and barriers to scale these companies and the sector.

Safe Water Enterprises (SWEs) provide a modular, decentralised approach to delivering safely treated drinking water in the developing world. SWEs are seen as one of the most scalable solutions to reach access to water (SDG6).

Within the seed accelerator of Aqua for All’s contribute to scaling the water kiosk business models was one of the objectives. Therefor we reached out to partners and bundled forces with like minded investors. The portfolio of these partners includes the 14 leading companies of decentralized water services in developing countries with a reach of 3 mio people. To support acceleration of the individual portfolio companies and the sector, partners bundeld forces and executed a multi client research into their portfolio companies and global developments.

Key findings from the research managed and co-authored by Africa Funded’s CEO Saskia Reus (with Dalberg) can be found here.

Jibu raised 7 million USD!

We congratulate Randy, Galen and the team of water kiosk business Jibu in closing their USD 7 Million USD round! Jibu is one of the 14 companies studied in a new in-depth study managed and co-authored by Africa Funded’s CEO Saskia Reus.

The research executed by Dalberg was set up to identify opportunities and barriers to scale Safe Water Enterprises and the sector. Key findings from the research can be found here

The Jibu deal shows there are investable opportunitites in water. A few years ago still “designing a scalable cookie cutter” and now scaling in multiple countries. Read more about the deal here

Scaling Smart Afri Solutions in Kenya

The African food market continues to grow
World Bank estimates showing that it will be worth US$1 trillion by 2030 up from the current US$300 billion. Demand for food is also projected to at least double by 2050. These trends, combined with the continent’s food import bill, estimated at a staggering US$30–50 billion, indicate that an opportunity exists for smallholder farmers—Africa’s largest enterpreneurs by numbers—who already produce 80% of the food we eat to finally transition their enterprises into thriving businesses.

With 90 percent of Kenya being arid or semi-arid land, highly variable rainfall patterns that are even further exacerbated by climate change, and growing number of water-intensive economic and agricultural activities, water management in agriculture is a big challenge in Kenya. At the same time, the country houses immense opportunities for irrigation and agricultural water storage of which only 12% (1.342 million ha) had been developed by the end of 2013. To realise this huge irrigation potential and face the challenges ahead, there is a need to invest in smart water solutions for agriculture.
 

Smart Water for Agri Kenya
Together with SNV, Meta Meta, KIT and Practica and Aqua for All we support a 4 year 6 mio Eur program, funded by the Dutch government to increase productivity of 20.000 small holder farmers in Kenya. Beside support for individual companies to enter the market we also work on improving the ecosystem engaging with local funders, small holder farmer groups and government to boost the sector. The Smart Water program offers technical expertise, access to customers and high risk funding to boost market uptake of innovative solutions.

By promoting market-led water management solutions, 20.000 farmers will increase their water productivity, to assure their access to water for agricultural production and increase farmers’ incomes. Thereby also increasing food security and improving resilience to climate change.

If you are interested to learn more and want to investigate a potential fit, please visit a special session during the Amsterdam International Water week at Tuesday 31st of October. We'll share markets insights and you can brainstorm with the Kenya based team, technical and business experts about the market fit of your solution. Entrepreneurs can registere here. Note places are limited. This opportunity is focuson on Dutch / Kenya based companies, we also support companies based in other countries as of 2018.