Yahoo Finance Brazil's Positive Ventures closes on $10M fund for impact investing
Positive Ventures, a São Paulo-based venture firm, has secured $10 million for its latest fund.
Positive Ventures has raised the capital from an impressive list of LPs, including investor Luis Stuhlberger, founding partner of Verde Asset Management and Teresa and Cândido Bracher, who was the chairman of Itaú-Unibanco, Brazil’s largest bank.
The Brazilian venture firm’s self-described mission is to “invest in startups where every dollar of revenue is also delivering environmental or social impact.”
I spoke with co-founder and co-CEO Fabio Kestenbaum, who emphasized the importance of such an investment strategy in a country like Brazil that has had its share of corruption over the years. (Kestenbaum co-founded the firm with Andrea Oliveira and Bruna Constantino).
Positive Ventures prides itself on being guided by the United Nations as part of its Global Compact initiative. It also has a top-tier B Impact Score, meaning as a B Corp. that makes impact part of its core strategy, it’s doing pretty darn good.
The firm’s sweet spot is early-stage -- seed and Series A -- ventures “that can deliver outsized impact and financial return,” according to Kestenbaum. Its average investment size is $500,000, but the firm can go up to $1.5 million in follow-on rounds.
Positive Ventures seeks to back impact-oriented early-stage companies “building breakthrough solutions to tackle massive challenges related to inequality and climate change.”
Partner and CIO Murilo Johas Menezes is based out of the Bay Area and leads the firm’s offshore strategy and investments in companies.
Investments
Positive Ventures is sector agnostic but keeps three impact megatrends in mind when sourcing deals:
Planetary Boundaries, such as recycling, carbon, sustainable systems;
Social Resilience, such as financial services, credit, workforce upskilling; and
Institutional Voids, focused on emerging economies’ most pressing challenges, such as education, health and rising technologies.
“If you want to bring private capital to the game to help address social and environmental challenges, we have to reward this capital,” Kestenbaum told me in a previous interview. “As such, we recognize that we have to invest in good businesses that can provide financial returns as well.” So far, Positive Ventures has backed five companies from its new fund.
One of its first investments, Labi Exames, went on to become a “yardstick for fighting COVID in Brazil,” Kestenbaum said, by delivering a fair-priced and quality alternative to test millions of uninsured low-income families in vulnerable communities.
Labi helped support companies in reopening safely by continually testing their workforce.
“This hybrid value proposition made Labi the most admired health tech in Brazil and resulted in MRR growth beyond 600%, accelerating their Series B, which will happen in the upcoming months,” Kestenbaum noted.
Another cornerstone investment for Positive Ventures was Slang, an AI-driven app to challenge the English illiteracy in Latin America backed by Chamath Palihapitiya of Social Capital and Mexico’s AllVP.
“Less than 3% of Brazilians speak English with proficiency, and such a void hammers their chances to get a decent job and improve income,” Kestenbaum said. “The same happens in all LATAM's countries.”
Positive Ventures recently went on to close its largest investment thus far -- in Provi, a B-Certified fintech providing education-driven loans to enable upskilling and employability for LATAM's workforce, starting in Brazil. The company's mission is to revolutionize education by delivering hassle-free and impact-oriented credit.
Provi has pioneered income-share agreements (ISAs) in the region and already generated more than $30 million in credit, most of which will go toward technology and healthcare courses.
Next up for Positive Ventures is a $30 million growth fund.
