Category Archives: impact investments

What’s new in crowdfunding, crowdinvesting

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Crowdfunding platforms are continuing to be launched and according to industry sources there are more than 500 platforms. Of the 4 types of crowdfunding sites (donation-based, reward-based, loan based and equity based) this year we are likely to see a surge of equity based crowdfunding sites (in particular in the USA) that would allow for investment in startups. This is due to the passage of the JOBS Act last year that includes the Crowdfund Act. A recent article titled Crowdfunding Clean Energy by David Bornstein gives an excellent insight on the recent trends in this area. In addition to Solar Mosaic described in this article there are several new green crowdfunding sites that look appealing. Impact Crowd, Abundance Generation, OnGreen

Skoll Forum 2011

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A belated report on the Skoll Forum 2011. This year’s main theme was “Large Scale Change” . Lots of content. I recommend the selection of superb blogs, and in highlights you can find all the sessions and plenaries as video or podcasts. It was nice to have been able to attend Skoll forum for the 5th time in a row as initially I planned to be in Japan teaching social entrepreneurship for the YES Japan Creating Drivers for Sustainability program (which was understandably cancelled due to the triple disaster). My takeaways: of course the optimistic, positive energy that always flows at Skoll Forums, networking, the interactive meetings at Oxford Jam and last but not least connecting with Shino (Japan Research Center), Ichi (Social Media) and Patrik Meier (Crisis Mapping, Ushahidi) to discuss and share information on how to support Japan in the wake of the recent triple disaster.

Rebuild Japan! Social Entrepreneurship Fund launched

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We (at Socential) have launched an initiative to help rebuild the lives of the Japanese people impacted by the triple catastrophe (earthquake, tsunami and nuclear power plant damage) that hit northeastern Japan on March 11. The fund aims to mobilize youth and social entrepreneurs to create initiatives/projects for the rebuilding of the infrastructure and to help the families and children impacted in northeastern Japan to rebuild their lives. The fund also aims to unleash the entrepreneurial spirit in Japan and to provide much needed hope by encouraging them to work and engage for their future. Socential is teaming up with trusted partners in Japan in the area of social entrepreneurship (Ashoka Japan) and sustainable development to select the initiatives. Please join us in our efforts by spreading the word, donating for this project and/or praying for Japan.
For more information go to Rebuild Japan! Social Entrepreneurship Fund.

Impact investments and social entrepreneurship: opportunities and awareness emerging in Japan

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On March 1st Daiwa Microfinance Fund, the first Japanese investment trust fund to provide commercial financing for microfinance institutions was launched with the fund size of USD 242mn. The fund will be managed by Developing World Markets (DWM) which launched at the same time the underlying vehicle DWM Microfinance Fund-J.The fund is distributed by Daiwa Securities and managed by Tokyo Marine Asset Management. The minimum subscription is of Yen 1000 or 12 USD.
Daiwa seems to be leading the way amongst the big financial institutions in Japan regarding impact investments they had launched a bond that invests in IFC (which invests in MFIs) and also have distributed the GAVI bonds.
Japan has been lagging in the area of impact investments but during my last visit to Tokyo in mid January I could feel/hear that there is finally a lot more interest, awareness on the topic of social entrepreneurship and impact investment. I was lucky also to coincide with the official launch of the Ashoka Japan office. Bill Drayton was in Tokyo to give interviews and to introduce the Japan representative Kashiwa Maki and the long time Ashoka supporter Nana Watanabe. Ashoka Japan had started to operate last year the Youth Venture program.
I also met with Ichi (Hiroyasu Ichikawa) who I had met last year at SOCAP and Skoll who is doing a great job as a social media consultant in Japan. I also met several players in the financial industry that expressed their interest in making impact investments. Once there is interest…. Japan can move boldly… a lot to look forward to!

Impact investments…going mainstream in 2011

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Looks like 2011 will be a breakthrough year for impact investments. A recent report by J.P. Morgan/Rockefeller Foundation and Global Impact Investing Network (GIIN) defines impact investment as “investments intended to create positive impact beyond financial return”. In other words, investments intended to; improve or provide access to energy, water, education, health, housing, and financial services for the poor, create jobs or mitigate climate change while also providing a financial return.
The term “impact investments” only surfaced less than 3 years ago and now thanks to the impressive efforts of the Rockefeller Foundation and GIIN it is emerging as an asset class. It is capturing the attention of investors in all segments from philanthropic foundations, high net worth individuals, financial institutions and governments as they all seek to make more efficient use of their capital, achieve better returns (social, environmental and financial) and help solve the world’s social problems. Estimates on potential market size (investment capital) over the next 5 to 10 years range from USD 400bn to USD 1 trillion. Major efforts have been made also in developing standardized metrics with Impact Reporting and Investment Standards (IRIS) and more recently on ratings the Global Impact Investment Reporting Standards (GIIRS) is testing its rating methodology with 25 pioneer funds. Impact investments has been featured in conferences such as Skoll World Forum, Clinton Global Initiative and SOCAP last year and certainly this year it will take center stage.
Suggested readings
Impact Investments- An emerging asset class (J.P.Morgan, The Rockefeller Foundation, GIIN)
Impact Investing: A Framework for Policy Design and Analysis (Pacific Community Ventures, Harvard University)
Money for Good (Hope Consulting)
Investing for Social and Environmental Impact (Monitor Institute)
related blog What is impact investment?

SOCAP 2010 Mainstreaming Impact Investments

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SOCAP 2010 took place in San Francisco on Oct 4-6. Over 1200 participants. Energetic, lively, sharing, innovative. Impact investments took center stage.Watch these amazing videos of Jacqueline Novogratz (Acumen Fund) Matt Flannery (Kiva) and many more http://video.socialcapitalmarkets.net/live-video-stream/ The first SOCAP Europe will take place in Amsterdam May 31-June 2, 2011.

Book: Microfinance and Beyond: Introducing microfranchising and social businesses

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This book introduces innovative social/business models that provide sustainable solutions to the problem of poverty and portrays the insipiring people behind them.You can find an update on microfinance, BOP (base of the pyramid) initiatives, and microfranchising all which are improving the lives of the 4 billion people living at the BOP. VisionSpring, an innovative social microfranchising enterprise with the mission to reduce poverty and generate opportunity through the sale of affordable reading glasses is featured as a model case. The aim of this book was to share my insights on 1) how the business and social worlds have been converging, setting the stage for these innovative models to emerge, 2) how these models, together with the advent of Web 2.0, are creating a strong and positive movement towards a more responsible, sustainable and kinder world and 3) how all of us could make a difference.
This book is the updated English version of the German book that was published last year. I used lulu.com to publish this and I can recommend it.

What is Impact Investing?

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“Impact investments aim to solve social or environmental challenges while generating financial profit. Impact investing includes investment that range from producing a return of principal capital to offering market-rate or even above-market financial returns. Although impact investing could be categorized as a type of “social responsible investing” (SRI) it contrasts with negative screening which focuses primarily on avoiding investments in “bad” or “harmful” companies -impact investors actively seek to place capital in businesses and funds that can harness the positive power of enterprise.” (source:based on GIIN)
I first heard this expression in spring 2008 at the Skoll Forum in Oxford described by Antony Bugg-Levine of the Rockefeller Foundation. (I thought I finally found the proper word to describe what I do, I am an impact investment advisor) A year later at the 2009 Skoll Forum, the Monitor Institute presented an excellent report titled Investing for Social and Environmental IMPACT and also A. Bugg-Levine announced that the Global Impact Investment Network (GIIN) was being formed. In Sept at the SOCAP 2009 in San Francisco one could confirm that “impact investing” had become the widely accepted expression by the rapidly growing social capital investment industry. On Sept 25th 2009, GIIN was officially launched and announced its 25 founding members of the GIIN Investor’s Council at the Clinton Global Initiative. A recent article in the Economist also profiles impact investing.
Over the past few years many new expressions have been created to describe investing for social and environmental impact and financial return. These include double or triple bottom line investing, blended value investing and BOP investing. Needless to say microfinance investments is one of the leading and successful examples of this type of investment. All these expressions are valid in their own right; however, it confuses the investors and makes it difficult to build the market mechanisms for this nascent industry to efficiently grow. It is great that we now have a clear terminology and definition and an institution such as GIIN which is dedicated to increasing the effectiveness of impact investing. Other great initiatives in this area include The Global Social Investment Exchange (GSIX) and Nexii, the electronic transactions and communication platform for the social and environmental markets.