Here's my deck all about impact investing used in the Future VC Masterclass, providing new talent breaking into VC with an overview of what impact investing is and how it applies to the venture capital industry.

1. A Future VC Masterclass
11th June 2021
IMPACT INVESTMENT
& TECH FOR GOOD

2. MY JOURNEY INTO VC
● I’m a cis-het, தமிழ் (Tamil) and German WOC
● Went to a Gymnasium in Germany
● Did my BA with a major in European Law
at Tilburg University in the Netherlands
● MA in International Relations at Leiden
University in the Netherlands
● Prior to joining BGV in 2017, I worked for
international NGOs on global
development and humanitarian issues for
four years
● Four years in early-stage VC (pre-seed +
seed)
@Dama_Yanthy
@bg_ventures

3. We back ambitious founders using
tech to tackle social and
environmental challenges that aim
to drive positive change at scale.
OUR MISSION
A better society
A sustainable planet Healthy lives

4. OUR TRACK
RECORD
Since our launch in 2012, we’ve
invested in 141 ventures
17m users +
beneficiaries
43% of
venture
employees
are women
£98M further
investment
raised by
ventures
£1.4M
invested in
2020 (25
deals)
67% are
first-time
founders
Data as last reported on 31st December 2020

5. OUR TEAM
More in our 2020 Learning and Impact Report
The BGV Team (FT staff) sans Paul, our CEO who just came
back from three months parental leave and Cansu, our Head of
Fundraising.

6. OUR VENTURES For an overview of all our ventures, go to
bethnalgreenventures.com/portfolio

7. What are your
assumptions and
perceptions?
1. Take out your phones
2. go to menti.com and
3. Use the code 85 34 53 9
Live results

8. Why Impact
investing?
All Investments have
impact — both positive
and negative.

9. Investments made into companies, organisations
and funds with the intention to generate a
measurable social and environmental impact
alongside a financial return.
Global Impact Investing Network
Definition of impact investment

10. Megatrends
Planet under
pressure
Resource
scarcity
Future of
work
Rapid
population
growth
Rapid
urbanisation
Energy
transition to
net zero

11. “Amid so much suffering and
injustice, we cannot resign ourselves
to the reality we’ve inherited. It is
time to reimagine what is possible.”
Ruha Benjamin, Race After Technology

12. “Purpose is not a mere tagline or marketing campaign; it is
a company’s fundamental reason for being— what it does
every day to create value for its stakeholders. Purpose is not
the sole pursuit of profits but the animating force for
achieving them. Profits are in no way inconsistent with
purpose—in fact, profits and purpose are inextricably
linked. Profits are essential if a company is to effectively
serve all of its stakeholders over time—not only
shareholders but also employees, customers, and
communities.”
Larry Fink
CEO, BlackRock
SHIFTING PERSPECTIVES

13. Achieving the Global Goals opens up US$12 trillion of market
opportunities in four economic system, ranging from food and
agriculture to cities, and energy per year.
Achieving the Global Goals will create 380 million new
jobs by 2030
Investor and consumer demand is shifting towards more
purpose-driven sustainable investing products and services.
85% of U.S. individual investors now express interest in
sustainable investing strategies (Morgan Stanley, 2019)
SHIFTING PERSPECTIVES

14. SIZING THE MARKET
2016 2017 2018 2019
Source: GIIN, Sizing the Impact Investing Market, June 2020
$114BN $228BN $502BN $715BN

15. SOURCES OF
CAPITAL
❏ Pension funds,
❏ Retail investors,
❏ Diversified financial institutions,
❏ Insurance companies,
❏ Development Finance Institution (DFIs),
❏ High-net-worth individuals (HNWIs),
❏ Family offices,
❏ Foundations,
❏ Fund of funds,
❏ Sovereign wealth funds,
❏ Endowments,
❏ Religious institutions, and
❏ many more.

16. CORE CHARACTERISTICS
INTENTIONALITY FINANCIAL RETURNS
RANGE OF ASSET CLASSES IMPACT MEASUREMENT
Source: The Global Impact Investing Network, Elements of Impact Investing

17. The Spectrum of Capital
Investment
approach
Financial
Goals
Impact
Goals
Traditional Responsible
Sustainabl
e
Impact-driven Philanthropy
Deliver competitive risk-adjusted financial returns Tolerate
higher risk
Tolerate below
market returns
Accept full
loss of capital
Practical capital
preservation
Avoid harm and mitigate ESG risks
Benefit all stakeholders
Contribute to solutions
Don’t
consider
May have
significant
negative
outcomes
for people
and planet
Avoid harm
Try to
prevent
significant
effects on
important
negative
outcomes
for people
and planet
Benefit
Effect
important
positive
outcomes
for various
people and
planet
The ‘impact economy’
Contribute to
solutions
Have a material effect
on important positive
outcome(s) for
underserved people or
the planet
Source: Adapted from Bridges’ “The
Spectrum of Capital”

18. How BGV maps
across the Impact
Management
Matrix

19. CORE PRACTICES
1. Intentionally contribute to positive
social and environmental impact
2. Use evidence and impact data in
investment design
3. Manage impact performance
4. Contribute to the growth of impact
investing
Source: The Global Impact Investing Network

20. IMPACT
MEASUREMENT

21. WHY MEASURE IMPACT?
Design company operations in
a way that would lead to your
desired outcomes and avoid
mission drift as you scale.
Purpose
protection
Product
validation
Fundraising
Collect evidence for your
stakeholders, such as prospective
customers or regulators.
Present a convincing and
data-driven narrative for
pitching and due diligence.

22. Impact measurement SEEMS complex
Track the conversion of
inputs to outputs over a
period of time (Best & Harji,
2013).
Examples: B Impact Assessments, The
Global Impact Investing Rating System
(GIIRS, Global Reporting Initiative (GRI)
Standard.
Process
methods
Impact
methods
Monetisation
methods
Impact methods relate outputs
and outcomes and attempt to
prove incremental outcomes
relative to the next best
alternative.
Examples: Theory of Change, Impact
Management Project, Nesta’s
Standard of Evidence.
Monetisation methods work by
assigning a monetary value to a
social or environmental
outcome (Best & Harji, 2013).
Examples: Social Return of Investment
(SROI), The Integrated Profit & Loss
account (IP&L) developed by the Dutch
Impact Institute.

23. COMMONLY USED FRAMEWORKS
Business model impact measurement
and impact risk assessments
Business model and operational
impact measurement
Impact measurement and metrics
Global targets and reporting on
country-level advancements
Linking the SDGs and GRI for tangible
metrics

24. Due diligence
Investment screening
Investment and portfolio strategy
Investment management
Exit
What is your funds investment thesis?
How does it align with your investment model?
How do you screen deals for impact?
How do you validate their impact?
How do you/they report on impact?
What platform support can you provide?
What does a responsible exit look like?
Impact alignment in the investment process

25. Impact measurement in PRACtice
Chatterbox founders
Mursal and Guillemette
Read the venture case study in BGV’s 2020 Learning and Impact Report

26. Fairphone is the world’s
most sustainable and
ethical smartphone,
using a modular design,
built through a fair
supply chain.
Pymwymic 2019 Learning and Impact Report

27. What about
making a
profit?
For-profit
maximising
behaviour leads
to mission drift.
To achieve
maximum impact,
you’ll have to
trade-of returns.
By virtue of being
“impact-driven”,
they are all good
companies.
It’s bloody hard
to measure
impact.
There’s always a
trade-off between
profits and impact.
Misconceptions about impact investing

28. What about profits?
Think of profit and returns on a large spectrum with different financial
return expectations.
29.02% IRR (net of fees) and 3x TPVI, which
elevates them to the top quartile of VC firms
1.9x TV/Cost, with two exits (16x returns, 3x
returns).
Total Value to Paid In Capital: The ratio of the current value of remaining investments within a fund, plus the total value of all distributions to
date, relative to the total amount of capital paid into the fund to date.
What the hell is TVPI you ask?
Data benchmarks from Cambridge Associates,
Upright Project’s 2021 Net Impact Report

29. By virtue of being “impact-driven”,
they are all good companies.
Hell no. Net impact of a company is not only the result of positive
impact outcomes, but also operational.
Theranos.
IDEO (recent #SurvivingIDEO stories, philanthropy and not-for-profit is not exempt).
Examples:
Good governance
Fair, decent and equal work
And many many more factors play a huge role

30. It’s bloody hard to measure impact.
It really isn’t.
BGV 2020 Impact Report, Norrsken Impact Report, and many many more.
Examples:
Start small, test with companies
Talk to peers in the community, and learn from others
Be radically transparent about what you do

31. Q&A

32. FURTHER
READING

33. 2020 Annual Impact Investor Survey,
The Global Impact Investing Network
(GIIN), June 2020.
Across the Returns continuum,
Omidyar Network and a series of case
studies in the Economist titled
Beyond TradeOffs.
Sachs, J., Schmidt-Traub, G., Kroll, C.,
Lafortune, G., Fuller, G., Woelm, F.
2020. The Sustainable Development
Goals and COVID-19. Sustainable
Development Report 2020.
Cambridge: Cambridge University
Press.
Core Characteristics of Impact
Investing, GIIN, 2019.
Excellent resources from the
Impact Management Project via
impactmanagementproject.com.
Harji, Karim & Best, Hilary. (2013).
Guidebook for Impact Investors:
Impact Measurement.
Navigating Impact, GIIN.
Integrated Profit and Loss account
(IP&L), Impact Institute
HBR Idea Lab Managing Impact.
B Impact Assessment Best
Practices, B Lab.
Impact Measurement: A Cautionary
Tale, by Do Big Good.
Sifted, Impact Investors to know in
Europe, July 2020
Entrepreneurship redefined, Slush,
June 2020 (really interesting
chapter on purpose-driven
companies).
Re-Generate, Research into
purpose-driven businesses.
Tech for Good community directory
Directory of impact investors
funding tech for good
techforgood/highlights weekly
newsletter.
About Impact
Investing
Impact
measurement
Articles + news
Tech for Good