I'm excited about the prospects of using private financial capital to fund impactful initiatives in areas that would in most cases be to risky. This can be done by seeing the high-risk areas a place for R & D, CSR, or a way to mitigate reputational risk. The problem is its complex.
There are a couple examples here about trying to make this vision a bit simpler to understand without lying through simplistic propositions.
The Netherlands is facing public sector cuts in a similar way to the Uk has already experienced. This presentation was given to a public sector conference in Utrecht focused on \’new financial mechanisms\’ and illustrating innovative models from the UK
ODA for Capacity Building in the Social Enterprise- and the SME-Sector in IndiaMartin Vogelsang PhD
Based on my long-standing experience as impact investor in India I would like to suggest that Official Development Assistance (ODA) coming into the country is disbursed more strongly towards capacity building (training, education) and supporting the incubation of viable social enterprises and inclusive businesses catering to the “Base-of-the-Pyramid”. Investing into this area of the Indian economy would not only help alleviate to poverty and at least partly solve some of the grave environmental problems the country is facing. Such an initiative could also help India’s corporate sector become more engaged in creating and scaling innovative solutions in the areas of technology or financial services that could open up new markets for them.
SiG@MaRS hosted a recap of the inaugural Social Capital (SoCap) Markets Conference held in October 2008 in San Francisco. Kerri Golden, Karim Harji, Michael Lewkowitz and Allyson Hewitt discussed the event, recent developments in the Social Finance marketspace, and the relevance of SoCap for Ontario and Canada.
The Netherlands is facing public sector cuts in a similar way to the Uk has already experienced. This presentation was given to a public sector conference in Utrecht focused on \’new financial mechanisms\’ and illustrating innovative models from the UK
ODA for Capacity Building in the Social Enterprise- and the SME-Sector in IndiaMartin Vogelsang PhD
Based on my long-standing experience as impact investor in India I would like to suggest that Official Development Assistance (ODA) coming into the country is disbursed more strongly towards capacity building (training, education) and supporting the incubation of viable social enterprises and inclusive businesses catering to the “Base-of-the-Pyramid”. Investing into this area of the Indian economy would not only help alleviate to poverty and at least partly solve some of the grave environmental problems the country is facing. Such an initiative could also help India’s corporate sector become more engaged in creating and scaling innovative solutions in the areas of technology or financial services that could open up new markets for them.
SiG@MaRS hosted a recap of the inaugural Social Capital (SoCap) Markets Conference held in October 2008 in San Francisco. Kerri Golden, Karim Harji, Michael Lewkowitz and Allyson Hewitt discussed the event, recent developments in the Social Finance marketspace, and the relevance of SoCap for Ontario and Canada.
Transform Global - A model for a private world banksassbo
Transform Global (TG), previously Transform Capital Management, is a model for a private world bank, also known as a global impact investment bank, investing into funds which have a social, environmental and financial return. TG aims to address critical market failures caused by our current financial system, while tackling the environmental and social symptoms that are a by-product of the system.
Fundamentals of Impact Investing - A Finance Matters Workshop - October 2014Finance Matters
The slide deck from Finance Matters' workshop on Fundamentals of Impact Investing held in London in October 2014.
Finance Matters is a London-based social enterprise helping people in finance put sustainability at the heart of their career. Check us out @fncematters, LinkedIn, Facebook or at www.financematters.co.
Social enterprise: What is it and what to considerNICVA
A presentation by Amanada Johnston from Social Enterprise NI helping participants understand more about what social enterprise is, what you need to consider if thinking about starting a social enterprise, what support is available and gave some examples of local social enterprises.
Background presentation on Markets for Good, including the imperative, opportunity, local and global solutions for impact investing, with particular focus on the Social Venture Exchange (SVX).
Transform Global - A model for a private world banksassbo
Transform Global (TG), previously Transform Capital Management, is a model for a private world bank, also known as a global impact investment bank, investing into funds which have a social, environmental and financial return. TG aims to address critical market failures caused by our current financial system, while tackling the environmental and social symptoms that are a by-product of the system.
Fundamentals of Impact Investing - A Finance Matters Workshop - October 2014Finance Matters
The slide deck from Finance Matters' workshop on Fundamentals of Impact Investing held in London in October 2014.
Finance Matters is a London-based social enterprise helping people in finance put sustainability at the heart of their career. Check us out @fncematters, LinkedIn, Facebook or at www.financematters.co.
Social enterprise: What is it and what to considerNICVA
A presentation by Amanada Johnston from Social Enterprise NI helping participants understand more about what social enterprise is, what you need to consider if thinking about starting a social enterprise, what support is available and gave some examples of local social enterprises.
Background presentation on Markets for Good, including the imperative, opportunity, local and global solutions for impact investing, with particular focus on the Social Venture Exchange (SVX).
This is a presentation about how we can work together in a distributed way. There is a currency system, and infrastructure, and some other little ideas.
Social Impact Ventures and Raising Capital: B Corporations and the Social Ven...MaRS Discovery District
There is a growing belief that businesses must do more than create value for shareholders. Non-profits and government cannot address current and future societal and environmental challenges without corporate involvement. If you are a startup looking to create value beyond profit, then you will want to learn about Certified B Corporations. This new type of corporation uses the power of business to solve social and environmental challenges. These types of certifications are ideal for raising capital from socially conscious investors.
Join us as Joyce Sou, Manager of B Corporations and Social Impact Metrics at the MaRS Centre for Impact Investing, discusses how Social Venture Connection (SVX) is helping capital flow for social impact ventures.
Participants will learn about the following:
What is impact investing?
What is a B Corporation?
How does SVX help B Corporations get investment?
A brief overview of finance for development, to encourage business enterprises to seek opportunity in the new global Sustainable Development Goals (SDGs)
The presentation was a workshop at Evolve 2014: the annual event for the voluntary sector in London on Monday 16 June 2014.
The presentation was chaired by Caron Bradshaw, Chief Executive, Charity Finance Group and looks at the practical issues around social investment, showcasing some of the products available, hearing from charities that have successfully used social investment and social investment providers.
Find out more about the Evolve Conference from NCVO: http://www.ncvo.org.uk/training-and-events/evolve-conference
Find out more about the work NCVO does around funding: http://www.ncvo.org.uk/practical-support/funding
The Investment Case For Financial InclusionElena Thomas
As part of the World Bank MOOC on Development Finance - this document makes the case for development financing to enhance social microfinance and bridge the gap from social to commercial financial services as a way to reduce poverty and build local economies.
"Disinvestment policy of india" Project workNikhil Gupta
This Project report will give an Idea about the "Disinvestment Policy of India". The project work gives an idea about the Approaches, Objectives, Importance, Criticism, Challanges of the Disinvestment Policy. It will give an idea about the amount received by Disinvestment in India. The project report covers the Union Budget of India 2017.
2. The Spectrum of Social Capital Investment - created in 1888 / 1944 –
“essentially pre modern capitalism” – the Gap
no financial return below market return market return
High risk
Low risk
Grants
$400bn
50%
Programme-related
investments
Venture
philanthropy
Mainstream
“For Profit”
Investments
Investment plus
Social Responsible
Investment
circa $4trn
Corporate
Engagement incl
CSR
”
NO INDIVIDUAL OR SYSTEM
MECHANISMS – THE GAP
3. Value Chain Financing – Sanitation
Grants Recoverable Grants
Investment Plus
Mainstream
Investments
no financial return below market return market return
Scale (GAVI) & Synthetic Profit (Corporate
incentive)
Increase the credit quality of social capital markets ie. Leveraging - Microfinance / DB Eye fund model
Incentivising Innovation / Collaboration at the bottom of the pyramid – Social Entrepreneurship
Enables a Range of Financing options; incentivising corporates, banks, civil society;
integrating “ for profit” and “not for profit” players
Based on “Foundations and Social Investment” Margaret Bolton 2005 and Bates Wells & Braithwaite
Legal Process
– ie L3C / CIC
Financing Mechanisms incentivising Community and Corporates Carbon / Vouchers / Fertiliser / Power
Programme
Related Investment
4. WHAT DO I DO IF I AM A BANK OR GOVERNMENT ?
Paul Martin - Former PM of Canada
“The question I would put to you is quite simple” – Nov 2007
“If we are prepared to use these kinds of (tax / legislative)
incentives to enable business entrepreneurs to tap capital
markets for the betterment of the economy, why would we
not provide similar incentives to social entrepreneurs as they
seek to tap capital markets for the betterment of society.
• Financial experts ought to be developing new cutting edge
instruments to make funding available to social entrepreneurs
• Tax experts ought to be thinking about mechanisms that can
support social enterprise in a meaningful way.
• Legislators should encourage an environment that allows
foundations to become more imaginative in support of social
enterprise”.
5. 55
Patient Capital for long term social impact
Financial
return
expectation
No return
Traditional venture capital
Maximize financial return
Maximize
Social impact
expectation
No explicit concern Maximize
Capital
only
Traditional philanthropy
Maximize
social impact
Patient Capital
Blending social and financial
returns for
long-term social impact
6. 66
Early stage
Scale up
Exit at Scale
Recycle
returns
We invest money and time to grow real businesses that
alleviate poverty, and then recycle our returns
8-10 years
Invest grant
funds in start
up equity or
debt
Grow businesses
focused on social
impact and
sustainability
Recycle
returns into
more
businesses
1 2 3
7. 77
An investment in water delivery…
• PROBLEM Government policy of free water has failed
• SOLUTION WHI sells affordable clean water
– Innovative technology works with unreliable power
– Costs covered by user fees + local govt subsidies
– Started with 1 plant in Andhra Pradesh, India in ‘05
• INVESTMENT Acumen Fund investment in 2004:
– $675k equity + $2M in subsequent loan guarantees
– Hands on management support to launch business
• IMPACT By end-2009, WHI had:
– 286 plants serving ~300k customers
– 220 more plants on order by State government
– Raised $22M in follow-on equity and $24M in
commercial debt facilities
8. 88
…is catalyzing an entire industry to serve the poor
0
100
200
300
400
500
600
700
800
900
1,000
2004 2005 2006 2007 2008 2009
Others
BV
Naandi
WHI
Number of private rural water plants in India
WHI and Naandi
start JV
• Over 700 plants
inspired by the
WHI model
• ~900 plants serving
~ 1M people across
India
• State governments
now passing
legislation to
enable large scale
replication
Private sector
replacing the public
9. The process
FIND
Amazing
Entrepreneurs
SCREEN
Breakthrough Idea,
Sustainability & Impact
INVEST
$, Expertise &
Patience
∞IMPACT
LIVES CHANGED
Unleashing a person’s full potential
= infinite growth
SUSTAINABILITY
Businesses that keep on going and going;
Returns are recycled
SCALE
Shifting mindsets, catalyzing a
sector, public sector partnerships,
inspiring others to do the impossible
DONOR
10.
11.
12.
13. Value Chain Financing – Sanitation
Grants Recoverable Grants
Investment Plus
Mainstream
Investments
no financial return below market return market return
Scale (GAVI) & Synthetic Profit (Corporate
incentive)
Increase the credit quality of social capital markets ie. Leveraging - Microfinance / DB Eye fund model
Incentivising Innovation / Collaboration at the bottom of the pyramid – Social Entrepreneurship
Enables a Range of Financing options; incentivising corporates, banks, civil society;
integrating “ for profit” and “not for profit” players
Based on “Foundations and Social Investment” Margaret Bolton 2005 and Bates Wells & Braithwaite
Legal Process
– ie L3C / CIC
Financing Mechanisms incentivising Community and Corporates Carbon / Vouchers / Fertiliser / Power
Programme
Related Investment