Unlike traditional “start-up” entrepreneurs operating in mature markets, social entrepreneurs largely need subsidized financial runways to innovate, learn and de-risk new business models. Learn where and how to unlock funding with impact investing and more!

1. save the world. turn a profit.
Lee Fox
PeerSpring
10.20.2015

2. roadmap of today’s
conversation:
traditional
charities
profit for
purpose
traditional
business
grants
trading
revenue
>75%
trading
revenue
mainstream
market
FINANCIAL
VALUE
SOCIAL
VALUE
grants
only
%
allocated
to charity
CSR
social
enterprises
hybridfor-profit non-profit
7.4M 1.5M
50K = 50M+ 144 = 50M+
impact motivated
impact committedimpact certified
IMPACT INVESTING
break-
even
profitable

3. who i am
• youthologist
• generational trend virtuoso
• popular culture junkie
• innovator + entrepreneur
• social justice maven
• philanthropist
• active learner
• speaker
• mother
• wife
• friend
L FOX

4. my current venture
• we are storytellers of youth
social innovation
• we build 21st century
leadership skills through
project-based learning
• we ensure next-step readiness
by facilitating
• critical thinking
• conflict resolution
• collaboration
• citizenship
• credibility
• we empower youth social
entrepreneurs

5. photo credit: Vote by Erin Leigh McConnel
the profile of
generation “impact”
• raised in turbulence with an up
& down economy and violence
• spoon fed cause-marketing
with an expectation of CSR
and a skepticism of good-
washing
• blurred lines between nonprofit
and for-profit with the rise of B-
corporations and other profit-
for purpose companies
• global thinkers
• disruptors of culture norms
• entrepreneurial

6. biggest wealth
transfer in history
• $41-trillion by 2052
• $6-trillion of ultra-high net
worth ($30M+ in assets)
transferring in the next 3
decades in the USA.
• Millennials consistently cite
social impact as one of the
most important roles of
business.
• willing to trade financial
return for greater social
impact
• twice as likely as their
grandparents to regard
investments as a way to
express social, political +
environmental values

7. natural-born social
entrepreneurs
• unlike traditional “start-up”
entrepreneurs operating in
mature markets, social
entrepreneurs largely need
subsidized financial runways to
innovate, learn and de-risk new
business models
• the lack of robust financial
returns + need for long
runways make it difficult to sell
to angel networks, VCs and
other traditional sources of
early investment
photo credit: Twitter Angel by Charis Tsevis

8. impact investing
market
• 2007 first time term was
coined.
• $1 out of every $6 invested in
the global stock market is
socially screened
• $60-billion in assets under
Global Impact Investing
Network management (2014)
• 76% expansion in 2 years
• $3.74-trillion (2012)
• $6.57 trillion (2014)
photo credit: Efectivo-Cash by Ruurmo
impact
investing
impact motivated
impact committed
impact certified
Cathy Clark click to see
12-minute youtube video
describing impact investing
https://goo.gl/WGQFSK

9. corporate venturing
In 2014, there were 656
corporate VC deals totaling
$12.31B
• $23M+ average deal size.
• Top 3 active corporate VCs:
• Google Ventures
• Intel Capital
• Salesforce Ventures
Of the 3,617 total venture capital
deals in 2014, corporate VCs
participated in 18%
• 54 different corporate
venture arms participated in
at least one U.S. seed VC
round in 2014
Why did Patagonia invest in
this skateboard company?
click to see
2:18 video describing
Bureo Skateboards
https://goo.gl/8rvlSi

10. venture philanthropy
Targets funds towards early-
stage social-impact for-profit and
nonprofit organizations.
• made across asset classes
• long-term plan (3-6 yrs)
• managing partner relationship
• accountability for results
• provision of cash + expertise
• well crafted exit strategy
• no return on the principal
Intimate involvement with
investor who provides consulting
+ non financial resources to
ensure long term plan and goals
are met. click to see
2:44 video describing
Venture Philanthropy
https://goo.gl/Q7O4mn

11. corporate social
responsibility: CSR
CSR is the commitment by
business to behave ethically and
contribute to economic
development while improving the
quality of life of its workforce and
their families, as well as of the
local community and society at
large. (Case Foundation)
• CSR funds and loans typically
seeks to benefit and improve
aspects of the corporate
supply chain.
click to see
Why did Starbucks invest
in the implementation of
Coffee and Farmer Equity
(CAFE)?
4:35 video describing
CSR
https://goo.gl/ETGQg5

12. cause marketing +
sponsorship
Cause marketing typically involves
the cooperative efforts of a for-
profit business and a non-profit
organization for mutual benefit
• $1.85 billion spent in 2014,
$1.92 billion expected for ’15
Social enterprises and profit for
purpose companies like LSTN are
leveraging the BOGO: Buy One
Give One cause-marketing models
click to see
Impact of LSTN partnering with
SoundSeekers to bring mobile
clinics to small villages in order
to fit custom hearing aids for
deaf children.
2:10 video describing
cause sponsorship
https://goo.gl/f06G8m

13. social success notes and
results based investing
• social impact bonds gets
commercial financing for social
problems with a promise for a
“bond-like” return on capital,
paid by a government if the
ventures achieve their desired
outcomes.
• community faces a challenge
• government makes it a priority
• service provider has a solution
• private investors step up
• project manager brings it all
together
• provider goes to work
• evaluator measures successes
• government pays for results
SIBs best to finance HUGE social
problems. click to see
2:59 video describing
social impact bonds
https://goo.gl/Msc3kT

14. mission-related
investing
MRIs are feasible for
foundations, nonprofits and for-
profit corporations and require a
market-rate return large enough
to fund grants.
• MRIs can be made at
various rates of social and
economic risk
• as endowments have to be
invested prudently, there are
some challenges to
unlocking these funds
because financial and social
goals may be in conflict
photo credit: Money by Tax Credits
click to see
5:24 video describing
MRIs
https://goo.gl/JOANcr

15. program related
investing
PRI involves financing methods
often associated with banks or
other private investors.
Investment should:
• earn below-market rates
(typically 1-3%)
• significantly further the
foundation’s exempt
activities
• present 10-year funding plan
click to see
Ford Foundation invested
$3.75M to real-estate
developer, Artspace to support
their Diverse Arts Spaces
program in 2011
• $750,000 grant
• $3M 10 year low-interest loan
2:16 video describing
PRIs
https://goo.gl/dD8Zlm

16. crowdfunding models
crowdfunding offers a great
opportunity for everyone to leverage
their social networks and transform
social capital into financial support.
(Massolution)
• $2.7B has been raised worldwide
across 600 platforms
click to see
JobRaising Challenge was put
together in partnership between
HuffPost, The Skoll Foundation,
McKinsey & Company and
CrowdRise
• 217 organizations across 31
states and 110 cities
• $1.2M raised on CrowdRise
• 93% = <$500
• 80%= <$100
• 7,000 tweets postedphoto credit: People by Cinzia
6:04 video describing
JobRaising Challenge
http://goo.gl/L4OBZI

17. competitions and
accelerators
There are a wide selection of
competition and open ideation
contests with substantial prize
monies, most notably: X-Prize,
OpenIdeo, Hult Prize, Up Prize,
Biz Spark, Genesis Prize, Forbes
Global change the World, Idea
Competition
photo credit: People by Cinzia
click to see
1:10 video describing
Hult Prize
https://goo.gl/30e9mH

18. where will you find your
pots of gold?
photo credit: Pot Of Gold by Sweetopia
traditional
charities
profit for
purpose
traditional
business
crowdfunding
and/or
competitions
MRI /
PRI .
social
impact
bonds
corporate
venturing
grants
venture
philanthropy
CSR sponsorship
social
enterprises
QUESTIONS?

19. 424.234.3669
Lee Fox
PeerSpring
lfox@peerspring.com