 "When you do the common things in life in an uncommon way, you will command the attention of the world." George Washington CarverWhat is Social Entrepreneurship?Statement of Faith
You can find other "Market with Meaning" but you definitely want to see "Profit with Purpose".
I personally "Believe in Kingdom Transformation" because I know there is only ONE "Life for Significant". --- 2010年8月19日 星期四，Kevin Jones, Good Capital <info@socialcapitalmarkets.net> 寫道﹕
寄件人: Kevin Jones, Good Capital <info@socialcapitalmarkets.net>
主題: Good Capitalist: Social Capital News
收件人: incubator.hou@gmail.com
日期: 2010年8月19日,星期四,上午1:07 | | | | |
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| | The Good Capitalist Dear Houghton, If the Social Capital market is imagined as an archipelago that's risen above the swirl of the traditional capital market, a cluster of islands grouped at the intersection of money and meaning and only partially and occasionally linked, then it's good news that some five new bridges are coming into place that will make it easier for investors and entrepreneurs in the social capital market. Ok, are you still with me after the mother of all metaphoric lead sentences? You can go back and fill in the blanks as the story evolves, if you want to take the time. The news I have to deliver is this: five new tools and initiatives have been developed and each one adds to the other in a way that makes the Social Capital Market stronger and more accessible than ever before. First, there is now a valid study that sizes up the demand side of the market for impact investing. Hope Consulting's extremely well received report estimates the latent demand in the US to be $120 billion. Second, there is a new a startup led by world class industry veterans, that is creating a tool to size the supply side of the market, via an index of the top 50 impact funds. Its goal is to guide investors to be able to do comparison research to help match their money with their meaning. The third new bridge that validates the social capital market is the rise of the big funds. With Alvaro Rodriguez's successful $102 million raise for Ignia, there are now three funds with more than $100 million in assets in the social capital market, with Leapfrog more than $100 million and Blue Orchard at $1 billion plus on the microfinance side with an additional $30 million on the impact investment side through Blue Orchard's Oasis Fund. And Microvest is knocking on the door with more than $90 million under management. How did these funds raise the money and what challenges did they face? They will tell their story at Socap10. Fourth, and at the opposite end of the market, but equally a proof point of new vitality, is the flourishing of seed investing, led by Gray Ghost's Bob Pattillo and the First Light crew. One more time, Pattillo was right about where to focus earlier than anybody else, and he's having a catalytic impact again. With the final and fifth bridge, philanthropy is coming to the Social Capital Market in force and in some kind of merging of two island groups or new trading compact. This is being led by Sean Stannard-Stockton. So those are the five new pieces of infrastructure rising up in this emerging market, the bridges between what can feel at times like isolated islands, the bridges that create easier access for new partners, investors, and entrepreneurs, that we will be highlighting at Socap10. As always, please contact us with any questions, comments, ideas, or contributions. Sincerely, Kevin Jones and The Good Capital team newsletter@goodcap.net |
| Social Capital Market
Feature News
| The Index: the new lens
 The second bridge, The index of the top 50 or so impact investment funds. The impact index an intriguingly complex piece of infrastructure. It will create a bounded, comprehensible group of funds for investors wanting to figure out where to put their money that matters. It's a tool to link passion (I care about women entrepreneurs and water) with geography, sector and a vetted pool of impact investment funds. And each fund has its own investment thesis and theory of change, which the index should also be able to put in coherent context. It will make the huge universe of more than 1,200 entries in the GIIN (link) database understandable by investors new to the field and to their wealth managers. By focusing at a basket of 50 impact investment funds and creating a base for doing analysis of a vetted group of comparable funds and their underlying portfolio companies. That will effectively size the supply of companies and funds, and track its growth over time in the same way an index of public companies does. A companion financial services company to the "Impact 50" is being built targeting the sweet spot in the middle of the $120 billion impact investing appetite. That's the $100 billion that's in the hands of people with from $2 to $20 million to put to work. The impact index and the related for profit company will be led by Ron Cordes, along with support from Tim Freundlich and others. It will make the huge universe of more than 1,200 entries in the GIIN database understandable by investors new to the field and to their wealth managers. If they succeed, they will greatly accelerate the flow of capital to good by giving investors a meaningful lens to link their hearts and their investment dollars in a way that honors motivations, financial return and scalable social and environmental impact. "It's time to take impact investing to the fat middle of the market, not just the highest end or, as Calvert Foundation has done so effectively with its Community Investment Notes, the retail end." Freundlich said. "It is time to create a funnel for billions of dollars to invest in impact." |
Seed Investing: Why now, finally? By Kevin Jones Why is it suddenly time to do seed investing in a serious way, in lots of forms and in lots of places? "Social venture investing is pretty well developed, there is a lot of capital, around $2 billion in more than 50 funds that we have surveyed," said Ross Baird of First Light, the seed investing arm of Bob Pattillo's Gray Ghost family of funds and foundations. Universally, what they found in the survey was that there was not enough deal flow to unlock the capital. They needed someone to apply discipline and energy around the problem of effectively providing early stage capital and services to raw startups. The existing fund would invest in the survivors, but it's like a food chain with no plankton to feed the krill to feed the whales and the big fish. "Being a pioneering investor in seed stage companies requires being a believer in the social capital market and its importance as a force for good if it reaches its potential and doesn't lose its way," Baird suggests. "If you bet right at the seed stage and have a vehicle for follow on funding, it can be enormously lucrative, if you happen to pick the right entrepreneur." There is a ton of risk, but the investors who sign up to be part of one of the handful of emerging seed stage social enterprise funds, will have bought a certain satisfaction. They will be part of creating an industry where every dollar invested in seed stage has hugely leveraged impact further up the chain. They will believe in being the people who planted the seed and were patient, waiting for a harvest in due season, a form of Slow Money, as I think Woody Tasch would describe it. That's why they are creating seed banks at fair trade rice coops in Thailand; to invest patiently in the future. And that's also why they created Village Capital to do peer directed investing in early stage social entrepreneurs around the US and in India. Investing in seed is investing in the future you want to be part of creating. |
| | | Sizing demand at $120 billionWhat's the real investor demand for putting money to work in impact investing? How many dollars are out there, and what is this new breed of investor, willing to link meaning and financial return, really looking for? What sells and what doesn't? Those are just some of the questions that are beginning to be answered thanks to new research funded by leading foundations carried out by Hope Consulting. The good news is the market is big, estimated to be at least $120 billion in the U.S. alone. According to the report, most of these investors don't care much about the size of the financial return that's offered as long as they get their capital back. As someone who has sold a fund to impact investors, their conclusions make sense to me. The way I interpret their data through my experience, leads me to this conclusion: I do not think impact investors pull the trigger using asset class thinking, measuring fixed income to public stocks to private equity with a complicated, if aspirational spectrum of risk and return. That's the way you manage your traditional investments. That's not how people take action on impact investing. As people mull over the decision, I interpret the data to say that impact investing acts more like giving; I want this to happen. People say, I want my money back to do it again, most of the time. Don't get in the way of what I am getting with your complicated portfolio-defining distractions. They also found a segment willing to take more risk to make more catalytic things happen, but that was a smaller group. While a milestone in itself, the Money For Good Report, thanks to emerging market dynamics, represents data that will become more valuable over time, as the market emerges, and supply intermediaries like the impact 50 arise to help clarify the Money for Good Report's original and crucial sizing of demand that's been accomplished in this report. |
Philanthropy meets Impact Investing at Socap10 |
| Good Capital is an investment firm that increases the flow of capital to innovative ventures that create market-based solutions to inequality and poverty. Good Capital manages the Social Enterprise Expansion Fund, which leverages the power of venture capital to increase the impact of social enterprises. Our combination of growth capital and expertise acts as a catalyst that enables proven social enterprises to go to scale, amplifying their social impact and financial return. In addition, Good Capital actively leads the development of the emerging social capital market. We share a deep commitment to the creation of a new, informed, and passionate world of investing that strategically moves more capital to good. | | |
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