Social Innovation Forum
The Social Innovation Forum (SIF) launched its 4th annual Social Business Accelerator on January 19, kicking off 12 intense weeks of programming for the six social impact businesses in the cohort. Curious about what goes on in an accelerator? Interested in learning more about impact investing? We’ve launched this blog series, Insights into Impact Investing, to offer a glimpse inside our Social Business Accelerator and share some of our learnings from our work in the emerging field of impact investing.
Who are impact investors? What do they care about? How do I, as an entrepreneur, learn to speak their language? These are some of the questions our “Impact Entrepreneur” cohort grappled with during the third session of SIF’s 2016 Social Business Accelerator, held at Bain Capital on February 2.
On hand to help answer these questions and provide insights into the impact investor mindset were Dr. Sara Minard, Executive Professor of Entrepreneurship and Innovation at Northeastern University, and Tony Howland, Chairman and CEO of Howland Capital Management, Trustee of the Devonshire Foundation, and an active investor in both traditional and social purpose businesses.
Academic Perspective
Dr. Minard offered an overview of an emerging and rapidly evolving field, giving the cohort and the mentors a glimpse into the latest national and international trends in impact investing. She highlighted the drivers of “social finance,” which sits at the intersection of public, private, and social sectors and introduced the audience to some of the key players in this field, both nationally and internationally. Impact investing is already a $6.57 trillion business in the US, having grown 76% between 2012 and 2014. Foundations, high-net-worth individuals, and millennial investors are increasingly showing a preference for impact investing, where social and environmental intentions of the investor are made explicit, over traditional investing.
Investor Perspective
Tony Howland shared his experiences in impact investing and his framework for making investment decisions. Among the criteria that impact investors value are social mission, evidence, impact measurement, potential for disruption, potential for global scale, governance, and potential for partnerships. In some ways, impact investors are a “market of one” as each investor makes decisions around the level of financial and social return he or she feels is appropriate.
Workshop: Telling Your Authentic Impact Story
During the second half of the session, Dr. Minard led a design thinking workshop to help the Entrepreneurs tell their “impact story” in ways that would resonate with impact investors. According to Dr. Minard, “measuring impact is as important as measuring financial value,” and she shared strategies for choosing a blend of financial, human capital, and social impact metrics. The hands-on portion of the workshop allowed the Entrepreneurs to practice aligning their social impact stories with the expectations of impact investors. The closing discussion covered a range of issues, including the pulls between domestic and emerging markets, as well as the associated tensions of patent security, mission creep during growth, and developing country corruption.
About the Presenters
Dr. Sara Minard received her PhD in Economics from Sciences-Po in Paris and taught at Columbia’s School of International and Public Affairs, before becoming the Executive Professor of Entrepreneurship and Innovation at Northeastern University. She also has extensive industry experience, and previously worked at the OECD and consulted for various entities including the World Bank and the United Nations.
Tony Howland is Chairman and CEO of Howland Capital Management and a trustee of the Devonshire Foundation, which focuses on addressing issues like climate change, sustainability, and inequality among inner city youth. He is an experienced investor in both traditional and social impact businesses and also serves on the Social Innovation Forum’s Board of Directors.
About the Author
Marissa Silapaswan was the Social Innovation Forum’s Impact Investing Fellow from October 2015 – April 2016. In this role, she worked closely with SIF’s Executive Director to support the Social Business Accelerator program, including conducting outreach and recruitment, managing a network of mentors, and coordinating meetings, workshops, and events.