Financing Social Entrepreneurs

Jed Emerson has been an influential leader in changing the way capital is invested in order to drive social change, and coined the terms Blended Value and Total Portfolio Management.  He has been awarded a Life Time appointment to North America’s Top 100 Thought Leaders in Trustworthy Business Behavior, and selected twice as one of the 50 Most Influential People in the Sector by NonProfit Times.  He is a Senior Advisor to family offices in Asia, the United States and Europe.  He is a Senior Fellow with both Toniic, a global impact investing network, and ImpactAssets, a nonprofit financial services firm, and a Senior Research Fellow with the Center for Social Investment at Heidelberg University in Germany.

Dr. Charly Kleissner is a pioneer in the field of impact investment. He believes that the deeper meaning of wealth is to make a positive contribution to humanity and the planet. Dr. Kleissner co-founded KL Felicitas Foundation (www.klfelicitasfoundation.org), and Social-Impact International (www.social-impact.org), which help social entrepreneurs worldwide to accelerate and increase their impact.  Dr. Kleissner co-founded Toniic and the 100% Impact Network, global networks for impact investors. Dr. Kleissner serves as Chairman of the Advisory Board of the Global Hub Company (www.the-hub.net), and as Board Director and Chairman of the Investment Committee of ImpactAssets (www.impactassets.org).In this extended and wide-ranging interview, Charly paints an enthralling picture of the state of impact investment today, talks about the importance of “deep impact investing”-and shares his abiding belief in the potential of changing the financial system to build a better world. Charly talks about his experience at TONIIC and the 100% impact network and highlights the results that have been achieved at the KL Felicitas Foundation (that impact investors can construct a 100% impact portfolio and achieve competitive financial returns in all asset classes while making a big impact). Charly highlights some of the important work the Foundation is doing supporting the impact investment ecosystem. Finally, he discusses how modern portfolio theory should be re-conceptualized to integrate positive impact.  

Garvin is the Chief Investment Officer of Green Alpha Advisors, an asset management firm that aims to use science-driven, fundamentals-based research to invest in companies whose innovative products and services will enable the transition toward a sustainable economy (the Next Economy).Prior to co-founding Green Alpha Advisors in 2007, Garvin worked at Forward Management, LLC where he managed the Sierra Club Stock Fund and the Sierra Club Equity Income Fund. Before Forward Management, Garvin served as Vice President of Strategic Services at Morgan Stanley Garvin studied in the Ph.D. program in physical anthropology and archaeology for five years at the University of Utah.In this interview, Garvin discusses the importance –and attraction — of investing in new areas of the economy that will drive a new sustainable economy. (Green Alpha is focussed on five broad industries within what the firm terms “The Next Economy” including renewable energy, recycling, and resources management.) Garvin contrasts this with the more traditional broad-based investment approach focussing on companies in today’s economy that have in effect given rise to all of these big risks the world is facing. Their strategies seek competitive returns from the growth of these investments as Next Economy firms gain market share from their legacy economy predecessors.

Tim Freundlich is President of ImpactAssets, a boutique donor advised fund that specialises in socially responsible and impact investment options to mobilise human and financial capital towards a sustainable world. Tim is a long-term innovator in new financial instruments in the social enterprise sectors and was instrumental in establishing the precursor to ImpactAssets, the Calvert Giving Fund. Tim is also co-author of the ImpactAssets Handbook, an introductory text on how to become best positioned to engage in impact investing as an asset owner.In this interview, Tim gives us an overview of ImpactAssets activities and the role of donor advised funds, philanthropic donations that are responsibly managed to maximise their long-term impact, allowing any individual donor in effect to be like the Gates Foundation. Tim discusses challenges and opportunities for financing small-scale social entrepreneurs and talks about different forms of impact investments, distinguishing between those that are “gap driven” and others that are “opportunity driven.” Tim is optimistic with regard to the millennial generation’s overwhelming support for purpose-driven business models. Given millennials are due to inherit the greatest generational wealth transfer in history this provides substantial opportunities for expanding such financial models. Finally, Tim stresses how impact investments’ rapid growth and proven track-record is changing finance and bringing impact led investing into the mainstream.

Jason Scott is a Co-Managing Partner and on the Board of Directors of Encourage Capital, an investment firm that seeks to change the way investment capital is used to solve critical environmental and social problems. The firm was formed through the combination of Wolfensohn Fund Management, LP and EKO Asset Management Partners, LLC. Prior to EKO, Jason was a founding Director and investment analyst at Generation Investment Management, co-founded by David Blood and former US Vice President Al Gore, Jr.  Jason also co-founded and jointly leads the CREO Syndicate. a network of family offices investing in Cleantech, Renewables and other Environmental Opportunities

Rodney is Founder of ClearlySo which works with high-impact businesses, charities and funds in the UK to raise capital, and introduces them to institutional and individual investors. ClearlySo is Europe’s leading impact investment bank, and has helped some 100 clients raise more than £108 million in investment capital by leveraging its extensive network of high-net-worth individual and institutional investors. Rodney held senior management posts at Lehman Brothers and Paribas, before founding the fintech venture capital firm Catalyst. Rodney teaches impact investment at the Said Business School (Oxford) to MBAs and in the Executive Education programme.  He is a former Board Chair of Shelter, JustGiving and Spacehive, and holds an MBA and BA from the University of Rochester.In this interview, Rodney gives an overview of the funding landscape for social innovation in the UK and discusses how ClearlySo funds social innovation. He talks about the funding gap for high impact low return organisations and the role of foundations in funding social innovation.(An edited version of this podcast has been posted to Inspiring Social Entrepreneurs.)

Ron Cordes is a veteran of more than 30 years in the investment industry – he co-founded and then sold AssetMark Investment Services. In 2006, together with his wife Marty, Ron set up the Cordes Foundation — a family foundation focused on social entrepreneurship, impact investing and creating economic opportunities for women, later broadening its focus to include ethical fashion brands, sustainable manufacturing and engaging millennials in impact investing. The Cordes Foundation was one of the first foundations to commit itself to aligning 100% of assets to mission. Ron also chairs the Executive Committee for ImpactAssets, an initiative to catalyze capital for impact investments, formed in partnership with the Calvert Foundation. In this interview, Ron talks about how he got started in philanthropy and talks about the work of the Cordes Foundation, highlighting the Foundation’s long-standing focus on providing economic opportunities for women and girls, and its growing interest in ethical fashion. Ron discusses the recent growth in impact investing and shares his views on the importance of generating market related returns within the sector. He discusses the Foundation’s pioneering move toward aligning 100% of assets to mission and some of the big changes taking place in philanthropy today. Finally, he talks about Opportunity Collaboration, an annual global poverty business retreat he co-chairs, and the Cordes Fellowships provided to emerging global social entrepreneurs. (A version of this interview has been posted on the Inspiring Social Entrepreneurs podcast.)

In this podcast, Susie discusses RSF’s core integrated capital approach for delivering impact and catalyzing change. She also contrasts RSF’s “patient capital” approach with the transactional nature of commercial financing, details the kinds of support that RSF provides to growing social enterprises, and describes RSF’s five thematic funding areas. Susie highlights RSF’s commitment to developing new sources of finance for social innovation, talks about the firm’s shared risk products, trust based underwriting, and discusses key trends in the world of impact investment.As head of capital deployment at RSF, Susie oversees the firm’s integrated capital strategy, which delivers a tailored mix of financial capital (debt, equity, loan guarantees, and grants) and non-financial capital to social entrepreneurs. Susie has 20 years of cross-sector experience. Prior to joining RSF, Susie was a principal of TBL Capital and director of IGNIA Fund. She has worked at the Skoll Foundation, Stanford, Google and JP Morgan. She also served as an AmeriCorps VISTA Entrepreneur Corps fellow at New Sector Alliance. Susie has lived and worked in Latin America and has experience doing business in Africa, China, and India.

Min Pease leads the impact investing program at Echoing Green where she supports Echoing Green Fellows seeking or receiving impact investment. In large part, this involves getting social entrepreneurs investment ready and helping them to find investors that have an aligned understanding of their mission. Min also works to engage investors in the Echoing Green community. In this podcast, Min discusses the results of Echoing Green’s latest research on funding of social entrepreneurship, undertaken with Enclude. This research is based on data from 49 of Echoing Green’s fellows, as well as information from focus groups. Min discusses the key findings of the report highlighting the key barriers entrepreneurs face in getting access to capital and the main types of support they need.

Silicon Valley Community Foundation (SVCF) is the largest community foundation in the world, with more than $8 billion in assets under management.  The community  foundation serves the Silicon Valley community and offers donor advised funds and other means for philanthropists to support the local and global causes they care about. It was founded in 2007 and has been a leader in addressing Silicon Valley communities most challenging problems and helping families, individuals and corporations manage their philanthropy – locally, nationally and globally. During the past 10 years,  it has awarded nearly $4.3 billion total in grants from all types of SVCF funds around the world and $2.3 billion (of the total $4.3 billion in grants) to charities in the nine-county Bay Area.In this interview, Dr Carson talks about the roots of SVCF’s tremendous growth to become of the largest donors in the United States (in 2015, it gave away $825 million in grants, second only to the Bill and Melinda Gates Foundation). Dr Carson provides a synoptic overview of some of the most important trends and developments in philanthropy, particularly within Silicon Valley: younger philanthropists keen to invest during their lives, making larger investments, with a different attitude to risk from previous generations. Dr Carson discusses SVCF innovative approach and emphasis on partnership and reciprocity, as well as some its distinct areas of focus like lobbying (on payday lending, for example, as well as other education initiatives). He talks about the rare blend of leadership, strategy and execution that the Foundation is looking for in grantee organisations and discusses his aspirations for SVCF in the future.

The John D. and Catherine T. MacArthur Foundation is one of the largest private foundations in the United States. Based in Chicago, the Foundation makes grants and impact investments to support non-profit organizations in Chicago, across the U.S., and in approximately 50 countries. It has an endowment of $6.3 billion and provides almost $300 million annually in grants and impact investments; it has awarded more than US $6 billion since its first grants in 1978.Debra Schwartz is the Managing Director of Impact Investments at the Foundation and is part of the Executive Leadership Team. A former investment banker, she joined MacArthur in 1995, having also previously been the Chief Financial Officer for a Chicago-based child welfare agency. Debra is a frequent speaker and guest lecturer and has also served on the United States Treasury Department Community Development Advisory Board and the founding board for the Mission Investors Exchange.MacArthur has dedicated $500 million of its assets to impact investing, to be used as Mission or Program- Related Investments. In this podcast, Debra talks about the Foundation’s impact investment work with a particular focus on preserving affordable housing across the US, and, more recently, climate change mitigation. She explains how the Foundation’s impact investment activities are integrated with its programmatic work as well as its commitment to help build the impact investment ecosystem. Debra also discusses how the Foundation works as a catalytic investor to bridge capital gaps with patient, risk-tolerant and flexible money that activates and “crowds in” other funds.

Kevin Barenblat is a highly experienced software entrepreneur with a passion for applying technology for good. He is a big believer that talented people can leverage technology to create scalable solutions to some of the world’s toughest problems. Kevin is the founder of the Fast Forward accelerator that helps tech nonprofits by investing money, providing training and mentoring, and helping scale them to impact using what he calls a “well-established Silicon Valley playbook”

Clara Miller is President of the Heron Foundation, a US foundation that helps people and communities help themselves out of poverty. Heron began as a grant-maker 25 years ago. Over time, Heron has aligned an increasing portion of its assets to mission related investment. In 2011, it made the decision to invest all its endowment in mission related investment, which it achieved at the end of last year, under Miller’s leadership. In this podcast, Clara talks about the background to this decision, and explores some of the key insights and lessons on this journey. She discusses in detail the different kinds of financial support, and scale, the Heron foundation provides, and what they look for in the organisations for support. Clara also explores the broader implications for other foundations looking to invest a greater proportion of their endowment in mission.Prior to assuming the foundation’s presidency, Clara was President and CEO of the Nonprofit Finance Fund, which she founded and ran from 1984 through 2010. In addition to serving on Heron’s board, Clara is on the boards of the Sustainability Accounting Standards Board (SASB), Family Independence Initiative, The R.S. Clark Foundation and StoneCastle Financial Corp. She is a member of the U.S. Advisory Committee to the G8 on Impact investing, named in 2014.  She is a member of the Social Investment Committee of the Kresge Foundation. Clara has won numerous awards for her work–in 2015, Miller and Heron were named Investor of the Year by Institutional Investor Magazine in the category “small foundations.”

The Ford Foundation has long been a pioneer when it comes to supporting social change via social sector innovations such as the Green Revolution, microfinance, public-private partnerships in cities, and impact investment. In this interview, Christine Looney, senior program investment officer in the Impact Investing program, and Graham MacMillan, Senior Program Officer for Impact Investing and Inclusive Economies, discuss the foundation’s long standing commitment to impact investment — and its recently announced commitment to invest $1 billion from endowment to mission-related investments, to be phased in over 10 years, the largest commitment of its kind by a private foundation.Christine and Graham talk about the background to this decision — how this is an outgrowth of the Foundation’s existing work in the area of Program Related Investments– and identify where this fits into the Foundation’s existing programmes. They talk about the specific aims of this impact investment initiative –in both social and financial returns-and how the Foundation hopes to send a signal and provide insights to other foundations and institutional investors that might be interested in considering this kind of impact investing. They also talk about and the important work that the Foundation does helping to build market infrastructure for impact investment.Christine Looney serves as the senior program investment officer in the Ford Foundation’s Impact Investing program where she manages Ford’s $280 million Program-Related Investment Fund; Christine has been working over the past 18 months as part of a team responsible for developing the Ford Foundation’s Mission Related Investment programme. Graham MacMillan is a Senior Program Officer for Impact Investing and Inclusive Economies at the Ford Foundation where he leads the grant-making strategy that is closely coordinated with the foundation’s work on program-related investments, and has a particular focus on the development of market infrastructure for impact investment.

Joel Solomon is a highly experience social investor who has invested in over 100 early-growth stage companies in North America. Joel was instrumental in the development the Endswell Foundation, the largest, BC-based, charitable foundation in British Columbia funding environmental issues in the 1990s. Joel is currently Chair of Renewal Funds, Canada’s largest mission venture capital firm, with $98m assets under management. Joel is a Senior Advisor with RSF Social Finance, founding member of Social Venture Network, Business for Social Responsibility, the Tides Canada Foundation, and Board Chair of Hollyhock. He is co-author of the Clean Money Revolution, which will has now been published.In this interview, Joel shares his perspective on the evolution of impact investing in the US, after years at the forefront front of social investment, and his experience building the Endswell Foundation. Joel discusses Renewal Funds investment strategy, what they are looking for in investee companies, and how they go about building a portfolio. He also provides advice for entrepreneurs that are looking to raise money for their business. Finally, Joel outlines some of the key ideas in his new book. Clean Money Revolution, and looks to the future of finance where profit & purpose are aligned.

Christie is director of New media ventures –the first seed fund and national network of angel investors supporting media and tech startups that disrupt politics and catalyze progressive change in the US. She has overseen investment into a growing portfolio of more than 40 non-profits and for-profits, including NationalField, Sum of Us, and Upworthy. Christie is passionate about fostering an independent, vibrant, and diverse media sector–at this time of huge change in progressive politics and media in the United States.In this interview, Christie provides fascinating insights into a new and growing area of political and media impact investing, which has had a huge wave of interest following the US elections. She talks about the kinds of companies that New Media Ventures are looking to support- and the different ways in which they support them. Talking through the experience of leading media sites like Upworthy, Christie discusses the evolution of progressive new media business models, identifies some of distinct risks these businesses face, and talks about evolving investor expectations.

In recent years crowdfunding has become an increasingly popular way for entrepreneurs and others to raise money for businesses and projects that might otherwise not get funded. Tom Dawkins is founder of the StartSomeGood crowdfunding platform that is designed specifically for the needs of social change ventures and projects, supporting them in raising the funds they need to transform ideas for good into action and impact. The platform has helped some 800 ventures raise money and has the highest success rate in the industry. In this interview Tom talks about the early growth of the StartSomeGood platform, its distinctive approach and some of the reasons why it has been so successful. Tom discusses the appropriateness of crowdfunding for different kinds of projects- and indeed for social entrepreneurs with different skillsets –also provides invaluable tips and advice for social entrepreneurs seeking to raise money through crowdfunding.

Jim Sorenson is a highly successful entrepreneur and business executive who has become a pioneer in the field of impact investing. Jim has built successful companies in sectors ranging from technology and life sciences to real estate and private equity investment. Following his experience setting up a videophone for the deaf community, Jim became interested in field of social innovation and has become an active investor and supporter of social entrepreneurship. Jim endowed the David Eccles School of Business at the University of Utah to create the James Lee Sorenson Global Impact Investing Center. He also supports social entrepreneurs via a number of foundations, including the Sorenson Impact Foundation, the James Lee Sorenson Family Foundation, and the Beverley Taylor Sorenson FoundationIn this interview, Jim talks in detail about the different kinds of funding that he provides through various foundations, focussing in particular on his interest in helping social ventures bridge the pioneer gap; and he discusses the work of the Sorenson Global Impact Investing Center. In recent years, Jim has also become a leader in the field of Programme Related Investments (PRIs) –an important and under-utilised source of catalytic capital to support social innovation. Jim talks about the crucial role that PRIs can play supporting social entrepreneurs prove out new ideas and social business models—and the promise of PRIs, particularly within new creative financial structures like social impact bonds and pay per success initiatives. Finally, Jim discusses some of the companies he has supported, talks about what he looks for in a social venture, and provides invaluable advice for social entrepreneurs seeking funding.

Ceniarth is a family office and related private foundation that supports social entrepreneurs delivering market-based solutions that improve livelihoods in underserved communities.  Ceniarth primarily engages in developing economies in sectors such as agriculture, energy, and financial inclusion.  Leveraging a full spectrum of financial tools, Ceniarth aims to support the most effective enterprises generating measurable impacts within target communities.  In this podcast, Ceniarth directors Diane Isenberg and Greg Neichin talk about the wide-ranging support that Ceniarth can provide to social entrepreneurs and innovators: from leveraging grants and program-related investments to investing return-seeking capital. They emphasize the importance of providing finance that is appropriate to the specific needs of different social ventures.Diane and Greg also share their views on the state of impact investing today, warn of the dangers of impact investment hyperbole, and investors who want to “have it all.” They talk about Ceniarth’s increasingly focus on assuring capital efficiency of dollars for impact, how Ceniarth uses capital to build ecosystems, and they offer invaluable advice for social entrepreneurs looking for financial support.

Building on the interview with Echoing Green President Cheryl Dorsey in episode 4 of Financing Social Entrepreneurs, this episode focuses on Echoing Green’s new impact investment programme. Min Pease leads the impact investing program at Echoing Green where she supports Echoing Green Fellows seeking or receiving impact investment. In large part, this involves getting social entrepreneurs investment ready, and helping them to find investors that have an aligned understanding of their mission. Min also works to engage investors in the Echoing Green community. In this podcast, Min talks about Echoing Green’s highly competitive Fellowship programme–and talks in detail about Echoing Green’s new impact investment programme, highlighting Echoing Green’s efforts to help social entrepreneurs become “investment ready,” and to make sure their voices are heard within the investment process. Min provides advice for social entrepreneurs looking for funding and also talks about the important work Echoing Green does to help angel investors understand the needs of social entrepreneurs and innovators.