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.