ImpactAssets 2013 Impact Report

Transcription

1 ImpactAssets 2013 Impact Report

2 From the President 2013 was a milestone year for ImpactAssets both in terms of growth and our commitment to impact reporting. The Giving Fund, our donor advised fund, topped $100 million, and we found innovative new ways to channel investments to seed-stage impact entrepreneurs, advanced our own impact reporting practices as well as what we expect from investees and expanded our field building efforts. All this is in the service of furthering our mission to increase the flow of capital to investments that provide financial, social and environmental returns. In our second annual impact report, we highlight the progress of our work in four key impact areas: INVESTMENTS, GRANTS, FIELD BUILDING and INTRA-FIRM OPERATIONS. In each area, we feature applicable metrics, an update on our 2013 achievements and select case studies to bring examples to life. A FEW HIGHLIGHTS FROM 2013 THE GIVING FUND grew by over 20% to end the year at $112 million. I am proud to report that over 72% of all non-cash assets are invested with impact. We invest in mutual funds, private debt and equity, seed-stage investments and more, reinforcing the notion that impact investing can span a broad range of asset classes. Currently, cash is an asset class with no clear impact alternative for institutional-scale capital. The industry needs impact cash investment alternatives, and we challenge the field to meet that need. Our most innovative new donor advised fund offering in 2013 was the SEED VENTURES PLATFORM, that enables donors to recommend investments of as little as $2,500 in seed-stage impact ventures. Made possible by R&D grants from several field building visionaries, the Seed Venture Platform meets a key market challenge by bridging the gap between investors and very early-stage impact entrepreneurs. Reflecting our commitment to impact reporting, we have created some new standards of practice. We have deepened our use of IMPACT REPORTING STANDARDS (IRIS) metrics for ImpactAssets intra-firm operations. We have also rolled-out a financial and impact reporting standards policy for our private debt and equity funds and individual investments. And, we now require that all IMPACTASSETS 50 firms measure and report impact. I am especially encouraged at the leaps that our field is making in both supply of and demand for impact investments. We are moving beyond the early adopters. This year we saw unprecedented interest from financial advisors and their clients. It is up to us, industry practitioners, to continue to meet this interest and grow participation by introducing innovative products and practices. Thank you for your feedback and support it fuels our passion and commitment to impact investing. Sincerely, Tim Freundlich ImpactAssets 2013 Impact Report 2

3 Impact of our Investments 72% TOTAL ASSETS EXCLUDING CASH IN IMPACT INVESTMENTS The GIVING FUND offers a variety of ways for donors to invest for impact and financial performance. Increasing the flow of capital to advance social or environmental change, ImpactAssets grew assets under management by 21% from 2012, to $112.6 million in Channeling 36% ($36.4M) of total assets into private debt and equity funds, investments are more directly impactful and contribute to the 72% of total impact investments excluding cash. We are committed to increasing this percentage over time. 36% TOTAL ASSETS EXCLUDING CASH IN PRIVATE DEBT AND EQUITY $36.4 MILLION IMPACT PRIVATE DEBT AND EQUITY In addition to socially-screened mutual funds and Calvert Foundation s Community Investment Notes, we have increased our focus on providing innovative platforms channeling capital to fill the financing gaps left by traditional commercial financing in frontier, emerging and developed markets. GLOBAL IMPACT VENTURES (GIV), a platform of impact private equity and debt funds currently features MicroVest, Sarona Asset Management and Elevar Equity fund managers. By lowering investment minimums to $25,000, ImpactAssets is democratizing access to top-tier impact managers for Giving Fund donors. Reflecting our commitment to impact metrics, measurement and reporting, all GIV platform managers are selected based on potential for financial and impact returns and must sign a financial and impact reporting standards policy. In 2013, we launched the SEED VENTURES PLATFORM to direct capital to very earlystage impact enterprises in the U.S. and abroad with minimums of $2,500. Giving Fund donors embraced this opportunity to fund emerging impact entrepreneurs. INVESTMENT SPOTLIGHT FROM SARONA ASSET MANAGEMENT, A GLOBAL IMPACT VENTURES FUND MANAGER Zoona In emerging economies, limited access to banking services constrains economic growth. Due to the inefficiencies and risks of cash payments, corporate suppliers and small businesses face high costs of transacting in cash and low access to affordable working capital financing. In 2008, this challenge gave rise to a Zambian company, Zoona. Funded in part by Sarona Asset Management, Zoona facilitates cost-effective money transfers and financing through mobile banking. Clients describe Zoona as, a life-altering organization with the potential to change the Zambian economy. Zoona currently provides affordable and reliable money transfer services to over 6% of Zambia s adult population at the very bottom of the socio-economic pyramid. Zoona also provides high-quality employment to its agents. Distributing Zoona products, these agents tend to be young people in their 20s, often with little or no business experience. Zoona hired and trained over 500 agents and aims to increase to 1,000 by the end of With the commission from Zoona, I am able to take care of my family and I even employ two people. CHARITY SHANDA HAMAINZA ImpactAssets 2013 Impact Report 3

4 Impact of our Field Building Initiatives As an impact investing steward, ImpactAssets is dedicated to increased UNDERSTANDING, ENGAGEMENT and INDUSTRY GROWTH through field building initiatives. As impact investing gains traction, we are a resource to support financial advisors and investors in taking action and incorporating impact investing into their portfolios, in appropriate ways. My advice to financial advisors is that if you or your clients want to learn about impact investing, start with ImpactAssets issue briefs and webinars. ImpactAssets makes impact investing easier to understand and has enabled my clients to make impact investments through a donor advised fund. JENNIFER KENNING, FINANCIAL ADVISOR, ASPIRIANT 1,100+ ADVISORS ENGAGED THROUGH MEETINGS, WEBINARS AND CONFERENCES 41,836 VISITS TO THE IMPACTASSETS 50 WEBPAGE 2,661 VISITS TO THE IMPACTASSETS ISSUE BRIEFS WEBPAGE OUR MOST POPULAR FIELD BUILDING RESOURCES IMPACTASSETS 50 The first open-sourced, publiclyavailable database of experienced private debt and equity impact investment fund managers. In 2013, over 40,000 visits were made to the website suggesting that this is a valuable resource for the field. With filters for geography, asset class, type of impact and more, the IMPACTASSETS 50 serves as a resource for exploring the impact investing landscape. ISSUE BRIEFS Our 13 ISSUE BRIEFS are thoughtful and digestible white papers exploring a range of topics from impact investing primers, to investor profiles, to demographic trends and more. Our most recent, The Millennial Perspective: Understanding Preferences of New Asset Owners, examines the commitment that a younger generation has to investing in alignment with their personal values. IMPACT INVESTOR 2.0 In partnership with CASE at Duke University, InSight at Pacific Community Ventures and the many sponsors and supporters, IMPACT INVESTOR 2.0 is a data-driven analysis of 12 fund managers, uncovering the keys to success in impact investing: policy symbiosis, catalytic capital, multilingual leadership, and mission first and last. Visit the project site: ImpactAssets 2013 Impact Report 4

5 Impact of our Grants $21.5 M IN GRANTS MADE 2,443 GRANTS MADE ACROSS 15 ISSUE AREAS 1,588 NON-PROFIT ORGANIZATIONS SUPPORTED The philanthropic grant-making of Giving Fund donors supported 1,588 nonprofit organizations, many of which strive to address the world s toughest challenges. In 2013, donors continued to be active grant-makers, granting out $21.5 million, 21% of their donor advised funds to advance charitable goals across fifteen key issue areas, such as ECONOMIC OPPORTUNITY, CIVIC ENGAGEMENT, ARTS AND CULTURE, and EDUCATION. With grant amounts starting at $250 and ranging to $2 million, donors supported inspiring organizations of all sizes across the globe. 100% RELIGION, FAITH & SPIRITUALITY 90% OTHER 80% 70% 60% 50% 40% 30% 20% 10% 0% ImpactAsset donors allocated the most philanthropic dollars to CIVIC ENGAGEMENT and ECONOMIC OPPORTUNITY issue areas while giving most frequently to HUMAN RIGHTS & SOCIAL JUSTICE and RELIGION, FAITH & SPIRITUALITY causes. DOLLAR ALLOCATION VOLUME ALLOCATION HUMAN RIGHTS & SOCIAL JUSTICE HEALTH & HUMAN SERVICES ENVIRONMENT & SUSTAINABILITY EDUCATION & YOUTH DEVELOPMENT ECONOMIC OPPORTUNITY CIVIC ENGAGEMENT ARTS, CULTURE & MEDIA ANIMAL WELFARE POPULATION SERVICES INTERNATIONAL, A GIVING FUND GRANTEE POPULATION SERVICES INTERNATIONAL (PSI), a leading non-profit global health organization, partners with philanthropists to invest in innovative health solutions to improve the lives of girls and women worldwide the surest means by which to end extreme poverty. Targeting the most vulnerable populations, PSI and its partners provide health services and products in 70 countries. A woman dies of cervical cancer somewhere in the world every two minutes. India bears one-fifth of the global burden of this disease, accounting for about 72,000 deaths annually. Supported by Giving Fund donor Kathy Vizas, PSI will integrate cervical cancer services including screening and preventative treatment into PSI s existing network of private clinics, with the goal of reaching up to half a million women with services that can prevent needless death and disability. Through PSI interventions and outreach campaigns in 2012, 35.2 million years of healthy life were added and 5.2 million unintended pregnancies and 14,000 maternal deaths were prevented. ImpactAssets 2013 Impact Report 5

6 Impact of our Operations The intra-firm operations of ImpactAssets are the embodiment of our values representative in our EMPLOYMENT PRACTICES, MANAGEMENT AND BOARD DIVERSITY, COMMUNITY ENGAGEMENT and ENVIRONMENTAL IMPACT. Beginning in 2013, ImpactAssets employees received the benefit of an employer-funded donor advised fund. Additionally, we have added a transportation and wellness package. The mission of ImpactAssets, to broaden access to impact investing through innovative solutions and products, aligns strongly with the passion and values of our employees. Broadening access to investments has been a core theme throughout my career. I m inspired to offer my experience to help ImpactAssets achieve its mission extending impact investment choices to more people, and in turn providing capital to address some of the world s greatest challenges. 12 EMPLOYEES [IRIS ID OI8869] 50% OF THE MANAGEMENT TEAM IS FEMALE [IRIS ID OI1571] 16.67% EMPLOYEE TURNOVER RATE [IRIS ID OI638] ELIZABETH STELLUTO, CHIEF GROWTH OFFICER WHAT IMPACTASSETS MEANS TO OUR EMPLOYEES ImpactAssets 2013 Impact Report 6

7 Seed Ventures Platform A wave of entrepreneurs is building mission-driven businesses to creatively and efficiently address critical world issues, such as unemployment, poverty and climate change. Investment into these very early-stage ventures is essential to scale the field and support EMERGING IMPACT ENTREPRENEURS. ImpactAssets Issue Brief #11, one of the four published in 2013, explores the landscape of SEED-STAGE INVESTING and illuminates the opportunities to close the gap between entrepreneur need and investor appetite. To facilitate the flow of capital to promising early-stage ventures, we added the SEED VENTURES PLATFORM (SVP) to the Giving Fund in Donors can recommend seed-stage impact investments of as little as $2,500 to ventures seeking capital to start or to grow their businesses. We identify these ventures through impact investing industry partners, such as Better Ventures and Village Capital, with plans to add others in the coming years. Investment innovations, like SVP, further fuel and support impact across Investments, Field Building, Grants and Operations. Philanthropy used to be considered a feel good activity while investments were purely financially-oriented, but now there s a richer spectrum. I joined ImpactAssets Seed Ventures Platform because I wanted to invest in innovative enterprises that have potential for scalable impact through replicable business models that can be financially lucrative. BRIAN ARBOGAST, A SEED VENTURE INVESTOR Our passion at Halloran Philanthropies is to support organizations committed to entrepreneurship throughout the world. ImpactAssets Seed Ventures Platform complements Halloran s focus by making investment in very earlystage impact enterprises more accessible. TONY CARR, A SEED VENTURE GRANT-MAKER The Seed Ventures Platform helps lower the barriers to seed-stage investing. This initiative enables investors to directly engage with impact ventures in an easy, efficient manner as opposed to the traditional model. It s groundbreaking work. ALEX NECKLES, OPERATIONS OFFICER UNITED CLASSROOM, A SEED VENTURE INVESTEE There is a strong need for new educational tools to foster collaboration between teachers and students in order to improve child learning outcomes. United Classroom (UClass), a K-12 education resource exchange, was created with this mission. The UClass platform promotes content sharing and virtual engagement enabling over a quarter of a million teachers and students to effectively connect, share and learn from one another. With investments made through the Seed Ventures Platform, UClass reaches over 5,000 schools in pursuit of its mission to change the educational landscape for the next generation. Teachers around the world note that UClass engagement has inspired and motivated their students. Mr. Webster, a public school teacher in New York, says that, UClass is a phenomenal tool that will help bridge mental gaps for students and open the door for idea sharing, collaboration, discussion and at the bare minimum, cultural exposure. ImpactAssets 2013 Impact Report 7

8 About Impact Assets IMPACTASSETS is a nonprofit financial services firm that increases the flow of capital into investments that deliver financial, social and environmental returns. Our donor advised fund ( The Giving Fund ), impact investment notes and field building initiatives enable philanthropists, other asset owners and their wealth advisors to advance social or environmental change through investment. ImpactAssets was spun out from Calvert Foundation in 2010 and is an independent 501(c)(3) nonprofit BOARD OF DIRECTORS Peggy Clark Ron D. Cordes Karl Charly Kleissner, Ph.D Gerhard Pries Jennifer Pryce Wayne Silby Liesel Pritzker Simmons Mark E. Van Ness 2013 SUPPORTERS Adam J. Weissman Foundation Blue Haven Fund Cordes Foundation Darrin and Shaula Massena Halloran Philanthropies ImpactAssets Staff Members K.L. Felicitas Foundation Posner Wallace Foundation Seth Goldman and Julie Farkas Silby Family Philanthropy Fund CREDITS Photos provided by the featured case study organizations Zoona and PSI ImpactAssets, 7315 Wisconsin Avenue, Suite 1000W, Bethesda, MD PHONE FAX ImpactAssets 2013 Impact Report 8