Everywhere you look, the impact investing drum keeps beating — in many cases, stronger than ever. Once a fringe movement and interest for the “hippies” and “activists” in finance, now impact investing has led to significant institutional change. Firms managing trillions of dollars like BlackRock and Goldman Sachs now offer products for investments aimed at double and triple bottom lines. At this point, a bona fide — but still evolving — set of tools exists for dispersing private capital for financial and social or environmental returns. One of the most recent tools is the ImpactUs Marketplace, scheduled to launch in mid-November.
Currently set on an invite- and registrant-only platform, ImpactUs promises to be a streamlined and efficient means for accredited, high net-worth foundations, investors, and advisers to deploy capital. And while the platform is new, currently in soft-launch, and developing, the minds behind it certainly are not. Liz Sessler, who began working on the platform in April of 2014 as the director of innovation at Enterprise Community Partners, has been in the impact investing space since 2006. Similarly, ImpactUs President and CEO Reginald Stanley has been in the space since 2000, when he took a position with Calvert Investments.
Sessler, who is serving as vice president at ImpactUs, says the initial rollout of the product will happen in two phases. First, only accredited institutional investors will be invited or granted a special access code if approved after registering on the website. Once the kinks are worked out and retail products are available, the platform will be open to the qualified public. Investments start at $500 and go all the way up to $500,000, but $25,000 will likely be the “sweet spot,” Sessler says.
“We are hitting the spectrum from retail investors up to institutional investors,” she told We See Genius at the annual Social Capital Markets (SOCAP) conference in San Francisco. Still, the platform isn’t for everyone, yet. To gain approval, potential investors must have more than $1 million in assets outside of their home, have a joint salary of at least $300,000, or, if single, have made $200,000 for the past three years.
INVESTMENT OPTIONS RANGE FROM SUSTAINABLE AG TO AFFORDABLE HOUSING
For those who do make the cut, ImpactUs seems to be a no-hassle outlet to social enterprises aiming to make serious change in the world. Already approved and on the platform for potential investors is Iroquois Valley Farms, an impact fund focused on organic and local agriculture and triple bottom lines. Also in the first batch of investment potentials is South Africa-based investment fund Shared Interest. According to Sessler, they were also doing due diligence and working out potential partnerships with an affordable housing fund, international sustainable agriculture firm, and a couple microfinance groups. All told, Sessler says, they have at least nine options that should be signed on and a “pipeline” that will quickly set up others.
“We evaluate them on a set of measures,” Reginald Stanley says, “and see not only if they are leading purpose-driven initiatives, but whether they’re also meeting financial metrics that make sense.”
To be on the platform, organizations must pay a one-time fee, a success fee, and an ongoing administration fee. ImpactUs plans to provide a call center for platform assistance. On at least a quarterly basis, every investor will receive an account statement that will include holdings listed and general activity. Additionally, each organization commits to three output measurements to report on “regularly” as well as a personal story.
“We are the facilitation and infrastructure that supports issuers, advisors, and investors participating in private impact investing doing their business more efficiently. But we don’t intend to get in the way of personal services,” Stanley says. “Part of our strategy is to really make sure we continue to not get in the middle of the issuer, who has a strong feel for the community and is able to represent that community the way no one else can.”
A ‘WILDLY EXCITING’ TIME TO BE IN THE IMPACT SPACE
Of course, impact investing platforms are increasingly common. Platforms like Enable Impact and Hedgeable offer online investing platforms. Even Morgan Stanley has recently offered similar options. Still, with Sessler and Stanley’s backgrounds, connections, and history in the industry, it’s easy to be excited about another platform in the marketplace. And they certainly believe they’re onto something unique. “We don’t intend to get in the way of where the personal service is, but actually do the back end more efficiently and cost-effectively,” Stanley says.
Both are enthusiastic about the market moving to a place where such platforms exist. Stanley says being in the space is “wildly exciting.”
“I came to this industry and found I could integrate the more traditional side of finance with my heart and mission and purpose,” he says.