First let me get this out of the way: I’m a finance guy, I’ve always done finance, my first job was working in micro-finance and perhaps I’m biased, but my long history making deals in what is now known as 'impact investing' has given me the well-earned practical experience that impact investing works to make real positive change in the world. But rather than bore you to death by rehashing my bio, I would like to address the fundamental question behind our mission here at Mission Markets: 'Why is impact investing important?'
In today’s world of increasing income disparity and poverty, the shortcomings of traditional approaches to addressing social issues grow ever more apparent as does the need for a market-based solution to fill the gap between traditional financial capital markets and philanthropy. This is where impact investing fits in. And this is absolutely important or I wouldn’t be working hard each and every day to nurture the growth of this industry.
Impact investing has existed piecemeal for most of my career, but what we need now is to apply the same tools traditional markets use to the impact investment space. In many ways, as social investors we’re still operating like the ancient Silk Road traders were a millennium ago. If an investor wants to invest in a social enterprise, he or she has to hunt through their network or call their broker who would to do the same. At the end of a lengthy journey they would be lucky to find upwards of 10 suitable deals. Compared to traditional markets where investors merely have to look at the NASDAQ and have hundreds of options immediately available, the social marketplace is in its infancy. We need a centralized, transparent marketplace for one stop shopping for socially oriented companies. Imagine if an investor could stop by an electronic marketplace with thousands of pre-vetted deals. It would be game changing—potentially generating real, systemic social change.
And I’ll be honest: the deals that come to us are pretty cool. Take Prosperity Candle. This remarkable company is operating in Iraq providing hope and a livelihood to impoverished women. It’s a simple and undeniable fact that empowering women can help families and whole communities break out of poverty. The pilot project is operating successfully and they are already looking to expand. The company utilizes a fully sustainable triple-bottom-line model, not only financially and socially but also environmentally. Rather than use traditional soy wax or beeswax, Prosperity candles are made out of paraffin – a ubiquitous regional by-product that otherwise would end up in a landfill. This is just one very cool company of thousands that fight for the recognition and access to capital they deserve.
Now seems to be the right time to craft a stage for companies like Prosperity Candle. The 2008 market crash changed the way people think about investing. They began to question whether a focus solely on profit generation was adequate. Into the investor ethos entered the notion that perhaps ethics and morals do matter when creating an investment strategy, especially a sustainable investment strategy. Mission Markets addresses this need. We’re here to provide easy, fluid access to companies offering stable, long term, social and financial returns and we’re excited to do it.