impact investing: funder readiness in southwest pennsylvania and west virginia
TRANSCRIPT
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Impact Investing: Readiness of Funders in SW PA & WV
Matt Zieger and Tony Macklin
for Grantmakers of Western PA, November 2015
Project funding
Claude Worthington Benedum Foundation
The Forbes Funds
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Agenda
1. Project Scope
2. National Picture
3. Existing Practices in Region
4. Challenges and Barriers in Region
5. Opportunities
6. Your Advice
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1. Scope
Support the expanded use of impact investing as a tool for nonprofits and foundations in the Pittsburgh region.
A pulse check on interest, readiness, challenges, opportunities around impact investing
• Foundations $1M+ in grants
• 15 in Pittsburgh area, 4 in WV interviewed
• 15 didn’t respond or declined
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1. Interviewees
Community
• CF Ohio Valley
• Jewish CF
• Parkersburg Area CF
• POISE
• Tucker CF
Public
• Jewish Healthcare
• McCauley
Family
• Burke
• DSF
• Fine
• Grable
• Hillman
• Hunt
• Robinson
• Staunton Farm
Private
• Bernard McDonough
• Birmingham
• Colcom
• FISA
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2. National Overview
Pre-1900s
Faith & opportunity
1910s
Socially Responsible Investing
Negative screens
Divestment
Shareholder resolutions (`70s)
1960s-70s
Community Investing
Program-Related Investments
Gov’t incentives
1990s
Sustainable Investing
ESG Investing
Mission-Related Investments
Venture Philanth.
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$6.57 Trillion in U.S. Impact Investments
2.33.1
6.6
2005 2010 2014
Drivers
• HNW & Millennials
• Mainstream Managers
• Field-Building
• Returns Analyses
• Fed Policies
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2. National Foundation Landscape
13-14%-ish
• Engaged in some form of impact investing
• Higher #s of large and 1st-generation foundations
The Other 87%-ish
• Won’t help us achieve our goals
• Lack expertise, skills, or staff
• Primary or exclusive focus on financial return
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3. Existing Practices in Region
0 1 2 3 4 5 6 7
Community Investing
Divesting
ESG/Positive Screen
Proxy voting
MRI
PRI
Negative Screen
N = 19
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4. Regional Challenges and Barriers
1. Investment Philosophy
• Board members and founders
• Investment advisors
2. Information and Capacity
• Lack of demand
• Willing to borrow or subcontract
3. Perceived and Real Entry Barriers
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4. Interviewee Summary
6Hard to Move
6Open to Possibilities
5Not Interested
2Ready
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5. Opportunities
1. Education programs and peer experts
• Philanthropic channels
• Allied professional channels
• Content curation
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5. Opportunities
1. Education programs and peer experts
2. Structure co-investments
• Opt-in models instead of pooled funds
• ESG and MRI
• PRI beyond real estate
• Health, wealth-building, conservation/sustainability
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5. Opportunities
1. Education programs and peer experts
2. Structure co-investments
3. Advisory services
• Know what you own
• Strategy development
• Implementation support
• Deal scoping and aggregation
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5. Opportunities
1. Education programs and peer experts
2. Structure co-investments
3. Advisory services
4. Investee capacity building
• With other venture funds, incubators
• National ratings/evaluation services
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5. Opportunities
1. Education programs and peer experts
2. Structure co-investments
3. Advisory services
4. Investee capacity building
5. Regional impact investing network hub
• Facilitate shared goals and resources
• Increase impact, influence, leverage, learning
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6. Strategic Questions
• Advantages in growing impact investing in the region?
• Worries about growing impact investing in the region?
• Which opportunities resonated most?
• Most natural role(s) for The Forbes Funds?