Building a business is hard. Getting the funding you might need is tough. But, as you know, when your business satisfies a social or environmental need, your options for funding are even scarcer. One of the things I hear a lot from social entrepreneurs is the tough time they have finding people willing to fund them. Traditional investors see the social component of their business as a discount on return on investment. If there’s a financial cost (short-or long-term) of the business’ social component, it’s viewed as a lousy investment choice. For-profit social enterprises are also excluded from foundation and donation-based funding sources.
There’s a small pool of social venture firms that evaluate a business on its social and environmental performance as well as its financial success. Who are these firms, what types of social enterprises are they looking to support and how can you connect with them? I spoke with Kevin Jones, co-founder of Good Capital and the SoCap Conference to bring you answers to these questions. You can listen to the interview here. This post was prompted by an email I got this morning from a women looking for funding options for her social enterprise (by Jake at dresshead). Below are some progressive new firms funding amazing work and seeing great returns.
Based on suggestions from you, I’ve written about 10 more social venture capital firms.
- Acumen Fund: Focus on solving problems of global poverty through loans and equity in India, Pakistan and East and South Africa.
- Big Issue Investment: Focus on medium-term growth capital.
- Calvert Group: Early, direct investments.
- Central Fund: Strong focus on sustainable jobs for low-income populations; services for distressed communities.
- City Light Capital: Early stage, social mission-driven companies; focus on good financial returns.
- Clean Technology Venture Capital: Invests in mid-sized alternative energy companies with promising exits.
- First Light (an iniatitave of Gray Ghost Ventures): Incubator and investment partner to seed-stage, for-profit social ventures
- Good Capital: Expansion fund; high-engagement, hands-on investment partner.
- Gray Ghost Ventures: Early stage enterprises focused on low-income communities in emerging markets.
- Investors’ Circle: Investors’ Circle matches social entrepreneurs with its circle of angel investors.
- Root Capital: Focus on grassroots businesses in rural areas of developing countries.
- Shared Interest: Invests in fair trade businesses.
- TBL Capital: Focus on social enterprises in consumer products, service providers, software, clean technology, green building, health and wellness, and retail.
- Triodos Bank: Equity and debt fundraising; Social Enterprise Fund and EIS Green Funds.
- Underdog Ventures: Focus on natural and organic food, environment and conservation, socially responsible consumer products, and socially responsible investment companies.
If you or your firm invests in high-impact social enterprises and should be listed here, send me an email, olivia[at]causecapitalism.com, or post it in the comments.