B the Change Weekly
This week, thousands gathered in San Francisco for SOCAP17, the world’s largest gathering for the growing marketplace of impact investing. If this marketplace grows as some predict, impact investing could be one of the most important social innovations in our lifetimes, leveraging the massive power of the capital markets to a higher purpose than maximizing returns for shareholders.
For impact investing to scale with integrity and achieve its hoped-for impact, the market needs credible measurement tools that provide comparable results, shares B Lab co-founder Jay Coen Gilbert on Forbes
This week, B Lab released its 2017 Best for the World Funds list, which highlights 28 top-performing funds using a third-party verified assessment to credibly measure and compare their impact. Keep reading to meet these funds, their fund managers, their portfolio companies—and how they are building a shared, durable prosperity for all.
The 2017 Best for the World Funds
The Best for the World Funds are the top performers of the 47 funds rated in the past year by B Lab’s measurement tools. In total, almost 100 funds over the past six years have made use of these tools to gauge their impact, and an additional dozen funds in formation, including Bain Capital’s Double Impact Fund and Bridges Venture’s U.S. Sustainable Growth Fund , have already committed to using B Lab’s assessment tools as they deploy their capital in the coming year.
Review the full list—which includes the fund honored, the fund manager, and its impact focus—and all of our coverage of the 2017 Best for the World Funds on B the Change . Keep reading for some examples of how this year’s honorees are creating global-scale impact.
We’re also grateful to share that each fund is listed on the the Case Foundation’s Impact Investing Network Map , which is a tool to showcase the publicly available transactions between impact investors and companies. By bringing the connections between actors to life?—?looking specifically at the investments that connect them?—?the Case Foundation hopes to foster a better understanding of the size, breadth, depth, and, importantly, the enormous potential of this field. We’re excited to be involved in this development.
Funds Shaping a More Sustainable World
Private-equity firm and Best for the World Fund manager CoreCo has an investment thesis you’re not likely to read about in The Wall Street Journal. CoreCo Private Equity’s $54 million Best for the Environment <http://go.pardot.com/e/39792/e-cleaner-economy-9c2859c109f1/7p4hns/796614681> Central America Fund I spots high-growth businesses in Central America that operate with sustainable business practices. As reported by ImpactAlpha <http://go.pardot.com/e/39792/est-for-the-world-400384c83ba0/7p4hn2/796614681> (and shared in, what we consider, their essential daily newsletter, “The Brief <http://go.pardot.com/e/39792/TheBrief-/7p4hn4/796614681> ”) a young and growing population, GDP growth outpacing that of the U.S., relative stability and lack of private capital for good businesses make Central America an attractive region for private equity.
In 2016, the firm backed GRS, a Honduras-based firm that commercializes household appliances in Guatemala, El Salvador, Honduras and Nicaragua. CoreCo’s Central America fund, which is backed by the Multilateral Investment Fund and private investors, says it works with portfolio companies to improve sustainability and ethical impact to create long-term value.
Another Best for the Environment honoree, Arborview Capital <http://go.pardot.com/e/39792/2017-10-13/7p4hn8/796614681> , is helping its portfolio companies, including Shenandoah Growers Inc. (SGI), grow. SGI started out as a family-owned farm in the valley of the Shenandoah Mountains more than 25 years ago and has blossomed into the largest provider of fresh-cut and live organic culinary herbs in America. With locations in more than eight states and operations that span from Virginia to Hawaii, SGI is a leader in innovative, sustainable farming practices. Compared with traditional greenhouse operations, SGI’s greenhouse systems utilize one-tenth the amount of water and produce eight times the number of plants using 3 kWh less energy on a per-meter average.
Funds Reshaping Communities
“Our [portfolio companies’] founders’ pathways are anything but traditional, but their understanding of the cultures that fuel the economic engines within underserved communities means that they see the business opportunities that traditional Silicon Valley tech investors often overlook. By providing capital for founders who have been previously ignored by traditional venture capitalists, we are able to lift up communities that have also been left behind or worse, exploited, by the innovations that the traditional sector has funded. The future we’re creating hinges on economic inclusion and the better community outcomes it provides,” shares Kesha Cash, founder and manager of Best for Workers Impact America Fund <http://go.pardot.com/e/39792/-best-for-workers-68434070b163/7p4hnb/796614681> .
One example: Impact America Fund’s portfolio company ConnXus is a cloud-based SaaS platform that connects procurement professionals with a database of 1.7 million minority-, woman-, veteran- and LGBT-owned vendors. It also allows companies to evaluate how their supplier choice impacts the economy and job creation, all the way down to their local communities. By making it easier for large corporations to contract with diverse vendors, ConnXus ultimately helps drive the expansion of minority and woman-owned companies.