In recent years, the world has seen increased numbers of social entrepreneurs seeking to tackle some of the world’s most pressing problems, such as poverty, climate change, and social inequality. These individuals are not content to make a profit; they want to find new and innovative ways to create positive social and environmental impact through their businesses.
But social entrepreneurship is not just about individuals with a mission – a social purpose. It also requires capital to make their vision a reality. This is where impact investment comes in – a type of investment that seeks to generate social and environmental impact alongside financial returns.
It is not simply about doing good but about doing good whilst making a profit. Impact investors invest in organisations committed to making a positive social and environmental impact as well as generating a financial return.
Social entrepreneurs need help in the important work they do. such as access to capital, limited resources, and a need for more support etc. Impact investment can help overcome these challenges by providing much-needed capital to social enterprises, with the wraparound support so often craved for.
Impact investment also brings many benefits to investors. By investing in social enterprises, investors can align their investments with their values, generate social and environmental impact, and earn a financial return of course on top. Impact investment can also help diversify an investment portfolio and reduce risk by investing in companies focused on sustainable business practices.
Impact investment has been proven to significantly impact social and environmental outcomes. According to a Global Impact Investing Network (GIIN) report, impact investors have invested over $715 billion in assets globally. The vast majority of these investments have generated positive social and environmental outcomes.
In summary, impact investment in social entrepreneurship is a win-win for investors and social entrepreneurs. It provides social entrepreneurs with much-needed capital to positively impact society and the environment while allowing investors to align their investments with their values, generate social and environmental impact, and earn a financial return. As a result, impact investment has the potential to address some of the world’s most pressing problems and create a more sustainable future for all of us.