Impact Investing in New York and Beyond

Thursday, July 12, 2012
By Cynthia Muller and Samantha Beinhacker, Arabella Advisors
New York’s thriving network of philanthropists, investors and social enterprises are rapidly expanding the region’s impact investing sector. Using return-seeking investments across a range of asset classes and return expectations, impact investors are finding new ways to affect issues from human health to community development to environmental protection. A new briefing by Arabella Advisors surveys some of their efforts and provides guidance for those interested in joining the impact investing movement.
What is impact investing?
Impact investors use return-seeking investments to accomplish social and environmental goals. These investments can be made in organizations, funds or companies along a continuum of asset classes. Impact investing, if carried out thoughtfully, can increase the scale of social and environmental impact, promote the preservation of capital and support the stability and growth of innovative enterprises.
What’s happening in New York?
Across New York, philanthropists, foundation executives and others who want to make an impact are harnessing the power of impact investing to pursue the changes they want to see in the world.
For example:
  • The W.K. Kellogg Foundation and Acelero Learning are helping meet the pressing needs of the New York City public education system by providing development financing to charter schools and social enterprises that bring new learning models into the classroom.
  • The Living Cities Catalyst Fund, the Contact Fund and the New York City Investment Fund are deploying capital to entrepreneurial ventures and community development organizations that will help diversify the local economy, create new jobs and service some of New York’s neediest populations.
To learn more about these projects and others, download Arabella’s brief on “Generating Impact and Returns in New York” and see recent briefs on impact investing in other cities.
How can you harness the potential of impact investments?
To successfully implement an impact investing initiative, you must first determine what impact investing means for the social and environmental issues you care about, as well as how to encourage the flow of capital. Then, engage your stakeholders to help them understand the role of impact investing in meeting your goals. Lastly, you can identify investment opportunities, compare social and environmental returns and track impact outcomes and financial performance. By employing a thoughtful approach, you can bring new resources to bear and advance your own efforts to achieve positive change.
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