The Rockefeller Foundation’s Bellagio Center in Italy was the stage where “impact investing” was coined eleven years ago. Antony Bugg-Levine convened that meeting and is now the CEO of the Nonprofit Finance Fund.
He said, “We gave everyone a rhetorical umbrella under which they could huddle together.” Ever since, many financial firms and investors have adopted the term and invested in companies and funds that have a quantifiable, positive social or environmental impact, aside from being profitable.
Global Impact Investing Network reports that at least $228 billion is circulating in such activities.
Reclusive individuals and organizations such as Khalifa bin Zayed Al Nahyan, Sultan Hassanal Bolkiah, The House of Saud, Bhumibol Adulyadej, often tend to keep a low profile when it comes to their philanthropic efforts and don’t get as much spotlight as their public counterparts, but their contributions to the society are just as impactful.
Here are some of the leading investors (with a net worth range of $11B-$97B) whose efforts impact various causes globally.
Impact: Healthcare and poverty
Bill and Melinda Gates have innovated impact investing by using the funds from their foundation, with any financial returns remaining inside it. It has put roughly $2 billion dollars into 70 initiatives since 2009. Among them is a North Carolina biotech firm called AgBiome.
The firm works on improving the resistance of crops against pests and diseases by identifying microbes who would help the plants. Another is Vir Biotechnology based in San Francisco, which is developing vaccines for tuberculosis and HIV. In addition, the foundation also granted $5 million to M-KOPA, a Nairobi startup that allows low-income customers to buy solar-powered lighting and mobile phone charging systems on credit with mobile payments.
The Chan Zuckerberg Initiative is the medium through which Facebook co-founder Mark Zuckerberg and wife Priscilla Chan have invested $100 million across more than a dozen startups, mostly in education. Andela, a New York-based startup that trains software developers in Africa was their first lead impact investment. Byju’s, an Indian firm that developed a learning app for students from 4th to 12th grade in math and science makes is one of the international investments that make up one-third of their portfolio.
Impact: Education, Health and Financial Inclusion
James Richman’s private family office accounts for multi-millions of impact investments over his lifetime. The reclusive investment tycoon focuses on two key areas, emerging market technologies that promote education and health, and financial inclusion across the globe, particularly in Asia and Africa.
Schools, nonprofits and social service agencies are the beneficiaries of the former Microsoft CEO, as he intends to bring their technology up-to-date. An investment of $59 million in Social Solutions, a software company that helps organizers digitize files and conduct data analytics for the communities they served was pledged by Ballmer and his wife, Connie, this August. The couple had tried unsuccessfully to fight the problem with philanthropy, donating money to help Washington State’s child welfare agency better harness data.
Impact: Education, Global
Through the Dell Foundation, this computing mogul has invested in education technology companies in India, which teach skills ranging from optometry, English language fluency and repairing cars. The foundation previously invested in the Unitus Seed Fund, a developer for Indian education, mobile startups, health, and tech.
Laureen Powell Jobs
Impact: Education, Tech
Laureen Powell Jobs has quietly built Emerson Collective. It is a 140 strong philanthropic investment and advocacy entity, which partners with entrepreneurs, and advocates to advance social causes and access to education. Emerson Collective has invested in startups that provide means for advancing government accountability (OpenGov, a public sector budgeting software), climate change (environmental sensor network Altima) and education (LearnPlatform, a tracking tool for schools).
Vulcan, the foundation of the late co-founder of Microsoft prioritizes much of its impact investing effort in Africa. It operates ten solar-powered micro-grids in Kenya, which provides electricity to villages with a combined population of 21,000, and supports a low-cost internet provider, Mawingu Networks, also based in Kenya. Vulcan says it focuses on projects with the potential to impact one million lives or more.
Omidyar Network started in 2004, way before the phrase “impact investing” ever was conceptualized. To date, Ebay’s founder has invested more than $600 million, including $100 million in 2017, in startups that deal with issues like low-cost education and climate change. His generous contribution allowed d.light to bring solar-powered lighting to communities in over 60 countries with limited power access.
It has now reached over 80 million people with products like solar-powered lanterns, chargers, and radios. He invested in Ruma after two years. The financial and information services company in Indonesia was able to train 10,000 low-income entrepreneurs, the majority of which were women. Go-Jek, an Indonesian ride-hailing company acquired it in 2017
Advancing the way of living
These leading billionaires have been paving the way for human empowerment in deprived areas. They have proven that financing cause-oriented ventures is philanthropic, but at the same time profitable. This may enjoin others, even the retail investor, to tread the same road.
Raj Bharrat studied economics at UCL. He now splits his time between Hongkong and London following the investments of the world’s greatest shakers and decision makers.