Angel Investing for Im-pact

17th June 2011Seoul

Doug (Duckjun) Lee

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Table of Content

I. Impact Investing - an Emerging Industry

II. Introduction of D3 Jubilee Holdings (on-screen only)

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Impact Investments: An Emerging Asset Class

Impact Investing is actively placing capital in businesses and funds that generate social and/or environmental good and at least return nominal principal to the investor. (Monitor Institue)

Impact

Principles of Invest-mentWarren Buffett’s rule#1: Don’t lose money.#2: Don’t forget rule #1.

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Impact Investments: Opportunities and Challenges

Impact Investing has the potential to grow to about 1% of total managed assets, which would result in about $500B of capital channeled toward social and environmental impact (Monitor Institute)

Growing interest among capital providersGreater recognition of the need for effective solu-tions to social and envi-ronmental challengesA steadily developing track record with early successesA flock of talent

Opportuni-ties

Lack of efficient interme-diationLack of enabling infra-structureLack of sufficient absorp-tive capacity for capital

Challenges

Impact Investing: Where to Go?

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A Periphery of Activist In-

vestors The Core of Main-stream Financial

Institutions

With increasing numbers of investors rejecting the notion that they face a binary choice between investing for max-imum risk-adjusted returns or donating for social purpose, the impact investment market is now at a significant turn-ing point as it enters the mainstream. (J.P.Morgan)

Social Bank

Fund of funds

Reporting & Measurement

Patient Capital

Intermediaries

Marketpalce Research

Industry Ecosystem being built

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Social Enter-prise

Impact In-

vestor

Sustain-ability

Ratings,Certificates

Foundations, Family Offices

Triodos Bank

Elevar Equity

GIIN (IRIS)

Accu-menFund

Imprint Capital

MM, Asia IIX, SSE

Research

Players on the Map

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Social Enter-prise

In-vestors’ Circle

Sustain-ability

B Corp,Trucost

Foundations, Family Office

Impact Investing CasesSocial Enterprises + Financing (Investing)

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“Root Capital is a nonprofit social investment fund that is pioneering finance for grassroots businesses in rural areas of developing countries. We provide capital, deliver financial training, and strengthen market connections for small and growing businesses that build sustainable livelihoods and transform rural communities in poor, environmentally vulnerable places. 

Since our launch in 1999, we have provided $256 million in credit to 320 small and growing businesses in 30 countries, maintaining a 99% repayment rate from our borrowers and a 100% repayment rate to our investors. ”

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“Our Goal is One million people investing 1% of their money in local food enterprises, within a decade.

15,000 people have signed the Slow Money Principles. 2,000 have become members of the Slow Money Alliance, including over 220 Founding Members—many leaders in social investing and sustainable agriculture.

1,000 people have attended our first two national gatherings, and 16 of the small food enterprises that made presentations there have received $4.25 million. Since mid-2010, local Slow Money groups have begun investing in 10 locales.”

Impact Investing CasesSocial Enterprises + Financing (Investing)

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“Farmland LP, a U.S. private equity fund, was created to deliver superior returns for its investors by acquiring conventional farmland and converting it to high-value organic farmland using sustainable agriculture best-practices.

As an investment, farmland has historically delivered attractive, diversified, secure, inflation-hedged returns with both current cash flow and long term capital appreciation.”

Impact Investing CasesSocial Enterprises + Financing (Investing)

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“Lumni currently operates both for-profit and non-profit funds in Chile, Colombia, Mexico and the United States, where it has raised and obtained commitments of more than $15 million from over 100 investors.

Lumni has financed nearly 2,000 students to date, nearly all from low or very low-income backgrounds where funding recipients are the first family members to attend college.”

Impact Investing CasesSocial Enterprises + Financing (Investing)