Social Entrepreneurship, Impact Investing and Networks of Change

The emergence of impact investors who invest in firms and organizations that seek to create social impact over the past two decades is starting to create a sea change in several countries around the world. Organizations like Omidyar Network, The Skoll Foundation, Acumen Fund identify and invest in people and organizations that have innovative ideas that can create a massive social impact on the ground. Several of these ideas have been self sustaining after a break even point due to the revenue model s underlying them.  Several of them have focused on building local economies and capacities in their target countries which can potentially have spillover effects in areas outside their intended impact.

While it might be interesting to see these organizations as nothing more than investors investing in specific organizations, this fails to address the network created between the investor and investees. Often several investees are connected to each other to share common stories, best practices and ideas for overcoming challenges. An idea designed to address challenges in agriculture in Africa could potentially be refitted to address issues of women’s self help groups in Latin America. Often what might start as a professional partnership and sharing of ideas can evolve into a stronger source of emotional support that allows investees to persevere in the face of overwhelming odds. A key factor contributing to this would be the fact that Social Entrepreneurs might value the experiences and advice of someone who has faced a similar problem in the development space over the advice of someone who has faced the problem in the corporate space - especially given the marked difference in cultural dynamics between the two spaces. 

The network that exists between these organizations is worth studying and understanding as it enables us to understand how ideas can originate in one country and travel to another country and have an impact quite different from what they intended. This analysis can also help us identify which organizations have the biggest impact networks as well as which individuals within these networks are the most influential.

In order to carry out this study one would need to connect to impact investors and circulate a questionnaire to them and their investees to track significant communications between the investors, investees, the transfer of ideas, and the forums in which key connections were made. While a master survey can be created, I would recommend customizing each survey to each impact investor’s networks to capture their characteristics more completely.