Overheard at EVPA 2019: Five ideas to make impact investing better

This week some 750 people from foundations, investment firms, impact funds, banks and others met to discuss how to invest more effectively for impact, at the annual conference of the European Venture Philanthropy Association.

Among the dozens of conversations Pioneers Post heard, here are five great ideas that jumped out to us.

1. Reconsider whether grantees still expect “free money” 

The UK-based Rank Foundation recently started issuing what it calls ‘repayable grants’ – prompted by a suggestion from one of its grantees. The term sounds contradictory, and other funders have suggested they don’t work. But deputy CEO Caroline Broadhurst said one of the several repayable grants the foundation has made so far, which average around £100,000, has just been repaid in full, and payments for the others are on track so far. 

“It’s a sort of social contract,” Broadhurst said, adding that expectations of free money have moved on. Grantees, she said,“don’t expect everything just handed to them”.

2. Celebrate failures – and we mean really celebrate them

Farid Tabarki from Amsterdam's Studio Zeitgeist spoke about the future of impact investing in a highly uncertain world – and referred to an unlikely source of inspiration: a Finnish gaming company that literally pops the champagne whenever a new game is unsuccessful. They have “a learning strategy” in place, he said; the failure of one product makes the success of the next much more likely. It’s not clear if many impact investors will now be stocking up on Moët & Chandon, but now that sharing success and failure is part of the new Charter of Investors for Impact, look out for more talk of what went wrong. 

Admitting failure might be tough to do, but it can be a valuable “healing process”, said Hedda Pahlson-Moller, CEO at TIIME. “You can’t learn if you don’t share.” 

3. Nudge change with eco-clauses for grants

One discussion looked at how to “capitalise nature”, by adding more costs or taxes to those who exploit the earth’s natural resources, and how philanthropic organisations could play their part. Chris Carnie, philanthropy and fundraising consultant, wondered if grant-makers could add clauses to grant agreements (for any projects, not just environmental ones) to nudge behavioural change among grantees. For example, a grant for education could come with an expectation that teachers travelled to work on public transport rather than in their own cars.

4. Focus hard when measuring impact 

No social impact conference would be complete without some soul-searching on impact measurement. For some, the key is to be really focused – since the more data you gather, the more messy it gets. “The picture starts to dissolve,” said Magdalena Skrzypek, impact officer at the Media Development Investment Fund. When measuring the direct impact of the work of MDIF on the independent media companies that it supports, the team currently focuses on just three elements of the media companies’ performance: revenue, reach and viability. 

5. Make “good decisions faster” through better networks

The global movement of venture philanthropy has reached what EVPA co-founder Doug Miller called a “critical mass”, with about 900 members across EVPA and its sister organisation in Asia, AVPN. But when members want to invest in Africa or Latin America, neither of these organisations has the capacity or reach to support them. That’s set to change with new networks being created in those two regions, plus plans for something similar in the Middle East and North Africa, all supported by the new International Venture Philanthropy Center. 

Do impact investors need more communities and more sharing? Ruth Jones, a director at AVPN, said peer learning should not be underestimated: “It helps people make good decisions faster.” And Big Society Capital CEO Cliff Prior praised “the amazing power of this movement… I so wish it was around when I was doing my early work.”

What did we miss? Let us know about any new or unusual ideas you took home from the EVPA conference by emailing news@pioneerspost.com.

Pioneers Post was a media partner at the 2019 EVPA Annual Conference. Our reporters’ travel costs were covered by the organisers. Header photo: Spring Roll Media/EVPA.

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