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When It Comes to K-12 Education, Where Are the Impact Investors?
For decades, reports have shown how schools in America are lagging behind their counterparts in other countries in key areas – particularly in lower-income communities. But though more funding could help schools achieve better results, impact investors have yet to contribute meaningfully to the funding of K-12 education systems. Mark Medema at the National Alliance for Public Charter Schools argues that the private sector, led by impact investors, can and must play a bigger role.
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India’s Impact Enterprises Need More Debt Financing to Grow: Here’s How Businesses, Lenders and Regulators Can Make That Happen
Many Indian social entrepreneurs struggle to obtain debt financing, as banks typically steer clear of these young companies, and alternative lenders charge unsustainably high interest rates. Meanwhile, India’s impact investors have shown far more interest in buying stakes in impact enterprises than lending money to them. Sudarshan Sampathkumar and Anuja Kadam at The Bridgespan Group explore solutions to this challenge, based on the findings from a new report.
- Categories
- Investing, Social Enterprise
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Avoiding Information Overload: Four Lessons From a Performance Manager on How To Use Data To Drive Development Outcomes
Development impact bonds (DIBs) are a popular way to drive successful social outcomes – but assessing a program's effectiveness requires a lot of data. Dayoung Lee and Dia Banerjee at Dalberg Advisors share lessons they've learned from managing the performance of the world’s largest education DIB, showing how data can improve outcomes without causing undue burdens on the organizations that should be benefiting from it.
- Categories
- Education, Investing, Technology
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Innovating on the Pay for Success Model: How ‘Social Derivatives’ Can Unlock Everyday Giving to Incentivize Greater Impact
Pay-for-success models have generated considerable excitement in the social finance sector. But according to Akhil Pawar and Geet Kalra at Yunus Social Business, the approach presents several challenges, mainly around the question of who will pay, and how to ensure an economical structure. They share a potential solution that leverages retail giving, substituting large donors with small ones by using "social derivatives."
- Categories
- Impact Assessment, Investing, Social Enterprise
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With So Many Financial Instruments Out There – When and How to do Results-Based Financing
The field of results-based financing has taken root, and several new mechanisms have sprouted – from humanitarian impact bonds to outcomes funds. But while development impact bonds and their many variations are getting attention, too many organizations are working backwards to fit them into a particular program or context, write Kate Sturla and Ellen Anderson at IDinsight. They suggest three questions foundations, investors and intermediaries should ask to first diagnose their objectives, then select the right instruments to meet them.
- Categories
- Investing
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The Downside of Social Impact Bonds
After more than three years researching social impact bonds, a filmmaker argues we need to consider the ways they might be doing more harm than good.
- Categories
- Investing
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Critics: Give Development Impact Bonds a Chance to Learn to Walk Before They Run
Brian Boland, co-founder of The Delta Fund - a donor-advised fund focused on poverty alleviation and justice reform - pushes back on a recent critique of development impact bonds. That critique, published in the Stanford Social Innovation Review by Kevin Starr, took DIBs to task for high costs and questioned whether the investor returns are justifiable. Boland argues that DIBs are in their infancy, investors are already learning a lot from early pilots, and any pioneering new system requires time before it can scale.
- Categories
- Investing
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How to Become an Impact Investor: Five Tips to Align Your Investments With Your Values
Using investments to leverage philanthropy is one of the most promising approaches to helping solve the world’s social and environmental challenges — while also meeting financial objectives. And though the impact investing landscape and its lexicon and metrics can seem daunting at times, getting started is actually quite simple, says Michael Tiedemann, CEO of Tiedemann Advisors. He shares some key takeaways for new investors to consider, based on his company’s experiences with a range of impact investors.
- Categories
- Investing