Social Innovations Journal: ImpactPHL
There is a growing sense among entrepreneurs, investors, and philanthropic and corporate leaders that the traditional ways of doing business aren’t the only ways of doing business.
The Impact Economy Working Group, under the project leadership and management of the Ben Franklin Technology Partners of SE PA (Ben Franklin) and the Economy League of Greater Philadelphia (Economy League), began the Greater Philadelphia Impact Economy Initiative (Initiative) in 2015 to better define both the opportunities presented by this new approach to economic development and social problem-solving, and the strategies and tactics by which Greater Philadelphia can position itself to capitalize and grow its base of impact investors and enterprises. Through research, roundtables and interviews, this analysis has helped to identify the current state of impact investing and impact companies in the Philadelphia region and the potential market opportunities for these companies, organizations and investors. The ultimate goal of the Initiative is to catalyze efforts to grow impact economy activity in Greater Philadelphia through a new collaborative effort, ImpactPHL.
Defining the Impact Economy
The impact economy is the ecosystem that supports the work of entrepreneurial enterprises addressing social needs in the community, either through the products they make or the process or strategies by which they do business, while they build profitable, and often scalable, enterprises. This includes:
- Impact companies and organizations – Enterprises (traditional for-profits, nonprofits, or benefit corporations) that directly address a social need or opportunity such as, but not limited to, environmental issues, job creation for disadvantaged individuals, health, sustainability or education, either by the product they produce or service they provide or through their business processes or strategy.
- Impact investors – Individual or institutional investors who are seeking investment opportunities that produce both financial returns and measurable social benefits. These investments can be made by venture funds, private investors, foundations, government and pension funds in entrepreneurial impact companies and organizations.
- Intermediaries – There is a growing set of organizations and advisors who are working with all elements of the impact economy. Wealth management firms are increasingly including advice on impact investing in the menu of services. There are organizations that serve as financial intermediaries between investors, impact enterprises and client governments or nonprofits, helping to structure the deals and contracts that result in results-oriented financing. And there are entrepreneurial support organizations that provide incubation, mentoring, and start-up business advice to social entrepreneurs, preparing them to refine their business models and enter the marketplace.
- Customers – The market for the products and services provided by impact companies and organizations. This includes the public marketplace of governments and nonprofits, private markets and consumers, and the regulatory and policy frameworks in which investors and companies operate.
Read the full article here.