Impact Investing

Strategy Type

Dual Mandate

Typical Stage

All Stages

Return Profile

Varies by Mandate

What It Is

Impact investing pursues measurable social or environmental outcomes together with financial return, and holds itself accountable for both.

The distinction from ESG matters: ESG screens for risk within conventional investing, while impact investing sets outcome targets and measures against them.

Typical Approach

Define intended impact before investing
Measure outcomes against stated frameworks
Accept a range of return expectations, from market-rate to concessionary
Frequently focused on health, education, energy access, or financial inclusion
Blended structures combining philanthropic and commercial capital

Return Drivers

Commercial performance in underserved markets
Access to concessionary or catalytic capital layers
Policy support and development finance participation
Growing institutional allocations to impact mandates
Lower competition in genuinely underserved segments

Key Risks

Impact measurement is difficult and inconsistently standardised
Tension between financial return and impact objectives
Impact-washing, where claims outrun evidence
Frequently operating in markets with higher country risk
Exit routes can be limited

What Founders Should Know

Impact investors will require outcome measurement, not only financial reporting, and that reporting obligation continues for the life of the investment.

Where a company's mission and commercial model genuinely align, the pool of available capital is wider than conventional venture — including foundations and development finance institutions.

Looking for the right kind of capital?

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