What do impact investors really want? Guidelines for approaching impact investors
So, you have established an innovative inclusive business, that has real potential to create significant social and environmental impact, but lack the funds to scale. Where can you turn? Impact investors!
Impact investors can help inclusive businesses to scale and create even greater impact by providing financing solutions such as equity and debt. That is their mandate, and they are constantly on the search of great businesses to invest in. But many early-stage businesses remain unclear on what impact investors are really looking for, and lack experience regarding the investment process. To address this challenge, Mike Debelak from the Innovations Against Poverty team undertook a study to explore the question “what do impact investors really want”, specifically with a focus on the following four questions:
• At what point do impact investors consider a business to be “investment-ready”?
• What does a business need to demonstrate in order for it to be considered for an investment?
• What are the main reasons promising impact businesses are not considered for investment?
• How should a business handle the due diligence process to successfully secure an investment?
11 leading impact investors were interviewed to get their perspectives on these questions. Their responses were translated into practical guidelines that businesses can use to understand where their focus should be when approaching impact investors.
You can download and read the guidelines here: http://innovationsagainstpoverty.org/wp-content/uploads/2019/11/IAP-what-do-impact-investors-really-want-November-2019-1-1.pdf