SoCap09, RISE and Fossil Fuel

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How to choose where to put money: creating software applications, launching community small, medium, micro enterprise hubs of barbers, gyms and internet cafes, and retailing food in lowest income communities? Conversations on social entrepreneurs have been keeping us busy these past weeks. New and existing small enterprises needing capital, and how to get it to them, in Bophelong Gauteng in South Africa or Sao Paolo, Brazil, is the challenge. SoCap09 is just weeks away and there is much good ground to cover to justify the thousands of miles and 2 day journey to San Francisco. This will be our first trip to SoCap for its second iteration - tight schedules meant we had to deploy interns to report back on the inaugural SoCap08 last year. Reports were good, and the content for SoCap09 good enough to seeing what Kevin and Amy have been conjuring up. From the chatter online it seems a bunch of the JustMeans community will be at SoCap and so we to hope to flip from virtual to physical relationships. While our Sinclair + Company advisory work has us stretched and probably not blogging live, impressions and material from the days will filter through the investment mind and onto the pages here in the Sustainable Finance editorial and SRI-Extra in future postings. What are you interested in understanding more from the investor’s perspective that we should be mindful of? Skimming the SoCap09 schedule to flag sessions that fit to the challenges of making sustainable finance and responsible investment happen in emerging markets, especially Africa, offers a fair amount. Check out the SoCap09 blog too. With the agenda set, it looks more like the sessions should offer material on metrics, impact and philanthropy capital than the role of public or private capital. Generation Investment Management will be there, perhaps covering the HBS case that came out in May this year. In particular we hope to learn from the West coast experience on deploying capital to meet social and environmental needs, and trying to keep core by measuring the impact robustly. One person I have been waiting to spend time in conversation with is Sara Olsen of SVT. Back in 2006 we connected and she shared with me her short book covering Social Return on Investment (SROI). This was after I had spent some time with fellow Net Impacter from Boston and founder member with us at NetImpactBoston, Farron Levy. Farron developed a widget also used in metrics called True Impact, and has been featured in Boston Journal for the consulting and software solution it offers. Go you good thing, go! Exploring metrics and impact may help with tracking the positive impacts from projects like those at African Dream Trust, especially the economic development theme.

Another piece of the puzzle that SoCap may help fill is where social exchanges are now, and what we may do to push them on , see JustMeans post Good News in Social Investment 27 July 2009. We head over the Atlantic after having spent time swapping notes with Greater Good and SASIX here in Africa about what is, and is not working. We should have some value to add to the conversations. At least the 20+7 hour flights offer some reading time, depending on the knee torture by old model Delta aeroplanes flying from S.Africa. The reading list includes catching up on what Cathy Clark has been up to since 2004 with her RISE (Research Initiative on Social Enterprise) program at Columbia University that launched in 2002. Her 2003 paper on the Double Bottom Line Private Equity Landscape 2002-2003 with Josie Taylor Gaillard seems like such a long time ago, but the work she did helped add some rigour to the emerging asset class and the integrated asset class thinking. For many of us, it helped open the intellectual and experiential door to this “other’ category of money management where environmental and social factors were explicitly included. The newness of the work was shedding some light on early stage social and private equity investing in the US, administered via web in 2002 and 2003, surveying 1,254 venture capital (VC) funds and others and finding USD 2.6 bn in “double bottom line” PE market, a large number at the time for the small sample. With the mix of institutions and people in SFO for three days in 2009, that number will probably be in one lecture hall.

Finally, in keeping with the life/work balance, entrepreneurship, biomimicry and long-term investing, a mini-highlight of the SFO onsite will be seeking a taste of the million-years old beer, courtesy of a great WIRED story. Microbreweries are one of the beautiful fabrics of the US community life, like Harpoon in VT and MA which builds brand through a 110 mile cycle race Point-to-Point from Boston MA to Windsor VT every August. Fossil Fuel is brewed at a brewery is 70mi from SFO, Hackett's brewpub in Guerneville, California, so a cycle is do-able if we can secure some fine Cervelo rides or such and dream of the Tour of California. See the full Wired article of a scientist refugee from Cuba, biotechnology, business failure, and serendipitous ski slope conversations leading a bacterium from the age of dinosaurs 45 million years ago to crack out of amber and be cultured to brew some very, very funky beer. Reality is new ventures filled with good ideas grow and die; nine out of ten new small businesses fail. Making investment decisions for sustainable finance and responsible investment is even harder. Kudos to Fossil Fuel for trying, and bootstrapping with one’s own cash to start a venture, that’s the market economy in action. So the smallest consumption decision we make may help unlock the bigger investment capital down the line. For now, buying a few pints of local brew; that’ll help a few social entrepreneurs in the region do more good work.