How to Get Impact Investment for Social Enterprise, NGOs: A Guide
Previously, we talked about impact investing, what the practice is all about and how it can benefit impact projects as well as investors seeking to park their funds with deserving projects. The sole purpose of impact investing is to channel the capital toward generating measurable & sustainable social impact.
This blog delves deeper into the concept of impact investment and is dedicated to social entrepreneurs and impact project managers who seek to gain investment for their sustainable initiatives.
Undeniably, the global market of impact investing is rapidly expanding. As per a 2019 USAID survey on annual impact investment, as much as $239 billion was pooled in for impact investing assets. It is a no-brainer that some of the most common and highly sought-after industries and sectors luring impact investors include health, education, clean energy, sanitation, food, housing, access to clean water, among others.
So, what does it take to get the impact investors to make a contribution to your project? How can one find impact investment for sustainable projects? We break the drill down into simple points:
Define your requirement
First things first, you need to figure out the kind of investment you need. Are you just looking for capital or also expect some technical know-how, contact-building along with the grants? Therefore, it is important for you to define your investment requirement. Also, what would be the term period for this capital?
Know your investors
Secondly, now that you have a clear understanding of your capital requirement, you would want to start with the process of researching your potential impact investors. You would certainly not want to approach just about anyone. Out of a mix of venture capitalists, angel investors, among others, you would want to gauge who would fit the bill, understand the ethos of your project and provide the appropriate support and nudge to your project.
While some may provide only capital, others come with a mixed bag of grants, technological expertise, and much more, therefore, it is only wise to do your research thoroughly before making a choice and approaching the party.
Approaching investors
Do your homework well before approaching your potential investors. You must know as much about them as possible — what they do, what interests them, their priorities, expectations, past investments. This will help you ascertain your prospects; if your project is a good fit for them and vice versa.
Be open to criticism, tough negotiations and show a willingness to walk to the middle ground by making adjustments. In the process, spell out your vision, plan, and expectations clearly.
Tip: Remember, your investor is interested in their Social Return on Investment (SROI), therefore, you must also be able to discuss how you plan to measure the impact and what metrics you propose to choose.
If you are fairly new to this field, you can get preliminary help from the Global Impact Investing Network (GIIN) to find potential impact investors, impact metrics, and more. Don’t forget to check our blogs to learn more about impact investing, sustainable startups, and more.
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Also, take a look at our outcome-based funding program that aims to provide impact investment or funding to deserving projects. Artemis can also help identify and shortlist well-suited impact projects for investors.
Contact us on partners@artemis.im for more information about our outcome based funding program
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