Giving Compass' Take:

• Impact investors are realizing that providing investment capital for the creative markets will lead to positive community development work. 

• What are examples of successful investments in the arts and arts organizations?

• Read more about impact investing in the creative economy. 

The impact investing community is starting to realize that the arts and business are one—both seeking to utilize finite resources to create returns beyond profit.

Take a glimpse at the tremendous body of research on the impact of the arts in education, for instance.

Research conducted in 2008 reveals that participation in the arts reduces high-school dropout rates, especially with students from low-socioeconomic households. Students with high involvement in the arts from these households had a 4% drop-out rate as opposed to the 22% norm for students from the same background with low arts involvement.

Arts organizations are situated in a prime spot in society for changing community outcomes, but are not recognized or leveraged by impact investors as a critical resource.

According to Laura Callanan, it has traditionally been very difficult for creative economy practitioners, such as those creating artistic or cultural products, to qualify for financing.

But can you imagine a world in which capital is connected with arts organizations that dually function as social entrepreneurship firms, B Corps, and employee-owned co-ops?

This very well could be the future of social impact investing.

Read the full article about arts impact investing by Mariama Holman at Americans for the Arts.