Giving Compass' Take:

• Stanford Social Innovation Review explores why early-stage entrepreneurs are needed to spur change — and why they need greater investment.

• The key takeaway for funders here is to embrace risk. What can we do to support those who are pursuing bold ideas in the social sector and make sure that they have the resources to scale?

• Here's how to use data to better inform impact investing decisions.

Society desperately needs new answers to its most challenging problems. Despite significant huge technological and scientific advances of recent decades, too few have found their way to the people and issues most in need. With the perspective of our venture capital legacy, we believe early-stage investments in social entrepreneurs are essential to creating profound and lasting change.

Funders often see early-stage investments as too risky or too “high touch,” or feel their outcomes are too uncertain and hard to predict. While our experience suggests that the first two are often true, we have learned that the third is less of an issue. Both in and out of our portfolio, we have seen numerous examples of how early-stage organizations create long-term, system-changing impact, not just by their success, but by their failures too. Impact from those whose early success leads to large-scale adoption is obvious. Less obvious are the derivative benefits from startup organizations whose initial insights have persisted even when the original vision of the organization has not. In other cases, early-stage organizations can demonstrate what is possible to populations who have lost hope, or governments that lack the investment capital or risk tolerance to pilot a solution.

Our message is simple: There’s no time to waste. The urgency to fund early-stage social entrepreneurs has never been greater.

Read the full article about the urgency to fund early-stage social entrepreneurs by Jim Bildner on Stanford Social Innovation Review.