Grantmaking Should Be Grounded In Real Costs

Amplifying Your Philanthropy Through Impact Investing

When TPI helped create and launch Invest for Better last year, one of our goals was to curate and share the best, most accessible resources about impact investing that have been created by our colleagues in the field. We know that great resources exist, and we want to help people get their hands on them so that more capital can be activated for good. But we’ve also come to find that there are gaps where key resources are missing, and we’re stepping in to fill them. Many donors we come across – either through Invest for Better or our consulting work at TPI – are experienced philanthropists, but new to using their investments as a force for social change. Does this sound familiar? Maybe you’ve deployed smart, focused philanthropic giving to support innovation and experimentation in your focus areas, to fill a gap in services that should be covered by public money, or to bring together stakeholders to learn and collaborate – but you feel frustrated by the limited ability of philanthropy to scale proven solutions. Or perhaps you’re discouraged by the absence of sustainable funding for an essential program. Donors in this boat may be intrigued by the idea of turning to the capital markets and their own investment capital to address these challenges, but don’t quite know how. It is for these people that we created the new workbook, Amplifying your Philanthropy through Impact Investing, with generous support from Fidelity Charitable. Aimed at helping the philanthropist who is a newbie impact investor develop plans for both learning and action, the workbook guides users through 6 questions to help identify possible ways to use investing to increase their impact on the people, places, and issues they care about: What are your philanthropic goals? What source(s) of capital do you want to use for impact investing? How much capital do you want to start with? What are your financial goals for each capital source? What impact investment solutions or tools might help you achieve your philanthropic and financial goals? How will you decide which impact investments to pursue? What criteria and due diligence processes will you use? How will you measure the success of your investments? The workbook includes a concise primer on impact investing along with numerous examples of impact investments. It is intended to serve as a starting point for developing an impact investing strategy to augment one’s philanthropy, and could be used in consultation with financial, philanthropic, and other advisors. (Heads up, advisors: Stay tuned for an annotated version of the workbook that you can use with your clients.) Philanthropy plays vital roles in our civil society that cannot or should not be replaced by the capital markets. We need all types of capital – philanthropic, impact-first, frontier, and market rate – to tackle critical issues facing our planet, and an ecosystem of smart investors who know how to use all the tools in their toolbox. We hope this new workbook contributes to that vision. If you're an individual, family, or foundation intrigued by the opportunities presented through impact investing, or if you have clients who want to learn more, also check out TPI’s primer, Navigating the Territory: A Guide to Impact Investing for Donors. If you’d like to discuss how you might use impact investing to amplify your philanthropic efforts, reach out to us at info@tpi.org. --- Invest for Better is a project of The Philanthropic Initiative (TPI). Visit www.investforbetter.org to learn more, and contact Ellen Remmer to get involved.