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Posts Tagged ‘SOCAP’

America’s Cup and SOCAP

September 6, 2013 by
 
 

By Joy Zhang, Skoll Foundation 

The Social Capital Markets (SOCAP) Conference was held this week in San Francisco, with the backdrop of the Golden Gate Bridge and the America’s Cup sailing competition.  As far removed as SOCAP is from the America’s Cup, the participants of SOCAP can also feel  as if they are from different worlds.  It’s a mash up of philanthropic donors, investors, nonprofits, for-profits – all there from perhaps the same ideological background (we care about impact!) but speaking different languages.  At the end of the day though, it’s the same conversation—and it’s not how can impact investing solve all our problems.  For a social entrepreneur, the million dollar question is: Who pays for what I do, and when?  And that answer includes the entire spectrum of folks who show up at SOCAP – and many more who don’t.

The health track highlighted this well.  For example, in a workshop on taking innovative global health solutions to scale, we had a small but diverse group of debt and equity providers, donors, nonprofit social enterprise, and one government representative.  The discussion centered around sources of revenue, and while donors may play a role in funding a health intervention, it’s much harder to ignore the role of government support when talking about scale.  (Speaking of which, maybe someone from Medicare and Medicaid should make it to SOCAP next year.)  In addition, revenues could come from out-of-pocket payments, insurance companies, pharmaceuticals, or any mix of the above.  And it could be one organization we’re talking about that is managing revenue coming from a multitude of sources.  The SOCAP crowd knows better than any other that the world is not so neatly divided between charity giving and money making.

That’s why philanthropic donors like us show up, and why we see great nonprofit social entrepreneurs like Skoll Awardees mothers2mothers, World Health Partners, Health Leads, Fair Trade USA, Vision Spring and others at an event like SOCAP.  It’s great to see the lines blurred at SOCAP where donors, investors, and terrific for-profit and nonprofit social entrepreneurs can sail to the finish line together.

 

Strong Presence for Skoll Foundation at SOCAP10

September 28, 2010 by
 
 
 

The Social Capital Markets Conference (SOCAP10) kicks off in San Francisco next week, running October 3rd through 5th, highlighting the growing field of social capital. SOCAP10 brings together a unique mix of the world’s top social innovators — investors, entrepreneurs, donors and other thought leaders — who are catalysts of change across the globe. read more

 

Maps, Gaps and Apps

September 17, 2009 by
 
 

The Skoll Foundation’s Jill Finlayson, who’s the marketing manager for Social Edge, our community website, led a panel discussion at the Social Capital Market’s conference – SOCAP09 – aimed at identifying  the barriers to greater efficiency in the social entrepreneurship ecosystem and how we might use technology to address the challenges.  She’s put up an informative sequence of three blog posts on this question, as well as her take on the gains made over the last year, and the gaps that remain, in moving the sector forward.  Definitely worth a read.

 

A View from the Social Capital Markets Conference

September 8, 2009 by
 
 

SOCAP09 came with the anticipation, fire and fury of a movement in the making. Easily a thousand investors, entrepreneurs, philanthropists, intermediaries, and service providers gathered in the main and parallel side events built around the mother ship. For this disparate group – from former investment bankers sporting Hermes ties to tattooed volunteers who paid for their own meals – SOCAP was the big tent for a world-class mashup of people that want to build a capital market that “does good.”

The overall feel was one of hard-nosed optimism. The slightly hallucinogenic effect of last year’s SOCAP08 – which took place during the very days that the world capitalist system seemed to be imploding – was gone. This year, in spite of a tough market, there were plenty of signs of hope that, by gosh, maybe things will really change this time.

One indicator frequently cited was simply the size of the event. The growing base of talent and commitment to the industry is surely a good sign. But beyond the crowds, one heard about the growing number of investors – from Charly Kleissner of Felicitas to Bob Portillo of Gray Matters Capital – that outperformed the market by placing their assets into impact-oriented investments such as microfinance.

Brian Trelstad of Acumen Fund told war stories of meeting with potential donors only to have them turn the tables and pitch Acumen for funding. But in spite of the worst financial turmoil since the 1930s, Acumen has been able to raise funds for Acumen Capital Markets, its first for-profit investment vehicle tapping into larger pools of private funding.

We also heard about the progress in building the infrastructure needed to take the industry to scale. The Global Impact Investing Ratings System group is working to build shared language and standards for impact metrics, standards, and reporting. Another group was launching a “fund of funds” to allow institutional investors and family offices easier access to impact investment opportunities.

The Global Impact Investing Network, the Aspen Network of Development Entrepreneurs, B-Corp, Calvert’s Impact Investing Roundtable, More for Mission, and a growing list of other organizations are working to facilitate deal sharing and relationship-building among investors, raising the game of intermediaries and service providers and levering significant growth in funding.

All of which is great stuff. And yet…

On the opening plenary panel, I asked “Why do we care about social capital markets?” Is it the warm and fuzzy feeling that we are doing good? Or is it to maximize the potential for large-scale positive change?

If we want the latter, we should recognize that, even with aggressive growth, social capital markets will not reach significant scale (say, 10 percent of GDP?) any time soon. Getting to major scale simply won’t happen on the basis of philanthropically oriented capital. Foundations and other investors willing to take a ‘social haircut’ shouldn’t kid themselves that private funders will continue to subsidize their creations along an S curve of significant growth.

Instead, we should focus our work on three priorities.

Get the business model right. Beyond microfinance, we’ve simply seen too few models that have succeeded at scale. To build more business models for scale, the primary focus of social capital markets should be to hatch and nourish innovation. In sharp contrast to traditional entrepreneurship, the ‘conveyer belt’ of seed-stage angel investors, A-round venture money, mezzanine funding, and IPOs is patchy at best for social entrepreneurs. Make no mistake: smart subsidies from investors and funders will be needed to make this happen. After all, the technology industry was created on the back of decades of government and private support for research, development and, yes, subsidy to the venture capital system.

Tap into funding for scale. As more business models mature and are ready for growth measured in orders of magnitude, they will need access to traditional capital markets and corporations. Government, too, may be able to provide significant funding for some business models. But in reality, the government cruiseship is not likely to turn quickly and will continue to shed passengers as budget deficits bite in the coming years.

Change the rules of the game. This final piece has traditionally been overlooked by boosters of social capital markets, who mainly entered the field to circumvent the dysfunction of markets and government. But some social entrepreneurs are creatively engaging with business and government to internalize the ‘negative externalities’ of environmental and social degradation into the daily decisions of market participants. In this way, social capital markets may one day change the equilibrium of how business is done and, in effect, put themselves out of business.

 

Skoll at SOCAP 2009

August 26, 2009 by
 
 
 

The Skoll family will be well represented at the Social Capital Markets 2009 conference in San Francisco next week.  Dan Crisafulli, who heads up ecosystem investments and partnerships at the Skoll Foundation, will be speaking on a panel on forecasting markets, essentially blue-sky thinking about the future of social capital markets – trends to watch and the potential for creative disruption.  You can see a video of Dan here talking about the panel and social finance.  Jill Finlayson of the Foundation will also be on a panel entitled Make the Maps, Mind the Gaps, Build the Apps. This panel will focus on ways to help social entrepreneurs, funders and service providers navigate and find each other efficiently. From the session description:  “From collaborative best practices such as the Social Entrepreneur API, a searchable database of vetted social entrepreneurs, to identifying missing pieces in the funder landscape, let’s work together to fill the infrastructure gaps that are slowing social entrepreneurs down.”

A number of Skoll social entrepreneurs will also be attending, some of whom are speaking, as well.  Look for the folks from Village Reach, Kiva, Water.org, Kickstart, Vision Spring, Root Capital and Benetech. (Apologies to anyone I missed!)

 

Social Capital Markets Conference – Day Two

October 15, 2008 by
 
 

The second day of the Social Capital Market Conference in San Francisco offered a smorgasbord of options for folks interested in finance in the social sector.  With ten parallel session tracks, there was almost too much choice.  Katherine Fulton of the Monitor Institute kicked the day off with a thought-provoking keynote.  She argued that social capital is at a transition stage as an industry, moving from uncoordinated innovation toward building a marketplace.  A series of converging forces – including money seeking diversification, growing environmental and income inequality challenges, a track record of early success, and some policy improvements – are creating a situation ripe for growth.  A key need now is infrastructure, to lower the cost and increase the volume of transations in social capital markets.  We need to unlock the latent supply of capital by providing efficient interactions; build an enabling infrastructure; and develop the absorptive capacity of recipients for this investment capital.   The opportunity – as well as the challenge  – is huge:  only a tiny fraction of the $60 plus trillion of investments around the world can be considered social capital investments today.

The keynote was followed by a roundtable with Jed Emerson, the father of the blended value concept, Matthew Bishop, business writer for the Economist and co-author of “Philanthrocapitalism: How the Rich Can Save the World”, and David Chen of Equilibrium Capital Group.  A few nuggets from that session:

– Today, you simply can’t invest for the long term without considering environmental sustainability and supply chain intergrity issues.

– We don’t need silver bullets, we need silver buckshot (great line from Jed) – i.e. we need to get out and try a number of approaches. There is no single answer.

– Brand authenticity will be resurgent after the financial market meltdowns.  Social entrepreneurs and social businesses have that authenticity.

– There is much opportunity pulling social capital forward from above, but there’s also risk management exerting similar pressure from below.  Companies are working to mitigate negative risks around carbon, supply chains, and the like.

–  Even if we don’t have all the answers,  we are making progress collaboratively.  We have to keep trying new things, and not let the perfect be the enemy of the good.

I attended breakout sessions on moving beyond microfinance (where Skoll social entrepreneur Willie Foote of Root Capital provided his always cogent analysis of what was happening in both the commercial and social capital markets), a session on perspectives from developing world social finance practitioners, a panel with African representatives talking about the state of play of social finance in Africa (it’s nascent, but the  opportunity is large), and a final session where members of the Aspen Network for Development Entrepreneurs spoke about a shared model for business support, monitoring and measuring for social entrepreneurs.

The day closed with a final keynote by Matthew Bishop, in which he outlined the main themes of his book.  Matthew pointed out that governments will now be stretched even thinner by the financial commitments they’re making to forestall commercial meltdowns, putting an even greater premium on social sector action.  He sees great progress in the sector, but pointed out continued challenges around scale, transparency, capacity building and duplication of efforts.  He argued that the philanthrocapitalists of today are different than earlier philanthropists in the comprehensiveness of their approaches to addressing root problems.  Speaking to a theme that was present in nearly every session – whether social capital has to return (or optimize) profit – he made the point that certain things will never – and shouldn’t – have a revenue stream associated with them.  In closing , Matthew moderated a “debate” around the thesis that social good is best maximized by profit maximization.  Folks had fun with it, and the profit maximizer team was highly energetic, even if they didn’t sway too many in the audience.  It was an entertaining and useful exercise to probe deeper some of the fairly basic – but critical – questions around what social capital really means.

My key takeaway from the conference is that there is significant momentum and innovation around the concept of social capital.  Most at the conference would agree with the statement that there’s a market, but not a marketplace, with key ecosystem pieces  – legal, audit, metrics, standards, taxes – still to be determined.  But it’s clear that there are some smart people working on these issues.  And the potential is big.  A representative from JonesDay, a large, global legal firm who sponsored the event, said they were interested in the sector because it represents “the largest pre-profit segment in the world.”   That sounds like opportunity to me.

 

Social Capital Markets Conference- Day One

October 14, 2008 by
 
 

Yesterday was day one of the Social Capital Markets conference in San Francisco – SOCAP ’08.  They were anticipating around 300 attendees and, instead, got double that.  While the number made for some tight sessions, it’s a powerful sign of interest in the space.  The subtitle of the conference gives the basic focus:  “the intersection of money and meaning”.  With a large number of parallel sessions going on, it was a bit tricky to get an overall sense of the discussions. But a few interesting points emerged for me:

–  Many see the financial meltdown as a unique opportunity to promote the idea of social capital markets and double or triple bottom line accounting. The meltdown has revealed the risk associated with profit maximization at all costs.

–  We have to break out of silos and look at ecosystems.  Sustainable fishing, for example, is not just about managing discrete fisheries in a better way, but about rethinking the entire supply and demand side of fish, from the ocean to the plate.

– In the long-term, there are no trade-offs between doing well financially and doing well socially.  There may be some short-term trade-offs, but the two go hand-in-hand over the long term.

– We need more examples of success in the social enterprise and social capital arena. Success begets success.

–  We need better infrastructure.  There is a social capital market in the U.S., but we need a better marketplace:  financial exchanges, legal systems, auditors, ratings agencies, standards, measurement tools, etc.

– Social entrepreneurs need to be able to talk to both financial and social audiences effectively.

The Skoll Foundation is involved in the conference at several levels.  Foundation staffer Dan Crisafulli, who oversees our ecosystem and partner programs, spoke on a panel on mission-related investment.  Debra Dunn, who’s on Skoll’s board, was on a panel on building infrastructure for social capital markets.  Jill Finlayson of Social Edge will be on a panel today on online communities.  Skoll social entrepreneurs Willie Foote of Root Capital, Premal Shah of Kiva and Jim Fruchterman of Benetech, also all have speaking roles.

Back for day two this morning.

 
 

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