0Email2ShareViews 428FEATUREOnline Platforms Link Impact Investors and Triple Bottom Line CompaniesSocial stock exchanges and match-making services aim to address a gap in a growing market.By Anne FieldView All Contributing WritersMarch 12 , 2012On the one hand, theres a burgeoning interest in a brand-new asset class. Called impact investing, it focuses on for-profit companies with a social mission. Enterprises from J.P. Morgan Chase to the Rockefeller Foundation , which estimate the market could grow to as much as $1 trillion over the next 10 years, have been trying to develop the area for several years now. And, by some accounts, there are thousands of so-called double- and- triple- bottom- line companies–businesses with a financial, social and /or environmental mission – – in operation worldwide.On the other, however, matching impact investors with social enterprises – – another term for these companies – – is another matter entirely. There have been few effective platforms for linking up the two sides. Social enterprises include anything from companies selling wind farm technology to organizations providing micro-finance to villagers in India.That is, until now. Recently, a growing number of efforts, from London to Singapore to New York, have sprung up to address that gap, many incorporating online systems into their platforms. “Its social technology for social change,” says Adam Spence, founder of the Social Venture Exchange SVX, a Toronto-based platform aiming to launch later this year. “Technology is the enabler.”For the moment, most of the activity is taking the form of online matchmaking services. Take SVX. It links via an online platform accredited investors with Ontario-based social enterprises of anywhere from $100,000-$25 million in revenues looking to raise $25,000-$10 million. To be included on the exchange, interested companies first have to go through an exhaustive vetting process thats largely done off-line to make sure theyre not only viable enterprises, but also are the real McCoy, that is, companies with a serious social mission at their core. Then, theyre listed on the platform, with the relevant information of interest to potential investors. After that, it functions much like any online dating service, according to Spence, with prospective investors reading over company profiles and then contacting them. Ultimately, transactions are conducted off-line.Thats only the beginning, according to Spence. With backing from TMX Group, which runs the Toronto Stock Exchange, among others, he aims ultimately to create a fully regulated public social stock market for Ontario for retail investors that would be conducted online. Getting to that point will take some time, according to Spence, due to both the technological complexity and the regulatory hurdles that need to be met. Whats more, for now, most social enterprises are small. For a real public stock exchange to have legs, there needs to be a critical mass of companies large enough to be listed.
Online Platforms Link Impact Investors and Triple Bottom Line Companies – The Network: Ciscos Technology News Site
March 20, 2012