Falling to Rise

Jed Emerson
Mar 15, 2019 · 5 min read

Doubling Down on Impact Investing

With the recent revelation of an academic scandal involving wealthy families buying access to universities for their undeserving children, we found one newcomer to impact investing prominently featured, both through his own words and those of a federal indictment.

Other newcomers have taken this — and more — as an opportunity to confirm suppositions of the hypocrisy of wealth and call for the suspension of impact investing until this may all be sorted out.

Still others of us have understood for years what the game is. We require no sorting:

Traditional, financial capitalism is extractive, aggregating wealth at the top to the benefit of the few.

The pursuit of wealth as a simple measure of worth destroys community, environmental, economic, and, ultimately, moral value.

We need more and better transparency, taxation, and regulation as the guardrails for how we manage money — but must recognize there will always be those who seek to circumvent our guidelines to their own advantage.

And ultimately,

How we think about the nature and purpose of capital is simply a social construct. We need to reject the dominant frame of the purpose of capital we have bought from the merchants of Wall Street — the purpose of capital being simply to create more capital — and instead seek to redirect our understanding of economics away from what has been toward what can be — capital as fuel for freedom, empowerment and sustainability.

Many of us have explored these themes:

In 2018, Morgan Simon wrote about them in terms of impact investing.

In 1999, Woody Tasch framed these concepts in the context of how foundations manage their wealth, calling it a “zero sum dissonance” to invest your assets in the very system you claim to want to change.

In 1902, Jane Addams wrote Democracy and Social Ethics, exploring issues of civic diversity and our pursuit of justice.

And before the days of our supposed Enlightenment, Buddha, Jesus and others spoke to all this as well.

Our work has always been about re-framing economics, the pursuit of justice and the promotion of sustainable organizational practices (whether nonprofit, for-profit or cooperative).

With the launch of the RISE Fund two years ago, many long time capital activists cringed at the hubris (As did, it is worth noting, some of his colleagues…), pre-selling of “new” approaches to metrics that quite simply were/are not new at all and the blatant self-promotion of RISE’s co-founding partner — in the absence of any actual demonstrated impact as an impact investor.

All this and more were and should have been red flags for us.

Quite simply:

It was clearly a play to aggregate billions of dollars of client capital, collect fees and let the “big boys” come show us all how it is done.

While none in our community could have known what was to come, perhaps this is also a moment for some introspection:

As we seek to remain open to the entry of mainstream investors to our community is there a danger of our being used by sharks as chum for simply raising capital and putting sheen on traditional finance and the arrogance of our vaunted business “leaders”?

How have our field’s media platforms, conference curators, and community leaders (such as myself…) let us down with our “big tent” vision and less than critical acceptance of all who come to claim the banner of impact?

A topic for a future post, but as some have suggested to me, we need be more discerning, promote greater accountability and be not quite as welcoming of the validation brought by mainstream acceptance after our years in the financial wilderness.

But we did see this coming… As we watched RISE roll out over the months, virtually every caution with regard to the scaling of impact investing that many of those in the field had written and spoken about for years was coming to pass before our very eyes, in this one firm that

for a brief moment

bought the mic and stole the narrative.


We’ve now seen what happens when the arrogance of Wall Street wealth meets the marketing opportunity of impact investing.

My sincere and best wishes go out to the members of the RISE team, long-time friends and colleagues of ours whose path has gone somewhat astray amidst the musty glitter of rusted rock stars with their fuzzy thinking and rosy laughter echoing into the late nights of Davos.

I’m confident our colleagues will RISE again to deploy their capital for true impact of various types.

(Although, we hope, perhaps no longer in the area of Education…).

So, again, fine…

But let us be clear:

Two years in the field does not an impact investor make…

While some may seek to promote the self-promoters as “leaders” of impact, we know he never was.

There are many kinds of leaders:

Chairman Mao once observed, a leader is one who sees a parade and runs to stand in front of it.

Bill was clearly the Mao type of leader, who has now exited, stage left.

Let it go.

May we now get back to the business at hand?

The reasons we all got into this work remain as compelling and critical as ever:

Creating equity (both financial and social) at the bottom, and increasingly middle, of the pyramid.

Promoting applications of capital to the generation of blended value that has as much to do with advancing justice and empowerment as disciplined financial and philanthropic performance — defined according to our own community and stakeholder’s terms — not those of market dominators and presumed experts.

Using capital as a tool; not confusing it with the task itself but rather to, in the capital context, modify the reality of what Martin Luther King, Jr., identified as our having “guided missiles and misguided men.”

If you think today’s events are concerning, you’re forgetting the real challenges before us:

the need for economic justice,

our call to address legacies of racism and slavery,

the need for new approaches to redistribution of wealth,

the opening of greater, financial equity opportunities for all contenders,

the needed promotion of empathy and compassion for Self and Other,

the endless progression of Ecocide and climate change,

and our proactive evolution of an economic order that today seeks to destroy us.

The appropriate fall of a partner of RISE is nothing

relative to what our community is,

what we have achieved to date,

and the incredible things we’ve yet to create in partnership with each other in years to come.

We need go both deeper and higher if we are to successfully engage with what is immediately before us in the months and years to come.

Moratorium on impact investing, my ass…

I’m doubling down for impact!

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