Where Are The Hot Deals In Impact Investing?
This interactive map visualizes the dataset of 3,000+ impact investing deals available at ImpactSpace as of March 2017. What all these investments have in common is the intention to generate a measurable, beneficial social or environmental impact alongside a financial return. They span across geographies, sectors and financial instruments — though the majority of deals captured here are structured as equity.
Orange nodes represent companies (recipients of an investment), blue nodes represent funders (those making the investment), and each link between two nodes represents an investment from a funder or investor into a company or investee. At a first glance, a couple of blue dots (funders) stand out by the large number of investments they have made: Village Capital and the Global Social Benefit Institute (GSBI). It comes as no surprise as they have been running incubator and accelerator programs for many years, supporting a large number of companies at the pre-seed or seed stage — with investment amounts on the smaller side of the spectrum. Other incubators and accelerators that have supported a significant amount of companies in this space include Fledge, Good Company Ventures, Points of Light, HubVentures, and NESsT. Most of these programs are fairly broad in their geographic and sector focus, supporting entrepreneurs and companies in a variety of regions and verticals. Some of them, like Village Capital, run accelerator programs in batches focusing on a specific sector, but in the aggregate, they end up covering a wide spectrum.
The most well-connected nodes (both companies and funders) are pulled together towards the center, whereas those loosely connected are pushed away to the periphery. Thus, expect to find the hottest, or rather the most trendy, deals towards the center of the map, where the most well-connected and influential investors gravitate to (pun intended). Look at where the density of nodes is the highest, and you’ll find the usual suspects. There is a dense cluster formed by Acumen Fund, Gray Ghost Ventures, Bamboo Finance and Aavishskaar (India only) that share a focus on poverty in developing countries. There is another cluster nearby around Elevar Equity, the Unitus group (Unitus Equity, Unitus, Impact, Unitus Labs) and Lok Capital that share a poverty focus in India and Southeast Asia.
Among government agencies and multilateral organizations, the Overseas Private Investment Corporation (OPIC) stands out by the number of deals and how close is pulled to the center, followed by USAID-Development Innovation Ventures.
Within the set of funders, highlighted in green are “smart money VCs” as defined by CBInsights: venture capital firms with the best combination of portfolio valuations and investment outcomes. Of the 24 “smart money VC” identified by CBInsights, 12 (50%) are present in this map. The most active are Koshla Ventures & Koshla Impact grouped as a single entity with 25 investments. Close to the center, we also find Accel Partners, Andreessen Horowitz, and Bessemer Venture Partners, though with only two deals each spanning education, agriculture, and health, both domestically and internationally. Another set of three (First Round, General Catalyst, and Spark) are co-investors in the same company, Warby Parker. Given the large number of investments that these VC do, their presence here is anecdotal, with the exception of Koshla.
What relationships and trends do you uncover exploring this map? Add your insights to the comments below. What else would you like to see that it is missing?
About the dataset & map
The original dataset contained 3,501 deals, of which 415 were discarded because they were unidentifiable (they were either lacking the investor or the investee fields). In the cleaned-up dataset, there are 3,086 deals, covering 1,981 companies and 406 funders. The dataset is incomplete, as many investments that qualify as impact investments are simply not present. Notable omissions are Echoing Green with only 2 deals represented of the several hundred entrepreneurs they have supported over the last decade and Omidyar Network with only 15 deals (a 5 to 10% of their portfolio).
The map is powered by the data visualization platform kumu.io, and provides the following built-in features:
- Zoom in and out using the top right controls
- Hover over any node to highlight that node and its first-degree connections
- Search utility (top left) to find a company or investor by name
- The left sidebar that displays node or connection details when available. Show or hide the sidebar by clicking the three vertical dots on the left of the map.
This article is the third of a series of three articles that explores where Colorful Ventures operates, focusing on early-stage companies with built-in impact. The first article covered How to Navigate the Impact Investing Landscape, whereas the second delved into Leapfrogging Venture Capital at Home and Abroad. Our vision is to grow the number of successful companies that make a lasting positive change in this world, and catalyze a vicious circle that attracts more capital, resources and talented entrepreneurs working for a more just and equitable world. While we acknowledge that venture capital or impact investing alone is not the panacea to end global poverty, we believe that market-based approaches have a big role in alleviating poverty, and we work hard to realize this potential.