I. Report Summary
W hile most surveys confirm millennial Interviews with 10 millennials provide fresh
interest in impact investing, some insight into their lives as active impact
suggest there is more talk than investors at different stages in their journey.
action. What are millennials actually doing We believe these stories will provide millennial
about impact? Are they really taking action? readers with evidence, inspiration, support
What is needed to empower interested and confidence to help chart their own impact
millennials to move from talk to action? This investing journey. We also believe that these
report goes straight to the source offering stories shed light on possible ways families
answers from millennials engaged in impact and advisors can collaborate with millennials to
investing – from exploration through achieve their impact investing objectives.
to execution. In conclusion, millennials need more support
Millennial respondents on 6 continents have to realize their impact objectives. The
generously provided us insight into the millennials we spoke with are demonstrating
following questions: a thoughtful, rigorous approach to impact
investing. However, they need more access to
• Are they interested in impact investing? tailored capacity building in impact investing
• What drives that interest? as well as robust deal flow across asset classes.
• What impact investments are they While they currently leverage their friends and
investor networks to access deal flow, they
making? also want to collaborate more with their family
members and advisors.
• Why? Which sectors? Which asset Investor networks, advisors, educators,
and family members can all be of service
classes? by providing more access to impact
thought leadership, tools and community
• What challenges are they facing? for millennials. Impact investing offers an
• How does their impact investing align opportunity for meaningful collaboration
• with other aspects of their lives – across generations and across the financial
• specifically careers and philanthropy? eco-system. It is our hope that this report will
• How are millennials collaborating with be the catalyst to spur more millennials, their
• their families and advisors on their families, and their advisors to action.
• impact investments? DISCLAIMER
• How are they educating themselves in Toniic, Bank Of The West, its affiliates and
subsidiaries, do not represent, warrant,
the field of impact investing? undertake or guarantee that the use of
Key findings show that the millennials guidance in this guide will lead to any particular
we surveyed and interviewed are indeed outcome or result.
interested in impact investing, with some The choice to use and manner of utilization of
taking a portfolio approach, and others information and knowledge gained through
considering how to align their careers and their Toniic is each investor’s individual choice. Toniic
philanthropic activities with their values and does not recommend or otherwise suggest
impact investments. that any investor invest in any financial product
Challenges shared by millennials surveyed
include:
• Not enough investment knowledge
resulting in lowered confidence to act;
• Lack of investor education tailored for
the needs of millennials;
• Resistance from family members; and
• Lack of support from financial advisors.
Millennials in Impact Investment Report 2016 1
or that any fund manager offer products to a
particular investor. Investors should consult an
investment, tax and legal professional before
deciding to invest in any financial product. No
guidance shall be given, nor shall any person
or entity affiliated with Toniic, or Toniic itself,
be responsible for an individual investor’s
use of the information, investment decision,
or the results of any investment. Toniic takes
no part in the negotiation or execution of
transaction for the purchase or sale of financial
product, and at no time has possession of
funds or financial products. Toniic receives no
compensation in connection with the purchase
of financial products. Toniic is not a registered
broker-dealer or investment adviser and does
not guarantee an investment of any form. •
Galen Welsch - Millennial Investor & CEO Jibu-Berndt
Millennials in Impact Investment Report 2016 2
II. Background and Objectives
A t SOCAP, (Social Capital Markets)1 2014, The Toniic community values an open and
Toniic had its first ‘ad-hoc’ gathering collaborative approach whereby impact
of millennial members. Millennial investors learn from and support one another
membership had been steadily growing in their impact investing practice.
across continents and SOCAP provided the With this in mind, this report examines what
first opportunity to bring some of them we have learned from our work with millennial
together to share their stories. In 2015, Toniic impact investors.
launched a formal working group for millennial What are they interested in? What are they
members to engage in peer-to-peer learning,
and sharing of investment opportunities and investing in? How are they working with
due diligence. Today, this working group is 50 their families and advisors? How are they
members and growing. educating themselves about impact
Much has been written about millennials and investing and what are some of
the anticipated $30 trillion2 of wealth transfer the challenges?
this generation will receive in the next few We hope these data and stories will
decades. In the recently published Narrative empower and inspire more millennials to
Analytics on Impact Investing, “Millennials consider investing for impact. In addition,
Demand it!” was found to be one of the key we hope these stories will encourage family
phrases dominating discussion across social members and advisors to be more willing to
media channels, especially in North America.3 collaborate with millennials to together foster
However, while most surveys about investing a greater movement of financial capital into
confirm millennial interest in impact investing, investments that deliver positive social and
others suggest there is more talk than action. environmental impact.
Toniic’s mission is to empower impact We are very grateful to The Bank of the West
investors and its vision is of a global financial for supporting us in this research and for
ecosystem that creates positive social and funding the publication of this report. •
environmental impact.
1 SOCAP (Social Capital Markets) has created a platform where social impact leaders can connect and present their ideas
to a global audience. The annual flagship event in San Francisco is the largest conference for impact investors and social
entrepreneurs and has drawn more than 10,000 people. http://socialcapitalmarkets.net/
2 https://www.accenture.com/gb-en/insight-capitalizing-intergenerational-shift-wealth-capital-markets-summary.aspx
3 Narrative Analytics on Impact Investing, Global Impact Investing Network, Monitor 360, Omydiar Network,
2016, February.
Millennials in Impact Investment Report 2016 3
III. Methodology and Acknowledgements
METHODOLOGY 4. Millennials, wealth transfer & families
• Anticipated transfer of wealth: timing,
This report is based on interviews and research • size of assets, structure of family
conducted by Toniic with its members and
key partners over a five-month period. assets, engagement with family assets,
Interviewees were identified from over interest of families in impact investing
seven global organizations. 58 interviewees 5. Challenges in moving assets into impact
completed an online survey developed by
Toniic and ten were interviewed over the • Degree of difficulty sourcing impact
telephone or in person. Data has been
aggregated and anonymized. Interviewees are investments across asset classes
referred to by their first name. From the data set received we have identified
PRIMARY RESEARCH and analysed responses from a group of 58
THE TONIIC SURVEY millennials (ages 20 to 40). These millennials
A survey was distributed to millennials represent 32 cities on 6 continents – Africa,
by Toniic and Bank of the West between Asia, Australia, Europe, South America
December 2015 and April 2016. Other groups and North America. Two-thirds of these
that supported the distribution include respondents are millennials who are either
Investors’ Circle,4 The ImPact,5 Resource investors with personal assets under
Generation,6 and Nexus.7 management ranging from USD $500,000
The survey focused on the following areas: to USD $99 million, or wealth holders who
anticipate future access to larger pools of
1. Getting to know the millennials capital with family assets ranging from USD
• Age, Domicile, Memberships of Impact $1 million to over USD $1 billion (“Affluent
Millennial Respondents”). The other third of
Investing respondents are millennials who either chose
not to offer the amounts of assets under their
• Networks/Groups, Assets under management or are millennials who do not
anticipate access to a larger pool of assets
management, structure of these assets and are currently owners of assets below USD
$500,000.
2. Millennials interest in impact investing PERSONAL INTERVIEWS
• How they define themselves as impact Personal interviews were conducted with 10
millennial impact investors in North America
investors and Europe to provide voice to the themes
and issues uncovered in the survey and allow
• How much of their portfolio is invested individuals to share their personal journeys for
the benefit of other millennials, families and
for impact and how will this change advisors.
over time SECONDARY RESEARCH
3. Impact investing activities
• Level of engagement, sectors of
interest, allocation across asset
classes, and sourcing of impact
investments
4 Investors’ Circle is an early-stage impact investing network that promotes the transition to a sustainable economy 4
by increasing the flow of capital to enterprises that are addressing social and environmental challenges. (www.
investorscircle.net)
5 The ImPact provides families with knowledge and networks to make more impact investments more effectively.
(http://theimpact.org/)
6 Resource Generation organizes young people with wealth and class privilege in the U.S. to become transformative
leaders working towards the equitable distribution of wealth, land and power. (http://resourcegeneration.org/)
7 Nexus is a global movement to bridge communities of wealth and social entrepreneurship. They work to unite
young investors, social entrepreneurs and allies to catalyze new leadership and accelerate global solutions. (www.
nexusyouthsummit.org)
Millennials in Impact Investment Report 2016
As a complement to the primary research, RESEARCH SOURCE
this report includes research and analysis of Toniic survey (all respondents),
news, scholarly articles, reports and resources secondary research
that address the trends, interests, values and Toniic survey (Affluent Millennial
activities of millennial investors. Respondents)
STRUCTURE OF SECTIONS IV, V, VI AND Personal interviews, secondary research
VII OF THIS GUIDE Personal interviews, secondary research,
In Section IV “Key Findings”, the following Toniic survey (Affluent Millennial Respondents)
Personal interviews, secondary research
IV. KEY FINDINGS
1. Impact Investing Is Growing Personal interviews, secondary research
Amongst Millennials
2. How Millennials Invest in Impact ACKNOWLEDGEMENTS
3. How Impact Investing Aligns with The authors of this report are Alison Fort,
the Values of Millennials Managing Director of EMEA and Jessica
4. Family Dynamics Loman, Director of Operations & Impact from
Toniic Institute.
5. Education & Support Networks We are very grateful to all of the millennials
interviewed for this report, and those that
6. Millennials & Advisors completed the survey. We value the willingness
sources of research are used: of our interviewees to share their journeys in
In Section V, ten personal millennial journey order to support other millennials, families and
interviews provide an opportunity to better advisors in a quest for impact.
understand the role of family and education We are also grateful to Richard Muller, Lisa
in enabling impact investing. They also Kleissner and Jenna Nicholas for their input
provide insights into the expectations and on the final document and to our researchers
demands millennials are placing on the Teresa Seabra Pereira and Camilo Bonilla
financial services industry. Garcia for supporting Toniic in this work. •
Sections VI and VII contain a resource guide
and an impact investing glossary to support
the reader in navigating the references and
terminology contained in this research.
Millennials in Impact Investment Report 2016 5
IV. Key Findings
1. Impact Investing Is Growing and responsible investing.
Amongst Millennials
As impact investing makes its way towards
“Be bold. This is what it’s all about. mainstream knowledge, millennials show signs
We know we have the means, now it’s that they are the most willing generation to
about having the guts to actually do It.” invest in impact and take on the risks that may
– Antonis, millennial interviewee accompany these investments. According to
U.S. Trust Insights on Wealth and Worth17, it
i. Impact Investing is in Demand is millennials more than any other generation
Amongst Millennials who believe investment decisions are a way
to express social, political and environmental
Omidyar Network,8 Ford Foundation,9 the values. Most millennials would rather not
MacArthur Foundation10 and the Global invest in a company that is negatively
Social Impact Investment Steering Group11 impacting the world even if high financial
commissioned Monitor 36012 to conduct an returns are expected.
Analysis of Narratives on Impact Investing
in the US and UK. This report13 measured ii. Toniic’s Global Survey Respondents
the percentage of articles within a specific Investment Interests
narrative that mention a particular audience,
person, or issue-area during the period of 79% describe themselves as impact investors
October 2014 – October 2015 and found that
a key issue area in the narrative about impact Of the 58 millennials around the world who
investing was “Millennials Demand it!” participated in Toniic’s survey, 79% describe
themselves as impact investors. This group
A recent Proving Worth study14 by defines “impact investor” in a variety of ways:
Campden Wealth Management15 and
OppenheimerFunds16 also showed that a • 74% say that they seek both financial and
majority of UHNW millennials (64%) are
interested or very interested in impact social impact returns
investing, and 70% expressed interest in social
• 13% say they seek opportunities that
align with their values, regardless of
financial return
• 9% say they seek financial returns first
with some social benefit
8 Omidyar Network is a philanthropic investment firm. We create opportunity for people to improve their lives by
investing in market-based efforts that catalyze economic and social change. (www.omidyar.com)
9 Ford Foundation is a globally oriented private foundation with the mission to reduce poverty and injustice, strengthen
democratic values, promote international cooperation, and advance human achievement. (www.fordfoundation.org)
10 The John D. and Catherine T. MacArthur Foundation supports creative people, effective institutions, and influential
networks building a more just, verdant, and peaceful world. (www.macfound.org)
11 The Global Social Impact Investment Steering Group is the successor to the Social Impact Investment Taskforce,
established by G8. The GSG is continuing the work of the Taskforce in catalyzing a global social impact investment market
across a wider membership. (www.socialimpactinvestment.org)
12 Monitor 360 is the Narrative Analytics+Strategy Company that brings clarity to complex, cross disciplinary strategic
challenges through Narrative Analytics - a systematic approach to understand, quantify, shape, and monitor narratives.
(www.monitor-360.com)
13 Narrative Analytics on Impact Investing, Global Impact Investing Network, Monitor 360, Omydiar Network,
2016, February.
14 Proving Worth The Values of Affluent Millennials in North America, Campden Wealth Research, OppenheimerFunds,
2015. (https://www.oppenheimerfunds.com/private-banks/article/what-ultra-high-net-worth-millennials-value-most)
15 Campden Wealth is an independent family owned business providing unrivalled knowledge, intelligence and
connectivity for family businesses, family offices and significant private investors worldwide. (www.campdenwealth.com)
16 OppenheimerFunds is a global investment management firm dedicated to serving the needs of their clients, who range
from financial advisors and individual investors to corporations and endowments. (www.oppenheimerfunds.com)
17 Trust, Ian, U.S. Trust Insights on Wealth and Worth, U.S. Trust, 2014, Web. (http://www.ustrust.com/publish/ust/
capitalacumen/summer2014/features/wealth-worth-2014.html)
Millennials in Impact Investment Report 2016 6
The 21%, who do not describe themselves
as impact investors explained that they lack
knowledge about the field, have not yet
invested in impact or simply do not have the
interest at this time. Half of this group aspire to
be impact investors.
“Invest in what changes the world and
changes you at the same time. After all,
wealth is just another tool, if used properly,
to live a life of impact and meaning.”
– Jenna, millennial interviewee
What are the impact investing themes
or sectors that are of greatest interest
to millennials?
50%
40%
30%
20%
10%
0%
I DON’ITT,ODTTEHESECCRHRSI,NBFOCEALOSOMHMYIGIYMOHNU&NTFOINECI&UNRTSOICAEYFSSMNNAOECTDOOCEGNMNSRNAIEIOCSRUVVIMAEG&VOIMIEDCLEPANSRIRDFIIALAALLSSSUOLALOCCEOOJTGEESCUCHAURNPYECERIUHEINSTELAWSLIVSUENICEMMMTTIGTNAAITRTTOREEEIUDLTIMICEAHOTTROEECTGNSNNEENETSSSTTSYREHRNYSSRETE
Agriculture, Energy, and Environment are clear
top interests for millennials, with Employment,
Food Security, and Water not far behind.
A similar set of interests emerged in a 2015
survey of Toniic members. A key difference
is that Toniic Members’ top interests include
Education and Health, two sectors that are not
high priority for the millennials surveyed.
Millennials in Impact Investment Report 2016 7
50%
40%
30%
20%
10%
0%
I DON’ITT,ODTTEHESECCRHRSI,NBFOCEALOSOMHMYIGIYMOHNU&NTFOINECI&UNRTSOICAEYFSSMNNAOECTDOOCEGNMNSRNAIEIOCSRUVVIMAEG&VOIMIEDCLEPANSRIRDFIIALAALLSSSUOLALOCCEOOJTGEESCUCHAURNPYECERIUHEINSTELAWSLIVSUENICEMMMTTIGTNAAITRTTOREEEIUDLTIMICEAHOTTROEECTGNSNNEENETSSTSTSYREHRNYSSRETE
• •MILLENNIALS TONIIC MEMBERS
iii. Likelihood That Millennials Have or Do you believe you will gain access access
Will Have Assets To Deploy to a larger pool of assets in the future?
67% of the millennials surveyed are either No
current investors with personal assets under
management ranging from USD $500,000 to Yes
USD $99 million, or future wealth holders who
anticipate access to larger pools of capital with When do you anticipate access to these assets?
family assets ranging from USD $1 million to 30
over USD $1 billion. 20
10
78% of millennials surveyed believe they will
receive access to a larger pool of assets in 0
the future. 27% of these millennials anticipate
access to these assets within the next 5 years, 0–5 YEARS
while 24% estimate access to a larger pool of 5–9 YEARS
assets in 20+ years. 10–20 YEARS
20+ YEARS
While the transfer of wealth is anticipated, it UNKNOWN
is important to note that there may be some
unforeseen challenges for millennials.
Eric, one of the millennials whose journey we
profile in Section V, speaks to his experience in
inheriting wealth from his father:
Millennials in Impact Investment Report 2016 8
“He put together a list of three [wealth] While conferences on impact that cater to
management companies that he was millennials are seeing an uptick in participation,
comfortable with managing the total so are innovative online brokerage solutions.
inheritance. His value systems were The do-it-yourself ethos of some millennials
baked into those advisors and the Trust. combined with their preference for online
So when you get this money, whose services have resulted in more millennials signing
money really is it?” up for web-based wealth management solutions.
While it is clear that conferences and online
This topic is also explored further in the Family advisories are a part of the millennial impact
Dynamics and Advisor sections of this report. journey, our survey looked a little deeper at
Observations how our respondents are moving into impact.
Millennials surveyed and interviewed in this Our survey focused on the following questions:
report demonstrate a strong desire to align
their assets with impact. They also recognize • What is the structure of assets
that there are timing, know-how and legacy you manage?
constraints. Given the gap in knowledge and • How much of your portfolio have you
work needed on values alignment to engage allocated to impact? How much of your
families and advisors, there is an opportunity portfolio do you intend to allocate to
to address these hurdles in the next 5-10 impact in the next 5 years?
years while millennials begin to assume more • In which impact categories do you invest?
responsibility in managing their assets. • In which asset classes have you made
impact or values-based investments?
2. How Millennials Invest in • How do you describe your level of access
Impact to various asset classes?
• How have you accessed impact
For the past five years, the Nexus Global investments?
Summit18 has hosted hundreds of millennials • What challenges do you face in moving
and focused, in part, on the topic of impact your assets into impact?
investing. In 2014, more than 600 largely Following is what we learned.
millennial participants representing nearly $750 i. Structure of Personal Assets
billion in assets spent three days “exploring and What is the Structure of Assets You Manage?
sharing case studies of social investments.”19 Two-thirds of millennials hold their assets as
The Harvard Business Review write up on the Individuals. Various other structured accounts
Summit shared the following observation. are used for the remaining one-third of
“Some of the investments had the respondents.
The majority of these millennials are active in
sophisticated deal structures of large managing their assets monthly if not weekly,
corporate transactions, some showed and in the Family Dynamics portion of this
private sector engagement driving report we share more about the connection to
infrastructure development and quality-
of-life improvement, and all demonstrated
growing connections between policy and
profit at national and international levels.”20
18 Nexus has hosted over 20 summits across five continents in the past five years to build bridges between millennial
wealth holders, social entrepreneurs, and impact investors. (www.nexusyouthsummit.org)
19 Nexus Global Youth Summit – Millennials Transform Philanthropy, Reuters, 2014, August, Web. (http://www.reuters.
com/article/ny-nexus-idUSnBw125653a+100+BSW20140812)
20 Dhar, Vilas; Fetherston, Julia. Impact Investing Needs Millennials, Harvard Business Review, 2014 ,October, Web.
(https://hbr.org/2014/10/impact-investing-needs-millennials/)
Millennials in Impact Investment Report 2016 9
Other (Part of)
5% Single
Family
Trust Office
10% 13%
Foundation
8%
Individual
64%
and engagement with family held assets.
Definitions of each of these structures of management
can be found in the glossary, section VII
ii. Allocation of Assets to Impact
How much of your portfolio have you allocated
to impact? How much of your portfolio do you
intend to allocate to impact in the next 5 years?
While the current allocation to impact in most
millennial portfolios is less than 50%, 72% intend
to move more assets into impact within the next
5 years. 10% of the millennials surveyed have
already moved 90-100% of their personal assets
and/or their family’s assets to impact.
40%
30%
20%
10%
0%
• •CURRENT ALLOCATION ALLOCATION IN FIVE YEARS
Millennials in Impact Investment Report 2016 10
0%
1–10%
11–20%
21–30%
31–40%
41–50%
51–60%
61–70%
71–80%
81–90%
UN9K1N–1O00W%N
iii. Millennials Are Investing Across investments. Within each category, levels of
the Impact Investing Spectrum risk and financial return expectations can be
considered. Impact categories have been
In which impact categories do you invest? published by various groups including the G8
Social Impact Investment Task Force,21 World
Various organizations have created Economic Forum,22 GIIN,23 Bridges Ventures24
impact categories to help investors define and Sonen Capital.25 Following is an example
and in many cases allocate their impact from Sonen Capital.26
Sonen Capital’s Impact Investing Spectrum
CLASSIC RESPONSIBLE SUSTAINABLE THEMATIC IMPACT PHILANTHROPY
INVESTING FIRST
Competitive Returns
ESG* Risk Management
ESG Opportunities
Maximum-Impact Solutions
Emphasis Consideration Targeting Focus on issue Emphasis Where social
on profit of ESG risk investments areas where on the and, or
maximization and, or social or
without personal best optimization environmental
regard for values across positioned environmental of social or needs
ESG factors a range of to benefit needs offer environmental
factors to from the commercial outweigh any
screen out integration of growth needs consideration
investments ESG factors opportunities (e.g. PR!**), for financial
and broad- for market- which may
based macro rate return return
result in
trends financial
trade-off
Adapted from Bridges Ventures and Clara Barby, June 2012
* ESG-Environmental, Social and Governance factors
** PRI - Program Related Investments available to US Foundations as defined by the Tax Reform Act of 1996
21 G8 Social Impact Investment Task Force, Web. (http://www.socialimpactinvestment.org/)
22 From the Margins to the Mainstream, World Economic Forum Investors Industries, 2013, September, Web. (http://
www3.weforum.org/docs/WEF_II_FromMarginsMainstream_Report _2013.pdf)
23 What You Need to Know About Impact Investing, Global Impact Investing Network, Web. (https://thegiin.org/impact-
investing/need-to-know/#s1)
24 Bridges IMPACT Report, Bridges Ventures, 2013, Web. (http://bridgesventures.com/wp-content/uploads/2015/03/
IMPACT_REPORT_2013-spreads1.pdf)
25 Sonen Capital is a dedicated impact investment management firm. (www.sonencapital.com)
26 Sonen Capital’s Impact Investing Spectrum, Sonen Capital, 2013.
Millennials in Impact Investment Report 2016 11
These impact categories can be further CAS PHPRI&UFVIHBEEAXLRIQTEDEECUDAIGIEELVENAQQAFLCSUUUIIESOTTNIIENMDEETTSSESSSequities, the most cited asset class. Many
described as follows: OTHERinterviewees report that their first move into
impact has been through direct investments
• Impact First: Emphasis on the optimization in private equities. 46% of respondents have
of social or environmental needs (e.g., impact investments in public equities, while
Program-Related Investment), which may 44% have investments in Fixed Income.
result in financial trade off
• Thematic: Focus on issue areas where 60
social or environmental needs offer 40
commercial growth opportunities for 20
market rate return
• Sustainable: Targeting investments 0
best positioned to benefit from the
integration of ESG factors and broad-based The relatively high percentage of respondents
macro trends who cite public equities as part of their impact
• Responsible: Also known as Socially investment mix is notable in that it contrasts
Responsible Investing (“SRI”) or with remarks from both survey respondents
negative screening and interviewees on the lack of interest or
• Non-Impact: Emphasis on profit product in this asset class.
maximization without explicit and Less than 40% of respondents are satisfied with
intentional regard for social and/or their level of access to any single asset class.
environmental factors Millennials overwhelmingly want more access
Using these categories as a guide in the survey, to impact investments in all asset classes. Along
more than half of the respondents indicated with this need for access is a need for education
they are investing in “Sustainable”, with fewer and awareness, as evidenced by the fact that
investing in “Impact First” or “Non-Impact.” 20-35% of investor respondents selected “I
don’t know” in regards to their level of access
60 to various asset classes.
40
20 60
0
IMPACT FIRST
THEMATIC
SUSTAINABLE
RESPONSIBLE
NON-IMPACT
iv. Millennial Impact Investments by 40
Asset Class 20
In which asset classes have you made 0
impact or values-based investments?
SATISFIED WITH ACCESS
The millennials surveyed have invested in
impact and/or value-based investments • SEEKING GREATER ACCESS
across asset classes. More than half (54%) •• I DON’T KNOW
of respondents have invested in private
Millennials in Impact Investment Report 2016 12
CAS PHPRI&UFVIHBEEAXLRIQTEDEECUDAIGIEELVENAQQAFLCSUUUIIESOTTNIIENMDEETTSSESSS
v. Support assets into impact?
Methods Used to Gain Access to “Not enough knowledge,” “push back from
Impact Investments financial advisors,” and “push back from family”
are the three top challenges cited – a finding
60 supported by other research with millennials.
40
20 • Other challenges mentioned by survey
0 respondents include:
INVESTO IRNOVENWLSIETANFOLEOTRPUHLNNEAATDTDFAVWITOISOROROMKNR • Analysis paralysis
OTHER • · International regulations
EVENTS • · Lack of availability of retail products
• meeting appropriate return
FRIENDS
FAMILY benchmarks
Observations
How have you accessed impact investments? Of the millennials surveyed and interviewed,
some have 5+ years of experience in some
The importance of the role of friends and form of values-based investing. Some are
investor networks in helping millennials to moving into impact with rigor across asset
find impact investments is shown clearly in classes. However, the majority are very early
the results of the survey and the in-depth in their journey to impact with great ambitions
interviews. Groups like pymwymic , Toniic for their personal and families’ portfolios. We
and Ashoka are named as important support believe there is a role for impact intermediaries
networks for sourcing investments. Family and to help define an impact strategy as a pathway
advisors rank third and fourth, respectively. for millennials. There is also an opportunity for
vi. Challenges That Remain experienced millennials to be the “influencers”
What challenges do you face in moving your providing the needed case studies that will
60 instill confidence in this new generation of
40 investors. While there are still many challenges
20 ahead, they are by no means insurmountable
and in fact shine light on the growth
0 opportunities available globally in impact
finance, education and innovation.
“The key is just starting somewhere. It
does not have to be big, but you learn so
much along the way - and remember that
no question is too dumb.”
– Jenna, millennial interviewee
I’M NOIPTUDASOCHTNI’BVTAECCLYKURFNMRROEOPOTBVNIUMAETSNLLFNHIYGAONBFNAUAAASCGCCNSEKEEHICITFNKCASRLPHNTOAOOAOLMRDILWTFVLEIMFAESNPODAMOGLIICGERLEOSSTY 3. How Impact Investing Aligns
OTHER with the Values of Millennials
Geopolitical and environmental challenges
have played a part in the desire of millennials
27 Pymwymic is the ‘Put Your Money Where Your Meaning Is Community’ of European families,
philanthropists, and individual investors who believe in capital for good. www.pymwymic.com
28 https://www.ashoka.org
29 Norcott, Lindsay, Emerson, Jed, The Millennial Perspective: Understanding Preferences
of the New Assets Owners, Impact Assets, 2013. (http://www.impactassets.org/files/
ImpactAssets_Issue_Brief_13_Millennial_Perspective.pdf).
Millennials in Impact Investment Report 2016 13
to reflect their values in all areas of their and working in creative jobs.”31 This quest
lives. The Millennial Perspective report29 for balance and alignment is commented
by ImpactAssets30 uncovers the economic, on broadly in research on millennials. “If the
political and environmental factors that have financial markets are going to be volatile, the
influenced the values of millennials. Economic most secure thing you can do is find a life and
uncertainties, democratic uprisings, terrorist work that you love,” says Megan Hellerer, 31, a
attacks, global warming and the impact of personal and executive coach in New York City
technology are informing a new worldview for and a former Google executive.32
the millennial generation.
These priorities influence what millennials
As a result, most millennials who entered the perceive as the primary roles of business: to
labor market during the last two decades improve society, to make profit, and to drive
have views on society that differ significantly innovation.33
from previous generations. Millennials
value democratic leadership, relationships, According to a Morgan Stanley study,34
transparency, empowerment, disruptive millennials are three times more likely to seek
innovation, and business for good. And they employment with a company based on its
question the status quo – from how they earn stance on social and/or environmental issues
a living, to how to give back, to what food they (14% of millennial investors, compared to 5% of
want to put on the table. the total individual investor population).
“As the millennial generation reach their Organizations in the UK, like Finance Matters,35
prime working and spending years, their working to put sustainability at the heart of
impact on philanthropy is enormous. Their finance, and Escape the City,36 a platform
approach and perspective is, mostly, unique to connect job seekers with purposeful
to their experience of coming of age in a career opportunities, are responding to the
time of technological innovation, growing demand from millennials to find value
globalization and economic disruption.” alignment in their financial careers.
– Julie Shafer, Head of Strategic
Philanthropy & Purpose Investing, So how are the millennials engaged in impact
Bank of the West investing connecting their career choices with
their investments?
i. Careers
Millennial impact investors in this study are
Millennials are very concerned about an pursuing careers in the following areas:
eroding quality of life. As a result, their
priorities include “staying close to family • Social Entrepreneurship
and friends, having free time for recreation, • Working with the family foundation
• Investment management in a social
30 ImpactAssets enables philanthropist and individual investors to engage in impact investing by providing: impact
investment products, including a donor advised fund and impact investing notes and educational resources to support
individuals and advisors looking to engage in impact investing and to help build the field of impact investing. www.
impactassets.org
31 15 ECONOMIC FACTS ABOUT MILLENNIALS, The Council of Economic Advisors, October 2014.
32 Cole, Lauren Lyons, Millennials And The Wealth Gap: What To Do When Your Friends Are Richer Than You, International
Business Times, 2015, October, Web. (http://www.ibtimes.com/Millennials-wealth-gap-what-do-when-your-friends-are-
richer-you-2152434)
33 (http://www.ibtimes.com/Millennials-wealth-gap-what-do-when-your-friends-are-richer-you-2152434)
34 Sustainable Signals: The Individual Investor Perspective, Morgan Stanley Institute for Sustainable Investing, 2015,
February. (https://www.morganstanley.com/sustainableinvesting/pdf/Sustainable_Signals.pdf)
35 Finance Matters is a London-based social enterprise working to put sustainability at the heart of finance. (http://
financematters.co/)
36 Escape the City offers young unfulfilled professionals an unconventional and meaningful career path. (www.
escapethecity.org)
Millennials in Impact Investment Report 2016 14
investment fund Bank of the West
The “Proving Worth” study37 found that
• Managing their own social investments 96% of millennials surveyed report they are
• Sustainability consulting involved in philanthropy, in part, the study
• Social Finance advisory and structuring suggested, because of their families’ existing
charitable activities.
The responses above demonstrate a Traditionally philanthropy has drawn a
connection between the work of millennials distinction between making money and using
and their impact investing, either directly as capital for philanthropy. Research shows that
managers of their own assets or indirectly m illennials are revisiting this practice.
through knowledge and insight gained working
in the sector. “Think back to the great philanthropists of
In recounting their journeys many reference years past who thought of making money
starting in careers that were neither linked to in the first half of their lives and giving
their values nor their impact investments and it away in the second half,” says Justin
how they have made a shift into something Rockefeller, a trustee and member of the
more aligned. Jenna, who is President of the investment committee at the $739 million
Social Innovation Club at Stanford Business Rockefeller Brothers Fund, great-great
School, observes, “More and more students grandson of John Rockefeller, and, at 33,
who are graduating from top business school himself a millennial. “Today, that view is still
are not looking to merely make money in their pretty pervasive, that there’s capitalism and
careers but are also looking at the social and making money on one side, and
environmental impact they can have.” philanthropy on the other. I think the
As millennials put their human and intellectual younger generation is seeing that as a false
capital to work in impact investing, it will have dichotomy, or at least something that will
implications on the growth and development increasingly become a false dichotomy.”38
of the sector. Although not a conclusive iii. What Does This Mean for Philanthropy?
finding, we believe that this is an interesting What Are We Seeing From Our Research?
trend to observe and one we feel deserves
further research. The “Proving Worth” study concludes that
i i. Philanthropy & Impact Investment millennials want to do good and that they use
both philanthropy and impact investing as
“I find millennials driven by a different set c onduits to achieve their impact goals.
of values. They recognize that doing well
and doing good are not exclusive “When it comes to evaluating their
endeavors and although the word philanthropy and impact investing, they
“strategic” is overused, millennials are have an acute focus on measurement,
searching for the best combinations of accountability, sustainability and long-term
traditional philanthropy and new ways returns. They are less concerned about
to achieve impact.” feel-good factors. They are focused on
– Julie Shafer, Head of Strategic basic human rights and conditions:
Philanthropy & Purpose Investing,
37 Proving Worth The Values of Affluent Millennials in North America, Campden Wealth Research, OppenheimerFunds,
2015. (https://www.oppenheimerfunds.com/private-banks/article/what-ultra-high-net-worth-millennials-value-most)
38 Katie Gilbert, Millennials Keen on Impact Investing, Institutional Investor, 2012, September, Web. (http://www.
institutionalinvestor.com/Article/3084842/Millennials-Keen-on-Impact-Investing.html#/.VtDUlpMrJuU)
39 Proving Worth The Values of Affluent Millennials in North America, page 4, Campden Wealth Research,
OppenheimerFunds, 2015. (https://www.oppenheimerfunds.com/private-banks/article/what-ultra-high-net-worth-
millennials-value-most)
Millennials in Impact Investment Report 2016 15
education, water, the environment, this is how to look after the money.”
gender equality and financial matters.”39 – Seth, millennial interviewee
We found that philanthropy remains an “Impact investing has brought us closer
important activity for millennials. Impact as a family because we have more honest
investing, rather than replacing philanthropy, conversations about our values.”
supplements their approach to living an – Steph, millennial interviewee
impactful life. The millennials we interviewed
are engaged both in the practice of impact In the interviews conducted for this report,
investing and philanthropy and in some cases the connections within a family have been the
have put structures in place to connect the top influencer driving the success, frustrations,
two to maximize both positive social and learnings and development of millennials
environmental impact. in their impact journeys. Whether it be
negotiations around investment decisions,
In addition, we have also found that learning from a father, working closely with a
philanthropy is often the first step to a future sister or considering the next generation in
engagement in impact investment. Connecting decision making, it is clear that the topic of
family members through the exploration of family dynamics is one that deserves to be
collective values provides an easy segue into highlighted in this report.
t he impact investing conversation. The team leading the Harvard Kennedy
School program for millennials concurred
“I first learned of the impact investing space w ith this view:
as a way to complement our grant making
work and tackle a different space on the “We knew that the dynamics of family
spectrum of what’s possible in terms of decision making needed to be a core part
impact in the social sector.” of the course but we were surprised that
– Sapphira, millennial interviewee developing skills to support family buy-in
was, for many of our participants, even more
Observations important than we anticipated.”
– James Gifford, Senior Fellow,
The millennials surveyed are integrating Initiative for Responsible Investment
impact considerations into their education, at the Center for Public Leadership,
career choices, investments and philanthropy. Harvard Kennedy School
This is spurring a rethink that is challenging How are Millennials engaging their families?
the status-quo belief systems of previous A study40 conducted by OppenheimerFunds
generations and putting into question quality- and Campden Wealth reports that 59% of the
of life-choices. Although the path to impact is 32 millennials surveyed sit on a committee
uncertain, these millennials seem to be finding or board that manages their family’s wealth,
ways to close their alignment gaps. but only 18 percent make strategic wealth
management decisions. Among those involved
4. Impact Influencers: Family, in their family decision-making, most of their
Education, Advisors strategic decisions are related to impact
investing (31%) or philanthropy (29%).
4.1 Education, Advisors In the Toniic survey, 65% of respondents
indicate that their families have an interest in
“If I just complain, they’ll only defend
themselves by saying “this is what we do,
40 Proving Worth The Values of Affluent Millennials in North America, Campden Wealth Research, OppenheimerFunds,
2015. (https://www.oppenheimerfunds.com/private-banks/article/what-ultra-high-net-worth-millennials-value-most)
Millennials in Impact Investment Report 2016 16
impact investing. However, while respondents Management Frequency
are busy managing their own assets and of Family Assets
moving them into impact, their engagement
with family assets is less frequent.
Several of the millennial impact investors in our
interviews feel strongly that it is part of their
mission to educate, inspire and influence other
mimepmacbteirnMsvoeafsnttmhaeegirnetfsam.meilynttoFcroenqsuideenr mcyaking
of Personal Assets
Annually 3% Daily Daily
Semi- 15% 8%
Annually Never Weekly
15% 31% 10%
Annually
Monthly Weekly 13% Monthly
26% 41% 18%
Semi-
Annually
20%
Observations
We provide the following observations regarding
working with families on impact investing.
1. Action & Ownership
Finding specific, thematically aligned
impact investments to consider together
as a family can make the process more real
and collaborative. Leading by example shows
others that it can be done. Reporting back
over the life cycle of the investment is a way
to connect others to the impact journey.
Millennials in Impact Investment Report 2016 17
“The way to do it is just to bring deals, Overcoming challenges – the role of
don’t let them say we haven’t seen education in impact investing
anything…bring them deals that tell the The importance of education is evident in our
story of what’s happening in the world.” survey. Lack of knowledge is the number one
– Seth, age 29 hurdle holding millennials back from making
2. Family Values Statement impact investments. 51% of those surveyed
Working together on a family Statement of ranked this as their top challenge.
Values can connect families across Ironically, more millennials today have a college
generations and inform all investment degree than any other generation.41 Millennials
decisions, whether they are impact or began entering the job market around the
non-impact. financial crisis of 2008, leaving less room
3. Advisors and Supporters for them as younger workers. As has been
External voices may give credibility and the case during other periods of recession,
additional evidence to support millennials these millennials decided to pursue a second
in discussions with family. degree or stay in school longer. However, the
4. Patience, Persistence and Evidence additional education did not typically give them
Change has been slow in coming to the the tools they need to manage their wealth.
financial industry. Many families, by It is then no surprise that both formal
necessity, rely on outside advisors to help education and informal or vocational education
them steward their wealth. Influencing feature in many of the journeys profiled in
change in an entrenched multi-stakeholder Section V. Interviewees shared how their use
structure requires patience, persistence and of internships, careers, philanthropic activities
evidence. Given the dynamic nature of the and on-the-job education enabled them to
impact industry, sharing updates and links to learn more about the field of investing and
key research papers with family members and management of assets.
advisors is one way to keep them informed “I wish we had had something like this in
and hopefully, eventually interest them in
impact. Another way is to become more high school,” says interviewee Sapphira, in
active in the family investment activities, reference to a recent impact investing
whether they align with impact or not. course, “just basic financial literacy.”
Sharing impact options with the family and Academic institutions are beginning to respond
advisors can spark conversations that may to this need. In 2015, the first impact investing
lead to a shift in perspective and valuable course focused on high net worth millennials
lessons about investing. was launched at Harvard. Developed by
the Initiative for Responsible Investment at
4.2 Education and the Harvard Kennedy School, the course
Support Networks developers have seen significant demand from
next-geners, their families and their advisors
“Since I never had a grounding in business for future programs. A second course will be
education and finance, I’m going back rolled out in 2016.
to school for a part-time two-year MBA A number of other impact investment courses
program. It’s part-time because I don’t have been developed – from MBAs with an
want to drop everything I’m doing, I love impact investment focus, to short courses
what I’m doing.” (weeks), executive education, and 1 to 3-day
– Seth, millennial interviewee
41 15 Economic Facts About Millennials, The Council of Economic Advisors, 2014, October.
Millennials in Impact Investment Report 2016 18
courses, plus any number of online courses. Observations
Toniic is also working with partners to deliver A key finding coming from our research is the
courses on impact investing, under its need for impact investor education. We also
ImpactU42 umbrella. More information about heard a desire from millennials to engage with
impact investing courses can be found in their peers and to look to friends to help them
Section VII Resources. source impact investments. We believe that a
combination of peer-to-peer learning, hands-
Overcoming Challenges: Peers and on experience, informal and formal education
Support Networks courses tailored to the needs of millennials
could add significant value to millennials on
The millennial generation is more connected their impact investing journey.
than any other generation. Their use of
technology enables quick access to and 4.3 Millennials and Advisors
transfer of information and a high degree
of transparency. Not surprisingly, friends “We’ve found that while advisors have
and investor networks rank first and done a solid job in serving the present
second respectively as the primary sources wealth holders, they’re largely unprepared
for millennial investors to source impact for the day when millennials or widows
investment opportunities. begin calling the shots for the family
investment portfolio.”47
Survey respondents are also members of – Seth, millennial interviewee
a variety of networks in addition to Toniic,
including Nexus,43 Clearly Social Angels,44 Gaining Trust
Investors’ Circle45 and Pymwymic.46 We Industry research has shown that millennials
provide a table with more details on these have a collective distrust of the financial
networks in Section VIII Resources. sector48 and are less inclined to use a financial
advisor than any other generation; only 47%
Millennial interviews also underscored the of multimillionaire millennials in the US use a
importance of community of practice networks: financial advisor49 according to a survey by
U.S. Trust.
“Toniic has played a huge role in creating a Coupled with evidence50 that a majority of
support network, inspiring me, and millennials will fire their parent’s advisors after
connecting me with people who are on the receiving their inheritance, the challenge facing
same journey. The support, relationships,
and mentorship has been extremely helpful.”
– Talia, millennial interviewee
42 ImpactU is a local and global impact investor-led educational program incubated at Santa Clara University. Designed
as a dynamic framework, course material is delivered in a tiered learning format: A 3-day The Essential Impact Investor
Practicum and a 1 to 3-day Impact Professional Essential Series. (http://www.toniic.com/about/impactu-impact-investor-
education/)
43 Ibid., 8
44 Ibid., 8
45 Ibid., 8
46 Ibid., 20
47 Dane, Ned, Advisors – How to Not Get Fired by Next Gen Clients, OppenheimerFunds, 2016, February, Web. (https://
www.oppenheimerfunds.com/private-banks/article/advisors-how-to-not-get-fired-by-next-gen-clients)
48 Cutler, Neal E., Millennials and Finance: The Amazon Generation, 2015, October.
49 Hunnicutt, Trevor, Wealthy Millennials Decline Financial Advisors’ Services: Survey, 2015, Investment News, May, Web.
(http://www.investmentnews.com/article/20150528/FREE/150529935/wealthy-Millennials-decline-financial-advisors-
services-survey)
50 Skinner, Liz, The Great Wealth Transfer is Coming, Putting Advisors At Risk, 2015, July, Web. (http://www.
investmentnews.com/article/20150713/FEATURE/150719999/the-great-wealth-transfer-is-coming-putting-advisors-at-risk)
Millennials in Impact Investment Report 2016 19
and educated in the Netherlands and the studied in The Hague and then went to
USA. Both are developing their careers in the Brown University to study International
impact investment ecosystem and have been Development. Initially, Josephine felt that
instrumental in inspiring members of their her path was best suited for development
family to consider investing for impact. finance, but an internship at a small rural
Alexandra is the eldest sister, who since a NGO in India brought to light how the
young age has been strongly engaged with efficiency of market forces was not being
the family through various roles in the family applied to help solve social issues in a
business’ governance. Alexandra studied systematic way. Josephine also spent
first in the Netherlands and then attended time exploring the traditional financial
Cornell University in the US. It was at Cornell sector through an internship at an asset
where she first became aware of social management firm,
entrepreneurship as part of an extra-curricular
Social Business Consulting Group. At the “There were some very talented people but
same time she explored a career on Wall the only motivation was purely financial.”
Street through an internship. However, she
immediately felt the disconnect between her Attending the pymwymic56 Family Day and
role in her Wall Street job, and her values and SOCAP57 in Amsterdam in 2011 were defining
her interest in supporting social enterprises. moments that brought the two sisters
Her next internship allowed her interest together with an aligned excitement for
in social enterprises and finance to come impact investment. Being on their home-turf,
together; she spent time at Goodwell it was the first time that the sisters started
Investments, a fund manager based in the realizing the power of bringing the learnings
Netherlands investing in Sub-Saharan Africa of impact investing to their family wealth. They
and India - regions that her family had returned to their family with more data and a
participated in already. There she gained thirst to educate themselves and their family
first-hand experience of impact investing on impact investment.
and knew that this was the right place for
her to be investing her human capital. Post- Family and Peer Dynamics
graduation, she moved to India where she
worked for the strategic venture-philanthropy What role has your family had in shaping
organization Dasra as part of the research you as an impact investor?
and portfolio team. How have your peers influenced you? How
Josephine, the younger of the two, had at have you influenced them?
times been seen as the “rebel” in the family,
asking the difficult questions at the family Throughout their childhood, the family had
shareholder meetings. She was frustrated given Alexandra and Josephine exposure
with the passivity of her generation and kept to both the family business and the idea of
pushing boundaries. collective decision-making. Their parents had
“I was never comfortable with accepting always challenged the girls to be independent
thinkers and entrepreneurial in spirit; dinner-
the status quo when it came to the family’s table conversations were educational and
business activities.” diverse. The family also travelled extensively,
Similar to Alexandra, Josephine first giving the girls exposure to developing
countries and the harsh realities of inequality.
At the tender ages of 12 and 9 the parents
gave the girls, along with their younger
brother, ownership of a small foundation – both
56 Ibid., 20
57 Ibid., 3
Millennials in Impact Investment Report 2016 23
The young, studious sisters. to the practice, however, served to build their
sisters and parents talk warmly of the complete credibility within the larger family. Also, while
‘failure’ of this exercise. different in personalities and position in the
“We spent most of the time deciding who family unit, having the two sisters connected
with the same voice around impact investing
would take minutes and what the foundation increased the volume of their message.
would be called…followed by much guilt Starting with the initial pymwymic Family
about our lack of action.” Day, both women became active members
Nothing much was achieved but the of the Netherlands-based impact investing
initiative nevertheless helped ground the network that works closely with families.
girls in the process of aligning their decision Through Margaret McGovern, co-founder,
making for impact. they found a supporter that both understood
Josephine and Alexandra are part of a family impact investment and could help them
group of 13 shareholders, which includes navigate the family, while simultaneously
their father, his two brothers and the next empowering them to have an active voice in
generation of 10 cousins. For more than five the impact community.
years Josephine and Alexandra brought the Josephine and Alexandra were also
topic of impact investing to the shareholders keen to join Toniic to access its deal flow
meeting. At first, there was little traction; database, but weren’t sure if they were
“We would present the theory of impact ready to commit to making multiple impact
investing and some examples of what we investments a year. Their mother made
were seeing but there was no engagement.” the plunge and joined as a family to get
Their tenacity and unwavering commitment them started. They quickly became active
members of the network, working with
Millennials in Impact Investment Report 2016 24
the deal flow analysts to source impact the sisters to invest, they presented the
investment opportunities and connecting opportunity also to their cousins and uncles.
with the community for their own growth. The CIO and their father, the key investment
decision makers in their family office, had given
The First Impact Investment – A Turning Point it their ‘stamp of approval’ and to the surprise
and joy of the girls, the family members shared
Tell us about your first investment and their excitement and co-invested.
describe the decision-making process.
Who was involved in the decision? The conversations with their family had turned
from being theoretical to actionable and
After three years of speaking with the family inclusive, with positive results.
about impact investing, the real turning point,
in the mind of the ladies, came when they were Continuing the Impact Investing Journey and
given permission to influence a portion of their Getting to 100%
assets and make their own investments.
What’s next for you?
“This provided us with the capital and also What excites you about the journey ahead?
the freedom to invest – finally able to take
the leap to ‘put our money where our Josephine and Alexandra have continued to
mouth is’.” build their impact investment portfolio and
have been investigating further potential
They worked together on an investment direct deals and funds. They have made some
strategy that considered their respective investments together and some separately.
and collective investment priorities and They continue to present to the family, who
impact values. They researched many deals have joined them on some deals.
and worked together with the family CIO
and their father, CEO of the family office, to Their latest success was a co-investment
assess the different opportunities. They’ve opportunity by the family office in a
never worked with external advisors, instead sustainable aquaculture enterprise, following
drawing upon the existing family resources to an investment into an aquaculture fund.
pursue impact investments.
In 2015, they took the decision to join the
Towards the end of 2014 they were ready to 100% IMPACT Network of Toniic and commit
make their first investment. They had sourced to taking a portfolio approach to impact by
the deal, completed their due diligence, moving 100% of their assets into impact.
negotiated terms and were confident that they
wanted to move ahead. The family had heard “We have a long way to go, but are excited
of the social enterprise at previous shareholder about the journey together.” •
meetings, so when the decision came for
Millennials in Impact Investment Report 2016 25
2. Putting the Planet First
Seth
Age: 29
Domicile: UK
First impact investment: Berti Investments – an impact
investment vehicle focused on sustainable investments in
the UK designed and seed funded by Seth in 2011.
Personal Development, Active Engagement, People and Planet — Getting to Know Seth
Seth’s story is one of active learning and a
hands-on approach to investment. Once he
recognized the disconnect between his wealth
and his values, there was no going back and
making the change has become his way of life.
Seth was born and raised in London, but has
been influenced by socially minded parents
throughout his upbringing. Dad grew up in
South Africa, mom in the US South. His parents
were familiar with apartheid systems from their
upbringing and that had an effect on them,
something they shared with their children.
Millennials in Impact Investment Report 2016 26
At University Seth worked on a sustainable passion for the environment and social
farm and engaged in a 15-week permaculture change. Seth had no understanding of finance
course. This connection between people and and investments and he was intrigued to
planet was to become the focus of his investing learn more and to understand how the family
and his life – initially explored through the trusts were operating.
medium of film.
Buying a van, powering a projector with solar Initial Steps Along the Road
and screening short films around the south
of England, Seth financed his own mobile How did you start your impact
cinema. The concept was to bring creative, investing journey?
inspiring short films or documentaries to a Who else was involved?
diverse audience. How did your involvement change
“Homeless people, families, young people over time?
on bikes, all came together for screening, In 2011, Seth went to his first Family Trust
some nights there were 300 people there.” investment meeting.
Seth’s family had invested in independent
cinema and impact-focused storytelling and “I was horrified at what we had shares in; I
documentaries. This provided Seth with a knew that films were fighting against some
connection to their investment activities. of the companies we had shares in. Before
From there the family’s financial advisor that, I’d never gone to meetings on the
engaged Seth in investment through his investment side of things. I’d always only
thought of making change through film.”
Seth’s farm.
Millennials in Impact Investment Report 2016 27
Up to that point, Seth’s father had gently tried and his own personal development, Seth
to engage his son in the investment process continued to have the ambition to influence
and decision-making but had decided to wait the trustees to adjust their investment
until he was ready. He felt strongly that the practices. Once he recognized that he was
desire to participate had to come 100% from the beneficiary of investments he didn’t agree
Seth himself. with, he knew changes needed to be made.
His plan was to come up with concrete
With the Family Trust meeting as the examples and operational plans for how to
catalyst, and with the support of the family create change. It was a few years before he
advisor, Seth set off down the road of active brought anything to the trustees.
learning. He asked the family foundation for “If I just complain, they’ll only defend
an initial investment of £5m and set up Berti
Investments (Berti) as a social investment themselves by saying “this is what we do,
company focused on environmental this is how to look after the money.”
sustainability in the UK. He researched the When he took the first deal to the trustees,
marketplace, went to many conferences, spoke Seth admits that he didn’t know much,
to active investment funds and built a support but wanted to start the process. It was
network of like-minded people around him. an investment into a sustainable asset
management company (Wheb). The Board
“Be open about what you’re doing to was supportive and viewed it as a strategic
surround yourself by others operating in investment for Seth’s continued education
the same space that you can learn from.” in environmental markets – in effect “paying
school fees in the investment space”.
The investments made through Berti served Seth continues to take investment
as a vocational investing education for Seth. opportunities to the trust and together they
Initially the family advisor was the one doing have made a number of investments creating
all of the talking but eventually Seth got more positive environmental impact. One investment
involved and spent 3 days a week working on that Seth is very engaged in is Beltown Power,
the investment business. Seth believes that a renewable energy investment manager in the
hands-on experience is the best teacher. He sat UK. Over a number of years, Seth developed
in on company meetings for all the underlying a relationship with the founder Michael
assets that Berti invested in. He looked Kaplan, and together, with the family trust, has
through business plans, learned how to read supported Michael in building this business.
a balance sheet and determine a valuation. Seth is optimistic that more families will align
Berti ran an accelerator program and business their capital with their values to create positive
plan competition giving him a great overview social and environmental change in the future.
of the emerging market opportunities in the Key to achieve this alignment is education and
UK at the time as well as the technologies and proactive engagement.
market opportunities arising in the space. “It’s a matter of time. The old generation
is fairly dominant, but becoming less so.
Family and Dynamics It’s a generational thing: young people get it
but parents and trustees are still in power.
How has your role within the family It’s hard to influence people who are stuck
trust changed evolved with regard to in their ways. The older you get the less
managing investments?
What advice would you give other families?
While pleased with the developments at Berti
Millennials in Impact Investment Report 2016 28
likely you are to change. It’s a matter of Seth has spent time on his own personal
time before the new generation comes in development and connects, not just on the
who totally gets this. financial side but also with the people he is
investing in:
The way to do it is just to bring deals,
don’t let them say we haven’t seen “If you find a great business but don’t like
anything… bring them deals that tell the the guy running it, it’s not fun. You should l
story of what’s happening in the world. ook forward to board meetings, etc. Find
It’s an educational thing but it’s hard to people who fit your culture.”
educate people who are stuck in their
ways. Nothing happens overnight.” Continuing the education
People and Planet What are you working on now?
What areas of impact investing are
How are you connected with others you currently exploring?
as part of your journey – your family,
your community? Seth is now complementing his on-the-job
education by going back to school in a part-
In 2013, Seth moved to Somerset to be closer time two-year MBA program that will give him
to nature and put into practice some of the a better grounding in finance and business.
techniques and technologies he was involved He is also continuing to explore a range of
in as an investor. He built a solar farm at his investment opportunities in a variety of asset
house. And runs retreats in a space near his classes and believes that there are many
home that he and his sister have developed to good impactful investment opportunities
support others on their personal journeys. available if you are open to considering new
structures and managers. He questions if
He believes that it is important to surround public equities can provide the direct impact
yourself with people that will hold you he is looking for and is now considering some
accountable. This acts as an important options with his existing real estate assets,
motivator to keep going. like improving energy efficiency or adding
solar panels on roofs. •
“The more people who care about what
you’re doing, the more help you can find
around you”
Millennials in Impact Investment Report 2016 29
3. Politics, Philanthropy
and Portfolios
Antonis
Age: 27
Domicile: Greece/Germany
First impact investment: Goodwell Microfinance
Development Company III, 2015; Goodwell Investments
aims to enhance access to basic goods and services for
underserved populations in India and Sub-Saharan Africa;
Invested via an investors’ pool facilitated by Pymwymic58
group of investors
Democracy, Shareholder Activism, Family Alignment — Getting to Know Antonis
For Antonis impact investment is an important
piece of his journey but one that needs to be
recognized alongside his wider activities of
philanthropy and political activism.
Antonis inherited money when he was 18,
giving early ownership of his assets. At the
time however he did not feel equipped, or
indeed interested, in taking a proactive
Millennials in Impact Investment Report 2016 30
approach and was therefore not involved in the Although this was not an easy process, Antonis
management of his assets. believes that the industry is changing:
After he had completed his undergraduate “You feel it. Lots of advisors and banks
training in European Studies in London, he had are engaging because customers want it
his first experience of trying to invest on the and they know that next gen investors
stock market will change advisors if they can’t find the
sustainable or impact investment
“I’ll take 15k EUR and try it on the Stock opportunities they are looking for, so
Exchange. Since I was a rookie I failed, they better start catching that train.”
lost approx. 30% of the stock value,
freaked out, and decided to leave wealth Family dynamics
management again to the family office.”
How would you describe your relationship
His first experience with impact investing with other family member with regard to
and social entrepreneurship came through managing investments?
an internship at Bonaventure, the first social What are the keys to working together
investment fund in Germany. Since that time, as a family to make investment decisions?
becoming directly involved in impact investing
has been a gradual process. He has connected While Antonis has control of some of his assets,
with networks such as Pymwymic, the Ashoka he is also keen to work with the rest of his
Support Network59 and Toniic, and decided to family to integrate impact into their investment
take the step of finding an advisor to work with decision-making process. He has the support
on his investment decisions. of his family and is finding that other members
of his generation are starting to show interest.
Working with an Advisor They are currently looking to make their first
investment as a family office.
Describe your initial search for an advisor.
What was important to you as part “I was asked by the family office if I had
of that search? any ideas for deals and I said yes – impact.
What do you think is the key to a good And the office said ok, let’s look at it.”
relationship with an advisor?
This open-minded attitude has provided a
Wanting to be more proactive than he had great opportunity but the path is still not easy,
been about his wealth, Antonis started requiring the coordination and alignment of
the process of looking for an advisor that values between all of the family members.
understood impact investment. Through the Getting to a consensus can be difficult
Ashoka Support Network he was introduced to amongst any syndicate of investors but
Bjoern Struewer who is the Founder and CEO Antonis explains when you are negotiating
of Roots of Impact, a specialized advisory firm with people that you care deeply about, it
for Impact Investing and Development Finance. brings an added complexity.
With the help of Roots of Impact, Antonis
created an Impact Investing Policy to help him “I had to reevaluate after I chose funds that
guide the next steps of his impact journey. the others didn’t choose. The challenging
After the Investment Policy was completed, thing is that on top of business you have the
potential investments were analyzed and whole family aspect, which requires an extra
discussed in monthly calls with the head of the amount of diplomacy.”
family office.
58 Ibid.,20
59 https://www.ashoka.org
Millennials in Impact Investment Report 2016 31
Refining negotiation skills is something Antonis To better his education in impact investing and
is actively learning through working with his to learn how to become an impact champion
family on impact deals. He is pleased with the within his family, Antonis has completed the
developments and level of engagement thus “Impact Investing for the next generation”
far, believing that there is more to come. course at the Harvard Kennedy School. The
program provided him with the practical tools
Investment Approach & Education necessary to make investment decisions while
learning from experienced professionals and
What areas of impact investing seasoned impact investors.
interest you?
What kinds of investments have you made? He also had an idea for a new fund that would
What are your interested in learning enable next gens to learn about impact
more about? investing. The idea, which he would be
interested in pursuing further, is:
Now that Antonis has found an advisor
he comfortable with, the two of them are • Next gens would invest between 50-
working closely on examining impact deals - a
gradual process. 100k EUR collectively across different
asset classes and themes.
For his personal portfolio, he has to date made
investments in the Unitus Right Livelihood • Next gen participants would participate
Fund, BonVenture III, Goodwell III, Sun Funder,
an ESG public equity index (GLS Aktienfonds). in governance to maximize the learning
Antonis is planning to invest in the Media experience. There would be a dual
Development Investment Fund and he is a benefit of having a return and learning
MCE Social Capital guarantor. something by being on the investment
committees, selecting the deals, etc.
His deal flow has thus far come from Roots
of Impact, as well as from actively talking to Politics and Philanthropy
people in the sector and networking; talking
to foundations in Germany such as the BMW How is your interest in impact investing
Foundation and using the Ashoka support interface with other areas of your life?
network (Germany), Pymwymic, and Toniic What causes are you passionate about?
as platforms.
While Antonis is pleased that he is aligning
Although Antonis currently has not done any his portfolio with his values, what gets him
direct investments, he is pursuing a traineeship most excited is discussing his work to promote
to learn more about direct investing and transparency, accountability and citizen
looking selectively at deal-flow opportunities. engagement in politics.
“The thing with direct investments is He has always been politically conscious and
that it feels like a full-time job, it’s in the last three or four years has put more
investing on a whole different level.” thought and action into it. He started an NGO
called Vouliwatch.gr that empowers Greek
In his impact portfolio, only a small part of his citizens to communicate with, evaluate, and
assets are in public equities. He feels that public hold accountable elected representatives
equities have very little impact and is more in the Greek and the European Parliament
interested in fixed income and private equity. (MPs & MEPs). The idea is based on the
ParliamentWatch concept that was originally
conceived by Ashoka fellow Gregor Hackmack
in Hamburg, Germany. This social business has
Millennials in Impact Investment Report 2016 32
been replicated in seven other countries and Shareaction (UK) and As You Sow (US). He
is a good fit for Antonis as it links his political is particularly passionate about the work of
science background with his passion for these NGOs:
disrupting the political status quo.
He is very committed to supporting an active “I love these examples because for a lot
civil society in Greece: of people impact investing is not only
“There is a huge funding gap in Greece, about using your assets, it’s about achieving
impact in general. Catalytic philanthropy
as well as humanitarian issues with refugees. can have a much greater impact than your
The social state is collapsing. My ultimate impact investments but they are also riskier.
aim is to inspire next gens in Europe to I am engaged as a progressive funder,
do more. I believe that the current amount because I believe the major challenges
of inequality is not healthy for society. facing humanity require policy changes
In the end, it all comes down to social and these changes come about by bottom-
and political empowerment.” up pressure on our political elites.“
His work does not stop there; in the last years
he has given donations and grants to many Lessons Learned
initiatives in the areas of political activism,
social entrepreneurship and vulnerable What recommendations do you have for
populations. To professionalize his philanthropy millennials getting started?
and to maximize his impact, he is in the process
of creating a foundation focused on the My one message: “Be bold. This is what it’s
aforementioned areas. all about. We know we have the means, now
Some of the NGOs he has supported work it’s about having the guts to actually do it.” •
in the area of shareholder activism, such as
Millennials in Impact Investment Report 2016 33
4. Bridging Passions Across Family
Stephanie
26
New York, US
First impact investment: An ethical fashion company, Soko
(shopsoko.com)
Millennial Ambassador, Fashion and Social Entrepreneurship — Getting to Know Stephanie
For Stephanie (Steph) her impact journey
began with social entrepreneurs and peers
she met at the Opportunity Collaboration, an
annual convening that brings together 400
global leaders building sustainable solutions
to poverty. The inspiring stories of fellow
millennials caused her to shift perspectives
about her career and much more.
Originally from the San Francisco Bay Area,
Steph received her undergraduate degree in
Communications from University of California,
Santa Barbara. Within a month after graduation
she landed what she had considered her
“dream job” working at a leading fashion
Millennials in Impact Investment Report 2016 34
magazine in New York City. Less than a year Early Days at the Family Foundation
later she participated in an annual convening in
Mexico that changed her life. How were your initial days in the
It was at Opportunity Collaboration (OC)60 family foundation?
where a new spark ignited, How has your role changed?
“I met people my age who were starting
When Steph officially joined the Cordes
social businesses, allowing them to integrate Foundation (http://cordesfoundation.org)
their personal passions and skill sets in 2014, she faced a steep learning curve to
into full-time careers. Those conversations fully understand how foundations and their
were what inspired me to look for ways to investment process worked. She was anointed
incorporate that synergy in my own life.” as the “Vice Chair”, which was a title left
While working at the magazine, her goal was to intentionally open-ended in an effort to enable
sell $200,000 one-page advertisements to large her to find her best fit. She appreciated her
luxury brands that would run in a single issue. parents’ flexibility as it really allowed her to
After hearing about an organization at the OC grow into a role where she could truly thrive.
that was looking to raise this same amount to
build 8 schools in Africa, she started to feel “I think my parents implemented a great
somewhat of a disconnect. That contrast really strategy for next generation engagement.
put things in perspective for Stephanie. Instead of simply assigning a role of their
Did I want to be selling people one choosing, they let ‘experience be the guide’”
extremely high-priced piece of paper,
or did I want to be providing an abundance In 2015, she expanded her role, looking for
of paper and education for children in the ways to incorporate her previous love of fashion
developing world?” into the current work she was doing at the
Within just the first few hours of the OC’s foundation. This new area of interest drove her
5-day convening, Steph had these “light-bulb to leading new initiatives in ethical fashion and
moments” that inspired her to look at the anti-human trafficking. After introducing the
world differently. She became particularly concept of ethical fashion to the foundation,
curious about who made her clothes, how the it has become seamlessly embedded into the
workers were treated and if supply chains were family’s foundation’s core strategy.
truly ethical. The week in Mexico was the first
pivotal experience she had through work with Historically there have been two themes
her family foundation. driving the Cordes Foundation: Social
“I certainly knew about the family Entrepreneurship; and Women and Girls’
foundation my parents started in 2006 Empowerment. Her father went from
when my dad sold his investment services “spending the first half of his life building
company, however it wasn’t until that businesses designed to be the best in
monumental week that I felt inspired to the world, to spending the second half
become more involved.“ supporting businesses that are the best for
the world.” Steph’s mom has a background
in psychology and has always been very
involved in women and girls’ empowerment
initiatives, such as working at battered
women’s shelters and homes for runaways.
These themes, combined with Steph’s passion
60 Opportunity Collaboration (OC) annually convenes 400 global leaders building sustainable solutions to poverty. We
engage social entrepreneurs, innovative nonprofit executives, grant-makers, impact investors, corporate & academic
field-leaders, and aligned media working around the world to solve common challenges and spark new opportunities.
(http://opportunitycollaboration.net)
Millennials in Impact Investment Report 2016 35
for fashion, have completed the family
foundation mission triangle:
Artisan
Enterprise
Social Female
Entrepreneurship Empowerment
Fashion
1 SOCAP (Social Capital Markets) has created a platform where social impact leaders can connect and present their ideas
to a global audience. The annual flagship event in San Francisco is the largest conference for impact investors and social
entrepreneurs and has drawn more than 10,000 people. http://socialcapitalmarkets.net/
Areas of Interest
How are you involved in supporting
ethical fashion?
Millennials in Impact Investment Report 2016 36
Steph and her mother travelling..
What direct investments have you taken In looking forward, Steph is excited to
on in this segment of the fashion industry? continue these efforts while also building out
the foundation’s ethical fashion investment
The family’s passions have led them to create portfolio. Thus far, she has led one deal in an
partnerships with grantees and investees ethical fashion company, Soko.
that Steph takes pride in fostering. She Steph first learned about the investment
often visits these partners to learn how the opportunity in Soko at The Unreasonable61
Cordes Foundation team can help beyond the “Girl Effect Accelerator” Investor Day, which
dollars invested or granted. She is constantly was held at Tom Chi’s Factory X62 in San
networking, traveling, reading and organizing Francisco. Steph met with the two female
events in alignment with their 3 C Strategy: founders and fell in love with their unique
“Connect, Convene and Catalyze.” The latest product, business model and scalable social
initiative she has been working on is “Impact impact. She shared her enthusiasm with her
Garden” - a convergence of fashion, wellness parents and Cordes Foundation’s Portfolio
and technology brought to life by event-driven Director, Eric Stephenson,
experiences that provide awareness around “I believe we have a really interesting
global fashion brands that are helping solve
today’s challenges. The inaugural Impact opportunity to invest in a company that
Garden premiered on March 2016 at Madison sells beautiful fashion-forward jewelry
Square Garden. Hundreds of yogis, fashionistas while economically empowering over
and models participated in an evening of 1,000 female artisans in Africa! It is
wellness and socially conscious shopping. exciting to learn that we are able to
61 Unreasonable Institute helps social entrepreneurs achieve scale in impact through acceleration programs. (http://
unreasonableinstitute.org/)
62 Factory X has a ten week new company creation program to help jump-start new businesses. (www.fact0ryx.com)
Millennials in Impact Investment Report 2016 37
support companies at the intersection She has spoken in various classrooms and
of my passion for fashion and positive found that students were excited to
social impact, through impact investing.” learn, but they did not have a background
or experience in investing. “Thinking
She participated with other investors in the back, neither did I, and I think that needs
Series A round, analyzing the financials and to change.”
completing the Foundation’s due diligence
template. With the help of her parents and Eric, For investors no matter where they are on
the deal was closed in March 2015. Since then, their journey, she feels that more formalized
Steph has been a close investment partner to mentorship is lacking.
Soko, serving as an Advisory Board member. “A shadowing program would be fun!
Overcoming Challenges If there was a program where someone
could shadow a mentor step-by-step, from
What challenges do you face as an sourcing a deal to the close, I think it would
impact investor? be tremendously beneficial.”
Who and what is helping your Working with Financial Intermediaries
overcome those challenges? Since her father is the Founder of AssetMark,
What gaps do you see in educating a financial services business, Steph and
others about impact investing the Cordes Foundation have never worked
directly with an outside financial advisor for
Like many people starting out in impact their portfolio. However, they have worked
investing, Steph felt challenged by her with financial intermediaries such as funds
lack of experience and knowledge of the and funds of funds that have proven to be
sector. However, these initial challenges quite helpful.
only propelled her to want to understand as “We don’t have the bandwidth to do all
much as she could about the field. With her the due diligence ourselves, so it is nice
increased knowledge and experience, she is to have outside experts to rely on in order
now encountering some of the challenges of to help vet companies and give investees
measuring impact. local support.”
She explains that intermediaries allow them
For support, she turns to her dad, Ron, and Eric to have a more diversified portfolio and
Stephenson (Foundation’s Portfolio Director), access to social enterprises that they would
and peers she has met in networks such as not have otherwise.
Toniic and Nexus. She particularly enjoys The unfulfilled opportunities she has
learning from conferences such as SOCAP uncovered relate to her work with artisans
where she has exchanged her business cards and their need for working capital facilities.
with speakers and kept in touch with generous She notes that there is a need for services
experts. Beyond these forms of support, she is that “provide loans that are larger than
not ashamed to admit that there has also been microfinance loans, but smaller than ones
a fair amount of “Googling.” available through the big banks.”
“Understanding investment is fundamental
to economics and how companies are
built and how they grow [...] it should be part
of standard college curriculum. It shouldn’t
only be business majors who are required to
take these introductory finance courses.”
Millennials in Impact Investment Report 2016 38
Broadening Her Scope for millennials getting started?
• Frontier Market Scouts (FMS)63: two-week
How are you engaged with others in
the impact investing community? course about impact investing.
How do you see your role evolving in • Look at mutual funds like ETFs screened
the larger community? for ESG.
• Look into impact funds that may be less
It was the inspiring experiences of Steph’s risky with a fund manager to learn from
peers that kick-started her own impact • Read books, articles and “Google Alerts”
investing journey. Since then, Steph has helped to stay up to date with the sector
a number of millennials around the world start • Attend conferences and
their impact journeys and provides leadership
in the Toniic millennials Working Group and the networking events
Nexus Impact Investing Steering Committee. • As they say in the Harvard Program,
“We are at such an exciting time in · “Know what you own.” Whether it is
history that I look forward to continuing your personal or family assets, ask
to meet, support and share experiences questions about what you own
with others who are already on this impact · “Competence to feel confidence”
investing journey (or just looking for meaning there is a need to build
somewhere to start)!“ “competence” and knowledge around
impact investing to then increase
Lessons Learned “confidence” to speak with family and
others about the industry
What recommendations do you have • Invest like it means something and realize
that decisions have consequences and you
have the power to shape something •
63 The Frontier Market Scouts training and fellowship program has trained more than 300 professionals and served more
than 100 different social enterprises in 20 different countries around the world since its inception. FMS received a 2013
Cordes Innovation Award from AshokaU and has now become the flagship program of the newly launched Center for
Social Impact Learning at the Middlebury Institute of International Studies at Monterey (MIIS).
(http://www.miis.edu/academics/short/frontier-market-scouts)
Millennials in Impact Investment Report 2016 39
5. From an IPO Windfall
to Impact Investing
Adam & Chloe
Ages: 36 & 38
Domicile: Canada
First impact investment: Ello Distributors
Connecting New Wealth with Values, Investing as a Couple,
Active Ownership — Getting to Know Adam and Chloe
Both Adam and Chloe were raised in traditional
middle-class families where any money
saved was to be invested safely and sensibly,
avoiding any risk. Money wasn’t something
either of them showed much interest in as they
initially pursued their careers. Adam’s acting
career led him to Vancouver where he reunited
with Chloe, his former teenage crush, who had
just moved from Toronto where she had first
worked with a then virtually unknown Canadian
start-up called lululemon athletica.
Throughout lululemon’s meteoric rise to its
iconic status as a retail brand, first in Canada
Millennials in Impact Investment Report 2016 40
and then globally, neither Adam nor Chloe Coming to Grips with Their Wealth
gave much thought to what the success of
the company could potentially mean for them What was your reaction when you realized
personally. Chloe remembers Chip (Wilson, how much your shares in lululemon
lululemon’s iconic and often controversial were worth?
founder) calling her one day to talk about his Who did you consult with and what advice
decision to award her shares in the company. were you given?
“I really had no idea what it meant at the
Adam and Chloe’s initial reaction was to
time,” recalled Chloe, as she shared some fall back on the conservative values about
of her memories. “Later that day, I was on money that they were both raised on: be safe,
a streetcar in Toronto, when a call came in preserve your capital and plan responsibly
from Chip’s lawyer. He told me that I would for your future. It’s the same story often told
immediately receive a modest cheque and about big lottery winners who, when asked
quoted the number of shares that I was also what they plan to do with their money, reply
getting. Before ending the call, he jokingly that they plan to trade in their old car for a
advised me to beware of arrows that might new one. In fact, that’s exactly what Chloe and
show up, lodged in my office door, since Adam did, which represented pretty much
some of my colleagues were not happy the extent to which they indulged in their
about the number of shares I was getting. newfound wealth.
I got off the call thinking, ‘Great, I still don’t
totally get what’s happening and now “We bought a 1989 VW Westfalia because
people are upset at me.’ These were still we wanted to start exploring the West
early days – and still pre-Adam for me!” coast. When we called our advisor to give
Chloe and Adam shared a grin as they him the news that we’d bought a new
reminisced about what Adam called, “a vehicle, he was ecstatic. When we told him
whirlwind of serendipity.” Chloe continued: what it was (an investment that represented
“When I received the cheque, I broke up with $15,000), his reply was, `get two’.”
my boyfriend at the time – he hadn’t really
been very supportive about my decision to That same advisor had been the go-to person
work in retail – and bought my first condo. for a large proportion of the lululemon
Over the course of about a year, I moved in, founding cohort and became the person they
reconnected with Adam, got swept off my relied on the most for financial advice and,
feet, relocated to the West Coast to be part of predictably, the investment recommendations
the core team to ramp up for the IPO, became steered towards safer and relatively risk-free
a landlord to the tenants in my Toronto condo holdings. Their advisor assured them that
and welcomed Adam, who had been living in they both now had enough money to take
London, into a rental in a modest Vancouver care of themselves and any plans they might
low-rise. At that point we were less than have for a family, for the rest of their lives and
three months away from the IPO and still likely future generations as well. They referred
had no idea what that would mean.” As the to their advisor as “Uncle Bob,” a term that
company’s plans to go public began to take the advisor himself felt comfortable using to
shape, it became clear that those shares could describe his role. Between them, there was a
dramatically change their financial fortunes and realization that they were financially set as long
their lives. as they followed Uncle Bob’s advice and didn’t
steer off course.
Millennials in Impact Investment Report 2016 41
Moving Towards Impact Investing They came back to Vancouver excited to
pursue some ideas of their own in this sector
What caused you to reconsider how your and, after several iterations of their initial
money was being invested? concept, they launched ello, their own food
When did you decide that there was more distribution company, focused on high quality
that you wanted to do with your money? local growers, providing fresh, daily produce
to many of Vancouver’s leading progressive
For Adam and Chloe, the major turning point restaurants.
in their approach to managing their wealth was
the birth of their first child. With Vancouver’s growing world-class dining
reputation and a clientele of chefs with a
“When Beckett was born, I think he passion for local ingredients, the business
caused us to ask ourselves what kind of found a successful niche. In retrospect, Adam
world we wanted to raise him in, and what and Chloe can now consider ello their first
kind of a world we wanted him to live in impact investment, although, at the time, that
after we were gone.” term wasn’t yet in their vocabulary.”
For the first time, they began wondering if Working with Support Networks
they should start thinking differently about
their money and how it was invested. But What has been the benefit of
the old paradigms proved hard to break joining Toniic?
initially: Uncle Bob was willing to listen to new, How has it changed how you think
emerging thoughts and concerns about their about your investments?
investments, but ultimately advised them to
stick with the plan. Shortly after they became Toniic members in
the summer of 2015, Adam attended Toniic’s
Feeling somewhat frustrated with the status- Annual Global Gathering where he was inspired
quo advice they were being given, Adam and to find so many like-minded investors and
Chloe, with young child in tow, decided that immediately connected with a number of
they needed to see and experience more of members who are part of an active sub-group
the world and use that time to consider what focused specifically on issues and challenges
they wanted to do with their lives and their facing millennial impact investors. Adam was
money. also attracted to the vision of the 100% IMPACT
Network within Toniic, a group of members
What did you learn about yourselves who have committed to allocate 100% of their
on the trip? portfolio over time to impact investing.
How did that change your approach
to managing your wealth? By adopting a portfolio approach, Adam and
Chloe now have a 360-degree view of their
Over the course of a soul-searching trip, they complete financial picture and can finally
realized that many of their conversations begin to identify and articulate their own
would come back to discussions about food: in investment strategies.
particular, their preference for fresh, local food.
“With the support of the 100% IMPACT
“We were inspired by businesses that Network and the Toniic team, it feels like
were trying to address the real issues of we now have the setup to be able to start
food security and sustainable agriculture.” developing our own voice as investors,”
Millennials in Impact Investment Report 2016 42
says Adam, “and we are building confidence we take with one advisor at one big
in how and where we want to invest our Canadian bank will contribute to the
money through exposure to other members. necessary evolution of the global financial
It feels pretty liberating. For the first time services industry.”
in our lives, we feel true excitement about
the potential we have to – yes – make a That evolution is still very much in the
financial return for ourselves and our family, beginning stages and will involve serious and
and generate a social return for things that concrete thinking about strategies that better
are important to us.” respond and adapt to the increasing number of
millennial investors.
Moving Forward
Lessons Learned
How is your approach to managing
your investments evolving? What recommendations do you have
What’s next for you on your impact for millennials getting started?
investing journey?
• “Ask all the questions, over and over
Armed with their analysis and emboldened to • again, until you get clarity. Even if you
make changes to their portfolio, Adam and
Chloe have activated the process of looking feel like you’re belabouring the point.”
for a new financial advisory solution. Their
goal is to make the transition amicable, even • “Trust yourself: don’t outsource yourown
though it is in fact inevitable. They have simply
outgrown the “advisor-knows-best” mindset best decision making.”
that is still prevalent in many client-advisor
relationships. They recognize the leadership • “Take time to reflect on your relationship
opportunity that now lies before them - to
use the transition as an opportunity to to money: past, present, and future.”
educate a small corner of the financial services
establishment on the range of products and “Take It From Us”
instruments that they have been introduced
to. They are ready and eager to become more Some thoughts on how financial
active participants in deciding how and where advisors and millennial impact
their money is invested, and ensuring that investors can collaborate
their investments align with their values.
Adam & Chloe outline some simple steps:
“We positively expect that the actions • “Listen, listen, listen”
• “Understand that every client is a
unique individual that is on their own
journey with money and investing.”
• “Find ways to step outside your
comfort zone with your client.” •
Millennials in Impact Investment Report 2016 43
6. Empowered to Act
Talia
Age: 25
Domicile: USA
First impact investment: Invest Eco; InvestEco’s main
focus is investing in expansion-stage companies in
North America that promote health and sustainability
in the food and agricultural sector.
Responsibility, Environmental Stewardship, Regional Impact — Getting to Know Talia
Talia’s impact investing journey has its roots
in her connection to nature, which was an
important part of her childhood.
“I was really privileged to have a relationship
with the natural environment through our
family’s farm in upstate New York… I
really feel a responsibility to be the best
environmental steward that I can be.”
Growing up travelling with her family to
wealthy and developing nations, Talia feels
that social justice, inclusion and access, and
health and wellbeing are inextricably linked to
environmental stewardship. The values she’s
grown up with have been responsible for the
way she looks at the world and can best be
understood by sharing a Buckminster Fuller’s
Millennials in Impact Investment Report 2016 44
quote: “Make the world work, for 100% “I remember my first meeting with the
of humanity, in the shortest possible time, family office manager and my Dad. I was
through spontaneous cooperation, without going through line item by line item, saying
ecological offense or the disadvantage of ‘What is this? That doesn’t align with my
anyone.”64 values, how can I get out of this, what are
my options?’ I was empowered to question,
Talia applies her values and worldview not so that was helpful, but I knew I didn’t have
only to her investing, but also to her daily the knowledge to make informed decisions
life. She currently works for a sustainability and make the changes I wanted. I was on a
consulting firm, supporting higher education path to align money with values and
institutions and K-12 schools – a job that is very contribute to world.”
mission-based and aligned with her values. Her
commitment to aligning her habits with her It was her first experience at SOCAP that
values can be seen in a variety of ways. set it all into deep motion. Inspired by the
connections she made with other millennials
“I try to purchase foods through farmers’ at the Toniic gathering at SOCAP and with
markets. I support the activities and other experienced and seasoned investors,
principles of slow money, slow food, I bike she started to think about the opportunity to
everywhere and try to use public transport create a portfolio that contributed to building
as much as possible.” a healthier world. This also prompted her to
question how her family could have a more
Aligning Values with Investments positive impact.
Describe some of your early experiences Family and Peer Dynamics
discussing investment decisions with
your family? How has your family helped you find
What were some of your early challenges your own voice in impact investing?
in forging your own path? What role do you play within
the family with regard to
When Talia was in college studying ecology, investment management?
evolution, and dance, she remembers
not having the capacity to engage with Talia’s father has been a role model and
managing her own portfolio. Once she resource for her and has been instrumental
graduated, she knew there were more family in helping Talia find her voice and path in
meetings and conversations happening, and impact investing. They are now team players
although she didn’t know how to exactly in identifying opportunities, reflecting on
plug in, she recalls thinking, the type of impact they want to have, and
holding each other accountable. In addition,
“I knew I had a responsibility to roll up Talia’s experience with her family foundation
my sleeves and engage with what I had has been empowering. “I’m lucky to
been given and the opportunities that participate in an inclusive, inter-generational
presented themselves.” family,” Talia explains.
As she started her journey of exploring and Experience with the family’s foundation and
asking questions in 2103, she felt inspired, but philanthropic activities came early. When she
also daunted by the road ahead and worried went to her first foundation meeting, she
that she didn’t have the right skill set helped identify and provide a grant to an
organization that focused on environmental
64 Buckminster Fuller.
Millennials in Impact Investment Report 2016 45
literacy. In addition to that starting point, complement to my social and environmental
Talia explains that at 18 years of age each impact questions,” says Talia. She just invested
family member gets a yearly allocation to in two CDFIs and is looking for others. “
give away for grants. Knowing that she was
entrusted with this “was scary and an amazing “I got to move my portfolio a couple
opportunity to learn about grant making.” percentage points more to 100% impact.”
Through this allocation she has made her
own yearly contributions to organizations Talia explains that she was drawn to Invest
and projects that interest her, from gender Eco, her first impact investment, because they
lens investing and growing that field, to a were investing in a dairy near her family’s farm.
sustainable development enterprise in Israel. “Having a connection with and understanding
of what I was investing in was one of the major
These experiences have empowered and wins in finding InvestEco.” While her current
enabled Talia to also work collaboratively with portfolio is very diversified, in the longer term,
the family on their impact investing strategy. Talia says she would like to have a regionally
Within the last year, Talia has worked with her based portfolio where she can understand
family members to transform a conventional and have a connection withher investments.
investing policy statement into a reflection of Supporting mission based, regional enterprises
their family values. Because of this shift, her is important to her.
family advisors are now looking at their new
investment policy statement and bringing Relying on Support Networks
forward recommendations based on her
family’s values. Who do you rely on for support?
How have they helped you grow as an
“We want impact metrics, not just impact investor?
financial metrics.”
While she hasn’t felt a desire to enroll in a
Regional economy the focus of personal formal investment training course (she prefers
investments “learning by doing” and is making her own
syllabus of reading material), Talia gets support
What passions and interests drive your and education through her relationships.
personal investment decisions? “Toniic has played a huge role in creating a
support network, inspiring me, and connecting
Along with helping her family transform me with people who are on the same journey.
their impact aim, Talia is focusing on her The support, relationships, and mentorship
own portfolio. CDFIs65 are her first start in have been extremely helpful.”
exploring financial products independently
from the recommendations she receives from Within her own family, she points out that her
her family. “One of my big values is building Dad, brother, and their family advisor have
a regional economy. I’m very interested in been supportive of her journey.
re-creating regional supply chains that build
regional self-sufficiency.” She found two CDFIs Talia and her father attended SOCAP together
on the Opportunity Finance Network website and joined Toniic together. One senses that
that serve her home area of Massachusetts. Talia’s enthusiasm and commitment to making
Her next step has been to interview them with changes is inspiring to her father and to others
her family advisor. The advisor asked all the in her family.
hard financial questions, “which was a nice
65 Community development financial institutions (CDFIs) are private financial institutions that are 100% dedicated
to delivering responsible, affordable lending to help low-income, low-wealth, and other disadvantaged people and
communities join the economic mainstream.
Millennials in Impact Investment Report 2016 46
Eager to pay it forward, Talia says, “My sister For other millennial investors who might be
will be graduating soon and I’m excited to feeling the weight of their huge responsibility,
bring her into this field and partner with Talia says, “have an open mind to the
her to critically think about our family’s opportunity you have to create change in the
collective impact.” world. Grab it by the reins, ask hard questions
and link up with the people who are asking
Talia characterizes her current journey as one hard questions.”
of reflection. Over the last two years she’s
gained a better understanding of impact “Take It From Us”
investing and now she’s developing a personal
vision by asking, “what am I passionate/curious Some thoughts on how financial
about, what are my interests and what do I advisors and millennial Impact
want to explore? How do I want to build and Investors can collaborate
create value?” She describes her desire to
develop her financial portfolio as a part of a Talia implores advisors to take more of an
more holistic portfolio of her life. She is very active role in bringing impact investment
self-aware about the journey she is on. Talia options to the table as real options. Rather
recognizes that getting to a portfolio that she than being reactive, she asks that they
is happy with will take time, but she has the be proactive in their work with clients,
patience and tenacity to get there. sourcing and presenting impact investment
opportunities. She recommends that they use
Lessons Learned their expertise and resources to help develop
tools to help families measure impact. “I would
What recommendations do you have encourage them to be ahead of the times
for millennials getting started? instead of behind.” •
Millennials in Impact Investment Report 2016 47
7. Bridging Philanthropy and
Impact Investing
Sapphira
Age: 31
Domicile: USA
First impact investment: not made yet
Collaboration, Learning — Getting to Know Sapphira
Sapphira says she is just in the beginning
stages of learning about the impact investing
space. Yet the steps she has already taken to
expand her knowledge of investing, engage
with others in the ecosystem, and foster a
collaborative relationship with her financial
advisor as she leads her family’s foundation
all demonstrate that her journey is off to an
inspiring start.
As Sapphira was growing up, her parents
modeled a life of giving back. She explains
that her parents grew up in less fortunate
circumstances, and that they attribute their
success both to their own hard work and to
being fortunate to take advantage of the
Millennials in Impact Investment Report 2016 48
opportunities they were given. This led them impact in the social sector.”
to have a passion for giving back by creating
opportunities for others, especially by focusing Family Dynamics
on access to healthcare and education.
Speaking about her family’s approach to How would you describe your
philanthropy, she says, “it’s less about giving family’s initial reaction to the
and more about creating opportunity.” concept of impact investing?
How have you helped influence
Early Days at the Family Foundation their perceptions?
How did you get started in your “Being receptive to impact investments has
family foundation? been a process for me and my family,” says
How did that experience help cultivate Sapphira, “As they learn more they gain a
your interest in impact investing. better understanding of what impact investing
is, and what it can mean for our foundation.”
After she earned her master’s degree in Public
Health and worked for international nonprofits, She describes how when she first broached
Sapphira began to run her family’s foundation the topic of impact investing with her father,
- The Goradia Foundation. “In the beginning,” he readily agreed that it was something they
explains Sapphira, “the foundation’s role could do with the foundation. There was an
was more passive than it is now, without a instance where they had slight differences in
clear strategic focus.” To bring another level perceptions of the value of impact investing
of intentionality to the foundation’s efforts, for their foundation. In her father’s eyes, if the
Sapphira asked to do a strategic analysis of investment failed, then they could have just
their family values, what they were interested thought of it as a grant. However, Sapphira has
in as a family, and where they thought they since helped to alter this perception so that
could be impactful. impact investments are taken as seriously as
other investment opportunities.
Her family was completely on board with this
approach. “We’re lucky in that we’re a small In order to present impact investing as a
immediate family and more than that, we’re legitimate financial option, Sapphira committed
lucky that our passions, interests, and values to take the time to learn as much about impact
overlap,” says Sapphira, which made it possible investing on her own as she could, and to
for them to complete their values analysis for finding data and examples of other impact
the foundation independently from an advisor. investments to present to her family. Her
As a family, they decided to focus the first five father was convinced by her presentation and
years of their philanthropic efforts broadly on supports Sapphira’s efforts, though he is not
health and education initiatives, and support involved in the impact investments himself.
models with the potential to scale across “His mindset is let me explore it on my own; he
India (where her parents are from). Sapphira’s knows that if I own it then I’ll be more involved
experiences running the foundation, attending with it.”
conferences, and expanding her network led
her eventually to impact investing. Areas of Interest
“I first learned of the impact investing space What investment areas / themes are you
as a way to complement our grant making most excited about?
work and tackle a different space on the
spectrum of what’s possible in terms of Sapphira is excited for the increased impact
Millennials in Impact Investment Report 2016 49
opportunities in India that impact investing her financial advisor is important to Sapphira
creates for her family’s foundation. She explains because he can provide the financial expertise
that in the health sector, for example, there and support she needs right now on her
is a lot of innovation in low-cost interventions journey as an impact investor. “I’ve spent
through mobile health technology. two days with him here in New York, meeting
with different funds and things that are very
“We haven’t invested in those concepts outside my sphere of knowledge.” Growing
before because a lot of them are for profit. her knowledge of investment practices is
So [impact investing] has really opened up valuable to her because, as she says, “You
the world of what we can participate it now.” want to understand your investments.” Her
eagerness to learn from him is part of what has
“Yes, definitely impact investing will made him receptive to the impact investing
complement the traditional grant making that ideas she proposes.
we’re doing,” says Sapphira. “I’m looking at
impact investing as a spectrum in terms of Reflections, Recommendations, and
financial return. Ideally I’d like to make some The Road Ahead
investments that have a higher likelihood of
market-rate return and others investments What challenges do you see ahead of you?
where you may sacrifice some return, but What are your impressions of the impact
they’ll be more impactful.” investing ecosystem?
Education And Working With Advisors As she considers the challenges she could
face in her impact investing journey going
Have you felt that anything is lacking in forward, Sapphira says that her immediate
your education about finance? goal is improving her financial literacy because
Describe the process of bringing your “it’s the first step toward everything else.”
family advisor on board She’s also focused on deal flow. Since the
foundation’s mission is focused in India, she’d
Part of Sapphira’s impact investing like her impact investments to be in India,
education has come through participation which has her wondering how to cultivate a
in a Harvard course for millennial impact network for finding deal flow and accessing
investors. In this course, she says, “I felt due diligence assistance on the ground.
like I was at a disadvantage because I Another potential barrier is having buy-in from
didn’t speak the same financial language advisors and her family, but she admits that is
as others.” While she has learned more and less of a barrier than she previously thought,
since discovered that the financial jargon due to her commitment to learning as much as
is not as complicated as it sounds, it does she can and putting it into action. “I’ve been
present a barrier to entry and limits her given an opportunity to experiment [with
confidence in making investment decisions. impact investing],” she explains, “and if it goes
well and if I do it in a meaningful way, I will
“I wish we had had something like this in have buy-in.”
high school,” says Sapphira, “just basic
financial literacy.” Reflecting on the impact investing ecosystem
at large, Sapphira notes that a potential
Another learning experience has come problem for the space is that there can be
through collaboration with her family office’s significant difference in how impact investing is
advisor, who Sapphira says is “coming around” perceived among different communities. At the
to impact investing. Forming an alliance with
Millennials in Impact Investment Report 2016 50
The words you are searching are inside this book. To get more targeted content, please make full-text search by clicking here.
MILLENIAL_REPORT_2016MAY11
Discover the best professional documents and content resources in AnyFlip Document Base.
Search