Impact Investing for Life, Liberty and the Pursuit of Happiness

Last Friday I attended the 2017 Kick-Off Event for the New England Impact Investing Initiative. This is a new meet-up being organized for the purpose of making Boston into a global impact investing hub.

During the meet-up, the organizers involved the attendees in a project to map out the impact investing eco-system here in New England. They started with a framework that divides the eco-system structurally into two halves.

One half comprises people who create impact (social enterprises and other values-driven businesses) and people who consume impact.

The other half comprises people who supply capital to impact enterpises (investors) and people who direct impact capital into impact enterprises.

Inthe middle, they identified the architectures of investment for making connections between enterprise and capital. These comprise debt, equity and an evolving portfolio of innovative architectures that combine elements of the traditional forms of debt and equity in new and different ways, to create various forms of hybrid investment architectures.

The organizers then asked us, the attendees, to self-identify as populating one of these four domains, and to also identify other organizations we know that populate the various domains, in order to help them begin to populate their ecosystem framework with real people and organizations in our region.

The most heavily populated domain was the capital conduits.

The least heavily populated? Consumers of impact.

It seems very common in the Impact conversation to have much participation by people keen to be useful in directing capital into impact. It seems equally common for these conversations not to include many people who are consumers of impact.

Does this point to a need that is also an opportunity to adaptively evolve our thinking and our practice about enterprise design through investment decision-making, for Impact, and for prosperity more generally?

Can we, as advocates and facilitators of Impact Investing, get really radical, in the Latin sense of “going to the root”, in our thinking about enterprise, investment, wealth and prosperity?

It seems right that such radical rethinking should begin here, in Boston, the birthplace of the American Revolution. In the whole of human history there are not many examples of such a successfully radical undertaking as the Noble Experiment of American Democracy, an experiment that started right here, in Boston, to create a new form of government designed to fit a specific function, the function of protecting the rights of the people to “life, liberty and the pursuit of happiness”.

Is it an opportune time now to start a new Noble Experiment, this time for the creation by design of enterprise and investment that are fit to the function of empowering the people to economic “life, liberty and the pursuit of happiness”?

A key feature of American Democracy is the inclusion of the people in the making of the laws by which we agree to be governed. This participation is not direct. It is representative. Through the popular vote, governing authorities are held to account to the people who they govern.

A key feature of a new form of enterprise design through investment decision-making would also provide opportunities for the people to participate in enterprise in how society chooses which enterprising ideas for creating by design prosperous adaptations to life’s constant changes can, should and will be evolved through enterprise.

I don’t see traditional forms of debt and equity being designed to provide for much popular participation. I believe new forms will need to be created.

Please consider, and let’s discuss.