A crop of impact funds just got more cash to spark innovative solutions to big challenges.
Driving the news: Boann Social Impact unveiled the first impact funds it is investing in as part of the federal government’s $755 million Social Finance Fund (SFF), a program launched last year to support organizations tackling social and environmental causes.
- The funds Boann invested into will support work in areas like agtech, climate tech, and food tech, as well as women- and BIPOC-led startups.
- Boann is one of three entities managing SFF’s investments. One of the others, Realize Capital Partners, revealed its first nine investments in December.
Why it matters: Impact funds aim to support social and environmental goals while meeting strict reporting standards. Successful funds can counter the perception that social good has to come at a financial loss, which is especially relevant amid growing backlash against diversity and environmental efforts in the tech sector.
- With new anti-greenwashing rules now in effect, impact investing’s focus on measurable outcomes could calm organizations worried about not being able to back up their environmental claims.
Zoom out: Impact funds haven’t avoided the fundraising challenges other investors have faced, but Dana Granofsky, director of operations at Boann, says a couple things help them weather the storm, like the fact that clean energy and social good are longer-term, less volatile trends.
- Impact funds also tend to be diversified and prioritize measurable outcomes, which offer the stability investors want in fluctuating markets.
By the numbers: Consultancy firm Millani surveyed 32 Canadian institutional investors and found that 43% plan to launch an impact fund this year. One of those investors surveyed has already started to deliver: University Pension Plan Ontario announced a pool of $1.2 billion it plans to invest in climate-focused initiatives by 2030.