“Impact investments are investments intended to create measurable positive social impact alongside financial yield. Intent is the key term: investors intend to solve a social or environmental problem. The impact investment world is developing at an incredibly rapid rate. According to the Global Impact Investment Network, three years ago $114 billion were invested in Social Impact Ventures in the US, whereas as today $502B are under management. Younger investors are the driving force of this growth”, says Devorah Patt, Israel Venture Network’s CEO, at the Social Impact panel held at the Social Innovation Conference of “TheMarker” earlier this week.
Over three-hundred people attended the conference, seeking to learn more about the world of impact investment and to engage with various actors involved in it locally. The notion of investment for social impact crystallized in Israel over 10 years ago. It still drives innovation and holds immense further potential for development. The Social innovation conference of The Marker sought to highlight the current state of significant social investment goals; to discuss the social activities of public firms; and to share the principles underlying such activities.
In a panel on the subject Social Impact Investment, Ofer Peleg, VP Sales and Business Development at LeumiTech; Devorah Patt, Adv. and CEO of IVN; Yoel Cheshin, Chairman and founder of 2B Group; and Moshe Gaon, Co-founder and CEO and of Yoocan, all took part.
In the words of Yoel Cheshin on social innovation and impact investments (originally in Hebrew):
“The profit element is crucial. It distinguishes Social Impact investments from philanthropy. For example, diversity in employment is morally valued. So where does the social innovation come in? It fuses the economy with values to produce an economic environment that fosters the recruitment of employees across various population segments. Treat your employees well to have better employees and to yield better results. In this sense, social innovation is a broad expression”.
The moderator of the Social Impact panel, Merav Arlosoroff—a senior journalist for TheMarker—asked about the role of the Israeli government in the world of impact investments. Devorah Patt then shared with the audience the story of the long-running cooperation between IVN, the Government and the National Insurance funds in the social impact fund “IVN Yozma”. By combining government, funding with philanthropy and private equity, “Yozma” is a pioneering three-dimensional fund. The fund was established as a joint initiative of the National Insurance funds, the National Institute of Economics and the Israeli Ministry of Finance. The three institutions have collectively allocated approximately NIS 24 million in two Yozma funds (through the IVN and Dualis organizations) in order to invest, support, and nurture social businesses focused on the employment of disadvantaged populations.
Devorah Patt further elaborated on the unique position of IVN’s mentoring program on the social impact investment ecosystem:
“We constantly approach CEOs, COOs and other business executives with a broad variety of backgrounds, both in high tech and in traditional industry, to join our initiatives as mentors. The willingness of these senior business people to contribute their time and energy to our portfolio ventures is a remarkable phenomenon – and I think very reflective of the society in Israel, and unique to Israel. So far, no one has said no to our requests for assistance. I think that such a willingness to engage in social entrepreneurship occurs in no other place. It continues to impress me time and time again.”
For the full article about the conference, from “TheMarker” (by Jenya Wolinski):