Development Finance — strategies for impact & sustainability
To achieve our mission and purpose, we take a “triple bottom line” approach, and partner with funders that are mainly financial returns-oriented, but roughly one third of the collective portfolio can be impacts-first oriented investments. Making a good profit is essential, but not enough, per our investment strategy. Blending the two — social/environmental benefits with financial upside — has become increasingly important (and fortunately also popular) in today’s economy, with a world full of pressing problems.
The Human Thing To Do
Those seeking investments for the sake of “development” often mean “sustainable development” or “impact finance,” which often includes this social side. Translation: helping people gain autonomy, self-sufficiency, the ability to meet their own needs over time … which is different than aid or philanthropy.
We firmly believe that combining financial returns with positive social and environmental impacts, both in emerging and developed markets, even if the financial returns are below market rates, builds momentum (investors are social animals that are greatly influenced by patterns of success, akin to a “herd” mentality) to reach the necessary scale while there’s still time.
But the developing world (including emerging and frontier markets) has unique challenges and opportunities that sets it apart from the more developed countries, such as the aforementioned self-sufficiency, but also the potential for solving unique problems due to lack of infrastructure (such as rail or roads), housing, reliable electricity, in some countries limited healthcare, water and food security, and so on.
One classic definition of Development Financing (from the Asia-Pacific region): “… providing access to financial and support services for the underserved, the strategic and priority areas of a country in order to achieve sustainable growth of the economy and thereby assure a more equitable distribution of the benefits of progress and a better quality of life for its people.” [source]
In3 and countless others have, since 2020, begun to invest at the intersection of the low-carbon or “circular” economy, infrastructure, and climate change mitigation, which ties back to health and prosperity in a different set of ways.
In3 Capital Group offers tailored and bespoke impact funding solutions, as well as advisory and co-development services to ensure successful closing, sooner, making such capital accessible and affordable to the widest possible circle.