How to invest in impact startups

So you’re well acquainted with the stats that impact investing is growing rapidly – with the market size currently estimated at $715 billion. You already align your lifestyle with your values – perhaps by being more conscious about how you travel, or by contributing to your local community.

But what about when it comes to your investments? All investments have an impact, it’s just a case of whether it’s a negative or positive one.

We’ve complied a list of five ways individual investors can back purpose-driven startups that are pursuing a positive social or environmental impact. ‍

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1) Angel syndicates & groups

Angel syndicates give individual investors extra fire-power – pooling funds, business experience and industry knowledge with others. While some angel syndicates form on an ad-hoc basis, there are also established groups you can join to invest in impact ventures alongside other angels.

• Green Angel Syndicate – an active and pioneering angel investment syndicate group that focuses specifically on businesses developing solutions to fight the climate crisis.  

• ClearlySo Angels – providing access to a diverse range of investment opportunities across deal sizes, sectors and structures. The one thing all deals have in common is a positive social or environmental impact. ‍

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‍2)  SEIS/EIS Funds

Investing in startups can be risky business, but by taking advantage of an established firm’s track record and experience, you can access a portfolio of high quality and diversified ventures. The sourcing of deals and deployment and management of capital, is all done for you. All the funds below also provide some opportunity to benefit from SEIS or EIS tax reliefs.
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• Tech For Good SEIS & EIS Fund – BGV’s fund aims to invest in 20+ startups using technology to build solutions for a sustainable planet, a better society and healthy lives. Targeting strong financial returns and positive impact benefitting the lives of millions.

• Earthworm’s Impact EIS Fund – Earthworm’s fund for individuals has a specific focus on environmentally focused ventures. They invest in early-stage solutions in the food, energy and waste sectors.

• Triple Point’s Impact EIS Fund – this fund invests in social impact companies with an aim for each investor to hold a portfolio of 8 to 12 companies, targeting exits within 4-7 years.

• Sustainable Accelerator Investment Fund – this fund, managed by Sustainable Ventures, invests specifically in high potential sustainability startups. Usually raised through crowdfunding via seedrs, their 2020 offering is yet to go live but you can follow them on the seedrs platform to be kept up to date.

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3) Networks & platforms

Joining a network or platform can be a good way of having investment opportunities filtered and shared directly with you.
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• Ethex – browse and compare a range of ‘positive investments’ from community energy projects to sustainability funds.

• The Conduit Connect – the investment arm and sister company of members club The Conduit. Through their investment platform they share businesses aiming to deliver profit and purpose.

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4) Wealth managers and financial advisors

There are a number of forward-looking wealth managers and financial advisors who recognise the demand from their clients for their money to do more than just make more money.
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• Tribe Impact Capital – striving for a ‘new wealth order’ Tribe are impact wealth managers. They help clients align their investment portfolio with the change they want to see in the world.

• EQ investors – ‘Invest to make a positive impact on people and the planet’ is EQ’s call to arms for individual investors. They help build positive impact portfolios.

• BlueSphere Wealth – financial advisors who want investing to feel good; they use the Sustainable Development Goals as a framework for assessing the impact of companies.

• The Path – passionate that positive impact doesn’t equate to sacrificed financial performance, they can help your savings, pensions and investments do good.

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5) Pensions

Perhaps initially the least thrilling of the bunch, your pension can actually be an extremely powerful source of capital and impact. There is approximately £3 trillion invested in UK pension funds and as a member of those funds, you can influence how that money is used.

• Make My Money Matter – a movement spearheaded by filmmaker and founder of Comic Relief, Richard Curtis, MMMM wants ‘everyone to have a pension they can be proud of – one which builds a better world, without compromising on returns.’

Of course this is not an exhaustive list of investing in impact, but we hope it gives you some good jumping off points to begin aligning your investments with your values.

P.s you might also like to know we’ve got a newsletter for investors interested in impact and tech for good. Sign up here!‍

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‍Disclaimer

BGV Investment Management Ltd is an appointed representative of Midmar Capital LLP, which is authorised and regulated by the Financial Conduct Authority. The Fund is an Unapproved Collective SEIS/EIS Portfolio managed by Midmar Capital LLP as a discretionary investment management service. The Investment Advisor is Bethnal Green Ventures. This website and the documents it makes available do not constitute an offer by the Investment Manager, the Investment Advisor or any other person to invest in the Fund or act as your investment manager or an invitation for you to offer the same. Any documents made available to you via this website may not be disclosed to any other person or used for any other purpose. Note that these documents do not constitute a prospectus and the investments referred to within are not a non-mainstream pooled investment. The Information Memorandum constitutes a financial promotion pursuant to section 21 of FSMA. Its contents have been approved for the purposes of section 21 of FSMA by the Investment Manager, Midmar Capital LLP, which is authorised and regulated by the Financial Conduct Authority. The Information Memorandum and the information contained in it are not for publication any are not to be distributed to persons outside the United Kingdom. Your attention is drawn to the Risk Warnings set out at Appendix 1 of the Information Memorandum, which you should read and consider carefully. Nothing in this website nor in the documents made available to you through it should be regarded as constituting investment, taxation, legal, regulatory or other advice. You should seek advice from an independent financial adviser authorised and regulated by the FCA before deciding whether or not to make an investment. The Investment Advisor has taken reasonable care to ensure that the facts stated in this website and the Information Memorandum are true and accurate in all material respects as at the date of publication and that there are no material facts the omission of which would make misleading any statement made in this Information Memorandum.

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