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Impact Investing through Social Venture Connexion

Posted by Kara Zucker on May 9, 2017
Kara Zucker
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We were extremely excited to sit down with Adam Spence, Director of SVX (Social Venture Connexion), which is an impact investing platform that supports impact ventures, funds, and organizations seeking both positive impact and financial return. SVX works with foundations, family offices, financial institutions and, very soon, retail investors who can take advantage of these opportunities.

SVX was initially conceived in 2007 and launched in 2013 with partners including TMX Group Inc. (parent company to the Toronto Stock Exchange), the Government of Ontario, and MaRS. They recently went down the path to register as an Exempt Market Dealer (EMD) to open up opportunities to a larger group of potential investors. Adam felt strongly about the current landscape and new opportunities, “If we can build an effective, knowledgeable and aware industry then everyone benefits.” Adam’s role is to help set strategy, work with their companies and investors on their campaigns and to support their investments while helping the team and the organization to achieve its objectives.

When Adam was asked, “How does SVX define impact?” His answer focused around SVX’s Theory of Change. “Our theory of change focuses on impact with the right kind of intention and scale.”

At SVX, they believe that impact should be at a deep local scale, changing a community or neighbourhood, or at a national (or global) scale that would have a wider influence. “When thinking about impact, it’s about intention - your goal should be to tackle a pressing problem with a viable business model.”

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Adam also emphasized that successful companies have a measurable impact on social and/or environmental challenges. “We want to see our impact through the companies we work with at SVX.”

They have worked with 100 different enterprises that have raised $100 M in financing from a variety of sources, from organizations managing solar projects to ventures reducing anemia in the Global South.

The industry is definitely changing. At FrontFundr we've also noticed more social enterprises interested in alternative forms of funding. Adam mentioned that “There is an estimated $9.2 billion dollars of potential towards impact investing with 25,000 social entrepreneurs in Canada. Businesses that do good are growing.”

As for potential red flags when evaluating companies, Social Venture Connexion finds a lack of financial statements to be a concern, since it’s something entrepreneurs don’t always have on hand. Sometimes they aren’t ready for investment and need to test their business model further. It takes a commitment from the entrepreneur and it takes the effort to engage in a capital raising campaign. This type of fundraising is not for everyone.

Something that Adam touched on and we at FrontFundr agrees with, is the need to change the market. He felt passionate about encouraging public policy to move more funds into the marketplace to help entrepreneurs succeed. The opportunities for federal and provincial governments to provide additional leverage to impact investment funds will help them to flourish and succeed. This can help mainstream actors to support and engage in the early stage and impact investing market. “We believe that having additional alternative funding opportunities available through financial institutions, funds or intermediaries to companies is really helpful for entrepreneurs. They should have a wide range of options available to them in order to succeed.  And their success can benefit all Canadians.”

Lastly, it was helpful to connect with Adam about the advice he usually gives to those just starting out. He was very straightforward, “Stick to your mission. Know your customer and engage with them. Bring on the right type of advisors. Connect with the free services that are readily available in almost every community across the country. When you’re ready for capital and have a good understanding of what’s entailed, then start to explore funding options. If that’s local investment funding, SVX or FrontFundr, whatever works best. You can’t do it alone.”

 
To learn more about whether your company is a good fit for the FrontFundr platform, check out our Raise Capital page to learn more.

Tags: Insider

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