Creating and Measuring Impact

Mar 20th, 2015

As impact investors, we are interested in better measuring the impact of initiatives in underserved markets. Below are articles highlighting how people are creating social impact globally and how to measure and scale impact efficiently. Strong Communities Build Global Impact by Nekesa Were on iHub Global Voices and iHub have been bringing people together to form communities dedicated to social impact. Today, 1200 contributors from 167 countries write for Global Voices, coming together to write the world’s most important stories that mainstream media does not always cover. iHub boasts 16,000 members spread all over the word, working to catalyze the growth of the tech community. Each organization is proving that collaboration empowers communities to innovate and solve major problems on a global scale. Impact Investing Can Help Foundations Avoid Obsolescence by Steven Godeke and William Burckart on the Chronicle of Philanthropy Traditional philanthropies are becoming frustrated by the apparent disconnect between their endowments and their social goals. While many foundations are looking to put more of their endowments into socially- or environmentally-driven businesses, certain restrictions have made it difficult to do so. Godeke and Burckart have identified steps that foundations can take in impact investing to successfully fulfill their social goals:

  1. Make efforts to change the culture of the foundation to ensure it has the right people with necessary skills working together
  2. Devise an investment policy and strategy that sets criteria for what risks are wanted and what return is required
  3. Assess sources of money for investments and what resources will be committed to impact investments versus more conventional investments
  4. Identify investments and learning to do due diligence on different investments than may have been done in the past
  5. Monitor investments and decide how to deal with those that may falter

When Less Impact per Client = Greater Social Good by Matthew Forti on SSIR Over the past decade, the social sector evaluators have created a simple formula for measuring effectiveness of interventions: select an indicator that captures the benefits of an intervention and measure it for clients and control groups to determine impact. When there are many evaluations of interventions using a single indicator, we are able to understand which solutions create the greatest “bang for the buck”. Once this is identified, organizations can scale and increase their impact accordingly. However, this has not been the experience of all organizations during scale-ups, and many have seen impact per client fluctuate. Forti, managing director of One Acre Fund, shares four strategies for scaling that decrease the pressure on impact per client and simultaneously increase potential social good:

  1. Reach a more underserved population
  2. Enhance measurement rigor
  3. Widen the lens
  4. Create your own competition

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