Three Tactics for Small Scale Impact Investing
By Gwen Straley, Executive Director, 3rd Creek Foundation
3CF made its first impact investment in Nam Thang Long, a company that manufactures life-jacket backpacks which prevent early childhood drowning during monsoon season in Vietnam.
3rd Creek Foundation (3CF) is a small organization, but at just 12% the asset size of the average U.S. private family foundation, it has a big vision: a world without poverty. Since its founding in 2007, 3CF has made grants to small organizations in developing countries around the world who are working to alleviate poverty in their communities. These grants follow the standard 5% annual payout rate mandated for perpetual foundations. To increase impact without spending down principal, 3CF has implemented a strategy to apply more funds toward mission related activity through impact investing. 3CF makes small-sized investments of up to $20K directly in early stage businesses in South Asia and East Africa. This outlay is important because there are roughly thousands of small social enterprises with sound business models that lack access to much needed capital. As mentioned by Capria, early stage enterprises make up the “missing middle,” and are unable to access capital from microfinance institutions, local banks, and most impact investors who make larger sized investments.
