Investing Together: Emerging Approaches in Collaborative Place-Based Impact Investing

Investing Together: Emerging Approaches in Collaborative Place-Based Impact Investing

While the emerging practice of collaborative place-based impact investing can bring about more inclusive local economies, it also involves complicated trade-offs and considerations, a report from the Urban Institute finds. According to the report, Investing Together: Emerging Approaches in Collaborative Place-Based Impact Investing (49 pages, PDF), foundations, individual investors, and other mission-focused stakeholders looking to catalyze systemic change in local communities require a common vision and purpose, meaningful shared authority, and mutual accountability with respect to results. Part of a collaboration with the John D. and Catherine T. MacArthur Foundation and Mission Investors Exchange, the report notes that, to be successful, such efforts need to be include an ongoing focus on portfolio construction, thorough due diligence, effective impact measurement, and funding aimed at boosting local community capacity. Examples of effective place-based collaboration range from networks for exchanging information, to closely coordinated consortia, to platforms designed to develop impact investment opportunities by, for example, pooling funds from local investors and investing via social ventures and funds. Considerations and challenges include the choice of operational structure, limitations on operational capacity, the need for relationship building and coordination, and additional pipeline development of impact investment opportunities.