Impact Investment Advancing Economic Mobility, Study Finds

Impact investments in education, economic security, and health and well-being are improving economic mobility for many low-income families, a report from the Aspen Institute finds.

Based on a survey conducted in partnership with the Global Social Enterprise Initiative at Georgetown University's McDonough School of Business, the report, The Bottom Line: Investing for Impact on Economic Mobility in the U.S. (168 pages, PDF), found that 69 percent of the thirty-nine impact investors surveyed reported investing in education, economic asset building, and health and well-being initiatives, while 64 percent said they have been active impact investors for more than ten years. Among respondents, the average investment transaction varied from less than $100,000 to more than $10 million, while among those who invested in one of the target areas, the majority reported an average transaction size of between $100,000 and $3 million.

The study also found that impact investments in support of economic mobility are leveraging  partnerships, data, and social capital to benefit parents, children, and families, and that emerging trends in the field include foundations moving from experimentation to institutionalization; an increased focus on place-based initiatives; the participation of market players other than private foundations; and a growing interest in metrics.

Funded by the W.K. Kellogg Foundation, the report includes a number of essays that capture lessons learned from the field, snapshots of impact investments made by three organizations, and case studies of successful social enterprise and pay-for-success contracts. The study also highlights opportunities for impact investors to strengthen the economic mobility of low-income families by, among other things, investing in educational outcomes in addition to school infrastructure, collaborating around investments in local ecosystems, and reducing disparities in access to and the quality of health care.

"As a country, we have long believed in the 'American Dream' — through hard work and opportunity, we can reach our goals," wrote Anne Mosle, vice president of the Aspen Institute. "But with millions struggling, those dreams are being eroded. Social and economic mobility has stagnated, and inequality is rising. Not only are families at risk but so is our nation's economic security."