Impact Esq Vol. 4

Welcome to the Weekend. I’m looking forward to seeing many of you at the Conference on the Legal Issues in Social Entrepreneurship and Impact Investing (see below). Thanks so much for all the positive feedback thus far on the Impact Esq newsletter. Please don’t hesitate to reach out with any relevant articles, events, or deal announcements. Cheers!

Social Enterprise

  • The Largest PBC. Danone’s North American dairy business acquired WhiteWave, which has created one of the top-15 U.S. food and beverages companies by sales, as well as the country’s no. 1 dairy business (excluding cheese). This new company, called DanoneWave, chose to structure as a public benefit corporation (PBC), giving it the instant distinction as the largest PBC to date. “It’s a clear statement to the world—and the people in our company—about what we’re up to and trying to do,” says Lorna Davis, CEO of DanoneWave, “which is to bring healthy food to as many people as possible… In 10 years-time, people will say it’s inconceivable that business was done any other way. The notion that a company can only care about profit will be seen as old-fashioned and irresponsible.” Learn more at Fortune (3 minutes).
  • Inclusive Governance. B Labs has released three PDFs to help entrepreneurs and lawyers think about more inclusive governance structures. First, inclusion through ownership. Learn about how company ownership can be used to drive positive impact through worker ownership, non-profit ownership, and more. Second, mission-Aligned Governance. Learn why and how to build mission alignment into your company’s corporate structure. Third, engagement and accountability through transparency. Learn about the potential value of transparency, with a spotlight on financial transparency and open book management. Download the PDFs at B The Change (22 minutes).

Impact Investing

  • Interactive Impact Deal Visualization. This data visualization maps the relationship between impact investors and social entrepreneurs…. And it’s pretty fun to play with. The dataset represents 3,086 deals, 1,981 companies, and 406 funders. Interestingly, of the 24 “smart money VC” identified by CBInsights, 12 (50%) are present on this map. Dive into the map and see who’s done what deals at Colorful Ventures (10 minutes).
  • GIIN Report on Guarantees. Guarantees, one type of credit enhancement tool, offer exciting ways to leverage relatively small amounts of capital to address the real and perceived risks that keep many investors from participating in impactful deals. A recent report by the GIIN presents three main recommendations for taking advantage of the opportunities and addressing the challenges preventing the broader use of guarantees at scale. First, to streamline structuring, practitioners negotiating guarantees should focus on five key considerations as factors that tend to most influence a transaction’s success: (1) objectives of the guarantee; (2) type of risk addressed; (3) coverage level; (4) financial return expectations; and (5) triggers of and access to the guarantee. The report provides guidance about how choices related to these factors affect different stakeholders. Second, practitioners should consider ways to standardize guarantee terms across larger numbers of investments, whether through funds, programs, or other means of pooling guarantee capacity. Third, several promising sectors could benefit from the use of guarantees but have seen limited use of the instrument to date, including energy efficiency, renewable energy, and healthcare. Download the report at the GIIN (26 minutes).

Events

  • 2017 Conference on the Legal Issues in Social Entrepreneurship and Impact Investing. On May 23rd and 24th we will be building on the momentum of the 2015 and 2016 conferences, the Impact Investing Legal Working Group (IILWG) is again convening leading lawyers and other professionals working in the field of social entrepreneurship and impact investing for a series of panels, discussions and workshops geared toward sharing knowledge and building a legal community of practice in this field. This year the IILWG is joined by the Grunin Center for Law and Social Entrepreneurship at NYU Law as a conference organizer. I’ll be there, so if we haven’t met yet, please come say hi. I’d love to meet you. Check out the agenda, and sign up.
  • Good Capital Project. The Good Capital Project is a new project of SOCAP, with its first convening in NYC on June 19th. The Good Capital Project leverages expertise from the financial, design, academic, non-profit, governmental and impact communities to contribute best practices from existing initiatives to the design of the new fabric of a purpose driven impact economy. I’m looking forward to seeing some of you there. They were nice enough to hook up Impact Esq readers. Grab your discounted ticket here.

About Impact Esq

Impact Esq is a monthly email summarizing the best articles on social enterprise and impact investing law edited by Kyle Westaway – author of Profit & Purpose and Managing Partner of Westaway. Thanks for being a member of the Impact Esq community. I truly enjoy curating this email every month and love hearing your thoughtful insights. Feel free to shoot me an email with any feedback or suggestions. If you like what you’re reading, I’d be honored if you share it with other social impact attorneys. Have a restful and thoughtful weekend.