By Melissa Wylie | From bizwoman
Laura Davis lives in Ethiopia, and every day, she sees people begging for money or assistance.
It’s hard to turn away from those in need, but she believes there is a better strategy than charity to help struggling communities. Davis is a founder of the Impact Angel Network at RENEW, an impact investment advisory firm connecting high net worth individuals with midsize companies in Ethiopia.
Impact investing puts philanthropy in a different light. Investing in growing businesses boosts the whole economy, and Davis said it makes a dollar go further and creates long-term solutions through jobs and economic growth. To illustrate her stance on investing versus giving, Davis calls to mind an image of people drowning in a river.
“There are certain organizations and people that are pulling those people out one by one by one. We need that work. I don’t want anybody to stop,” Davis said. “But I’ve learned that I’m oriented more to walk up river to try to figure out why people are falling in.”
The term “impact investing” is roughly nine years old (although the concept goes much farther back), and the practice is still making its way into the consciousness of the masses. But growth and legitimization are happening quickly.
Impact investing is expected to account for $2 trillion of total worldwide investments in the next five to 10 years.
Davis built her business around that trend and is now bringing significant resources to the Ethiopian middle class.
Davis launched RENEW with her husband Matt and chief counsel Tom Scriven in 2012. RENEW now has seven investments under management in Ethiopia through which about 800 full-time and 600 part-time jobs have been created or sustained. RENEW’s Impact Angel Network consists of 75 investors. The average investment in a single company is about $500,000 pooled from multiple angels.
“Our investors, a lot of them are very well-traveled. Some are coming from a finance background; some are self-made; some are C-suite folks,” Davis said. “But all are focused on the idea they can perhaps do more than just give to places like Ethiopia.”
Read more at bizwoman
