If the rise of socially responsible and impact investing is any indication, investors are more likely than ever to invest in causes and enterprises that benefit the surrounding communities and the wider world.
David Bank, a former Wall Street Journal reporter, and Zuleyma Bebell, a former United Nations Development Program officer, are betting on this trend’s sustainability. Together they built ImpactAlpha, a news site dedicated to covering the relatively newfound world of socially responsible investing.
ImpactAlpha’s stories focus on themes Bank and Bebell have found are important to socially conscious investors, such as the rising role of women in socially beneficial enterprises, and the United Nation’s 2030 development goals. On a given day, the site might run a profile of female entrepreneurs building startups in India or the latest developments in the fight against climate change.
Recently, ImpactAlpha announced it was joining an accelerator for startup media businesses called Information Accelerator. We caught up with Bank and Bebell to learn more about how ImpactAlpha is providing a unique perspective in the crowded financial media space.
Benzinga: How did Impact Alpha get started?
David Bank: I’m a journalist by trade. I spent a couple decades at newspapers, including a decade at the Wall Street Journal, mostly covering technology. In the course of that, I followed the tech titans as they moved into philanthropy and social impact issues. Chief among them was Bill Gates, but many of them made that shift. I moved into that kind of coverage as well.
Some years ago, this idea came up that there’s this other pot of money. Not just philanthropic money, but private capital markets that could be steered towards social and environmental impact. I thought that was a big trend to start covering. I assigned myself to that beat, which was the genesis of the Impact Alpha side. Zuleyma can tell you from her side that she had a similar kind of insight and started collecting data on deals, funds and the flow of capital in this direction. ImpactAlpha and ImpactSpace joined forces, formally merged in 2015, so we have this editorial and data strategy.
Benzinga: Zuleyman, your role as data lead is interesting — what does that mean?
Zuleyma Bebell: I always say that I herd cats! We’ve been trying to promote this idea that sharing is caring in terms of data, and apply that to the impact investing space. There’s a huge information gap in what’s happening in this space, and everyone has different definitions of what impact investing is.
One of the things that ImpactSpace has been focused on is trying to showcase the different faces of impact investment. What do impact investors look like, What do the social enterprises look like, and, going down to the teams, who are the people that are involved in these ventures?
That’s what we’ve been doing over the past few years, collecting this information on entrepreneurs, investors, and all of the support organizations that are involved in this space.
Benzinga: There’s been a surge in socially responsible investing in the past few years — the investing population is much more keyed into what their money can do to align with their values. How does ImpactAlpha fit in with that trend?
David Bank: Impact is one step beyond negative screening for, say, tobacco and firearm stocks or focusing on environmental, social, and governance factors. It’s proactive investments in positive social and environmental outcomes. Not just better outcomes, but products, services and innovative ideas that specifically improve particular outcomes. People put caveats on that — make it measurable so you can report those impacts — but the whole idea is that there are big problems to solve and big opportunities in solving them.
That’s the cutting edge of innovation. It flips the concept around from charity and need, to seeing things as business opportunities. We say: “challenges are the biggest opportunities of the 21st century.” There’s an interesting fact that low-income people in the U.S. and around the world pay more for goods and services, and if you can deliver better quality and lower prices, there’s quite a market there. These ideas are starting to take hold in business, and shrewd investors are trying to find those opportunities.
Benzinga: How do you decide what to cover?
Zuleyma: Earlier this year, we had a team retreat where we sat down and asked “What are the things we want to focus on, and why do they matter to us?” David and the editorial team take the lead on what gets published, but it’s guided by these storylines we’ve been following for the past few years and made the conscious decision to focus on.
David: There’s a set of shifts, of market transformations that are underway. One of them is the increased empowerment of women around the world in earning power, spending power, governance and management. There’s a whole set of research that’s very keen on this gender-lens investing. Women represent an edge in a whole lot of ways. We have a section of the site called Women Rising that focuses on that.
We have a section that uses the U.N.’s goals for 2030 as a framework for impact investing. It provides a center of gravity that entrepreneurs can organize around, a set of shared goals that the world has ratified. A big part of that is climate investment. We call that project 2030 Finance. We try to provide longer-term thinking and help people imagine where the world and financial markets might be if we marshal the capital to meet those goals.
Another big theme is what we call “Inclusive Prosperity,” and the focus there is a shift in thinking that a broader-based prosperity, frankly, making lower-income people richer or at least less low-income, is a pro-growth strategy. It has all kinds of benefits for the markets as a whole. More spending power, more stable communities. Strategies to improve the prospects of lower income workers and consumers turn out to be pro-growth strategies. We’re always looking for the business case for social impact investing.
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