Startup Funding Espresso -- Key Terms in Impact Investing

Key Terms in Impact Investing

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

There are key terms used in the impact investing world.  

Here is a list of the ones to know:

1. Below market rate -- an impact investment made with the expectation that the financial return will be less than the market rate of a startup’s investment.
2. Charitable purpose -- the investment’s purpose has a charitable contribution that aligns with the foundation's purpose.
3. Mission-related investments -- an investment for social or environmental reasons with a financial return.
4. Program-related investments -- a specific type of investment made by the foundation that aligns with its mission.
5. Divest/invest movement -- investors using their investments to achieve social goals.
6. Due diligence -- an in-depth evaluation of an investment.
7. Environmental, social, and governance -- incorporates environmental, social, and corporate governance criteria into an investment analysis.
8. Market rate -- the standard financial return an investor expects.
9. Socially responsible investing -- an investment strategy that seeks investments that are considered socially responsible based on the business.

It’s important to know the difference between impact investing and non-impact investing. 


Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.
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